Being independent can be a liberating experience. However, don’t let your new freedom lead to a dwindling bank account. There are easy ways to keep your cost-of-living down, but it will mean setting some rules and adopting new habits.
The idea of budgeting can be scary. It may seem difficult or complex, but it doesn’t have to be. Essentially budgeting can be simple if you want it to be.
A simple budget rule you could follow is the 50/20/30 principle. 50 per cent of net income goes to living expenses, 20 per cent goes to savings or investments, and 30 per cent goes to lifestyle choices and your social life. Whatever you don’t spend for that week, fortnight or month, put it in your savings or investments.
Give up a treat (or a few)
We all love our treats and indulgences, but our wallet will thank us if we cut back. Afraid to? Start with something small. Cancel a subscription you rarely use, have less takeaway or give it up entirely. It’ll all be much easier to give up if you think about the larger indulgence you’re saving for – maybe that weekend getaway with friends?
Track your spending
There are a lot of different personal finance apps and programs now that will track your spending for you. Using them will help you keep track of where your money is going. When you see how much you spend on coffee each month, you’ll know to you need to cut down and take coffee from home instead. When you can see where your money is going, you know where you need to curb your spending and adopt some new habits.
Your trash could be someone’s treasure
Moving is a great opportunity to see what you have but before you donate or bin something, see if you can sell it. There are so many ways to sell your stuff such as through local forums, apps, eBay and Gumtree. Old phones, CDs, books and games can also be traded in for cash or store credit.
When moving into your own place, ask your family and friends – do they have some furniture, appliances or homewares they don’t need? You’ll be surprised at how generous some people can be. Whether you buy appliances or receive them as gifts, ensure you check their energy rating. A low energy rated appliance will cost you more in the long run as it sucks up energy and will only increase your bills. It would be worth investing in something with a higher energy rating. When buying curtains, get ones that are insulated to keep the warmth in in winter and keep the heat out in summer. This will also help to reduce your energy bills.
Shop around for deals on electricity, gas and water. Figure out your household requirements and find out what’s on offer. If you sign up for a discount, make sure it will actually save you money in the long-term. Revisit your contracts often and beware of electricity’s “lazy tax”.
If you want to pay monthly, have an easier way to organise your funds and only pay for what you use, give Elysian Energy a call because we deliver exactly that. Call us on 03 8630 2825.
It may take a while to find your feet financially so set yourself some financial rules and goals and stick with them. Always follow the golden rule; do not spend more than you can afford.