Have a budget – and stick to it - Make sure your budget is realistic by using your bank statements from the previous three months to get an accurate picture of where you spend your money. Going over your previous months’ spending will highlight areas where your precious hard-earned dollars are being ‘wasted’. Set goals for the things you need to save for over the course of the year (like holidays and car maintenance or upgrades) and factor this saving into your weekly budget. A detailed budget, showing income and outgoings (and the difference between the two), empowers you to spend and save money where you need to, while encouraging you to refrain from unnecessary spending. BNZ’s Be Good With Money hub has tons of handy hints on creating a budget.
Save hard - Have multiple suffixes within your bank accounts, naming them for different savings goals (holiday, car, rainy day etc). With BNZ’s Internet Banking, for example, you can have up to 25 accounts, allowing you to be specific about your different goals and expenses. You can even label your suffixes with photos, adding a visual incentive to save for that shiny new family car or sunny tropical island holiday.
Spend gently - Have one account for everyday expenses, but keep the balance as low as possible – enough money to cover only the essentials between pay days – so you’re not tempted to spend more than you need to/can afford to. The old saying ‘money burns holes in pockets’ still rings true in a cashless society where our plastic cards do the spending.
Make it automatic - Set up automatic payments for bills and time the payments to go out of your account on, or near, pay day. This way you avoid late payment penalties, or running out of money before you’ve paid all your bills.
Make saving a priority - Once you’ve organised your bills on pay day, the next step is to move money into your savings accounts in order to meet your goals. Get into the habit of making saving a priority, instead of an after-thought if there is any money left over.
Plan the menu - Groceries take up a considerable chunk of the average family budget but growing kids take a lot of feeding! The best way to save on your grocery bill is to plan the week’s menu before you shop. This way you ensure you have the ingredients you need for a week’s worth of dinners (cook extra so you can have leftovers for lunch and save even more!), you reduce waste – as you’ve only bought what you are going to cook and eat, and you have food at the ready to prevent 5pm fridge panic and the temptation of expensive takeaways.
Read our practical tips on ways to reduce your grocery bill.
Beware of the ‘pop-in’ supermarket shop - Ever run into the supermarket to grab milk and bread, only to be faced with a $60 bill at the checkout to cover all the other items you threw in the basket as you dashed along the aisles? Our guess is yes, as this is a universal problem. Basically, the fewer visits to the supermarket you make, the less you’ll spend. See if you can stretch out your weekly shop to fortnightly. Extra for experts – some people even manage to grocery shop only monthly, stocking up on enough non-perishables to last the whole month and relying on a weekly shop at the local green grocer for fruit, vegetables and milk.
It’s all in the timing - Check your home for appliances that are sucking up power unnecessarily. For example, a 65 watt heated towel rail left on 24/7 can cost around $15 per month. If you install a timer to restrict its use to just 6 hours per day, you could reduce the monthly running cost to just $3.60. Read our helpful tips for shaving money off your phone bill.
Less is more - The Western world is drowning in ‘stuff’. Our cupboards and garages are packed with things we don’t use and probably don’t even need, we even hand over money to hire storage space for our overflowing stuff. It feels like stating the obvious to say that buying less stuff will save you money, but the principal of ‘less is more’ is invaluable and a lesson we’d do well to teach our children. It’s so important we teach our kids the difference between needs and wants, as this will set them up for a lifetime of saving money as they limit impulse buying and learn to buy only what they need.
Declutter - Knowing exactly what you have in your home prevents you buying things you didn’t actually need or already have several of. Clear out cupboards, drawers and wardrobes – get rid of things you don’t use and then only replace items or buy new things when you really need them.
Write lists - Keep a general shopping list somewhere handy and note down perceived needs as they come to mind. Every time you feel the urge to go out (or even more tempting - jump online!) and buy something, first note it down on the list. From kids’ clothing to new hand towels - write everything down on your shopping list first, including details such as size and colour requirements. Then let your list sit there for a week or so – you may find that with some space for consideration, you don’t actually ‘need’ that thing after all.
Shop with a list - Once you’re comfortable that your shopping list covers items that really do need to be bought – and you’ve got the money in your budget to cover their purchase - head to the shops with your list tightly in hand, and your discipline firmly in place! Buy what you need and don’t be tempted by items not on your list.
Do more with free time - Malls are designed to keep you warm, comfortable and entertained – for as long as possible. The longer you stay, they more you spend. Many of us head to the mall when we have time to kill, especially in the weekend, and shopping has become a recreational activity. While there is nothing wrong with a stroll through the shops and some casual window-shopping, recreational shopping makes it very hard to stick to a budget. Basically you are putting yourself in temptation’s way. The best way to save money is to avoid the shops. Chose free activities to fill your spare time – like bush walks, bike rides and trips to the beach – and avoid the mall unless you have a concise list and a mission to accomplish.
Borrow it - It’s tempting to buy shiny new toys and books for our children but there is so much more value to be had by becoming a regular at your local library and signing up to a toy library service. Borrowing instead of buying also reduces the amount of clutter in our homes as our children can enjoy a new book or toy for a time, before swapping them for another new and interesting experience.
Plug the leaks - We ‘leak’ money all over the place if we’re not careful. Take a review of your spending and look for places where you can cut back. Subscriber television channels and un-used gym memberships are a good example, as well as unnecessary insurance costs (talk to your advisor about reducing your spend, rather than cancelling policies). Ask around about the cost of utilities such as phone and power, as you could save money by switching provider.
Walk and go local - Driving all over town is expensive, as well as often unnecessary. When booking your kids in for activities, look for things you can do locally so as to save on transport costs – places you can walk to are ideal!
Ditch the disposables - Convenience comes at a cost and if saving money is your bottom line, consider a switch from disposable to cloth reusable nappies. The initial investment may seem high, but the savings pile up over the years your child – and subsequent children – will be in nappies.
DIY wipes - While you’re swapping disposable for cloth, look into the ways you can make your own wipes and save even more cash at nappy-change time. Find instructions for making your own wipes here, as well as other DIY money-saving trips and tricks.
Resist the urge to put things on credit - It’s so tempting to buy items with a credit card but if you can stretch those self-control muscles a little longer and save up for the things you want, you will make considerable savings by avoiding the crippling interest rates of credit card debt.
Give gifts handmade with love - All this talk of saving can sound a bit dour and frugal. Our consumerist culture has conditioned us to believe that buying things will make us happy, but this is a myth and the opposite is true if buying things means spending money we don’t have. Rather, think of frugality as ‘resourcefulness’ – a much more appealing word – and feel liberated when you discover that experiences are worth so much more than things, and some of life’s riches experiences are in fact free. And saving money doesn’t mean you can’t be generous – gift-giving needn’t cost a lot of cash. Check out our creative ideas for homemade gifts. Homemade is more meaningful than store-brought, and vouchers offering a helping hand or special treat are a lovely gesture – breakfast in bed, anyone?