Get Smart With Money


Budgeting and Saving 101

Let’s face it – thinking about budgeting and saving is pretty uninspiring. But unfortunately, it is important. It’s not about watching every cent, but rather developing a realistic idea as to how much money you spend compared to how much you earn in order to ensure you’re able to afford the things that are really important to you.

Orange and brown coin purseBudgeting

Have a close look at your current spending habits. Think about writing down everything you spend over a week, or even better, a month. That’ll give you a good idea as to where your money goes – you might be surprised at just how much you spend on things you could probably easily do without.

Moneygirl recommends

MoneySmart – budget planner

The Australian Securities and Investments Commission’s website MoneySmart has a fantastic budget planner that you can fill out. It’s very thorough, so you’ll be able to see clearly where your money goes and how much you could potentially save every week or month.


Think about how you can cut out non-essential spending. There are a million ways to do this and you probably have a few ideas already. Whatever you do, don’t go to extremes – you’re more likely to give up if you set a budget that’s too tough. Remember that even cutting out tiny expenses can make a huge difference in the long run. If you need inspiration take a look at a compound interest graph. It shows how a small amount of money saved on a regular basis can add up to a fortune over time.

Experts often stress that the best way to save is to set aside a small amount of money you know you can afford and have it whisked away from your bank account every month by setting up a direct debit to a separate savings account. Theory is that if you never see it you won’t miss it (and you can’t spend it!) and that’s a good thing. How much should you save and where should you invest it? That’s up to you, but it’ll depend on your personal situation and goals – more on that later in Setting Your Goals.

Moneygirl recommends


Online savings calculators

Most financial institutions now have great easy-to-use savings calculators that will help you work out how much you can save over different periods of time.

MoneySmart – Savings Goals & Tips

The Australian Securities and Investments Commission’s website MoneySmart offers sensible tips and advice on ways to cut your costs and boost your savings. Have a look – it should give you a few ideas.


The Freecycle Network is a non-profit movement made up of thousands of members around the globe who give (and get) stuff for free from people in their own area.

Find a financial adviser

Check out the Australian Securities and Investments Commission’s website MoneySmart– it has loads of great information about obtaining personal financial advice and finding a qualified financial adviser. Experts often suggest you find an adviser who charges by the hour instead of receiving a commission.


>> Next in Budgeting and Saving – Credit Cards and Personal Loans

<< Previously in Budgeting and Saving – Budgeting and Saving overview

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8 Jun 2009 at 11:09 pm

Compound interest comparison link pretty interesting. Makes a good case for starting early.

10 Jun 2009 at 8:08 pm

You were right about that graph being a motivator. I better get started! Does this apply to saving or even more so to investing eg. in shares or managed funds?

14 Jun 2009 at 1:32 pm

It applies to all types of investment I think, because it’s all about how your money will grow if you keep reinvesting any interest earned (e.g. dividends from shares or interest from a term deposit, etc.). The more you earn (and reinvest) the more your money will grow!

14 Jun 2009 at 3:00 pm

Hey Lucy, if you’re new to investing, here are some good books you could try:

* The Barefoot Investor by Scott Pape (fun!)
* Flirting with Finance (new book just out by two Aust. women Virginia Graham & Anneli Knight)
* Making Money: The Keys to Financial Success by Paul Clitheroe (lots of good information)
*Smart Women Finish Rich by David Bach (US) (motivating, if a bit on the cheesy side!)

25 Oct 2009 at 12:47 pm

Budgeting eek!
I found that if I “pay myself” each week from my mortgage offset into an ATM account, then I learn to live off what’s in my ATM account without touching the rest. Key is to be realistic, otherwise like dieting its easily blown if the goals are too ambitious.

15 Jun 2010 at 2:16 pm

Is it best to pay off credit cards or a loan first before putting a little aside in separate high interest earning savings account or if you can put aside a little while still paying off your credit cards and loan?

19 Jun 2010 at 3:27 pm

Hmm… I’m no expert but I’d say that it doesn’t make a whole lot of sense to have money sitting in a savings account earning 5% interest when you’ve got thousands of dollars of debt paying something like 18 per cent interest. It is pretty hard to see your savings go to something as boring as loans payments etc, but I’d say that it makes the best sense to pay off all your debts as your number one priority. Anyone have any other ideas…?

30 Aug 2010 at 12:33 pm

[…] was browsing like a mad person through Moneygirl – (Yup big laugh there!) as i’m starting to budget for the future, when I stumbled upon […]

25 Nov 2011 at 8:30 am

Love Moneysmart website – you should check it out

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