Everyone says to save 10% of what you earn, but things are so expensive these days. How do you cope?
How Is Your Savings Vs Expenditures?
lightfoot on 08/03/2022 - 16:35
Comments
Do you even live?
I borrow.
Then you're spending to save.
You doing a Buy Borrow Die thing?
@sjj89: Isn't that the thing in Australia?
Study > job > borrow $1M to buy a house > work to the š¦“ trying to pay it off before ā ļø.
Lives at home with mum and dad
In mum's garage trading š.
spending far out weighs saving..
My side hustle luckily pays for any disposable income needed, so my 9-5 earnings are purely savings.
Admittedly the current inflation curve and constant erosion of disposable income is cooked and the government and boomer generation have lost touch with reality in that there's an entire generation struggling to afford necessities let alone a house.
Whatās your side hustle out of curiosity? Can share via PM if you want to keep it on the dl.
I donāt think itās all boomers, just boomers who vote for the LNP. They donāt care about anyone except rich people.
It's a form of arbitrage, unfortunately i feel its days are numbered with the resurrection of supply chains post covid.
Scalping masks, RATs and toilet paper?
Have you tried?
Four quick SIDE HUSTLES you can use to generate extra cash flow … https://t.co/B0v0z28LxB
WFH has been a boon to savings. No commute costs, no dry cleaning, no work clothing purchases, no going out coffees/food, no after work events etc.
As long as I have 5 cents more in my bank than the total of my bills at the end of the week I'm happy.
Any more is a bonus.
A fellow man of culture i see
savings? i wouldn't be on this site if i had any
How Is Your Savings Vs Expenditures?
It was fine until I became a member of OzB
I cope by being extremely frugal. I only really spend money on food these days. A couple of subscriptions for Disney+ and Amazon Prime, but other than that, all my money goes towards either housing or food. Thatās it. Well, investments too as I put money into investments each week, but thatās more so when Iām older Iāll be better off. Pay now or pay later as they say.
I aim to save about 60%-70% of my budget and have been for a few years now. Lately with costs going up Iāve just been WFH more, driving less, going out less, eat one meal a day. I basically live close to the poverty line despite having a good salary (6 figs). Not saving as much as I was a few months ago, but canāt help it much more.
I mean it helps if you have a decent salary. If I earned say, $50k I would struggle to save what I save now (would probably move home in that situation). Feel sorry for people in that situation, just gotta try and claw yourself out of it. Doesnāt help idiots in this nation think throwing lots of money in housing is a smart idea. I think everyone would be happier if housing costs werenāt so stupid, pushed up by idiot investors and FHBs who have no idea what their money is worth.
Itās not psychologically sustainable to be locked up at home though however, like you will crack eventually
True, it isnāt easy. More people will live like I do thanks to high housing costs, well the ones who want to live a nice retirement anyway and not rely on the pension.
āAnnual income twenty pounds, annual expenditure nineteen nineteen and six , result happiness.
Annual income twenty pounds, annual expenditure twenty pounds ought and six, result miseryāā Charles Dickens, David Copperfield
Wise and very true.
Remind me of the idea that $10 isn't much money, unless you haven't got $10.
1k a month by 30 years I'll have 300k.
$360k
Might be dead too!
Mr Warne may have a comment on that one…..
Statistically not likely
(Stolen from mokr below)
Too soon?
Probably
See, ^^, more maths jokes
They write themselves
statstically not likely
Make sacrifices where possible. Cut back on the subscriptions, go a tier down on your internet and phone bill, forget dining out, etc.
Completely agree with you there.
Although i think the current government doesn't understand is that without disposable income the economy will grind to a halt.It's all well and good to say just save more everyday and you'll be able to afford your house. But what they fail to understand is that an economy works on the mobilisation of money, just look at how quickly Russia's economy ground to a halt once you couldn't move the money. It's the same when you put that much disposable income into a house. It's no longer mobile and sits in a bank.
The logic behind higher house prices is counter intuitive to a strong economy and only serves to maximise bank mortgages whilst everyone else lives miserably on beans and rice and as long as no one is doing anything about it our quality of life will be significantly worse off.
I agree completely.
LNP and their voters were all probably born rich and therefore think money grows on trees or that high salaries are easy to come by because a family friend can get them a job. They have no idea how the real world works or what middle or low income people have to do to make ends meet.
Weāre going to be a very unhappy country in the future as people spend all of their money just to keep a roof over their heads scrimping to make ends meet. All because of what? Idiotic house prices. Then again itās happening all across the globe.
High house prices are forcing people to reconsider having children or having less children also. It is just detrimental to society.
We are headed towards a two class society, renters and owners.
The latter will be generational poor and live terrible lives, while the former will get richer and richer as wealth is passed-on down the generation.
Doesn't seem to matter what government is in power long lasting significant changes that benefit lower to upper middle class never seem to happen.
We just have work hard and smart for our families
Yep, I can buy a house, or have kids, but I can't see myself having any time for intellectual/spiritual development and just plain old stargazing if I try to do both.
Hence, if it's one or the other
Well, I want a house
But without kids, I don't need a house
So… How about neither?Leaves me with lots of time to contemplate my potentially myopic decision… And of course hang out here on ozbargain.
LNP and their voters were all probably born rich and therefore think money grows on trees
No - they think money grows in houses.
Why do you think they continue with negative gearing and are doing everything they can to keep house prices high?
More rent for the investors
More interest for the bankers
More premiums for the insurers
Using Barefoot's bucket principle we are:
Entire household operating budget inc. mortgage - 59%
No-guilt spending money - 10%
Savings for fun stuff and holidays - 10%
Savings into offset account - 21%I'm going to get downvoted for this, but the best way to decrease your percentage outgoings is to increase what you earn. I know it's not that simple, but it's very worthwhile doing.
I was in a job with a ceiling on earning potential. I used annual leave and all my spare time for 2 years and got 2 diplomas (while supporting my family). This got me a 25% wage increase and all the sacrifice was worth it.
Changing jobs, especially in this labour starved market, is a great way of getting paid more. I did that, the money is about the same but it's less hours, CPI annual raises and low stress.
We have no control of what things cost, but we have some control over what we earn.
Moving to a LCOL area is also a worthwhile option.
I'm not going to downvote but Barefoot's advice, really?
barefoot really needs to invest more aggressively when younger
Arrrhhh old Barefoot Investor, the bloke who pulled all of Dave Ramsey's ideas and repackaged them for Australia.
Why so many on OzB think Barefoot is some kind of guru we all have to assimilate?
Imagine if everyone followed barefoot - we'd all have no shoes (joke), but really, there's nothing worse than heard mentalityBarefoot make šµ by selling table scraps to the lazy that can't be bothered looking for alpha.
He sells a basic plan and hope mostly but that's all you really need to get outta debt and get on the right track.
Surprisingly simple but a revelation to many who donāt know how to manage their finances.
Pay yourself first. That's the reason the funds are available at tax time because it's automatically deducted from your pay. Superannuation is the same. If you try to save what's left over after expenses you will no doubt find there is nothing left over!
My outgoings are lower than my incomings.
I save 8.5%, its easier than 10% and gives me an extra 1.5% to spend on Oz bargain stuff I don't really need
I save 100%.