You have a savings goal in mind but how on earth do you save the money without living like a hermit?

1. Before you save, pay off your debt

The interest earned in savings or term deposits is minimal compared to the interest you’re racking up on your debt. Commit to paying this off first, then when you start saving you don’t have to worry about repayments getting in the way of your hard-earned savings. If you have a mortgage, get your financial consultant to add the goal to your plan, then you can work out how long it will take you to get there.

2. Learn to value every dollar

Let’s say you’re going down the road for your coffee fix and you come to a place that does $5 coffees, but you spot a place 10 metres further down that does $4 coffees. Do you walk the extra few steps to get a cheaper brew? If you make the extra little effort to save a bit here and there it’ll all add up.

3. Share subscriptions with friends or family

Share subscriptions with family or friends eg newspapers, magazines etc and watch your savings goal draw closer and closer!

4. Review your mobile plan

There are plenty of options to choose from now so there are very few excuses for high mobile bills – I pay $16 a month for 1GB data, 150 NZ and AU minutes, and unlimited texts and calls to people who are with the same provider. I would probably use more than 1GB if I had it, but instead I rely on Wi-Fi where I can to keep my data usage in check.

5. Live with other people

For some, it may be the very last straw; having to get a flat mate, or move back home short-term. After flatting as a student, I vowed never to live with anyone else ever again (other than my other half). But that all changed when we got a flat mate while saving for our wedding. It proved so effective that now we’re saving for our next goal by living in what some would describe as a commune! I’m pleased to report the sacrifice is worth it, especially because we set ourselves an end-date to look forward to.

6. Consider cheaper transport options

I suggest you consider cheaper options but sometimes it doesn’t always make sense to go ahead with it. At the beginning of this year I was inspired to ride the bus to work every day until I realised it would take me at least three times as long, plus it’s a 20-minute walk to the bus stop. I decided it’s not worth my time, but you may be more motivated!

7. Take lunch to work

If you’re already in the habit of making your own lunch, or taking leftovers from last night’s dinner to work, then kudos to you. Now and then I’ll treat myself to buying lunch – but only if I can justify it by making it a social event catching up with friends or colleagues.

8. Eat less meat

Challenge yourself to have meat-free days during the week and your savings will benefit from the cheaper meals.

9. Cut down on a vice (or give it up if you can)

Wine, beer, concerts, and shows. I have cut down on all of the above to stick to my savings goal. I’ve not completely given them up, as I think I would go spare, but allowing myself to pick and choose when I can indulge keeps me sane without feeling guilty about my savings.

10. Review your insurance policies

The last thing you want during your savings streak is to have to cut into your fund when the unexpected happens. Book an appointment for a free review of your insurance to make sure you have the appropriate protection.

11. Be realistic

When you set your savings goal be real with yourself about how much spending you’re going to allow yourself each week. If your spending budget is set too low it will be harder to stick to. Make saving as easy as possible.

After nearly a year of living these changes to my spending it makes me cringe to think about what I was blowing my money on only a year ago!

Feeling more optimistic about reaching your goal yet?

The information contained in this article is of a general nature and should not be taken as advice. It reflects the opinions of the writer only and does not necessarily reflect the opinions of New Zealand Home Loans (NZHL).