Thrifty hacks: The Mindset

From my experience saving money comes from a particular mindset which you need to develop. It’s about looking out for opportunities to change behaviours which will help you save and make money and being willing to do what it takes. This over time develops in to habits which allow your savings account balance to increase. Don’t get me wrong, i’m not saying that you won’t have to make sacrifices in terms of how you spend your money and time – although the greater the sacrifice often the greater the reward is. What i’m saying is that you don’t need to be a genius or be earning big money to save money over time, its quite simple. Below i’ll provide some examples from my own experience:

1.Public Transport: In many countries transportation is priced on distance, on how far you need to travel. What i would do and still do, pretty much everywhere i go on public transport, is to work out the pricing zones. I ask, where does the cheapest zone end? And how close will that get me to where i need to go? If its too far, can i get off a stop or two early to lower my fare? For example, here in London when i was working over in West London, and was in Zone 2 travelling to Zone 1 i discovered i could save 60 pence if i walked for 15 minutes to a Zone 1 station. Sure, 60pence doesn’t sound like much, but over time it adds up. If you were to do that every day of the week you would save £3 – for 48 weeks of the year thats £144.

For those in Sydney, when i was in Sydney, it was a $3.50 bus ride to the train station from my work – what i would do is walk for 20 minutes to get to the cheapest zone and save $1.40. Over a week thats $7 saved, over 48 weeks of the year thats $336 saved. Of course it required some sacrifice and getting home a bit later, but i was ok with that.

2.Coffee: Now i love coffee and this one was the hardest behaviour for me to change – but small regular purchases like coffee can really add up. For a long time i would be a large cappuccino everyday during my lunch break, costing me $4.20 a day. After adding up the weekly cost i realised i was spending $21 a week on coffee. To save money i drank instant coffee four days a week, and rewarded myself on Friday with my large cappuccino – saving me $16.80 a week – over 48 weeks of the year thats a $806.40 saving.

3. Bank accounts: some bank accounts reward people who are willing to leave their money alone for a month. In Australia, you can get a base interest rate of 0.5% and a bonus of up to 2.5% if you make a single deposit (1 cent is enough) and no withdrawals in a given month. Now these accounts can be great if you need some incentive to not touch your money, but a nightmare if you don’t have the discipline to leave it alone.

In Australia, banks often offer bonus introductory interest rates on savings account. Like a bonus 1% for the first four months after you join. What i did, and is a good way to make the most out of your money if you can’t or aren’t willing to invest them in more sophisticated investments is shop around. Sure, the thought of applying to a bank is a hassle, but these days its really  not hard. You can apply online, and if you have a credit history and/or a passport and drivers licence everything can be done online. No need to go into the branch and you will be able to secure that higher interest rate. Of course, for those not in Australia this isn’t particularly helpful, but the point is that you need to look for opportunities to exploit.

These are just a few examples, but i hope they illustrate the point that saving money is about identifying opportunities to save and forming habits which allow you to save money.



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