Credit cards have become an integral part of modern financial payment, and are essential in securing a convenient line of credit, whilst providing consumers with the opportunity to improve their credit score.

However, it is important to understand the many associated pitfalls, have you made any of these ten common credit card mistakes?

1. Know your credit score

It’s important to get familiar with your credit score, as it can save you from being rejected when applying for a loan or another credit card, as well as inspire you to improve your credit rating, should it be below par. To find out more about your credit rating, or to obtain a credit report, go to www.moneysmart.gov.au

2. Shop around

Consumers looking for a credit card that best suits them should first consider their credit rating, their lifestyle and how they spend money before applying. If you plan to carry a balance, then a low interest credit card would be ideal. If you’re a frequent flyer, then it may pay to go for a card with travel rewards. People applying for the wrong type of card can often be rejected or will have to cancel it down the track – both are situations that can have a negative effect on your credit rating.

3. Use your credit cards

Some people refrain from using their credit cards for fear of accumulating debt that they may not be able to pay. However, by not using credit cards you lose the opportunity to improve your credit rating, which may make borrowing for bigger purchases in the future a little more difficult.

4. Getting greedy for rewards

Often people continue to collect cards from different banks in the pursuit of the rewards and discounts each one can provide. However, it is important to focus on managing credit card debt before worrying about your credit card rewards.

5. Don’t collect credit cards

It goes without saying, although still important to mention, that having a whole lot of credit available to you and accessing it without carefully monitoring your spending, can often lead to crippling debt down the line. That’s why it’s best to only keep a couple of credit cards – a primary card for spending and one for back up and emergencies. It also pays to use the back up card once a month, and then pay off the balance in full, to maintain a good credit rating.

6. Considering introductory rates as permanent

Often, in an attempt to lure you into applying for a card, banks will offer low or zero interest rates for a period that can range from 3 months up to a year. Remember these rates are not permanent and will change once the specified period is over. It’s advisable to pay off your outstanding balance during this period to avoid outstanding’s been charged with retroactively applied interest from the date of purchase.

7. Make timely payments

Missing the monthly due date may not seem like much of an issue, but each time you do so it damages your credit score. A well-planned budget should include credit card repayments and, if you’re likely to forget your regular monthly payment, then it may be best for you to set up a direct debit, which pays at least the minimum payment or, if you can afford it, the full balance each month.

8. Get rid of the balance

It’s not uncommon for people to think that just paying off the minimum amount each month helps their credit rating, but unfortunately that’s not the case. Paying off the balance, instead of carrying it, should always be your priority if you truly wish to have a good credit score.

9. Don’t use your credit card for cash advances

Making cash withdrawals from your credit card account is always coupled with high interest rates that begin to accrue immediately upon withdrawal. So, if you want to make a cash withdrawal, it’s best to stick to your debit card.

10. Stay in the game

If you have a bad credit rating, or have suffered damage to your credit score, it’s easy to fall into the trap of thinking you can’t dig out of your debt hole. But when it comes to credit ratings, time heals all wounds. So, instead of cancelling your cards or, worse case scenario, declaring bankruptcy, talk to your provider and get some financial advice that can help you out of your debt dilemma. Alternatively, you could seek the advice of a trusted financial planner to see what is the most effective way to repair your credit.

If you can identify with any of these common credit card mistakes, or if you need any general financial advise, get in touch with one of our Chapter Two consultants today.

Okay, you had a great time over Christmas and it’s only afterwards you’ve realised it all cost rather more than you expected. Before you blow a gasket or worry yourself sick, stay with us and discover the best ways to deal with the debt.

1. First things first

Firstly, it’s important to look at the problem rationally. Don’t blame yourself or anybody else for that matter and work on a positive plan to deal with it. Stress and worry just make you feel bad, but they don’t fix anything, so let’s look forward, not backwards.

2. Don’t make things worse!

Nowadays, there are always tempting offers and deals on offer, but have to be strong and ignore them completely. Remember, buying something cheap isn’t saving you money, it’s just another cost you can do without.

Also, this is the time to examine all your everyday and regular expenses and look at where you can reduce your costs. Start by cutting down on unnecessary costs such as eating out, takeaway meals, ice cream and coffee, movies, clubs and pubs etc.

If you are heavily in debt, you should look at cutting back on the big-ticket items too, like your car, or that upcoming holiday and anything in life you could live without, at least for awhile.

3. Your credit card bill – step one

No doubt, this is your major concern. The most important matter to deal with is to pay off any credit card with a really high interest rate.

If you have to pay off several credit cards, always start by paying the ones with the highest interest rate, then the next highest and so on.

4. Your credit card bill – step two

If you can’t afford to pay your credit card right away, you might consider a reduced settlement with a low interest rate card to pay off the balance.

Please don’t make this an ongoing strategy; remember this is just a way to deal with your current financial situation.

5. Breathing space

Having given you some breathing space, we need to deal with the future, to ensure you don’t end up with debt problems later down the track . Begin by cutting up all your credit cards except one. Just keep the one with a lowest, interest rate and always, always, pay the amount due, on time, every month, or whenever it should be paid. Don’t be tempted to pay the minimum amount because that just increases your debt each month. You know it makes sense!

6. Moving forward This is the time to put your ‘wise’ hat on

With your financial situation looking less desperate, you must start a savings plan. It’s always a smart thing to do for many reasons, even if it becomes a ‘save your bacon fund!’ In the meantime, put aside any extra funds that come along, however tempting it is to spend it.

7. Become wealthier It’s perfectly legal to be ambitious, so go for it

This might sound easier said than done, but if you focus on your goals you will find opportunities will come your way. Think about your career and how you can move up the ladder and earn more.

8. When the debt problem doesn’t go away

Fortunately, when things are looking really gloomy money-wise, help is at hand. Don’t assume you have to declare bankruptcy, for example. This isn’t your best option – ever. Professional help is always available, even if the banks aren’t interested. ChapterTwo are specialists in guiding you through the hard times and helping you come out the other side.

In Summary

As you can see, Christmas debt problems aren’t insurmountable; you just need to deal with them rationally and, as soon as you can. Then, when you’re back on track, remember the lessons you’ve learned. Stay with the program and you could be set to be in control of your finances for life.

It’s a question that never goes away and, because it will ultimately be your decision, it’s essential you weigh up all your options before signing on the dotted line.

Buying a property is likely to be the most significant monetary purchase you’ll ever make, so it’s worth putting the time in first, because it can have major financial implications for many years to come.

Fixed or adjustable?

1. Fixed rate

Pro’s:

• You don’t have to stay awake at night worrying about the next rate rise.
• You think you will stay in the same home for a long period of time and hope to pay off your mortgage.
• You are lucky enough to buy at an opportune time with low interest rates, so it will be cheaper over the long-term.
• You’re worried a rate rise could be unaffordable for you.

Cons:

• When there’s a rate cut, it won’t benefit you, which can be annoying
• Less agile: fixed loans can be liable to extra fees if you change or sell your home before the fixed rate period is completed.
• Fixed loans can be more restrictive if you want to increase your payment at anytime. They can be either disallowed or be subject to fees.

2. Adjustable (variable) rate mortgages.

Pros:

• You think lower rates may become available in the future, and you can take advantage of them.
• You believe you are likely to move after a shorter period of time.
• If rates drop, you have the potential to adjust your mortgage accordingly.
• You think you might invest elsewhere, so don’t want your home to be your sole investment option.

Cons:

• No set price means you may need to readjust your monthly budgeting.
• The rate could rise to the point where they become unaffordable.
• Unpredictable – the rate can go up and down, or just keep rising.

3. The best of both worlds.

Nowadays, the competitive home loan market has opened up your choices and, for many people, a combination of both a fixed and an adjustable mortgage is a popular option.

It means you can fix the fist portion of the loan, such as for the first 5 years, and then the remainder of the mortgage is subject to the market rate changes. Alternatively, you could go for a 7 or 10 year fixed rate, before they become adjustable.

There is even (for a 30 year loan) half and half option – with a 15 year fixed rate, followed by an adjustable rate thereafter.

4. What about YOU?

The majority of people seem to move more often than they used to, so flexibility is important. If you think you’re likely to move in, say, 5 or 6 years, you need a mortgage that allows you to do that with incurring extra fees or penalties when you choose to move on.

Also, if you think you might be able to afford it, make sure you select a mortgage that allows you to make extra payments. This can potentially save you many thousands of dollars over the long term and allow you to own more or all of your home sooner.

Remember, when you are shopping for a home, to shop around for the best mortgage deal out there for you. There are banks, credit unions and independent mortgage operators all keen to attain your business, so take your time and don’t sign until you’re completely happy.

We all develop regular habits, some good and, probably, a few that we should shake. Nevertheless, when it comes to your financial health, it’s strongly recommended you should develop some daily habits to ensure your security and future success.

1: Once a week – your financial catch up

Each week name a specific day and time you will ALWAYS review your finances. We all live busy lives and so it’s imperative to nominate a specific window to assess exactly where you stand. Make this catch up part of your weekly routine, because it will help you avoid being caught out by an unexpected incoming bill, or a potential overdue payment that will result in a higher interest charge on your account.

2: Daily – keep it simple

Whenever possible, pay online and for regular monthly payments, like for rent or mortgage payments, arrange for auto payments, so they can’t be overlooked.

3: Daily – inspired reading

Some great books have been written on how to save, manage or generate money, so why not inspire yourself with great ideas? Do your research and then make the book of your choice part of your regular reading routine – say, a minimum of one chapter per day.

4: Daily – be organised

• • Open all your bills when you receive them and keep them together in one file, so you know where they are, what you owe and when.
  • Always read your incoming credit card statements carefully. Mistakes do get made and it’s a good habit to check all your payments first before you settle your account.
  • When you pay credit card bills, NEVER pay the minimum because that’s a sure fire way of committing yourself to paying the maximum interest rate.

5: Daily – keep your wallet thin

Don’t carry around wads of cash. Keep a minimum amount on you to pay for daily expenses, but not enough to let you be tempted to overspend.

6: Monthly – create a budget

Look at the big picture and decide in advance what budget you should allow to spend each month. Break it down to Household, Personal, Home, Transport, Socialising, Savings etc. Then, stay true to your pre-set budget and review it weekly (see No 1).

7: Daily – bring business savviness to your household

Run your household expenses like you’d run a business – never impulse purchase, look for savings whenever possible and always compare costs carefully before making any purchase.

8: Daily – cut out ‘extras’

It’s all too easy to overspend as soon as you leave the front door – buy a newspaper, a coffee, a sandwich, a beer, cigarettes, drinks, magazines, gambling, and so on. They can all be either reduced or cut out altogether, so just do it. Put the money you save into your savings fund instead.

9: Monthly – pay off your credit card debt

If you can’t afford to pay it, you can’t afford to buy it! Better still, just use a debit card instead, so you don’t run up credit card debt at all.

10: Daily – think about your end goal

We all daydream – owning a dream home, a dream boat or car, going on a dream holiday. A dream is the ideal way to focus on your personal financial plan to make your dream become a reality.

Start developing your habits tomorrow

Modern living ensures that we’re all busy and the best financial intentions often become lost as we struggle to keep our heads above water. In next to no time, bills pile up, expenses go unchecked and, when it all unravels, it’s often too late to correct the situation without doing something drastic, like selling the car, or home.

However, if we make our financial checks part of our daily routine, it’s so much easier to stay on course. Don’t let it slide until tomorrow, or next week, start developing your new habits today.

Nearly everyone, regardless of how much they earn, likes to complain about the high cost of living. It’s understandable, yet it’s also possible to make your own cost of living substantially lower by living more frugally.

While this might sound unappealing at first, you might discover your life is just as much fun, but much more economical.

Not convinced? Well, here are 12 thought-provoking ideas to help keep a lid on your everyday costs:

1. Buy in bulk

Do some planning and figure out all the essential items you buy regularly, things like toilet paper, paper towels, butter/margarine, tea, coffee, cleaning products, washing powder, etc.

Don’t pay the premium prices at the supermarket, but buy in bulk instead – you’ll be amazed how much you can save.

2. Buy generic, not ‘Name’ brands

We all know they’re likely to be identical, so why pay much more for a familiar label? You can save lots of dollars every time you shop just by resisting those famous brands.

3. Eat out less

When you look at how much you spend in restaurants and cafes, you might be shocked. The best alternative is to eat at home more and discover how much fun cooking can be.

Another benefit is how popular you might become when you invite people to eat at your place.

4. Don’t throw food away

Most of us only eat a small portion of the food we actually purchase, the rest it just thrown away. So, rather than discarding food that’s sitting in the fridge make a point of eating it instead!

Sometimes you can re-think how a meal is served. Roast meats, for example, can taste even better when cold and served with a salad.

5. Don’t buy takeaway for breakfast or lunch

Another easy way to save money is to avoid simply grabbing a coffee and a muffin (or whatever) in the morning and then a sandwich at lunchtime. Just add up what you might spend in a week and you’ll be shocked at how much it adds up to.

To save money, eat fruit, yoghurt, toast or cereal at home, or make it when you’re at work.

For lunch, plan your meals and bring your own sandwiches, soups or salad pre-prepared so you’re not tempted to go shopping. Top tip: Lunchtime is another great time to use those leftovers you were going to throw in the bin.

6. Watch out for expiry dates

How much food do you not eat because you it’s past its expiry date? A lot is the likely answer. Think of how much is wasted so, next time, just check the dates and make a point of eating and drinking more of those great things you have in the refrigerator.

7. Savvy clothes shopping

Today it’s much easier to buy smart, fashionable clothes without spending a fortune. Don’t rush to buy new clothes as soon as they’re in stock because you’ll be paying a heavy premium for the privilege.

Online shopping means you can save hard earned dollars by not having to travel to the shops, saving money on transport, car parking, or hefty parking fines. Sales? To encourage buyers almost every clothes retailer will be running sales, or low cost offers, all year ‘round. Take advantage of them, rather than paying full price.

Other great alternatives are pre-loved clothing stores, where even the hip clothes bloggers now hunt for bargains. “Vinnies” has become the new Versace.

8. Cut energy costs

This is another easy way to economise:

• Reduce your heating bills by wearing warmer clothes
• Shut your doors and close curtains to retain heat
• Insulate your home
• Unplug your power chargers/phone charger – they consume power even when you’re not charging
• Switch to energy efficient bulbs – they really work!
• Use the economy cycle on your washing machine
• Don’t use the tumble dryer, use a clothes rack

  9. Cancel your pay TV subscription

  A big expense you can probably do without. Let’s be honest, there’s a world of alternative of cheaper entertainment available online if you must seek out visual entertainment.

  10. Re-discover your library

  They have thousands of fantastic books you’ve never read and, what’s more, they’re all free. Great books are still fantastic entertainment and, never underestimate how smart you sound when you discuss your favourite authors at parties.

  11. Gyms – who needs them?

  They’re full of sweaty bodies and are usually over-crowded, not to mention extremely expensive. If you want to keep fit why not do your favourite exercises in the great outdoors known as your local park. Or, if you live near the beach, work out there instead.

  It’s free, doesn’t need air conditioning to make it smell good and, if you don’t go, you can console yourself with the knowledge you won’t be paying those sky-high membership fees.

  12. (Almost) free parties

  Throw ‘Bring a Meal” parties, so all you have to provide is one dish and that bottle of red someone left behind from your last party. Just send out the invitations and sit back. You can look generous, make new friends, catch up with current friends and enjoy the great food and drink provided by your guests.

  13. Save on gas – don’t drive.

  If you live in a big city, you’ll have the option of professional or private car sharing services whenever you need wheels.

  The rest of the time, there’s public transport, walking or maybe a bicycle.

  All of these options will save you purchase/lease costs, insurance maintenance and fuel costs.

  This is just the start of a new way of living

  These tips are the be all and end all. If you think about where your money goes, you’ll be sure to think of countless ways to seriously cut your living costs, without making your life any less enjoyable. Indeed, in many respects, it’s likely to be enhanced.

  Or, look at it another way, what you save could help pay for something really special, like a trip overseas or a new house.

What was your earliest lesson about earning or saving money?

Did your parents give you an allowance as long as you cleaned your room?

Were you the entrepreneurial type, setting up a cold drinks stand on a hot summer day? Did your great Aunt give you $5 every Christmas (even in your 20s) and tell you to put it away for a rainy day?

There’s no doubt that our early memories shape what we are today. If you could turn the clock back, what would you want to learn from a younger age? And if you’re a parent, what should you teach your children?

1. There’s no such thing as money for nothing.

Parents who just hand over money or an allowance to their children are setting them up for failure. Make sure the money is earned, not given.

2. Make gifted money special, not the norm.

Money given as a gift should be carefully considered rather than the victim of wanton spending. This puts true value on the gift, even if the decision is to save it.

3. Really understanding what credit means.

Young minds can’t grasp the concept and often initially see it as ‘free money’. Comprehending that the money is borrowed and needs to be paid back – with ‘interest’ (another concept they should understand) may take some explanation – even to adults!

4. Have an end goal in mind.

Whether you’re saving for a One Direction album or a down payment on a home, delayed gratification can also be beneficial in other areas of life.

5. Always have an emergency fund.

Life is full of uncertainties. The roof may leak, or One Direction may release a surprise album!

6. With money comes responsibility.

This is a take on the quote ‘with power comes great responsibility’. Money is not a self-fulfilling prophecy. In taking care of yourself you are also taking care of the greater community. Perhaps a bit deep for a five year old but an important lesson nonetheless.

7. Making choices.

We do it all the time based on our finances. The sooner this is understood, the better the transition is to ‘the real world’. Taking this one step further, if children are involved in family decisions – “should we as a family go to the cinema or wait until it’s released on a streaming service and put that money away for our family holiday?” is one example.

8. Literally watching your savings grow.

Money accruing in a bank is an abstract concept, even for adults. The digital age makes it near impossible for really young minds. That’s why the good old-fashioned piggy bank or money jar is the perfect way to start.

When it comes to finance, you can never stop learning. So follow these steps –they’re so easy, even a child could do it (so there’s not excuse for you).

It’s all too easy to spend more than you bargained for over the Christmas period. Let’s be honest, the temptations are everywhere: the added social engagements, the parties, the advertising (just 10 shopping days left!) that seems to bombard you at every turn and, of course, there are all those presents you are expected to buy for your loved (and even not so loved) ones.

Make no mistake, the pressure is on to spend money like water, or to be considered mean-spirited and possibly scrooge-like.

The truth is, you don’t have to spend excessively and, if you use a little imagination and budget sensibly, you can survive the whole festive season, without having to empty your bank account before 2016.

1. Free money

Yes, you are probably surrounded by stuff you don’t like, don’t want, don’t use, so why keep it? Sell it, on eBay or Gumtree, or similar. You might be surprised how much you can make from stuff you’ve probably forgotten about. That old antique that doesn’t look good with your new design ideas. The exercise bicycle gathering dust, etc., etc. 

Next, gather up your loose change and throw it into the Coin Counter at your bank, it might add up to a pretty penny. So, it’s like free money, making your Christmas spending budget look healthier right away.

2. Think inexpensive

It doesn’t mean you are cheap, it means you know how to shop wisely. Start by making a list of the presents you HAVE to buy to avoid becoming a social pariah. Then start working out how to save money without anybody noticing. You’ll be surprised how you can buy essentially the same object at a fraction of the price just by doing some canny online shopping research first.

3. Never, ever, just wander into a shop

You might as well have ‘sucker’ written on your forehead. Always do your homework and make a list of the items you’re looking for. Then do an online search to see where you can buy those items for the lowest price. The chances are someone somewhere has the gifts you need on sale. Or, someone else has an unwanted gift exactly the same, or similar, they can’t wait to unload at a bargain price. Online shopping destinations such as Gumtree and eBay are ideal starting points for your search.

If you’re looking for cameras, domestic appliances, bicycle and other similar items, check to see if the previous model is available a sale price. If it’s basically the same item, as they often are, why not buy the one on sale?

4. Insider tips

Lots of fancy gifts are worth a lot less if they don’t come with the right box, especially online items. Posh perfumes can cost a fortune, but not if the box is missing or damaged.

This is an opportunity to buy an expensive perfume at a bargain price. Just wrap it in a nice gift box, and tie it up with a beautiful ribbon (hopefully, she won’t miss the original box). This principle goes for a wide range of expensive items – they are much cheaper if the packaging is damaged or not available. And, once it’s been torn open by the lucky receiver, it’s hardly an issue is it?

5. “I don’t have a clue what to buy”

There’s a number of potential gifts almost anyone will be happy to receive:

• Books – they look great, they can provide hours of pleasure, suggest the receiver is intelligent, well read and, nowadays, even the most impressive volumes are relatively inexpensive.
• Flowers – a personal gift that shows how much you care. They’ll look stunning, even if they don’t last too long.
• Cinema tickets – only the committed misery chops wouldn’t be happy to receive some tickets to see the movie of their choice. A pack of cinema tickets are never a bad choice.
• Alcohol – if you know the recipient doesn’t mind the odd drink, you can be sure another bottle will be happily received and consumed at some point.
• Gift cards – okay, it does suggest you aren’t the world’s most imaginative shopper, but it’s a safe choice and avoids making an expensive mistake.

6. The Two Dollar Store

Who hasn’t wandered into a bargain store and not been amazed what you can get for so little money?

When you shop at these stores, you should spend recklessly, like you’re made of money. See a set of tools? Go crazy and buy the toolbox too. The chances are you’ve still spent less than $15, but appear to have spent far, far more. These aren’t the best shopping destination to buy presents for your nearest and dearest, but ideal for distant relations, friends and ‘tree’ presents.

7. Early sales bargains

Another no – brainer for those looking for impressive presents that don’t cost the earth.

Every year the festive season sales seem to start earlier and earlier and the traditional January sales now appear to start in December. All the major stores are keen to clear their existing stock and you’ll be surprised how many great deals are available if you start looking a week or two before Christmas. Just don’t expect to find the best options on Christmas Eve – shop early to nab the very best bargains.

8. Photographs and Memorabilia

There are some presents that are worth more than money. For example, old photographs are often seen once and forgotten for years, even decades. Yet most people would love to see them again.

If you have some great photographs tucked away in a drawer, why not spent some time hunting for some old favourites and have them framed. Or, find a few of a similar size and have them framed as a small collection.

Every thoughtful, personal gift will be treasured forever and, again, it needn’t cost much at all. You can save even more and buy some DIY frames. Job done.

9. Give to a charity

There’s always pressure to appear to be generous, by buying an extravagant present. If you don’t want to compete in the shopping rat race, why not donate money to a good cause? There are thousands of people in need and who can complain if you announce you are donating your spending money to a favourite charity? In truth, if we all chose to spend money on a charity rather than on gifts, we could solve many of the world’s poverty problems faster than we do now.

10. “I’m desperate for cash”

If you really need extra cash to buy a special present for someone important in your life, you could consider one of the 0% interest cards on the market. There are a few to choose from and they can be a convenient way to purchase gifts, if used wisely. To avoid building up a potential credit problem, make sure you pay the full sum before the stated repayment deadline and DON’T be tempted to use the card to make further purchases. The easiest solution is to arrange regular monthly repayments with your bank debit card to ensure it all happens automatically. Another problem solved.

In conclusion

The festive season is meant to be a time of fun and enjoyment, but it all comes at a price too. For many people, shopping for the festive season is a yearly nightmare.

Nevertheless, as these top 10 tips prove, if you plan a little earlier and think outside the box, you can make everyone happy without spending that fortune you don’t have.

Where to start?

We all know we probably spend more money than we need to and, when we seem to be dong well financially, it’s easy to have a cavalier disregard for where our money’s going.

Now, there are lots of reasons to save:

• You might be feeling the pinch and have too many bills to pay
• You could already have financial problems and an increasing amount of debt
• You’re feeling desperate and think you might be heading towards bankruptcy
• Or, you may simply be saving up for something important – a car, holiday or even a home.

Whatever situation you feel you’re in, it’s always wise to plan how you can avoid spending more money than you might be earning. So, here are some ideas you might want to consider to help you get back on your feet, or perhaps avoid money problems in the first place.

In truth, there are hundreds of ways to spend less and the best way to start is to make a list of the savings you think you could live with easily. Not all savings need to be painful. Quite the reverse, some lifestyle changes can actually be more fun than the expensive alternatives.

These ideas are in no particular order, so cherry pick whichever example sounds good to you:

I sell my car?

Cars can be great and very necessary for some, but not everyone needs to rely on them ALL the time. And, let’s be honest, they can eat up cash fast, with fuel, running expenses, repairs, insurance etc. You don’t have to sell it (if you’d rather not), but perhaps you could use it less.

• Car sharing. If you live in the city, there are many other choices. Car sharing schemes allow you to just borrow a clean, modern car (or van) when you need one, but not share the burden of running costs.
• Public transport. Depending on where you live, you could use public transport (our PM seems to enjoy it!).
• Get fit. Cycle or walk more so there are fitness benefits too.
• Carpool. Do you know someone who lives and works close to you? If you can, it will be very sociable to commute and will save money too.
• Other options. Or, consider some transport alternatives – electric bikes, scooters and motorbikes are all cool nowadays and cost much less to own and run than a car.

Should I eat or drink less?

Yes, we all need them both, but too much of anything isn’t great for your health, or your finances. This is where you can save money without making real a major sacrifice. For example, do you buy your breakfast or lunch at a café most days of the week? Then just count the cost per month – the chances are you’ll be shocked.

• Breakfast. You can start by eating breakfast at home, or taking it to work. Drop those hefty muffins/cakes and think about buying of buying some cheaper, healthier alternatives from the supermarket. Think yoghurts, healthy breads (for toast), porridge, muesli, cereals or fruits, all foods you can eat anywhere, at home or work.
• Coffee. Coffee costs a fortune in good cafes and coffee shops. One option is to buy a good coffee machine. Used regularly, it will save you plenty of money over time. Do you really need those $4.00 espressos several times a day? Just two a day costs about $3000 per year! Your own coffee maker is much cheaper, so it could be a wise investment.
• Lunch. Without even thinking about it, you might be buying the same lunch that you could easily make at home and bring with you. Even if you only do it two times a week, bringing a sandwich, salad, stir-fry or just leftovers from last night can save close to $100 a month.
• Eat out less in general. Food can cost even more, so if you eat out all the time, you’re literally eating up your money at an alarming rate. Whether it’s takeaways, or eating in restaurants, you might be shocked at how much you spend in total.

Sure, a trip to Macca’s or the local pizza joint isn’t too pricey, but they aren’t the healthiest, or most desirable choices on a regular basis.

The reality is it isn’t hard to eat really well AND save money. The most obvious way to go is to cook more at home. Almost anyone can learn to cook simple fare that tastes great and costs less than eating out. Look at all the freezer food choices available and keep some frozen favourites available when you need them. The world has gone cooking mad, so you can find out a zillion easy to cook at home recipes online. With practice, your cooking will improve and you’ll be able to impress your partner or friends whenever.

Treat yourself – occasionally.

With the money you save eating at home more, you can afford to eat out now and then without breaking your monthly budget. And, you’re likely to be more appreciative of the experience when you eat out less often.

Alternatively, rather than going to your favourite fancy restaurant, check out what’s on at the movies, go to a bowling alley, ice-skating, check out the local exhibitions, art galleries or local music scene. Good fun doesn’t have to cost a fortune.

Are you a social drinker? Well, you might be spending a lot more than you think at your local bar. Again, if you’re spending too much on alcohol, you can either drink less, or drink at home. Then invite your friends and invite them to bring a bottle.

If it’s still eating up your cash, you can work towards a dry week now and then, or check out those bargain bins at the major bottle shops. Wine connoisseur? You might have to rely on the generosity of your friends!

What else?

Modern living is expensive, but when you put your mind to it, saving can be made quite easily, especially around the home.

• For example, don’t just switch on the air conditioning when you feel too warm. Open some windows and switch on a fan instead. And, if you feel cold, consider wearing warm clothes rather than turning the heater on.
• Don’t leave all those electrical items switched on, they’re causing your power bills to be too high. Go around the house and switch off EVERYTHING unless you need it.
• Cancel all those subscriptions – you can live without them for a time. Pay TV and media subscriptions can be costing you a fortune.
• Cancel the gym membership too. Running, walking and swimming needn’t cost a thing.
• Don’t go shopping unless you have to, so you avoid temptation.
• Wash and iron your clothes whenever possible.
• Spend less time on your mobile phone. Life will go on.
• Sell stuff – you’d be amazed what people will buy on Gumtree and eBay.

Needless to say, there are many ways to live a cheaper life if you put your mind to it.

Still spending too much?

Being budget-wise isn’t necessarily the answer, of course – if you are living frugally and still can’t make ends meet, you might have to make some bold moves. For example, you might need to find a job that pays more, move to a cheaper suburb, or maybe even a cheaper place.

Whatever your situation, you’ll be surprised how good life can be, even when you are spending less.