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10 budgeting tips to save time and money

Budgeting is necessary for everyone. Make it easier with these tips and tricks.

A budget is a spending plan which helps you understand your real financial position and how much money you actually have to spend. Simply put, a budget breaks down your income vs expenses so you can manage your spending and saving in real terms without relying on guesswork. Even better, you can find a lot of budgeting apps and tools online which can make it all quicker and more straightforward.

  • Budgeting is for everyone. Today, someone who doesn’t budget is the odd one out. How else can you balance phone plans, credit card bills, mortgages, car payments, insurance, utilities, rent, groceries, travel expenses and the countless other day-to-day living expenses? Unless you’re a genius and can work it all out in your head, budgeting might be essential.
  • Saving up for something? A budget can help you get there faster by showing where your money is going and where you can make cuts.
  • Get a real picture of your finances. A lot of people think they’re spending wisely only to check their budget at the end of the month and realise that they’ve still got a long way to go.
  • Keep improving your spending. Budgets can show how your spending habits change over time so you can see what works and what might not be saving as much as you thought.

If you already budget, check how many of these tips you’re already using. If you’re only just starting to budget, take these tricks onboard to get off on the right foot.

Top 10 budget tips

1. Get an app

Are you excited to pull out receipts, scribble figures into tables and assess your spending in painstaking detail? Didn’t think so.

Thanks to apps, you don’t need to anymore. There are dozens of these clever tools available for free, and they can automate the hard parts. Only 15% of Australians use them, and those that do swear by them. With an app, all you have to do is key in your expenses of the day and let the app handle the rest. At the end of the month it will have everything in one place for you to review. Pocketbook is a popular choice, but there are other options too.

2. Keep your receipts

Ask for receipts and hang on to them. They’re naturally useful as evidence for insurance purposes and claiming tax deductions or refunds, but can also help you manage your budget. Receipts are powerful little scraps of paper, clearly showing the whats, wheres, whens and hows of each transaction. They might show if you’re habitually overspending when using a credit card, are consistently paying too much for something or if one location in particular tends to bring out the big spender in you.

3. Work the bank

Budgeting is all about saving, and saving is all about finding a system that works for you. In essence, as long as you’re putting money in the bank at the end of each month you’re making a positive difference and can look for ways to put away more than the month before. Everyone’s financial situation is different, but banks will almost always have to be part of your budgeting system, so you might as well make sure you choose the optimal one. Consider a high interest savings account that might let you put more away. It may be a small difference, but the sooner it starts the sooner it can grow. To make sure it’s a good switch, double check with a savings calculator before you sign anything.

Compare high interest savings accounts below

Rates last updated December 4th, 2016
$
$
months
Maximum Variable Rate p.a. Standard Variable Rate p.a. Bonus Interest p.a. Fees Min Bal / Min Deposit Interest Earned
ME Online Savings Account
Ongoing, variable 3.05% p.a. rate when you link to a ME Everyday Transaction account and make a weekly purchase with your Debit MasterCard using tap & go. Available on balances up to $250,000.
3.05% 1.30% 1.75% $0 $0 / $0 Open More
RaboDirect High Interest Savings Account
Introductory rate of 3.20% p.a. for 4 months, reverting to a rate of 2.05% p.a. Available on balances below $250,000.
3.20% 2.05% 1.15% $0 $0 / $0 Open More
ING DIRECT Savings Maximiser
Ongoing, variable 2.75% p.a. when you link to an ING Orange Everyday bank account and deposit $1,000+ each month. Available on balances up to $100,000.
2.75% 1.60% 1.15% $0 $0 / $0 Open More
Bankwest Hero Saver
Ongoing, variable 2.65% p.a. rate when you deposit at least $200 each month and make no withdrawals. Available on balances up to $5,000,000.
2.65% 0.01% 2.64% $0 $0 / $0 Open More
AMP Saver Account
Introductory rate of 2.55% p.a. for 4 months, reverting to a rate of 2.10% p.a. Available on balances below $5,000,000.
2.55% 2.10% 0.45% $0 $0 / $0 Open More
Australian Unity Easy Saver
Introductory rate of 2.90% p.a. for 4 months, reverting to a rate of 1.70% p.a. Available on balances below $250,000.
2.90% 1.70% 1.20% $0 $0 / $0 Open More
ANZ Online Saver
Introductory rate of 2.85% p.a. for 6 months, reverting to 1.25% p.a. Available on the entire balance.
2.85% 1.25% 1.60% $0 $0 / $0 Open More
Westpac eSaver
Introductory rate of 2.71% p.a. for 5 months, reverting to a rate of 1.25% p.a. Available on the entire balance.
2.71% 1.25% 1.46% $0 $0 / $0 Open More
St.George Maxi Saver
Introductory rate of 3.00% p.a. for 3 months, reverting to a rate of 1.05% p.a. Available on balances below $5,000,000.
3.00% 1.05% 1.95% $0 $1 / $1 Open More
Bank of Melbourne Maxi Saver
Introductory rate of 3.00% p.a. for 3 months, reverting to 1.05% p.a. Available on the entire balance.
3.00% 1.05% 1.95% $0 $1 / $1 Open More
BankSA Maxi Saver
Introductory rate of 3.00% p.a. for 3 months, reverting to a rate of 1.05% p.a. Available on the entire balance.
3.00% 1.05% 1.95% $0 $1 / $1 Open More
ANZ Progress Saver
Ongoing, variable 1.91% p.a. when you link to any Australian everyday bank account and deposit $10+ each month. Available on the entire balance.
1.91% 0.01% 1.90% $0 $10 / $10 Open More
Westpac Reward Saver
Ongoing, variable 1.85% p.a. when you deposit at least $50 and make no withdrawals each month. Available on the entire balance.
1.85% 0.01% 1.84% $0 $0 / $0 Open More

4. Review your spending

Did you know you can save money by spending less? Did you know that you can save money by not having a cup of coffee every day? These unhelpful tips are brought to you by many experts, most of whom are apparently not coffee drinkers.

The truth is that having a budget doesn’t mean you need to cut out “bad” spending. Instead, you should simply budget for it. Set yourself a daily, weekly or monthly allowance for certain expenses and then stick to it. You can set a budget to suit your habits, but you can also let your habits shift to suit your budget. You don’t have to cut these expenses from your routine when you can adjust them instead.

5. Get a budgeting buddy

If you’re fighting a war against your own spending habits, call in some backup. Budgeting is easier with a support system. It could be a partner, friend, family member, financial coach or almost anyone else in the same boat as you. They can help keep you on track if you find yourself backsliding or overspending, so don’t underestimate the power of moral support. And don’t underestimate how much you can learn from each other either. Share useful tricks that worked for you and they might do the same. Support groups like Debtors Anonymous mean almost anyone can find an understanding crowd to help them change their habits.

6. Use cash

Keep spending simple with cold hard cash. No credit, no fees and no way to spend more than you have. Set aside a certain amount of money each week and withdraw enough cash to see you through, with whatever kind of discretionary spending buffer, if any, you think is right. Save your credit cards for emergencies and don’t buy it until you can pay for it in cash to automatically change your own spending habits.

7. Leverage micro-investments

Micro-investments can simultaneously let you make investments and more easily balance the budget. The premise is simple: whenever you buy something, round it up to the nearest dollar and invest the excess. This adds up over time, letting you continually invest even if you’re living on a tight budget. For example, round up a coffee that costs $2.60 and deposit the extra 40 cents. Do this every day and over the course of a year you’ve invested $146 with relatively little effort. This can all be done near-automatically with groups like Acorns, or with any one of a number of other options. Build micro-investments into your schedule to invest on a budget.

8. Pay yourself

Paying yourself might seem like a surprising way to save money, but a good budget can allow for it. Instead of drawing from your living expenses account for luxuries, consider setting up a special account for these. Many banks will let you segment and set up your accounts as desired. Pay 10% (or however much you can) of your typical income into this special fund every time you get paid, and use only this account for non-budgeted expenses. Consider keeping up with a separate savings account as well and combining the two to pay for big expenses like holidays.

9. Set achievable goals

Have you ever met someone who made a new year’s resolution to get fit, then when you next saw them they were smoking a pack a day and having ice cream for breakfast? The same thing can happen with budgeting, which is a lot like dieting in two main ways.

  • You need to set realistic goals. Don’t plan on halving your body weight in a week, and don’t plan on cutting your budget by 80% unless you actually think it’s possible. The money has to come from somewhere.
  • You need to stick with it. A lot of people diet until they lose weight, then quit the diet and immediately balloon right back to their former size. Likewise, a lot of people budget carefully until they’re out of debt and then figure they can go right back to their old ways. If circumstances change, adjust your budget rather than throwing it out.

10. Adjust your goals if you don’t meet them

If you managed to perfectly nail your budget down to the last cent on your first try then neither this guide, nor this world, was meant for you. If you didn’t, you’re just like everyone else. Some of the things that end up in your budget might simply be unfeasible or inaccurate. You may have misquoted how much you spent, set an unattainable budget or forgotten to consider important expenses. Don’t panic – it’s okay to make amendments. This is not cheating, and is in fact a normal part of keeping a budget. Your spending needs and financial situation will naturally evolve and your budget needs to keep up. Making amendments is a learning opportunity, and a chance to look at your expenses in a different light.

Don’t think of your budget as a necessary evil or a chore, but instead as a powerful ally in the fight for savings. If you haven’t already created a budget and aren’t doing anything else at the moment, start now.

  • A solid target can help you focus your budget. Know your financial goals.
  • Pick your weapon of choice, in the form of your preferred budgeting apps or tools.

There’s no time like the present, so get started when you can or head to the budgeting for beginners guide for more tips, tools and where to begin.

Andrew Munro

Andrew writes for finder.com.au, comparing products, writing guides, sniffing out deals and looking for new ways to help people get the most out of their money.

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