We work with a lot of people to try to get them in a better financial position, get them ready to buy a house. A lot of the time that takes some savings, and it takes moving someone from from where they are today with $X to really ramp up their savings to get them the place that they want.

The number one thing is really simple, it’s just choosing to do it and say, “right, I’m going to save this, I believe it, it’s going to happen”. And then setting your goa, for example, you need to save an extra 10 grand, you need to save an extra 100 grand, whatever the figure is, that’s your goal. And you’re doing it for a particular purpose; you’re doing it to buy a home, or for your deposit, or it could be something else, maybe to buy a car, you’re saving up for a holiday, whatever it is, have your goal and set your budget and say, “okay, to hit this goal, this is how much I need to save”. And then look at your individual budget to see what you’re spending at the moment. Review your budget and have a critical look through where your money goes to identify some savings that you can make. And I’ll go back to that a little bit later.

Then you set your plan, you say, “okay, these are the areas that I’m going to attack, these are the areas that I see the low hanging fruit to get myself into a better position to increase my savings”, and then regularly review that plan and look back a month later and say, “This is what I tried to achieve this month, did I achieve it? Did I over achieve it? What can I tweak for next time?” It’s really important just to have that little cycle running, so you’ve got a way of navigating through these principles. There’s some other videos on exactly that, that I’ve done that you might want to check out. If you want more information on that.

One way that we find works really well is having buckets of money. So basically having your pay paid into a savings account. And then having that money follow through automatically to other accounts in your financial ecosystem, to make it easy. You have a certain amount going into a spending account — your pocket money, allowance, or how much you’re going to spend over the next week or month — you might have a bills account, and you have an amount dedicated to building an emergency fund. You basically choose the accounts that you need for your goals and then have that money automatically filter through, and really try to stick to the budgeted amount in your spending account. That is so important.

How can we make that spending amount last as long as possible? Well, that’s getting rid of some bad debts or getting rid of some crappy consumer debts. And there’s some really good ways to do that. Again, I’ve got some other information on that, but really focusing on, “okay, I’ve got these credit card debts or those personal loans, they’ve got to go, how are we going to get through those as quickly as possible?” and then focus on getting rid of those. Once they’re gone, saving money becomes a lot easier, because you’re not paying someone interest, you’re actually earning interest, which is really powerful, obviously, then it’s looking through your transaction, looking through where your money goes and say, “what stuff can I cut out?”. I’d be so surprised if you didn’t look through your accounts, and find something that can easily go — is it you’re paying for a subscription service or an app or something that you just do not need? Or are you seeing that you are spending a lot of money on lunches or coffees, or whatever it might be, but you can actually save. Getting rid of that low hanging fruit, and then the stuff that stays.

There are obviously things you need to spend money on. But are you getting the best deal on those? You need electricity; When’s the last time you spoke to your electricity provider or others? Finance is obviously a way to make some savings in your budget. So utilities and finance are absolutely areas that so many people can save money, but there are certainly more, and it might be digging down to which brands you’re buying. Is there an equivalent product with a cheaper brand. These are just some ways that your regular spending can be adjusted so that you’re actually saving more money and then automatically make sure those savings stay in your savings accounts.

Having separate accounts or “buckets” means the cash isn’t in an easily accessible place, so you can’t blow it all on a whim. People are really good at thinking, “okay, I’ve saved 100 bucks here, but now suddenly, something amazing has popped up, so I’m going to spend my 100 bucks”. Just be careful about that. Make sure that when you do make savings you ensure those savings are going towards a higher purpose or your goal. One of the main things that we’ve worked with our clients on is just stopping the impulse buying.

What can you do? What mechanism can you put in place to stop an impulse buy? You see a piece of clothing, some sort of consumer good or electrical good, or whatever it might be and say, “I like it, I really like it. I’m not going to buy it today, I’m going to come back in a week and buy it”. So you cut that impulse out and just see if you really wanted that product, or something cheaper might have popped up. So once you’re looking for it, you might be able to save money that way. But really, it’s about having a process setting your goals, setting a plan in place, taking a bit of ownership of how your money flows through your financial ecosystem, which is a really, really important first step, and then seeing where those savings are made. And then having a look back and reviewing it to see where else you can attack next or what’s working well and what’s not, but it’s an ongoing process. It’s worth just a little bit of focus and you’ll be pleasantly surprised at the position that it puts you in.

I’d love to chat more about how this relates to you and your personal situation. Please reach out to me.