How to Live on Less Money in Australia

As the cost of living rises, more Australians are teetering close to the financial abyss. Our consumer driven society has generated tremendous financial rewards for a minority of the population at the expense of everyone else, and the gap between rich and poor is wider than ever. We can’t all be rich, but nobody enjoys being poor, and while opting out of capitalist society is a dream worth considering, it isn’t possible for people with ongoing expenses, obligations, or a family to feed.

For many Australians, cutting back on spending is essential. When outgoing expenses exceed income, finances can quickly spiral out of control, often resulting in a cycle of debt and dependency. The picture looks bleak, and is unfortunately accurate, so tackling crippling debt is a responsibility all Australians need to share. Our proud boast of national equality is now a distant memory and more Australians are taking the initiative by finding innovative alternatives to spending money wastefully.

How to live and save within your means

Saving and investing money is great in theory, but for most people in the 21st Century, saving is simply a means to ensure bills are paid and food is on the table. It takes organisation and dedication to trim costs and begin saving money for special treats and luxuries. The first step is to create a realistic budget. This straight-forward approach entails determining all current income and expenses. The budget needs to be thorough, easily understood and accessible, saved on hard copy or computer programme.

The next step is to examine ways to spend less, earn more and achieve financial goals. There are hundreds of ways to cut costs and even make money across the board, and all of them are worth investigating, but we are all individuals with certain needs and wants. Make two lists – one for needs (priorities) and one for wants (desires), then ask yourself a few questions about the ‘wants’ list:

  • What is my reason for wanting it?

  • Is it important for me to get it?

  • How will my life change if I have it?

  • Will getting it make my lifestyle more, or less, expensive?

  • Does it satisfy my ideals, ethics and values?

A budget provides visual confirmation of overall finances and the opportunity to focus on what’s important in your life. Many financial lessons are hard-learnt, but frugal and intelligent spending has resulted in countless financial turnarounds for the better. Wealth is attainable even from humble beginnings, and although slow at first, savings will accumulate that can be invested in more than just paying the monthly bills.

Trimming and tracking savings

The budget doesn’t lie, and will likely also present obvious areas where costs can be cut and money saved. Savings initiatives based on a realistic budget are far more likely to succeed, and introducing just one new savings strategy every week will begin to reap rewards in a short time. In many instances, cutting back on something is preferable to completely cutting it out, although wasteful expenses should be honestly acknowledged and dealt with as soon as possible.

Setting realistic goals is important. In a family environment, achieving targets is only possible with a team effort. Household finances won’t improve if one family member becomes a militant energy saver while everyone else rebels. The ‘SMART’ way to trim and track savings needs to be implemented.

Specific: Savings are easily wasted if they are not earmarked for a dedicated purpose. Financial goals should be coupled with the need for real measures to achieve desired outcomes. Planning is essential, as is monitoring savings progress, especially if you hope to save enough by a certain date.

Measurable: It’s easier to save if you have a target to aim for. In many cases, cutting back on luxuries is a temporary measure to help achieve goals. Regardless of how much you need to save, quality of life shouldn’t be sacrificed, and a savings time-frame can be utilised to focus on the goal.

Attainable: You shouldn’t have to put your life on hold or become a hermit to save money. Finding ways to cut costs and save money is possible, but we could all do with more, and keeping desires in check is important. If your goals are attainable and reasonable, without unsettling work or home life, they are probably worth striving for.

Relevant: We would all love the best luxuries that money can buy. However, most of us need to accept our limitations and capacity for joining the jet set. In time, rubbing shoulders with the rich and famous is possible, but for now there is no shame in selecting value for money wherever you are. Frugal doesn’t mean miserly anymore. For some, frugality is a way of life.

Time-related: Most people juggle a lot of expenses and savings ideas simultaneously. The budget can include a savings timeline for every considerable purchase. Once the target is reached, additional savings can be dedicated to other projects. Achieving savings targets is difficult for a lot of people, but establishing a budget is essential for everyone regardless of income or wealth, and learning smart money saving ideas will result in outcomes that are worth celebrating.

[Source: How to Live on Less Money in Australia.]

7 views0 comments

Recent Posts

See All