Read this statement and discuss:

“Although many of us would recognise the instant gratification from spending impulsively, few would say the same about saving…One of the reasons for this is that we face many more triggers to spend than to save in our daily life”

Source: Wired for Imprudence by N Spencer and J Nieboer, May 2015

• Does it match your experience?
• What strategies do you think you could use to create more triggers to save?

Share your tips and experiences of ways to save. Some ideas are:

• Take your own lunch to uni/work rather than buying lunch
• Give your time rather than a purchased gift – for example, offering to cook dinner for a friend, or offering to babysit for your friend
• Make, rather than buy, a birthday gift
• Buy second hand
• Buy seasonal produce – tailor your menu planning to fruit and vegetables that are in season
• Use a car sharing service
• Walk vs car/bus trips
• Free exercise vs gym membership

Do you have any other ideas? What has worked for you? Share your tips and your experiences with your peers.

The MoneySmart compound interest calculator is a useful tool.

Try out the calculator for a fictional Olave named Jenny.

How much can Jenny save?

Jenny wants to start regularly saving $50 per month. She has found an account that will pay her 3% p.a. interest

How much can Jenny save in 3 years? Find out using her information in the calculator.

Initial deposit: $0
Regular deposit: $50
Deposit frequency: Monthly
Compound frequency: Monthly
Number of years: 3
Interest rate: 3%

What if Jenny starts saving next year instead?

Jenny has second thoughts and decides that she would rather spend the $50 per month this year, and start saving in a year’s time.

Find out how much Jenny’s savings will be affected by using her information in the “Alternative strategy” section of the calculator:

• Start later – 1 year
• Regular deposit: $50
• Compound frequency: monthly

What did you think about the impact of Jenny delaying the start of her savings plan? Was the size of the impact above or below your expectations?

What about your savings?

Now try using the calculator to see how your own savings can grow. You may not always be able to commit to a regular amount to save each month if your income is irregular. It may be that you can commit to saving $50 some months and $10 other months. Your commitment to a savings plan is an important habit and should reflect your circumstances.

Use one of the options below to set yourself a savings goal.  You can set either a short term or long term goal, or you can set both.

A short term goal is achievable within 1-2 years, examples include going on holiday, or buying a new TV.

A long term goal is achievable in 5+ years. Examples include saving for a deposit on a home or investment property.

Option 1

• Use SMART goal thinking to set your goals
• Check if your goals are achievable using the Savings goals calculator .

The calculator can help you to work out:

• If your goal is achievable with your timeframe
• How long it would take to achieve your goal.

Option 2

• Download and use the MoneySmart TrackMyGOALS app  to set and track your goals.

You have a greater chance of success if you make the time to set realistic goals and understand what is involved in achieving those goals.

• What do you think could keep you motivated to reach your goals?
• What’s your plan to review your progress?
• Share what kind of hurdles you think you might encounter.
• Do you have tips for others on overcoming hurdles?
• What would be a good way to celebrate successes?

Celebrating the achievement of milestones along the way as well as the end result of achieving your goal is a good way to help you stay on track.

Consider sharing your goals within your Olave peer group – a goal that is public has a greater chance of success than a private goal.

Make a plan for how you will celebrate your achievements at each meeting.