By Alison Banney | Banking and Investment Expert at Finder.com.au
Having a clear savings goal is a great way to stay motivated to save money. Whether it’s a short-term savings goal or long-term savings goal, these five tips will help you stay on track and achieve it sooner.
1. Set a goal that you actually want to achieve
The first step to achieving a savings goal is having one in the first place. Before you can work towards meeting your goal, you need to decide what it is that you’re saving for. Your goal should be something that you’re personally motivated by. For example, there’s no point trying to save for a house deposit if you’re not sure whether you want to buy a property or not. You won’t be motivated to achieve it.
Figure out what it is that you really want to save for, and when you know it, write it down. Writing it on a post-it note and keeping it somewhere you’ll see it on a regular basis will help reaffirm your goal.
2. Do your research and be specific
If you’re saving for a house deposit, research the suburb that you’re hoping to buy in and look at the type of properties that you’re hoping to buy. If you’re saving for an overseas trip, look at flights and accommodation in the countries that you want to visit so that you know exactly how much money you’ll need.
That way, your savings goal won’t just be a random number and you’ll know the exact amount that’s needed to make your goal a reality. There’s nothing worse than hitting your savings goal only to realise that you don’t have enough saved to actually purchase what you’ve worked so hard to save for.
3. Make a realistic budget and timeline
It’s important to be realistic when setting your budget, otherwise you’re setting yourself up for failure. Don’t set yourself a goal of saving $2,000 a month when you know you can only comfortably save $1,000. Plus, remember to allow room for one-off unexpected expenses.
It’s also important to be realistic about your timeline. Take into account your final goal and your monthly targets and set yourself a strict but practical deadline. If your monthly savings targets and your timeline aren’t achievable, you’ll likely end up resenting the whole process and abandoning your savings goal altogether.
4. Compare savings accounts
It’s all well and good to have a well-researched goal and a realistic budget, but arguably the most important thing to consider is your savings account. Depending on your balance, you could save an extra few hundred dollars a year simply by switching to a savings account with a better interest rate.
However, the interest rate isn’t the only factor you need to consider. Consider comparing your options before making your decision.
5. Have regular check-ins with yourself
Make sure that you track your progress regularly to ensure that you’re staying on top of your goal. This could be monthly for longer goals or weekly for shorter goals. This also provides a good opportunity for you to reassess your budget and amend it if you feel you could save more, or alternatively loosen it if you feel it’s too tight. Regularly checking in with your progress also provides a good opportunity for you to celebrate your success so far, which will help keep you motivated.
As you can see, in order to set yourself up for success, quite a bit of work needs to be done before you can even begin saving for your goal. Dedicating time to figuring out exactly what your goal is, doing research and creating a detailed budget may seem like hard work, but it will help you achieve your savings goal sooner. If you want to chat further about what you’re saving for and how you can achieve it, visit your local BOQ branch.
About the author: Alison Banney is the Senior Banking and Investment Writer for finder.com.au. She is determined to help more Australians get excited about their finances through the use of clever content.