From groceries and petrol to utility bills and mortgages, the cost of living has risen and many Australians are finding it difficult to stay ahead.
We’ve brought together three pros from the business, food and finance industries to offer their hard-hitting tips.
In our Q&A blog, ABC business reporter Emily Stewart, author of four books on saving money and living frugally, Jody Allen, and Financial Counseling Australia’s Lody Stewart answered your questions about budgeting and saving.
Here are the biggest takeaways from the blog.
When you get paid, split your money into separate “buckets”.
A handful of you said you would spend any money that hit your bank account immediately.
How can you change this?
Ms Stewart says it’s all about separation.
“When you get paid, you split your money into separate accounts or ‘buckets’ that are meant for different things,” she said.
“If you’ve budgeted money for groceries, then every time you get paid, put that money in a separate, low- or no-fee bank account that has a debit card.”
She recommends the words “only groceries” in bold letters on this card to remind you what it’s for.
“You should check from time to time to make sure you’re putting enough in your shopping bucket,” she said.
Unrealistic timeframes and limited enjoyment are budgeting mistakes
One listener asked what budget-related mistakes the experts had seen people make?
Ms Stewart says the three most common mistakes are:
1. Having an unrealistic budget that is difficult to achieve
For example, save $8,000 through the end of six months.
Budgeting goals like these are not only vague, they can be unrealistic and difficult to achieve given the changing pace of *gesture wildly* all.
Your own situation will never be the same as that of the next person.
make sure you Consider your personal lifestyle, values, and money goals when creating a budget.
2. Having a budget that takes too much time to track and manage
As mentioned above, Ms. Stewart says “bucketing” is one solution to this.
With every payout, put money into a separate account that you need for regular bill payments such as rent, telephone, health insurance, etc. You should also set up automatic payments for this.
3. Don’t budget for a little pleasure
Ms Stewart says people should accept that they’re likely to splurge a little now and then, and that’s normal.
Whether it’s dining out or clothes shopping, your budget needs to allow for it, but still set a limit.
“I cap mine at 10 percent of my weekly net income, which isn’t a lot but it works for me,” she said.
In winter, set the air conditioning to 18-20 degrees Celsius and turn off the consoles to save energy
Ms Stewart says there are many ways you can reduce your energy use:
- Adjust the temperature of your air conditioner to 18-20 centigrade in the winter
- Turn off computers and game consoles on the wall when you don’t use them
- Switch to energy-saving LED lighting. Some state and territory governments offer renters discounted energy efficient lighting, but you must check with your landlord
- if you can Replace old, inefficient appliances with new, energy-efficient ones. Your state or territory government may offer you a rebate or rebate in this case
- Make sure you have the best plan and that you’re getting any energy rebates and concessions you’re entitled to from your state or local government
Save on groceries with unit prices and replicate store-bought vegetables
Many of you have wanted to know how to save on groceries, especially if you follow a vegetarian diet.
Stewart suggested unit prices. It’s not as scary as it sounds.
“One price is a great way to compare different brands, but also different sizes,” she said.
“It’s on the label and says ‘Price per 100 grams’ or ‘Price per litre’.”
Stewart says larger sizes tend to be cheaper, so you can buy some staples like rice or flour in bulk. Otherwise, you can opt for smaller units.
Ms. Allen also recommended “re-growing” vegetables you’ve already bought.
“Spring onions, potatoes, and celery are all pretty easy to regrow,” she said.
Start your savings by setting aside 10 percent of your salary
One viewer told us she just started her first full-time job and wasn’t sure what percentage of her salary to save.
Ms Stewart suggested starting with 10 percent.
“You can always build it up from there,” she said.
“It’s an option if you’re not sure where to start.”
Having trouble managing debt? Consider consolidation or partial waiver
We had a listener tell us he had $78,000 in unsecured debt.
While they have made arrangements for financial hardship, they are set to end, leaving them struggling to make the repayments.
Ms Stewart says the options available to people in this situation depend on it who your lender is and their personal situation. They include:
- A permanent hardship variant in which the repayments are permanently reduced and no further (or reduced) interest, fees and charges are added
- A partial waiver or debt reduction and affordable repayments so you can pay off the reduced debt in a timely manner
- Consolidate debt, such as a personal loan, credit card, and home loan, so your total repayments are lower
- A combination of these and other measures