The A-Z of keeping financially fit!

Adopt these 26 bank balance-friendly habits today and your next destination could be a bright financial future

Adopt a motto
Creating financial rules of thumb to guide your spending decisions can help you change bad money habits, according to a recent report by behavioural economist Dr Hersh Shefrin. So when you’re out, instead of telling yourself “I deserve this jacket”, try “I deserve the financial security of adding $200 to my savings account”.

Become resourceful
A latte-a-day habit costs about $1500 a year, so why not buy a second-hand coffee machine and make your own? Ditto preparing your lunch, mending garments and exercising for free outdoors. 

Carry cash at all times
It’s too easy to overlook what you spend each week when you don’t feel the pain of handing over money. This is exactly why you should forget EFTPOS and rely on cash. Not only will you be conscious of just how much you’re shelling out, but the dwindling amount in your purse will often inspire you to rein it in.

Develop a daily spend figure
Work out how much money you need to go about your daily life and use this number as your “trigger”, wealth strategist and founder of Energise Group (energisewealth.com) Barbara Turley suggests. “Once you go over this daily figure, you’ll immediately know that you’re getting into discretionary or non-essential spending,” Turley explains. “Use this trigger to stop and ask yourself if what you’re about to spend your money on is driven by need or emotion.” 

Earn more than you spend
Even though actress Keira Knightley is reported to be worth more than $50 million, she says she pays herself only $50,000 a year. While this might seem like overkill, she’s touching on the rule many of the world’s wealthy subscribe to: spend less than you earn. 

Find a planner
Regardless of your financial situation, it’s always worth seeking outside professional help for the occasional fiscal health check. We can assist by putting you in touch with a financial planner to help you get to where you want to be faster!

Gaze into a crystal ball
How much do you need to comfortably retire? Work out what that figure might be and use it as your key financial goal. One way is to multiply your current annual living cost by 20 and you’ll arrive at your magic number. 

Hedge your money bets
Don’t put all of your money into one investment. Have considerable savings? Rather than investing it all in stocks or leaving it in a high-interest online account, consider allocating a portion in managed funds and putting some in a fixed-term deposit.

Increase super contributions
Most Aussies fail to recognise they’re already investors, Turley says. “[Super] is a living, breathing investment fund which requires your interest and attention.” Start putting an extra measly $20 into your super each week and, assuming you’re in your 20s and the interest rate hovers around the 5 per cent mark, you could end up with an additional $230,000 by the time you retire. If you’re 30-something or older? Increase your weekly superannuation contributions by another $10 or so.

Justify service providers 
Are you really getting the best deal with your insurance and utilities? Make them work for your dollar by conducting annual reviews on service provider comparison websites, such as iselect.com.au or canstar.com.au, then switching to suit.

Keep payments consistent 
Don’t take interest rate falls as a sign to decrease the amount of your mortgage payments. Continue to pay the same amount you always have and, not only could you save tens of thousands of dollars, you could also shave years off the life of your mortgage.

Learn to pay yourself
As soon as you get paid, transfer money into an investment account. This is a far more successful method of wealth creation than paying your monthly bills and expenses first, and then investing what’s left over (if anything).

Make time for money
It’s important to be across what’s happening in your personal financial world. Whether it becomes a daily or weekly habit is up to you, but create a regular “money minute” where you go online and check your recent transactions and track your progress towards your financial objectives. 

Negotiate a better price
The key to getting something for less than the advertised price is simple: you only need to ask for it. Department store managers and service providers can always slash the marked prices and, if they can’t, they might be able to throw in a few extras for you. 

Offset your saving
Got money sitting in online savers or term deposits? You may want to consider parking that money in your mortgage offset account, which could be a better option. Doing so can significantly reduce interest costs, in contrast to being taxed on that same amount of money in a savings account.

Protect your assets 
Take steps to protect your income source and assets. Some options are income protection, and home, contents, disability and life insurance.

Question everything
Ask questions if you’re unsure of something. A common trait of successful investors is that they never let pride or fear of feeling judged get in the way of finding the correct information. 

Review bills and statements 
Open every bill and bank statement as they come in and carefully go over each word and figure. You’re looking for unauthorised charges, billing mistakes and sneaky fee increases. The quicker you’re onto it, the easier it will be to rectify. 

Save little, save often
It’s the kind of tip your grandparents would give you and it’s worth repeating now. You don’t have to shift thousands to create sizable savings, but be disciplined in putting aside small amounts regularly. Even saving $2 a day can buy you a return airfare to Hawaii in 12 months’ time.

Tackle your debts first
There’s no point in saving money or putting extra on the mortgage if you have credit card debt. When it comes to debts, always tackle the ones with the highest interest rates first and, if you have more than one, look into consolidating them to make payment more manageable. 

Use your ATM
Download the ATM Hunter app to your phone to find your bank’s ATM and avoid paying a $2 fee every time you use another bank’s machine. 

Visualise your passion
The secret to making money lies in doing what you love, according to success coach Niro Thambipillay. Ask yourself what you’re passionate about, then monetise it.

Write it down 
Do you like the sound of a 33 per cent higher chance of achieving your financial goals? All you need to do is write them down and share weekly progress updates with a friend, according to a study by the Dominican University of California. 

Examine your relationship with money 
We often treat money with resentment but shifting this mindset could change a financial outcome, Turley says. “Respect your money, pay attention to it and nurture it so it does the same for you in return.”

Yank all your bills into order
Organise for your bills to be paid automatically through direct debit. Not only will you never have to worry about overdue bills and associated interest costs, but you’ll also avoid those automated messages from companies seeking payment. 

Zzz on it
Emotional spending is the greatest barrier to financial success, so before you make a purchase, sleep on it for a night, Turley says. “This will dissipate emotion you’ve attached to the item and allow you to think clearly.” 

Much thanks to Dilvin Yasa at Body and Soul for this contribution.