Banks and Finance

Money Saving tips - in times of high inflation

September 8, 2022
By
Bobbob Team

The goal of this article: Make a big financial difference, with small changes.

 

Do you ever feel like you just can't get around to reaching your savings goal, no matter how hard you try? Despite your best efforts, something always comes up? And with the cost of living on the rise while wages—not so much—does it feel like meeting your savings goals is becoming slightly harder?

 

Life brings along many unexpected expenses—car repairs, birthday gifts and fixing a chipped tooth—which puts saving money (or reaching your monthly savings goal) out of reach.

 

To avoid the financial headache that life brings, saving needs to be habitual and sustainable. Why? Read our previous blog on the importance of saving money here

Saving and expense management becomes even more relevant in a high-inflation economy, as inflation makes meeting our savings goals that much harder.

In this article, we list some tips we’ve come across to help you save money, and hopefully, by mastering these money-saving tips, you can soften the blow to your wallet 👛

 

Here are 7 money-saving tips to help you tweak your spending and grow your savings. 

7 money-saving tips 💰

1. Pay yourself first 🫅

A tried and tested method to save money fast is to pay yourself first. This means that you save or invest money before spending any of your monthly income. 

At the end of each month after receiving your paycheck (or each fortnight or week), put aside a set amount or percentage of your income by saving or investing it. In this way, you save first and spend later (not the other way round 🙅). 

This good financial habit ensures that you put your financial goals first, even if you later have to dip into savings, at least you’ve built the positive habit of saving first, and spending second. 

Like making your bed in the morning, it’s something easy to forget but sets the tone for your financial well-being.

2. Record your expenses 🧾

You can’t know how much you can save unless you know what you spend. 

The boring part: Track every expense, both variable like coffee, household items and clothes, and more fixed like rent and water. 

Create the habit of recording your expenses. There are many tools that you can use a simple spreadsheet or an app-based budgeting tool.  

For the organised, you can then sort your expenses into categories such as groceries, shopping, utilities and total each amount (P.S Read our blog on 3 easy steps to budgeting here).

3. Pay your bills early 💵

We all slip up from time to time and pay our bills late, but late fees add up over time and are a waste of money. Especially credit card bills, woah. That’s not a nice text message to miss.

Pay your bills early rather than on the due date if you’re the forgetful type. This way, you’ll be less likely to forget and end up paying late fees. (Nobody likes to pay more than they should 🙄) 

Again, don’t forget we live in 2022—your life is organised by your Microsoft Outlook and Google calendars, your dinner dates might even be recorded here, why haven’t you added your bill due dates there too?

4. Look for ways to reduce spending 💸

It’s time to trim the fat, so to speak. 

Cutting your expenses can save you tons of money each month. 

▪︎ Review all your recurring charges and cancel what you do not need… 

▪︎ Don’t really watch Stan, or listen to Spotify? Cancel that subscription.

▪︎ Wasting half of your HelloFresh cause you eat out with friends? Drop it.

▪︎ Have a Nespresso machine at home but still drink 3 coffees out a day? 😈

▪︎ Only going to wear that dress once? Say no to it.

A penny saved is a penny earned. 

Even these seemingly small expenses add up over time and cutting them out may make that vacation dream a reality. 

If you find saving hard or you can’t seem to save as much as you’d like, it might be good to cut back on your spending. From your expense tracker, identify all the nonessentials such as entertainment or that coffee you don’t need.

Another micro-tip is to wait before you buy. 

When tempted by a nonessential purchase, wait one week.
Reassess again to see if you truly need the item or if it is just a want - and you can develop a plan to save for it. 

5. Set savings goals 🎯

There’s nothing quite like the feeling of smashing your savings goal that you’ve been working towards for months. However, we can’t smash any goals if we don’t have goals to smash! 

Let’s first think about what you want for your financial future and consider what you want to achieve in the short and long term (1-5 months, 1-5 years).

Estimate how much money you’ll need and how long it might take you to save it. 

To ensure that you have a clear picture of how to allocate your savings, you need to determine your financial priorities 🏆, i.e. in a bad month, do you allocate savings to your home deposit or a new Xbox?

There are many financial goals that you might want to achieve, and it may seem impossible to accomplish them all. Hence, getting your financial priorities straight is imperative.

6. Automate your savings and investment 🤖

Save yourself time, and stop worrying about forgetting to save, by automation. Automating your savings ensures that part of your monthly income will always go to your savings for your long-term financial goals. 

Why do we need this? Most of us tend to delay boring and manual tasks. Looking at your bank statement, doing some math and making manual payments seems like a hack and you’d way rather be at the beach than sitting on Excel, right?

By simply setting up a recurring transfer from your account, you’ll also: 

▪︎ Eliminate Buyer’s Remorse. Automatically managing your finances means you could spend any remaining money without worrying that it will hurt your ability to build your wealth. 

▪︎ Spend more time doing things that are meaningful to you (and more time multiplying your wealth 😉).

▪︎ Have an “umbrella” on a rainy day. Speaking of those unexpected expenses (urgent car repair, phone dying and unexpected illnesses), automating your savings help to deal with them, too. When you’re regularly setting money aside for savings, you’re essentially building an emergency fund that helps cover extra costs that crop up.

7. Reduce your grocery bills 🌱

Supermarkets are strategically designed to make you spend as much time and money as possible.

Don’t fall into these traps and spend more money than you really need. (Remember the cheese sitting at the back of your fridge? 🤔) 

So here are some ways you can reduce your grocery bills: 

▪︎ CEO’s tip - Shop on a full stomach: Ever heard the expression: your eyes are bigger than your stomach? If we have a natural bias to order a bigger meal than we’re capable of eating, imagine the damage we can do if we go to Woolies or Aldi’s hungry? Aussie’s food wastage equals ~312kg per person, equivalent to around one in five bags of groceries.
Eat before you shop.

▪︎ Buying only what you need. Plan your meals ahead for the week and stick to the grocery list to avoid buying (and wasting) unnecessary items you don’t need.

▪︎ Purchase seasonal items. You can save a lot by buying fruits and vegetables in season!

▪︎ Get better value by comparing unit prices. The unit price lets you compare different products more easily because it breaks down the cost into standard units of measurement (whether that is a litre, Kg or roll). Comparing unit prices between different brands or different packet sizes could help you get better value instead of looking at the headline prices.

▪︎ Loose is better than packaged: A common tactic by retailers is to make packaged food look cheaper than loose food, but loose food is almost always cheaper than packaged! As an example, a packet of broccoli might be A$3, and the headline price of loose broccoli is A$5, but if you look at the unit prices, that loose broccoli is A$5 per kilo, while the A$3 package is 300g, meaning it’s A$10 per Kg!!!

▪︎ Consider home brands/generics. Homebrand products have improved in quality in recent years, and occasionally out-do name brands. What’s better is that a recent basket survey found that shoppers can save up to 40% when they switched to a home brand. 

 

Start earning 7.60% on your savings today.

Download Now

More Like This