Life is unpredictable so having some money set aside for emergencies, is essential. Whilst we all have different financial situations and saving for some people is more of a challenge than others, there are a few ways you can make it less of a shock to the household budget:
- Pay more tax. Ask your payroll department to pay a certain amount from your wages in additional tax. This will be deducted before it hits your bank account and at the end of the financial year, you’ll get it back as part of your tax return. You can adjust or cancel the amount at any time.
- Use your banks budgeting app (like NAB’s Spending) to see precisely where your money is being spent. This allows you to monitor and manage your spending using real information from your bank accounts and credit cards.
- Open a term deposit or saving account. A term deposit is a good way to lock your money away for a set time so you can’t access it whereas a savings account can be accessed whenever you like. Develop the habit of saving a percentage of your income each pay period and stick to it.
It’s also really important to introduce your child to good saving behaviour as soon as possible. Not only will this help them develop good financial habits, it also means they are less likely to move back in with you when they grow up!
Teach them the value of money in a way that suits their personality, so they don’t have to learn the hard way by getting into debt when they are older. These are our top three favourite approaches when it comes to teaching your children to save:
- Buy a piggy bank! This works really well if your child loves animals. Explain that you’re feeding the piggy, so it is happy and doesn’t have to worry.
- Open a bank account. Whilst we do live in a digital age, it’s still exciting for a child to have their own account with their name on it. Physical branches do exist and staff will be more than happy to make it a positive experience when you go for a visit.
- 3. Give them a goal. If they want a new bike, that could be the motivation they need to save pocket money or do chores to earn a few more extra $$$.
If you’d like to plan for a better financial future, make an appointment with the Empower team and see how much difference we can make.