How to Save Money: 21 Ways to Cut Costs

1. Set up direct debits to your savings account

By setting up a direct debit from your everyday account to your savings account each month, the money will accumulate over time without any additional work on your part. This technique can be especially useful when your savings accounts are dedicated to specific goals, such as establishing an emergency fund, going on a holiday or building a house deposit.

You can also let apps like Raiz (previously Acorns Australia) do some of the work for you. After you sign up, they’ll transfer small amounts from your checking account to a separate savings account for you. That way, you can “set it and forget it” and don’t have to spend time or energy thinking about making a transfer. Some bank accounts, including NAB Classic Banking and Commonwealth Bank Smart Access, also have built-in savings tools. 

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2. Count your coins and small notes

A more manual option is to collect any coins and small notes you’ve accumulated over the course of the day and pop them in a savings envelope or jar. After you have a sizeable amount, you can deposit it directly into your savings and watch your account grow from there. 

In fact, when you want to watch your spending, it’s a good idea to use cash instead of credit cards because it can be harder to part with physical money. While this strategy doesn’t build savings overnight, it’s a solid approach for slow-and-steady savings growth.

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3. Prep for your supermarket visits

A little work before you go to the grocery store can go a long way toward helping you save money on groceries. 

• Check your pantry and make a shopping list to avoid impulse buying something you don’t need. 
• Shop at supermarkets with competitive prices, such as Aldi and IGA. 
• Choose seasonal and homegrown produce where possible. An easy way to do this is to flip through your preferred supermarket’s latest flyers — you may even score a coupon.
• Sign up for programs like Woolworths’ Everyday Rewards and Flybuys (which partners with Coles) to earn points to apply to future shopping trips or travel.

If you use a cash-back credit card, you could earn extra cash back on the money you spend at the supermarket. These types of cards offer cash back in the form of a percentage, dollar figure or credit card points, but you’ll want to be sure to pay off your bill each month to avoid paying credit card interest and fees.

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4. Minimise restaurant and takeaway spending

One of the easiest expenses to cut when you want to save more is restaurant meals or food delivery, since eating out or ordering takeaway tends to be pricier than cooking at home. 

You can also opt for starts or split a main meal with your dining companion to save money when you eat out. Skipping drinks and dessert can help stretch your budget as well. If you travel or dine out frequently as part of your job, aim to make your own breakfasts and lunch at a minimum.

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5. Get discounts on entertainment

You can take advantage of free days at museums and national parks to save on entertainment costs. Your local community might offer free concerts and other in-person or virtual events; check your local calendar before splurging on pricey tickets to private events. You can also ask about discounts for older adults, students, military members and more.

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6. Map out major purchases

You can save by timing your purchases of appliances, furniture, cars, electronics and more according to annual sale periods, like the end of the financial year or Boxing Day. It’s also worth confirming a deal is actually a deal by tracking prices over time. You can let tools do this step for you; the Honey browser extension pulls in coupon codes and checks for lower prices elsewhere.

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7. Restrict online shopping

You can make it more difficult to shop online in order to stop spending money on things you may not need. Instead of saving your billing information, opt to input your shipping address and credit card number each time you order. You’ll probably make fewer impulse purchases because of the extra work involved.

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8. Delay purchases with the 30-day rule

One way to avoid overspending is to give yourself a cooling-off period between the time an item catches your eye and when you actually make the purchase.

If you’re shopping online, consider putting the item in your shopping cart and then walking away until you’ve had more time to think it over. (In some cases, you might even get a coupon code when the retailer notices you abandoned the cart.) If 30 days seems like too long to wait, you can try shorter periods like a 24- or 48-hour delay.

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9. Get creative with gifts

You can save money with affordable gift ideas, like herb gardens and books, or go the do-it-yourself route. Baking cookies, creating art or preparing someone dinner can demonstrate that you care just as much as making an expensive purchase, and perhaps even more so. You can also shower someone with the gift of your time by offering to take them to a local (free) museum or another event.

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10. Lower your car costs

Refinancing your car loan and taking advantage of lower interest rates could save you considerably over the life of your loan. Shopping around for car insurance regularly can also help you cut costs compared with simply letting your current policy auto-renew. You can cut ongoing car maintenance costs by driving less, removing heavy items from your boot and avoiding unnecessary rapid acceleration.

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11. Reduce your petrol usage

You can’t control prices at the pump, but you can do several things to cut your petrol use and save money, besides opting for public transport when you can. Try using a petrol app like Fuel Map or Petrol Spy to track fuel prices and help you locate the cheapest possible petrol near you.

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12. Bundle pay TV and internet

To lower your internet, pay TV or streaming bill, consider bundling a few services under one plan. For example, Foxtel’s Broadband + Platinum Plus package provides high-speed internet and a Foxtel subscription. 

Another option is to cut ties with pay TV and stick to cheaper streaming services, like Netflix and Stan.  To reduce costs further, it’s worth assessing how often you watch each service or downgrading to versions with ads. 

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13. Switch your mobile phone plan

Changing your plan is one way to save money on your mobile phone bill, but it’s not the only way.

Here are some ideas:

• Remove phone insurance from your plan, especially if your phone is an older model.
• Sign up for autopay and paperless statements.
• Skip the phone upgrade.

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14. Reduce your electric bill

Big and small changes in your energy usage can help you save hundreds annually on your electric bill. Consider plugging any insulation leaks in your home, using smart power strips, swapping in more energy-efficient appliances and switching to a smart thermostat. Even incremental drops in your monthly electricity usage can add up to big savings over the long term.

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15. Cancel subscriptions you don’t use

Untick the auto-renew option on any subscriptions you aren’t using regularly, such as subscription boxes. You might even be paying for subscriptions you no longer use or need. Reviewing your credit card or bank statement carefully can help you flag any recurring expenses you can eliminate. And avoid signing up for free trials that require payment information, or at least make a note or set a calendar reminder to cancel before the free period ends.

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16. Refinance your home loan

Refinancing your home loan can save you several hundred dollars each month if you’re able to snag a lower interest rate. While refinancing comes with some initial costs upfront, they can be recouped over time, once you start paying less each month.

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17. Set savings goals

Set a specific but realistic goal. It may be “contribute $5,000 to my super fund account this year” or “pay off my credit card debt faster.” Use a calculator to see how much you’d have to save each month or year to reach your goal.

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18. Track spending

Keep track of your monthly cash flow — your income minus your expenses. This step will also make it easier to mark progress toward your savings goal. Try a budget app that tracks your spending, like MoneyBrilliant, GoodBudget or Frollo. 

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19. Pay off high-interest debt

Debt payments can be a huge burden on your overall budget. If you can pay off high-interest debt more quickly through extra payments using the snowball or avalanche methods, you’ll save on total interest paid and free yourself sooner from that burden. Then, start putting the money into savings instead.

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20. Keep savings in a high-yield savings account

As you work toward your financial goals, make sure to put your accumulating funds in a high-yield online savings account to maximize your money. Some of the best digital banks and neobanks pay interest rates that are higher than the ones at large traditional banks.

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21. Create a 50/30/20 budget

One smart way to manage your money — and hopefully hold on to more of it — is to follow a budget, which means setting priorities for your spending.

At NerdWallet, we recommend the 50/30/20 budget for money management. This approach means devoting 50% of your after-tax income to necessities, 30% to wants and 20% to savings and any debt payments. If one of your allocations exceeds these percentages, you can make some adjustments elsewhere.

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