savings

5 things we can all do to boost our savings

We look at the savings gap in Australia and how it affects women and millennials, plus what you can do about it.

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The average Aussie has $28,426 in savings, but that varies greatly depending on age and gender.

According to the latest figures from Finder, young Aussies aged around 23 years were on the lower end of the spectrum, only earning around $10,586.

Women were also smaller savers, with Millennials only holding around $18K in savings, Gen X with $26,436 and Baby Boomers with $30,162.

Ordinarily, Aussies need 20 per cent of a home purchase price for a deposit, which could cost anywhere between $60K – $160K depending on the residence. But with less than $30K at their disposal, some Aussies may struggle to achieve their home ownership dreams.

So how can Aussies save more?

Getting into the habit of saving more money after each paycheck isn’t exactly easy, especially with any incurred debt over the past year.

However, it’s not impossible to make steps towards a financially free future.

Here are some tips to consider when trying to get in the habit of saving more money.

  1. Start small, then build: Give yourself permission to start slow. Try saving 1 per cent of your monthly income, and then increase by 1 per cent each month. The main focus is to establish the habit of saving. Once you maintain sufficient momentum, you can take a look at your budget and figure out the savings opportunities that you may not have immediately noticed, and increase this figure.

  2. Treat your savings account as off-limits: Unless absolutely necessary, try to resist the temptation of dipping into your savings account or any emergency funds. Remember, ideally you should have three to six months worth of living expenses set aside for emergencies.

  3.  Question all of your purchases: Do I really need this pair of shoes? Should I just eat the food I already have at home instead of getting takeaway? My current phone is still in good shape, do I really need the new model? Whatever your vices are, the point is to stop buying things thoughtlessly. Go full Marie Kondo by asking yourself if your spending is bringing you any happiness (or bringing you closer to your budgeting goals), and if it’s not, cut it.

  4. Account for extra expenditures: One common reason so many people make it to the end of the month and wonder where all their money went is that they don’t account for extra expenditures. A coffee here, a parking meter there- it all adds up.

  5. Keep your budgeting goals realistic: Saving money often means making sacrifices, and it can wear you down after a while. If your self-imposed restrictions on spending are too restrictive, you may be setting yourself up for failure. Ensure you are allowing yourself enough budget to maintain a decent quality of life. Saving is important, but it shouldn’t put a damper on your daily life.

  6. If you do have a mortgage, negotiate a better rate: In many cases, some emerging lenders and neobanks can offer competitive rates and better offerings than the traditional Big 4. However, if you’re happy with your current lending provider, don’t be afraid to negotiate a better and lower mortgage interest rate.

Brodie Haupt is the CEO and co-founder of digital and payments provider WLTH

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