There are so many money saving tips out there but not all are created equal. So let’s bust some myths and talk which savings methods can help you.
One of the most talked about savings plans is known as the 50:30:20 rule but is it myth or a great method? Depends who you ask.
This involves putting 50 per cent of your income towards essentials like food, accommodation and bills. Then allocate 30 per cent to non-essential and flexible items such as gifts and entertainment, and then 20 per cent towards savings.
But there is debate as to whether this rule is actually right for every woman.
Lisa Barber in her new book A Woman’s Guide To Wealth believes the 50:30:20 rule is the “ideal cost ratio of an individual’s net personal income.”
She backs the rule and adds that it is simple to work out and applies to “whatever amount of money you earn.”
But Women With Cents founder Natasha Janssens says the 50:30:20 rule won’t work for everyone.
“It really depends on your income, the reality is if you are on a lower income, the reality is that more than 50 per cent of your money is probably going to go on paying bills and the essentials… and if you are on a high income earner … you might actually be overspending by using that 50 per cent.”
Ms Janssens recommends the following when it comes to budgeting and saving.
1. Do a list and look at where your money is being spent
2. Recognise when your main bills are due such as water and rates and organise automatic direct debit payments.
3. Look at your bank statements and identify where you are overspending
4. Start using electronic payments rather than cash. The thinking behind this is that you can better track your spending electronically than you can with lump sum cash withdrawals.
What we know already about women and money is a lot of averages and generalisations that we tend to be less confident around money and more conservative spenders but actually better than men when it comes to investing.
Women on average earn less, have broken work patterns because they are more likely to be primary carers of loved ones, they also have less super than men and because they live longer, they need their life savings to stretch further.
It’s because of all of this that many women want to know more about how they can do better, and indeed they deserve to have better.
“Yes we can be and the way to do better is to take control of your money, you are the one in charge,” said Ms Janssens. “It will all begin with having a budget a deciding how you are going to spend your money.”