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10 tips on how to budget and save money

Finding out where you could cut back on spending so you can give your savings a boost might be easier than you think.

June 2021 – 5 minute read

What’s in this article:

  • Shop around for the best deal
  • Look at the small expenses
  • Sorting out your menu
  • Keeping a spending diary and creating a budget
  • Paying off debt
  • Getting your savings sorted


A penny saved is a penny earned, or so the saying goes. Getting your personal finances in order doesn't have to be difficult - just follow these tips to find out where you might be overspending  and where you might be able to find some extra cash to put towards your  long- and short-term savings goals.

1. Shop around for a cheaper option

Whether it’s your mobile phone or broadband, take a good look at the plan you're on to see if you're still getting good value for money. New plans are constantly being released onto the market, so if you’ve been on a plan for a while you might be surprised by how much you could save.

Another option might be to bundle your services together. Not only could you save yourself some cash, you’ll also cut down on the hassle of having to pay two bills.

If you have insurance (including car insurance and health insurance), it's worthwhile checking your insurance policy to make sure you're paying for the right level of cover. Give your insurer a call to make sure you're getting the best deal for your needs. If you have a home loan, you could also talk to your mortgage provider to see if you can negotiate a lower rate.

2. Take a look at your small expenses

Finding ways to cut back on what you spend doesn’t have to be drastic – in fact, there’s a chance if the changes are too dramatic you could be setting yourself up to fail.

Take coffee as an example. If you’re a coffee lover, giving it up completely is likely to be asking a lot. But if you’re in the habit of getting a takeaway coffee whenever the mood hits, maybe settle with just the morning coffee to get a kick start but go without the afternoon caffeine hit.

3. Get your menu sorted

There’s a reason why so many articles about cutting back on spending mention making your own lunch – it works. Let’s say you spend $12 a day buying lunch. Add that up over five days and you’re looking at $60. If you buy your lunch for 45 weeks of the year, that adds up to a cool $2,700. When you look at figures like that, making your lunch DIY instead of buying it every day could be well worth making the effort.

And why just stop with lunch. Try setting a menu for all your meals during the week, then making a shopping list before you go to the grocery store. If you have a plan for each meal; you’ll also be less likely to splurge on takeaways. 

4. Keep a spending diary

Where does your money go? It might seem like an obvious question; but stop and think about it – do you really know? One way to find out is to keep a spending diary. Keeping track of everything you spend money on for a couple of weeks could be a real eye opener.

You can either buy a notebook and write down every purchase (that means every coffee, every drink and every takeaway meal); or you can download an app and track your spend on your phone. Once you’ve kept a spending diary for a couple of weeks, you’ll likely be in a position to see where you could make changes to your spending habits.

5. Have a budget 

The thought of budgeting might seem like a drag, but setting one up can be surprisingly easy.  And when you know where your money is going, you'll be able to see where you could make savings on both essential and non-essential living expenses, so you can start putting extra money away to help you achieve your financial goals. Creating your own budget doesn't have to be difficult - a good place to start is by taking a look at your bank statements to see where your money is going. 

Find out more about setting up a budget

6. Pay off debt

If you've got high interest personal loan or credit card debt, prioritising paying this off could really make the difference to how much you're able to save. With some credit cards in Australia charging high interest rates of over 20%, paying down your balance could make all the difference to how much you can save - the less you're paying in interest, the more you could put into your savings. 

To make sure you don't miss a payment, or if you want to commit to paying more than the minimum repayment each month, you could consider setting up a direct debit each payday directly onto your credit card or personal loan.

7. Set a savings plan

If you've found some areas where you're able to save money and are ready to start your savings journey, setting up a savings plan is a great way to get started. 

A saving plan is simply knowing what you're saving for (your savings goal), how much you'll need to save to reach it and when you want to save it by. Once you've got this figured out, it’s just a case of working out how much you have to put away on a regular basis to reach your savings goal. 

Find out more about setting up a savings plan

8. Start small 

Saving money to achieve your financial goals might seem like a daunting task, but it's ok to start out saving a small amount regularly and then building up more over time if you're able to. Even putting a small amount away can quickly begin to add up, and when you see your balance grow, the chances are you'll feel motivated to save even more.  Should you get an unexpected windfall, such as a tax refund or bonus from work, you could also use it to give your savings an extra boost.

9. Open the right savings account

Not all bank accounts are the same. Some pay introductory bonus interest for a set length of time, while others pay bonus interest to reward regular saving, such as making at least one deposit each month and growing your balance by the end of the month. 

Another advantage of putting your money into a savings account is over time, you'll also get the added benefit of compounding interest - where you'll be earning interest on the interest you've already earned.

The Australian Government also guarantees deposits up to $250,000 that are held in Authorised Deposit-taking institutions such as banks and credit unions, so you'll have the peace of mind of knowing that should something happen to your bank or credit union, your savings are still safe.

10. Put your savings on autopilot

Coming up with a savings plan is one thing, getting into the habit of saving money on a regular basis is another. To make it easier on yourself, think about setting up a regular transfer into your savings account, perhaps to coincide with your payday.

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Things you should know

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