Our seven tips for getting richer in 12 months’ time will require some sacrifice, but just think how much better you’ll feel when you check your savings this time next year. Here are seven suggestions that will make you richer by 2023.
1. Eliminate three unnecessary expenses
The easiest way to save money is not to spend it in the first place. For those living on the Age Pension this is not as simple as it sounds. Or is it?
Focus on your finances; rifle through your bank statements and choose three non-essential expenses that you are paying on a regularly. Now get rid of them.
The expenses you eliminate could be along the lines of reducing your mobile phone plan, having lunch at home or cancelling your newspaper subscription and reading it online instead. Eliminating these types of costs will free up more money for things, such as savings and investments, or a holiday.
Read: Demystifying your spending
2. Shop without your credit cards
Next time you go shopping, remove the credit cards from your wallet and use cash only. The ways in which you’ll save are threefold.
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- you’ll only spend the money you have in your wallet
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- you’ll save on interest – especially if you can’t pay off the balance before it’s due
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- you’ll save on credit card fees.
3. Don’t take on new debt
Just as the easiest way to save is not to spend, the same applies to debt. If you don’t want to be in debt, don’t take on any more debt, and pay off the debt you already have.
And even if you’re struggling to pay off your current debt, by avoiding new debt and making minimum monthly repayments on your existing debt will get you out of the red, eventually.
4. Switch your credit cards to zero interest cards
If you have a significant amount of credit card debt, why not take advantage of a credit card that charges zero interest for three, six or 12 months? Many credit card providers offer zero balance transfers on existing credit card debt, so take advantage of this generous offer and pay off the principle as much as you can while being charged no interest. It will absolutely get you out of debt a whole lot more quickly.
Read: Simple savings in retirement
5. Cut living expenses by 10 per cent
Cutting out expenses altogether can be difficult for some, but if that’s the case, try reducing your spending by 10 per cent across the board.
Obviously some expenses can’t be reduced, such as rent or mortgage payments. But there are other ways to save on groceries, food, entertainment, utilities, fuel, and insurance by 10 per cent or more.
6. Save 10 per cent of your income each month
Once you’ve reduced your spending by 10 per cent, try also saving 10 per cent of your monthly income. That way you’re doubling down, and will be 20 per cent (or more) better off at the end of each year.
You can divert this extra money into a savings account, and eventually move into mutual funds or other investments.
And while it may not feel good cutting back on so much of your everyday spending, the feeling you’ll get at the end of the year when you look at your savings account will more than make up for it.
Read: 10 simple retirement savings
7. Sell or donate everything that you no longer use or need
Do you have things lying around your home that are just not as useful as they once were? Why not sell them?
Not only is it one of the quickest and easiest ways to raise money, but it’s also incredibly liberating to declutter your house and your life in general.
You may even find that much of what is around your house could be worth hundreds or even thousands of dollars, especially if it’s in good condition.
Do you have any suggestions for how to be richer in 12 month’s time? Why not share them with our members?
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Disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.
