Over the years I have learned about and use many money saving tips that are relevant to living in New Zealand. I want to share these with you! To help you on your journey to becoming financially independent. So here are some money saving tips that will get you off to the right start.
Pay insurance annually
Insurance is necessary. But remember that insurance if for big unexpected life events- not small ones like breaking your phone. You need to be covered if a tree falls on your house. Or you accidentally crash into some CEO’s Mercedes.
Paying your insurance bill annually saves you money when compared to paying fortnightly or monthly. Just look at this insurance quote I just did online.
You can either pay $488.07 per year or choose the fortnightly or monthly payments. Fortnightly works out to be $541.32 per year, which will cost you $53.25, or 10% more. Instant 10% savings if you pay annually.
And that is just for one of your insurances. You will likely get the same savings for all your other insurance payments. Sure you might not have all the money up front, but all it takes is to set up an automatic transfer every time you get paid to transfer money into a separate savings account to cover your yearly insurance. And then next year you can get 10% off all your insurance premiums.
Use your car less
Not many people do the math on the full cost of ownership for vehicles. Car ownership is expensive. And it’s much more than the price of petrol. Only around 30% of your car-related expenses are for fuel.
I worked out what a car has been costing me over the last seven years and it worked out to be $5800 per year. And that is less than the estimate calculation done by the AA. Either way, your car is costing you thousands each year.
To save money you could start to bike to work a few days a week- which will save money and give you some exercise. You could minimize your car ownership expenses by sharing one car as a couple. There are many ways to decrease the cost of owning a car.
Avoid Going to the Supermarket
Well at least avoid going every other day when you are hungry.
You should try to do only one show a week, at a time of day that you are not hungry. If you go to the supermarket before a meal, you will tend to buy more crap.
You can even go further if you can’t resist overspending at the super market. With the invention of the internet, you can order groceries online every week. There will be stuff that you buy every week without fail, think milk, vegetables etc. This can be a standing order you do every week.
Then there are the non-perishable items, which make up the majority of the remainder. Try to buy bulk whenever they are on special. Canned goods can be up to 50% mark down and cleaning stuff can be heavily reduced as well.
When you are at the supermarket, try not to be brand loyal. When you need an item just buy the brand that is on special. And if the product is actually inferior (90% of the time you won’t even notice the quality difference between brands as many items are made in the same factory and just rebranded.) make a mental note to buy it again.
Plan You Home Cooked Meals
Cooking at home can save you thousands a year. You can cook at home and server a meal for around $1 to $2 dollars per serve. Compare that to buying takeaways at around $5-$15, and eating at a restaurant for between $15 to $30 per serve.
When you go to the supermarket every week have a mental plan of what you are going to cook throughout the week. This will help reduce food waste. Say pumpkins are in season- you buy a whole pumpkin for a few dollars. You need to plan a few meals around it. Pumpkin soup one night, roast pumpkin a few nights later. You get the picture.
I don’t think I need to elaborate any more on how much you can save by cooking at home as it’s common knowledge. The one thing I will say is that food is one of the big three expenses you will have, after housing and transport. So to make real money savings you should focus on the big three.
Eat Meat-Free… Sometimes
If you want to make more savings on your food expenses try eating 1 or 2 meals a week without meat. Meat is the most expensive part of any home cooked meal usually. Over recent years I have noticed even beef mince, which was a staple food for me as a university student, has significantly gone up in price.
There are many options for meat-free meals. Soups are the easy one that comes to mind. Carrot or pumpkin soup is really cheap.
I know going without meat might sound hard, or that I’m pushing a vegan agenda. Trust me, I’m not. I enjoy meat a lot. All I’m saying is that if you aren’t financially independent yet then can you really justify the luxury of meat every day. You need to live within your means.
Ask for a Better Deals
Every year you have the option to ask for a better deal from your ISP and power company. Usually, when you sign up for a term contract they will give you a bonus of some kind. Once that runs out, don’t do nothing. Ring up your service provider and ask what they can offer you.
Many of the deals that they advertise are usually for new customers. But I have found that if you ring them and ask for the deals they will either give you the deal or offer you something else. And in the rare case that they don’t want your business anymore, sign up with a competitor who is offering a deal- if the rates are comparable.
In my experience, all the internet and power suppliers in New Zealand offer the same level of service. I have switched so often I can’t even remember how many times. And it’s not that hard. The savings and bonuses will cover the cost of your time ringing them. A few months ago I rang our power company and got two months of power free in exchange for signing up for another year with them.
Stop Buying Coffee
That daily coffee has been the evil villain of personal finance for as long as I can remember. And for good reason. That daily coffee adds up. Coffee is around $5, and if you have one every day at work that is about $1200 per year.
Reality check! If you aren’t financially independent can you justify buying that coffee every day?
When it comes to vegetables and fruit you want to shop in season. At different times of the year the price of certain vegetable and fruit will drop. This is the time of the year to buy them. When you buy produce that has been grown overseas it tends to be more expensive.
If you really think about it, isn’t it strange how you can get the same fruit and vegetable all year round? Doesn’t that make life boring. Wouldn’t you rather buy when it’s in season. I love the time of the year when feijoas are in seasons.
When it comes to cloths you might want to shop off season. At the end of summer, stores will massively cut the price of summer cloths to make room for the winter season. This is the time of year that you want to end up buying cloths. The savings are ridiculous.
Actively Decide Where to Live
Housing is one of the largest expenses you will have! So it makes sense to optimism you housing expense. First off, you need to determine what you can afford, rather than what you want. That can save you thousands.
Secondly, you want to really consider where you are going to live. Its it close to a supermarket, is it close to work. Is it close to the beach.
People often want to live close to the beach for the lifestyle. I get it. It would be awesome to live next to the beach. But you pay for it- more expensive housing and higher rent.
What you should consider is that the majority of the week you will be at work. So if living at the beach increases you commute time significantly then you are not only increasing your housing cost, you are increasing your transport costs.
Instead, if you live close to work and amenities you will generally have cheaper rent and the possibility of not owning a car. Or significantly reducing your dependency on owning a car. This can save you tens of thousands a year not only housing costs but also commute costs. And save your time. Then every weekend you can go down to the beach.
Monthly Expense Reports
You need to do an income vs expenses report every month and categorise all your spending. So you know how much you are spending, and what you are spending money on. You need to pay attention to what/where you’re spending your money on.
It’s often said that using cash can help you with not overspending because it’s generally VERY easy to just swipe and not really notice how much you’re spending. But, there is no record of what you have spent your money on. That’s why I recommend using EFTPOS for everything so that you can track what you’ve spent your money on.
You can track your spending using excel spreadsheets, which is what I did for years, or you can use a service like PocketSmith, which cost the equivalent of a few coffees a month and likes to your bank to track all your spendings. And if you don’t want to pay their basic plan is FREE.
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