Ways to Grow Savings That Actually Work

There are many reasons to grow your savings—to pay for the kids’ education, purchase a family home, go on a big holiday overseas, get out of debt, plan for retirement, and plenty more. 

But for some, the outcome is overshadowed by the perceived journey. In short, many associate savings with austerity and sacrifice. ActOn Wealth financial planners often meet new clients burdened by this misnomer, and we’re here to help.

We’ve created a helpful guide of financial saving tips that are easy to adopt and can be scaled to any amount. What makes these small tips so mighty is they’re achievable. We believe that friction and finance don’t go together. Positive financial planning is about removing barriers, adopting positive but effortless behaviours, and sitting back to watch that balance grow and grow. 

So, start your savings plan with this great advice…

Savings Tips That Make a Difference 

Start Saving Early and Frequently 

This is one of the best savings tips, as it helps establish positive behavioural patterns. 

You know the saying, “Look after the pennies and the pounds look after themselves”? It’s a cliche for good reason—it works. Setting aside savings here and there in small amounts can feel inconsequential at the time. However, keep at it, and you will soon realise just how significant these savings can be. 

Let’s take a classic Melbourne cultural experience – the daily coffee. We’ll assume you go to a cafe for your regular caffeine hit, so you’re probably spending somewhere around $5 a drink. Let’s say you decide to DIY your coffee at home or work on weekdays and head to the cafe for weekend coffee only. Instead of paying $5 daily to the cafe, you set up a coffee saving fund in your bank app. 

Within 12 months, you’ve saved £1,300, minus the cost of your DIY coffee beans and maker (which is considerably lower provided you don’t opt for a barista set-up!). And you’ve done it with hardly any effort at all. 

Understand and Control Your Cash Flow

Cashflow management can have a monumental effect on your savings. We consider it a foundational building block for most of our client’s wealth-creation strategies. Getting your head around your incomings and outgoings and making the necessary ‘tweaks’ here and there can be literally life-changing. 

Many clients experience a near-like epiphany when they realise they can control their cashflow rather than have it control them. And it can be achieved with little sacrifice. It all comes down to understanding your goals and making adjustments to achieve them. 

Our financial advisers in Melbourne are cashflow management magicians—they have the ability to track your spending (with no judgement!), get right to the core of what you want and help identify where you can make small changes in how you save and spend money. It’s truly game-changing. 

Become Friends With Compound Interest 

Compound interest is very good company to be around and one of the best ways to grow savings. Put simply, it is interest earned on interest. So, let’s say you put $1,000 into an account that earns 5% interest. By the end of the first year, you will have $1050. By year two, $1102.50, etc. The longer your money compounds, the greater the interest you earn. And again, you’re doing it without feeling any sacrifice. 

Apply this idea to your real-life scenario; use our compound interest calculator to see what you can achieve. 

Prioritise Your Superannuation Fund 

Superannuation planning is one of the most significant ways to increase savings. If you’re an employee, your employer will be making compulsory payments into your superannuation fund. Whilst that may feel like ‘money for jam’, you can also do your bit to maximise these funds. For example, making salary sacrifice voluntary contributions is a tax incentive, so you have double the motivation. 

It’s important to remember that the total combined amount of your employer and salary sacrifice contribution cannot exceed $30K otherwise you will be taxed. Speak to our superannuation specialists for the best advice tailored to your financial situation.

Protect Your Savings 

Whilst this might not be a savings tip per se, you need to factor it in. After all, what’s the point of increasing your savings if you don’t look after it? 

Let’s say you’re doing an exceptional job of growing your various pots, and you’re on track to achieving your long- and short-term goals. Then, out of nowhere, you lose your job, or become ill and have to resign. What happens now? How do you keep all the wheels turning? Chances are, you will need to dip into your savings. 

So far, we’ve outlined some very effective and fairly effortless ways to grow savings, so you haven’t exactly sweated things up to this point. It’s not as if you’ve made huge sacrifices up until now. However, you have started to see the fruits of your easy labour. Figures have been growing nicely, and virtual piggy banks are fattening up. Dipping into these dollars can be deflating and even heartbreaking; your goals are slipping away with each withdrawal you make. 

Unless, of course, you’ve been cautious and planned for this eventuality by taking out life or income insurance. Our Melbourne financial planners can offer tailored insurance advice for your situation. 

Audit Subscriptions, Memberships and Other Automatic Payments

You’d be surprised how much money you can claw back with a life admin audit. Unnecessary gym memberships, pay TV channels, streaming services etc, can be fantastic ways to increase savings. Sure, there might be a little effort involved in identifying them all (that’s something else our financial advisers can help you with), but it will be worth it. 

Automate Your Savings and Round-Up Transactions

Setting up an automated monthly savings transfer means you don’t have to think or act. The money you might have spent disappears before you even see it, going instead into a high-interest earning account. 

Rounding up is also a great savings tip and something you can set up in most banking apps. This feature means you can round up any payment transactions and divert the difference to a savings account. For example, that weekend coffee we mentioned earlier might be $5.20. Your app can be set up to round it off to $5.50, with the 30 cents going into savings. Sounds like small fry, we know, but remember the cliche about looking after the pennies. The simple savings tips are often the most effective! 

Consider a Blocked Savings Account

Not sure you have the willpower? A blocked savings account can take care of that! This type of bank account prevents or penalises you from making withdrawals. 

We hope you agree these are all manageable and effective ways to increase savings. Our team of experienced financial advisers is always available to help you build wealth with a solid, tailored financial plan.  

What Are the Benefits of Saving? 

No matter your age, income, point in life or goals, there are always benefits to saving money. These could include:

• Relieving your family from financial burden. 
• Better mental health—feeling secure and having peace of mind. 
• Being able to provide for you and your family (education, family home, etc). 
• Establishing financial independence. 
• Building an emergency financial fund to deal with the unexpected. 
• Facilitating a better quality, longer or even earlier retirement. 

Contact Us About Ways to Grow Savings and More

Convinced? It’s genuinely not that hard to make big, positive changes in your savings and financial goals. Speak to our team today for a no-obligation, no-cost initial meeting and see how we can help you get ahead.