Setting goals

Now that you’re earning money, try to create both short-term and long-term goals so that you are building your future, while living the life that you want now.

Short-term goals: These could be as simple as ‘save up $100 to buy a new dress’ or, ‘save $200 to go to the Gold Coast for the day’. These goals are achievable just by making small changes during the week. Think of them as little weekly victories!

Long-term goals: Long-term goals are bigger, and could be ‘buy a new car’, or ‘go on a holiday to Fiji’. It’s helpful to have a solid savings plan to that keeps you on track, and it’s really rewarding seeing your savings grow each month. Check out RACQ’s savings goal calculator so you can see what you can put away today and how soon you’ll be living your dream!

The benefits of saving now

While you may be achieving your short and long term goals, it’s also useful to put money aside in a savings account to continue to accumulate interest.

If you start saving now, you’ll have an enormous advantage as you get older. You see how saving a little bit extra can really maximise your balance (and how interest really pays off!)

Savings example 1 Savings example 2  Savings example 3
 Initial deposit: $1,000  Initial deposit: $1,000  Initial deposit: $1,000
 Regular fortnightly deposit: $50   Regular fortnightly deposit: $100  Regular fortnightly deposit: $150
 Number of years: 5  Number of years: 5  Number of years: 5
 Compounding frequency monthly at 3.02%  Compounding frequency monthly at 3.02%  Compounding frequency monthly at 3.02%
 Total interest: $665  Total interest: $1,168  Total interest: $1,672
 Total savings: $8,165  Total savings: $15,168  Total savings: $22,172

*The savings example provided assumes no fees are payable.

Look for a savings account without account keeping or transaction fees and rewards you with a high interest rate.

It’s a great idea to open a transactional account for day-to-day spending and a separate account for your savings. You could have a ‘first car’ or ‘Bali holiday’ savings account. That way, you won’t be as tempted to touch the funds you’re putting aside for your long-term goals.

Savings tips

Here are some easy tips to help accumulate your savings:

  • Think about how much you can spend before you head out and give yourself a little budget for the day, or night
  • Before you impulse buy, ask yourself “do I really need that?”
  • Put your spare coins in a change jar and when the jar fills, deposit the amount into your savings account
  • Open a high interest savings account and automatically transfer money each time you get paid
  • Set a budget and make some long-term and short-term savings goals
  • Start saving today. It’s never too late and you’ll be happy you did tomorrow!

One last tip: cash is easier to control than a debit or credit card, so if you really want to amplify your savings, try to spend in cash. Here’s a little exercise you can try and see if you notice any difference:

  1. Work out how much you’ll need to spend for the week
  2. Take out that amount in cash
  3. Put your debit card away
  4. Each time you pay for something, pay cash. You’ll be able to easily track what you’re spending.
  5. When you get paid next, put any extra cash into your savings account

Savings FAQs

Understanding interest and the different types

Generally, you’ll earn interest on money you have deposited into your bank account and you are charged interest for money you have borrowed. The interest earned is a percentage of your deposit, just as the interest charged is a percentage of the money borrowed.

The amount of interest on your account varies from bank product to bank product, and from bank to bank. For example, personal loans and home loans will charge different interest rates, and different banks will charge different rates for a personal loan.

What to do when you lose your debit or credit card

The process for reporting a lost card varies from bank to bank. For some banks, you will have to call to report your lost card. For others, you can do this yourself by logging into your online bank account.

If you have your account with RACQ Bank, call 13 1905 immediately if you have lost your Visa Debit Card or rediCARD. If you have lost your credit card, call 1300 912 667.

No matter who you bank with, it’s a good idea to know your bank’s process for reporting a lost card so you can react quickly. The faster you act, the faster your card can be locked or cancelled and the less time someone may have to make unauthorised transactions on that card.

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