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Aligning your budgeting, spending and saving

A woman smiling at her computer looking at an expense tracker chart

Keep an eye on the cents, and the dollars look after themselves – or so the old saying goes. While it’s easier said than done, keeping track of your spending could be the first step to a healthy financial future. From tracking expenses to setting up a savings account, here are six steps that could help reach your financial goals.

1. Keep a spending diary

Before diving into the detail of budgeting, it’s crucial to get a true picture of your spending habits. Some people may find it useful to keep a diary of all their spending, whether that’s in a notebook or using an expense tracker app on their phone.

Here’s how to do it: 

  • Commit to recording and expense tracking, no matter how small, for a set period of time, such as four weeks
  • Create categories for common expenses, such as travel, lunch and entertainment
  • After four weeks of tracking expenses, compare what you’ve spent in each category
  • Make a note of where you’d like to spend less, noting spontaneous purchases you think you could probably do without in future.

The simple act of tracking expenses creates awareness and could prompt you to think twice before making impulsive decisions. It also lays the groundwork for a more mindful approach to spending.

2. Analyse how to cut back

Once you’re armed with a comprehensive spending diary, the next step is to analyse your expense tracking and identify areas where you could cut back. It’s time to hold a mirror up to your spending habits!

Start with everyday expenses. Are there opportunities to save money on groceries, utilities, or transport? Audit your subscriptions list, for example, we often accumulate services that may no longer align with our needs.

Then, look at your expense tracking on discretionary spending on treats or non-essential items. Perhaps you have been going out to dinner more often, or maybe you purchased an expensive new piece of clothing or gadget without thinking about it.

A good tactic is to work out your hourly wage, then compare it to the cost of what you’ve just bought. You might be surprised at how hard you have to work to buy one thing!

While these indulgences can bring joy, they can contribute significantly to your overall expenditure. Find a balance by identifying areas where you can trim without sacrificing your lifestyle entirely.

3. Make a budget based on your expense tracking 

Creating a budget is the backbone of effective financial management. It provides a roadmap for your money, dictating where it should go rather than leaving you wondering where it went.

To streamline this process, the Westpac App has a suite of budgeting tools, such as the ability to compare spending across categories and identify trends in your cash flow. It’s also easy to see where your money’s going thanks to a simple, visual dashboard.

Having a clear budget in place is a powerful tool for aligning your spending with your financial priorities. 

4. Be realistic

During the process of creating your budget, it’s important to be realistic about what you can save and spend. Be mindful of your income, fixed expenses, and the need for discretionary spending. Cutting down on non-essential areas like entertainment or eating out is a good place to start, but remember to leave some room for small pleasures if you can!

Set a timeframe to review your budget, whether it’s monthly or fortnightly, and commit to regular reviews. Remember that life is unpredictable and circumstances change.

Regularly revisiting and adjusting your budget ensures it remains relevant and adaptable to any changes in your financial position.

5. Practise healthy savings habits

Celebrate small wins along the way. If you manage to spend less in a particular month, you could allocate the surplus to your savings if that works for you.

Consistency is key, and acknowledging your achievements, no matter how small, reinforces positive financial habits. Here are some other savings tips:

  • Start small – start by saving for something achievable and short term, such as a weekend away
  • Pay yourself first – automate transfers to your savings account to make it a seamless part of your financial routine
  • Be specific – work out exactly what you want and why
  • Share it – talk about your goal with a friend, partner or family member to stay motivated
  • Celebrate each step along the way
  • View saving as a positive habit rather than a chore – this helps to promote a healthy relationship with money.



6. Set up savings accounts

It can be too tempting to spend money that’s just sitting in your everyday bank account. A savings account could give you a secure place to transfer your hard-earned cash and may reward you with interest to boot. 

Bonus interest accounts provide an opportunity to earn more on your savings over time. Westpac Life, for example, is a savings account that offers bonus interest when you meet specific criteria. Plus, it has no annual fee or online transfer fees. 

For short-term savers, online savings accounts such as Westpac’s eSaver account offer a bonus introductory rate as well as unlimited withdrawals and 24/7 access*.

Longer-term options such as term deposits can offer higher interest rates for fixed periods. With a fixed interest rate over a set term, you’ll know exactly how much you’re going to earn. 


Diversifying your savings strategy allows you to use different financial products based on your financial goals and timeline.



To sum up

Aligning your budget, spending and saving all starts with tracking expenses, building a budget, and cultivating healthy savings habits. A spending diary lays the groundwork for mindful spending, while a well-structured budget, supported by tools in the Westpac App, provides a roadmap for financial success.

Don't forget to be realistic, celebrate wins, and explore different savings accounts to optimise your returns.

You may find these useful

Budget planner

To help you achieve your savings goal.

Setting up a savings plan

Understanding the benefits and differences.

Developing good savings habits

How to keep track of your spending 

Things you should know
  • *Subject to system availability

  • For Westpac issued products, conditions, fees and charges apply. These may change or we may introduce new ones in the future. Full details are available on request. This information does not take your personal objectives, circumstances or needs into account. Consider its appropriateness to these factors before acting on it. Read the disclosure documents for your selected product or service, including the Terms and Conditions, before deciding. Target Market Determinations for the products are available.

  • Fees and charges may apply for international money transfers.

  • Life Bonus Interest: Bonus interest: You will be eligible for bonus interest if during the month (subject to transaction processing times):

             a. your account balance has not fallen below $0; and
             b. you (or someone on your behalf) have made a deposit of any amount; and
             c. the account balance on the last business day of the month is higher than the account balance on the last business day of the previous month.

  • Interest paid into your account does not qualify as a deposit in terms of bonus interest eligibility. 

  • eSaver Intro: If you have not had a Westpac eSaver account before, an introductory fixed interest rate of 3.55% p.a. applies for the first 5 months, on top of the standard variable rate. After 5 months, the standard variable interest rate, currently 1.10% p.a. will apply. Existing or previous eSaver account holders are not eligible for this offer. Joint accounts are eligible where the primary account holder has not held an eSaver account before. 

  • The information in this article is general in nature (including any tax information provided) and does not take your objectives, financial situation or needs into account and does not constitute tax advice. Consider its appropriateness to these factors; and we recommend you seek independent professional legal and/or financial advice about your specific circumstances before making any decisions.