One way that people accumulate wealth isn’t the first one to come to mind. Typically, our clients tell us that they’d like to earn more income to give their finances a healthy boost. But instead it might make more sense to spend less.
Spend Less, Retain More Money
The spend less strategy makes sense as when you buy fewer items then you keep more cash. Alternatively, you might buy a little-known brand at the grocery store rather than the more expensive one to reduce your food bills week after week. Did you know that some of the store brand items are the same as the branded items? Often batches of product are made and when quota for branded products it achieved, the remaining batch is relabeled and sold as a store brand.
In other words, you can spend less by literally buying fewer things or by buying cheaper things than before. You might even choose a combination of these two methods.
Did you know that Australians The Government estimates food waste costs the Australian economy $20 billion each year. Over 5 million tonnes of food ends up as landfill, enough to fill 9,000 Olympic sized swimming pools. One in five shopping bags end up in the bin, that is $3,800 worth of groceries per household each year. A quick and easy way to start saving money is to be become mindful of wastage. Taking left overs to work instead of buying take outs is an easy way to start stashing your cash.
How to Stick with the Strategy?
If you are not sure that this sounds doable, or worry that you’ll feel deprived, then we can help you easily incorporate small changes in your spending routine. We would tailor the changes to your lifestyle and work with what you’re comfortable with.
For example, rather than driving to work, if you are a close commute than perhaps you could bike instead to save gas money. But if you have bad knees then this option won’t work; instead, we might suggest taking public transportation.
Over time, you will likely get used to the new way of spending or not spending, such that you do not feel like you are missing anything by spending less. That’s when you know that saving money, which is what you’re doing, by the way, doesn’t have to mean restricting yourself to the point of being unhappy.
Yes, you can still have a happy, full lifestyle while spending less!
Take a Moment to Make the Calculations
When you spend less, over time you can really see the amounts you’re saving. For instance, if you used to grab a coffee from a local shop on the way to the office every Monday morning but no longer do so (brew at home, it’s cheaper!), then think of the amount you’re saving per week. In Perth the average cup of coffee costs $5. If you only bought one coffee a week and brought your own the rest of the week, over a 40 week year you would save$800 for the year.
While you buy the coffee beans and filters, the value you get from those items is more than the 5 cups you’d buy for the same amount. You’ll get at least 5 times the number of cups of coffee!
Once you start to spend less in one area of your life, then branch it out to other areas, such as travel, entertainment, and clothing. It’s amazing the savings that can accumulate over time.
If you’re not sure where to start, reach out to us today to help you start to see your finances grow.
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The information contained within this site has been provided as general information only and prepared without taking into account your financial position, objectives, and needs. You should consider its appropriateness and seek financial advice before making any financial decisions.