Finding opportunities to help manage the cost of living
With cost-of-living pressures continuing to bite, many of us are looking at how we can make every dollar stretch a little bit further.
12 October 2023
With cost-of-living pressures continuing to bite, many of us are looking at how we can make every dollar stretch a little bit further.
The 50-30-20 breakdown has long been a popular rule of thumb for budgeting – dividing up your income as 50% on the essential needs (things like your loan repayments, food, transport, and utilities; 30% on non-essentials (gym memberships, streaming service subscriptions, dining out) and 20% on savings (for unexpected bills, future goals, retirement planning).
Rising costs mean essentials might now be costing more, but the 50-30-20 rule remains a valid goal. Here are a few things to consider that may help you make the most of your income and fight the cost-of-living blues:
- Update your banking arrangements
All savings accounts are not the same – talk to us to see if you have your accounts set up the right way for your individual circumstances. A few simple changes, like keeping money in an offset account or putting lump sums into a term deposit could save you money.
- Set up automatic deductions.
A great way to stick to a budget is to set up deductions that automatically transfer money to pay bills or go into accounts set up for specific goals, like saving for a holiday. If you don’t have the cash in your everyday account, there’s less temptation to spend.
- Limit your energy usage.
Electricity costs continue to grow and take out an increasingly larger chunk of your income. This is an area where you can easily make savings. Switching off appliances at the wall avoids standby power usage. Replacing light bulbs with low energy options is also effective. You might also think about using a timer to run the washing machine or dishwasher late at night, when lower cost electricity tariffs may apply.
- Try online grocery shopping
How often do you go to a supermarket and come home with lots of things you didn’t set out to buy? If you are an impulse buyer, try online grocery shopping instead. That way you can send in a set list of items and avoid the temptation to buy extras. Of course, there may by additional delivery fees when buying online, so weigh up what’s best.
- Cut out a regular purchase and save instead.
It’s amazing how small discretionary spends can add up over time. Try cutting out a regular purchase, like a coffee from your local café and put that money toward a savings goal.
- Save your windfalls
Put any unexpected or windfall income, such as a tax refund, toward a savings goal. While it’s tempting to spend the money, it’s income you weren’t counting on, so you won’t miss it if you save it up instead.