It’s a charmed life for those dressed in the latest threads and rapidly joining the jet-set. But if you think their lifestyle is way out of reach because of your McDonald’s wages, think again. A few changes to the way you manage your money could change all that, and before you know it, you’ll be jetting off to schoolies in style! It’s a hard-knock life for us no more…
From Budget to Bonanza
Want to get the most out of what you put in? Dr. Lois P. Frankel, author of Nice Girls Don’t Get Rich, says a budget is a “plan that will you make you more conscious of how you spend your money” and she’s right. Allocating money to things you need – such as phone credit, school stuff or toiletries – makes it easier to see how much is free for the fun stuff like going out. Dr. Frankel advises you devote 10% or more of your salary per month to savings, only 3-5% on clothing, and 5-10% on personal/miscellaneous expenses. The rest should be divided up between home, medical and transport expenses. So draw up a budget (tailored to your needs) and stick to it– don’t spend what you don’t have and learn great money skills along the way!
It’s all in the bank
Well, that’s where it should be anyway, considering little pigs don’t do us justice these days. Everyday savings accounts aren’t too complicated, but you need to find one that suits your money use (do you prefer to shop using cash or EFTPOS?) – so get researching. Some banks offer little or no account keeping fees if you’re a student, others charge a whopping amount for ATM use. And even if the overdraft facility (ability to withdraw more than what you have and pay it back later) sounds blissful, be warned: it comes at a hefty penalty price! Key questions to ask include: Will it allow me to make withdrawals at ATMs not specific to that bank? What will it cost me to make branch withdrawals? Is there unlimited phone and online banking access? How often will I get statements? All these questions are imperative to getting a hassle-free account that gives you access to your money when you need it and the ability to analyse where you’ve spent it – without the headaches of fees and penalties.
Below are some money-savings tips – deposit what you save and roll in the cash!
• Designate one weekend evening where you stay home. Hire a DVD and cuddle up to your boy, or have a food and gossip session with the girls.
• Take your spring cleaning one step further by selling your stuff on EBAY. One girlfriend’s trash is another’s treasure!
• Empty your loose change into a jar at the end of the day, and deposit the lot into your savings account each month.
• Join the loyalty programs of your favourite cinemas and stores – and take advantage of their discount offers and rewards.
• Think before you buy. Discount department stores like K-Mart and BIG W often discount girlie essentials like beauty products by up to 20%, so flip through their catalogues often.
• Best sellers are best-savers! Save a fortune by buying books at less than RRP – stores like Target and Myer have regular sales and always discount best-sellers by up to 35%.
• Use your concession card. Students get discounts at cinemas, on public transport, and at events, so work it, baby!
• Subscribe to your favourite mag – save on the newsstand prize and get a cool pressie for doing it too!
• Buy your basics, like T-shirts and undies, at factory outlets. It’s not like their styles ever change.
• Make your own lunch. Not only is it healthier, but it will save you a fortune considering it adds up quickly.
Phone Caps or Thinking Caps?
Dr. Frankel says that one of the biggest mistakes we make financially is “not taking time to research” which costs us “extra dollars” in the long run. Pre-paid mobile phone deals are constantly changing, which means the offer you picked out last year might not be the most efficient for you now – if you and your mates go with the same carrier, you could save on calls AND text. For example, you might pay $49 a month and get $250 credit on a cap plan, but this could be at a higher call rate, whereas buying a $30 recharge every two months, could give you hundreds of free minutes to special numbers that you regularly call. Read up on the different offers and make a decision tailored to your phone patterns (and continue to do so every few months) – you’re not going to save anything if you’re not bothering to investigate!
Saving to splurge:
Got a big, extravagant item in mind? Whether it’s schoolies week, a car or a designer handbag, you’ve got to save for it right – using an online savings account. These have a higher interest rate if you make little or no withdrawals (which means you make money on what’s already sitting in there, especially when there’s lots of it) and using them is easy and you can do it at any time by phone or online (but make sure your computer has adequate security to avoid people discovering your personals). Visit infochoice.com.au to compare per annum interest rates, but our picks are ING Direct’s Savings Maximiser (variable rate), Commonwealth Bank’s NetBank saver at 6.75% and NAB’s i-Saver at 6.8%.
And one simple rule:
Money makes the world go round, but it does not buy you happiness. Use these tips to maximise your living potential, but don’t turn into a complete scrooge, workaholic or shallow, designer-clad brat. Avoid the extremes and have fun making some money – don’t use it too sparingly and don’t let it rule your life – it is definitely not worth it at the expense of your dignity and loved ones (and a true Chanel girl would not be caught dead behaving this way). Happy researching, saving and splurging!