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Cash-strapped? Try these nifty ideas to get ahead in 2017

By Suzanne Kiraly 10 January 2017 33

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This is the time of year you might be considering improving your finances or saving for something really special, like maybe a holiday, a house or a new car. Maybe you had a shocker in 2016 and really want to improve your overall finances in 2017.

Well, you wouldn’t be alone. For most of us, we are not happy with our financial situation, and we feel the need to improve it one way or another.

It might surprise you to know that the more you learn about the psychology of money, the better you can implement that knowledge to get ahead financially. Kabir Segal, neuroeconomist (and yes, there is such a thing), and author of the book “Coined”, explains that the effect of money on our brains is akin to the effects of cocaine!

“Neuroeconomists [scientists who research how the brain is affected by money] have performed several brain scans on individuals who were about to make money, and the results were staggering,” Sehgal told Time magazine. “The studies show that these people had the same neurological response to making money in their “pleasure centers”, as someone who was high on cocaine.”

And, if psychology plays a large part in our financial behaviour, it only stands to reason that we should use psychology to improve our situation.

In this vein, I’ve been collecting some money ideas for a while now that play on our psychological attitude towards this concept of money and its accumulation. Here are some that I found to be really nifty suggestions, not too hard to do for most, and which could make a little cash go a long way towards achieving your financial goals or at least improving your financial destiny in 2017.

(1) One idea from a friend of mine is to put away $1 in week one of the new year and then increase the dollars with every week – so that you save $2 in week 2, $3 in week 3, and so on. Or a reversal of this is possible too – saving $52 in week 1 and $51 in week 2, and so on. You’d be surprised how much you will accumulate by the end of the year and this strategy plays on the idea that it’s a game or challenge, so it becomes none too painful.

(2) Another nifty idea that is sound psychologically (and which I am trying myself this year), looks like it works a treat – it is via an app called https://acornsau.com.au – where you get to invest the small change from your daily purchases and see how your money adds up. You can also nominate regular micro-payments to be added to your account and of course, in addition you can choose to invest lump sums if you wish. It’s really a very clever, simple little concept which plays on the notion that we don’t notice the small amounts that slip through our fingers. The founders of this app recently floated it on the stock market, I believe, with share offerings to the investors who use it. This one could go a long way in the future too, with our fast-growing, cashless society and our ever-growing financially savvy population post-GFC.

(3) This next idea is a psychological ploy, where you trick yourself into thinking there is no such thing as a certain denomination within our currency system – say the $10 note, by way of example. (Although you could easily choose the $5, $20, $50, or $100 notes instead.) The idea is that whenever you get one of the said chosen notes, you stash it away and then they accumulate over time. I have done this before with very pleasant results at the end of a year.

(4) This one is an ancient tried and true method used by the wealthy. It is the principle “to pay yourself first”. This concept originally came out of a 1926 book entitled “The Richest Man in Babylon” by George Samuel Clayson, and it has had a huge impact on thousands of investors – the wealthy and wise. It means that before you pay your bills or anything else, you pay a small amount to yourself (like 10% for example), and that way, you will make sure that the most important person (you) gets paid every single time. The trick is to not touch the money and let it accumulate, with interest.

These are four of the money ideas I like most that use the power of psychology in the way we view money and our strategy for financial gain.

I am sure there are many, more worthwhile ideas out there … please do share any you think may make a difference to our readers’ finances. We are all keen to get ahead – aren’t we.

What’s Your opinion?


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Cash-strapped? Try these nifty ideas to get ahead in 2017
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Suzanne Kiraly 10:47 pm 17 Jan 17

Chris Mordd Richards said :

devils_advocate said :

A mentality of abundance would drive you to find a brand that you really like, that fits you well and makes you feel like the professional you want to be. And when they’re on sale, buy ten of them. Classics never go out of fashion and you will get the same number of wears out of an item of clothing or pair of shoes, whether they are your only pair or you rotate them through once a week. One of the worst mistakes I used to make was having only two pairs of “work” shoes (one black, one brown) and then having to pay full retail when they wore out. Now I stock up when I see a good sale, and have saved hundreds if not thousands.

I realise it’s not 100% applicable to women’s fashion but most women I know still have a few classic items (suits, heels, bras etc) that they wear from season to season.

I avoided clicking on this article all week thinking it was another list of super obvious “ideas” that is so popular around this time of year. I was very pleasantly surprised to discover four actually quite good and maybe not so well known ideas for saving instead, along with a game element to it which always helps I find! So kudos to Suzanne Kiraly for that.

As to devils_advocate comment, I really like that idea / approach actually. Unless you love thrift store clothes shopping as I do, that’s a really sensible way to go about it I think actually! I could do the same by combining low cost sale brand names pieces that really suit me with my thrift store stuff too, for an even more unique look. I’m going to suggest this to a few friends now actually.

As for not buying coffee, each to their own, but i’m sorry life isn’t worth living without good coffee!! 😛 LOL My aim this year is to cook at home more and buy less takeaway myself though! Good comments all round, thanks all!

Thanks so much for this and your generous comments – glad you did click on my article and yes, I can’t go without good coffee either!

Maya123 5:52 pm 17 Jan 17

Serina Huang said :

Some really good ideas for making saving a ‘challenge’. I find it is all about the mindfulness of the little things. My habit is that every time I make a saving (e.g. decide not to buy a cupcake at my super yummy café at work), I immediately transfer that saving onto my mortgage. And that motivates me to make bigger savings as well, too. Over the course of a month I usually save at least $1,000 this way.

It will end up being a much bigger saving than that. $1000 a month over ten years at say, 5% home interest loan according to a Compound interest calculator ends up as a saving off your home loan of $155,282. The home loan will be paid off much quicker and then that money is freed up for other investments (or holidays etc). (But that’s a lot of cup cakes a month. Are you sure it’s $1,000 a month?)
I was told by some that small savings ideas are silly, but they do add up.
Even saving on $20 coffee a week, could be $13,458 off your mortgage over ten years. Then add other savings to that. Say, $50 on bought lunches a week. That could be another $33,644 off the mortgage over ten years. And the small savings keep adding up, as they are not small savings in the longer run.
The home mortgage is not generating income, so the sooner it is paid off, the sooner money can be put to investments that do pay money.

Serina Huang 12:23 pm 17 Jan 17

Some really good ideas for making saving a ‘challenge’. I find it is all about the mindfulness of the little things. My habit is that every time I make a saving (e.g. decide not to buy a cupcake at my super yummy café at work), I immediately transfer that saving onto my mortgage. And that motivates me to make bigger savings as well, too. Over the course of a month I usually save at least $1,000 this way.

Chris Mordd Richards 2:18 am 15 Jan 17

devils_advocate said :

A mentality of abundance would drive you to find a brand that you really like, that fits you well and makes you feel like the professional you want to be. And when they’re on sale, buy ten of them. Classics never go out of fashion and you will get the same number of wears out of an item of clothing or pair of shoes, whether they are your only pair or you rotate them through once a week. One of the worst mistakes I used to make was having only two pairs of “work” shoes (one black, one brown) and then having to pay full retail when they wore out. Now I stock up when I see a good sale, and have saved hundreds if not thousands.

I realise it’s not 100% applicable to women’s fashion but most women I know still have a few classic items (suits, heels, bras etc) that they wear from season to season.

I avoided clicking on this article all week thinking it was another list of super obvious “ideas” that is so popular around this time of year. I was very pleasantly surprised to discover four actually quite good and maybe not so well known ideas for saving instead, along with a game element to it which always helps I find! So kudos to Suzanne Kiraly for that.

As to devils_advocate comment, I really like that idea / approach actually. Unless you love thrift store clothes shopping as I do, that’s a really sensible way to go about it I think actually! I could do the same by combining low cost sale brand names pieces that really suit me with my thrift store stuff too, for an even more unique look. I’m going to suggest this to a few friends now actually.

As for not buying coffee, each to their own, but i’m sorry life isn’t worth living without good coffee!! 😛 LOL My aim this year is to cook at home more and buy less takeaway myself though! Good comments all round, thanks all!

Maya123 11:35 am 14 Jan 17

dtc said :

Maya123 said :

Oh come on, there are lots of activities to enjoy that don’t cost lots of money. You have a very limited outlook if you think things have to cost money to be enjoyable. Show some creativity. By the way, it didn’t take me 25 years to pay off my home loan. I did it in five, on a very ordinary income. How? First I bought the cheapest house for sale at the time, then I rented out the other bedrooms, I bought almost no new clothes in that time, only some cheap underwear as needed. Took cheap holidays, which I thoroughly enjoyed. Grew my own vegetables and based my eating around this as much as possible. Rode my bike much more than I drove my car to save on petrol. I also went on long distance bike rides for some of my holidays, which were wonderful holidays. I socialised, but not in restaurants. I rarely had takeaway, doing my own cooking…as did my tenants too, in case you think this is rare. I also rarely bought fizzy drinks or alcohol, as this is a big expense, and I didn’t yearn for them. Then I was debt free. A wonderful feeling, and that brought ‘freedom’.

Great, if you like your free activities then you like them – but you are definitely foregoing other activities that cost money. Movies, travel, food etc. And thats fine, but it doesnt make you a ‘better’ or more intelligent person because you scrimp and save. It just makes you a person with certain interests and if someone else has other interests (that involve spending money) then they are not wrong to have those interests.

There is a difference between someone (for example) deciding to go to a dinner and movie knowing it will cost money but being willing to accept that in return for having a good time, and someone not paying off their credit card because they keep forgetting, or buying a BMW on a finance lease (making bad financial decisions).

Dont get me wrong, I’m all for people being encourage to properly analyse their expenditure and figure out what they will miss and what they wont miss. But spending money on yourself isnt, by default, the wrong answer.

So there may be millionaires who dont spend much on themselves. I go back to my original point – having become millionaires, what is the outcome? They have financial security I guess. But maybe they would enjoy a nice house or a fast car or more travel. But probably they now have such a sense of guilt that they wont – and they will become the old age people desperately hanging onto every cent of their pension/tax benefits/health benefits so that they never have to spend their own money. Miserly unhappy old people with a guilt complex, but lots of money.

Trust me, I have never forgone travel, even in those few years until my house loan was paid off. I might not have travelled overseas during those few years, but I still had holidays in Australia. Holidays that were cheap. Long distance cycle rides for instance, which are some of my most memorial and best holidays I have taken. In my twenties and after my home loan was paid off I have travelled to many countries. It’s because my home loan was paid off that I could afford to. In fact, I will soon be taking off overseas for another couple of months, and then later this year I might go overseas again. In between I will do some local travel. I can do this, because for a few years I lived frugally and paid off my house loan quickly.

One thing, reading here, has revealed to me, that there are spenders and savers among us. Two different cultures.

devils_advocate 4:40 pm 13 Jan 17

My advice is directed to the typical Canberra person. Who is that, you ask? Great question.
They are likely to be in their early 30’s, and drive a car as their main form of transport. They are more likely to be employed compared with other Australians, particularly if they are female. The typical Canberran earns more than other Australians on average, but also spends a lot on housing. Most importantly, the majority – and far more than other Australians – describe ourselves as either in management, professions or clerical/administration roles.

To you I say:
-Invest money building your professional network. Focus not on your colleagues but on the people in the position you would like to be in one day, and who genuinely like you and want to see you succeed. That might mean coffees, social club memberships, after-work drinks, or the occasional gift for a mentor when you reach key milestones, to show your appreciation for them and your recognition of the role they played in getting you there. These investments pay off more than you can initially imagine.
-Invest money in building your personal brand. Dressing to save money will earn you the corresponding reputation. You don’t want your wardrobe to attract attention for the wrong reason. Dressing for the job you want, rather than the one you have, sends a clear message, and has a psychological effect both on yourself and the interactions you have with other people. Splash out on a few, expensive signature items, for men I’d recommend a watch. People do notice.
-You are better off having no car than having your clapped out Hyundai leaking oil all over the executive parking spaces (yes this happened).

dtc 4:34 pm 13 Jan 17

Maya123 said :

Oh come on, there are lots of activities to enjoy that don’t cost lots of money. You have a very limited outlook if you think things have to cost money to be enjoyable. Show some creativity. By the way, it didn’t take me 25 years to pay off my home loan. I did it in five, on a very ordinary income. How? First I bought the cheapest house for sale at the time, then I rented out the other bedrooms, I bought almost no new clothes in that time, only some cheap underwear as needed. Took cheap holidays, which I thoroughly enjoyed. Grew my own vegetables and based my eating around this as much as possible. Rode my bike much more than I drove my car to save on petrol. I also went on long distance bike rides for some of my holidays, which were wonderful holidays. I socialised, but not in restaurants. I rarely had takeaway, doing my own cooking…as did my tenants too, in case you think this is rare. I also rarely bought fizzy drinks or alcohol, as this is a big expense, and I didn’t yearn for them. Then I was debt free. A wonderful feeling, and that brought ‘freedom’.

Great, if you like your free activities then you like them – but you are definitely foregoing other activities that cost money. Movies, travel, food etc. And thats fine, but it doesnt make you a ‘better’ or more intelligent person because you scrimp and save. It just makes you a person with certain interests and if someone else has other interests (that involve spending money) then they are not wrong to have those interests.

There is a difference between someone (for example) deciding to go to a dinner and movie knowing it will cost money but being willing to accept that in return for having a good time, and someone not paying off their credit card because they keep forgetting, or buying a BMW on a finance lease (making bad financial decisions).

Dont get me wrong, I’m all for people being encourage to properly analyse their expenditure and figure out what they will miss and what they wont miss. But spending money on yourself isnt, by default, the wrong answer.

So there may be millionaires who dont spend much on themselves. I go back to my original point – having become millionaires, what is the outcome? They have financial security I guess. But maybe they would enjoy a nice house or a fast car or more travel. But probably they now have such a sense of guilt that they wont – and they will become the old age people desperately hanging onto every cent of their pension/tax benefits/health benefits so that they never have to spend their own money. Miserly unhappy old people with a guilt complex, but lots of money.

dungfungus 3:05 pm 13 Jan 17

devils_advocate said :

Maya123 said :

dtc said :

So now that you have foregone things that are enjoyable, scrimped and saved and lived on second hand and unexciting cars and paid off your house for 25 years and become a millionaire….what happens?

As in you either spend your money when you are too old to really enjoy it (sure you can enjoy some of it, but there will be limitations) or your give it to your kids. Great.

Oh come on, there are lots of activities to enjoy that don’t cost lots of money. You have a very limited outlook if you think things have to cost money to be enjoyable. Show some creativity. By the way, it didn’t take me 25 years to pay off my home loan. I did it in five, on a very ordinary income. How? First I bought the cheapest house for sale at the time, then I rented out the other bedrooms, I bought almost no new clothes in that time, only some cheap underwear as needed. Took cheap holidays, which I thoroughly enjoyed. Grew my own vegetables and based my eating around this as much as possible. Rode my bike much more than I drove my car to save on petrol. I also went on long distance bike rides for some of my holidays, which were wonderful holidays. I socialised, but not in restaurants. I rarely had takeaway, doing my own cooking…as did my tenants too, in case you think this is rare. I also rarely bought fizzy drinks or alcohol, as this is a big expense, and I didn’t yearn for them. Then I was debt free. A wonderful feeling, and that brought ‘freedom’.

In my opinion, excessively (obsessively?) focusing on the expense side of the balance sheet is a losing strategy. I think it’s somewhat irresponsible to tell people that constantly chipping away at their outgoings is going to lead to financial security.

On reflection, I think that instead of cutting out genuinely wasteful expenses, it would be nice to see an article discussing how to cut out wasteful people. You know, the people who appear to be well-meaning but in reality waste your time, energy and positivity by their negativity, self-pity and at times straight out jealousy. And who resist your most well-thought-out, well-supported advice on how they could change things, and persist with complaining about the same problems year in, year out.

Oftentimes it can be tough to cut these people out of your lives, because you may have known them for years, decades even. OT I know, but I can’t recall having seen such a long shopping list of how to identify these people and reduce their impact on one’s own life, and it would probably better position people to succeed.

That was a very positive thought.

Maya123 12:09 pm 13 Jan 17

devils_advocate said :

Maya123 said :

I think you may have misunderstood the premise of the article. Yes, there are eccentric millionaires, and dotcom millionaires, and inherited wealth and so on. Some may display their wealth, some may choose not to. Precisely none of those people are going to be reading this article. So despite having read your comments, I fail to see their relevance.

My comments were not for the wealthy. It was to point out that flaunting wealth (while likely not having it) is wasteful and from what I have read, many of the self made rich don’t do it anyway; more likely the wannabes, who might never be more than wannabes if they continue to waste their money this way. However, if people want to spend their money now, rather then invest it, that is a personal choice, as long as they don’t complain when they retire and say they now can’t afford to travel etc, but not everyone wants to do that anyway. Some are very happy to stay home and potter and join in local community things.
My personal strategy was to pay off my home loan as quickly as possible to free up that money for other investments, and if that meant living very frugally for five years, so be it. I didn’t have a high income; I’m guessing lower than many here, but with no longer needing to pay off my house I was able to then invest my money elsewhere, which was my plan. That and I don’t like debt. Money paying off the home loan is a waste in a sense, because no matter how much your house value increases you still need somewhere to live, so I thought it prudent to get that out of the way so the money could be put elsewhere.
I also went against friends and acquaintances telling me not to buy the house where I did. So many negative comments. But as well as the house being cheap at the time, I could see positives to buying it, and I was right, as that house increased in value more than the houses others were suggesting I buy. It was also in cycling distance to work, so I saved a lot on petrol; plus the cost of a gym membership. I wanted to cycle anyway; the savings were a bonus.
This was my personal strategy. There are other ways, but at the time this worked best for me, and although I couldn’t be called rich, I have likely retired better off than many people who had my (very ordinary) income. I can afford to travel at least.

pink little birdie 10:03 am 13 Jan 17

Maya123 said :

dtc said :

So now that you have foregone things that are enjoyable, scrimped and saved and lived on second hand and unexciting cars and paid off your house for 25 years and become a millionaire….what happens?

As in you either spend your money when you are too old to really enjoy it (sure you can enjoy some of it, but there will be limitations) or your give it to your kids. Great.

Oh come on, there are lots of activities to enjoy that don’t cost lots of money. You have a very limited outlook if you think things have to cost money to be enjoyable. Show some creativity. By the way, it didn’t take me 25 years to pay off my home loan. I did it in five, on a very ordinary income. How? First I bought the cheapest house for sale at the time, then I rented out the other bedrooms, I bought almost no new clothes in that time, only some cheap underwear as needed. Took cheap holidays, which I thoroughly enjoyed. Grew my own vegetables and based my eating around this as much as possible. Rode my bike much more than I drove my car to save on petrol. I also went on long distance bike rides for some of my holidays, which were wonderful holidays. I socialised, but not in restaurants. I rarely had takeaway, doing my own cooking…as did my tenants too, in case you think this is rare. I also rarely bought fizzy drinks or alcohol, as this is a big expense, and I didn’t yearn for them. Then I was debt free. A wonderful feeling, and that brought ‘freedom’.

While it’s great that you have chosen to do this, there is an issue around accessibility of the housing market for most people not affordability once in which is not a particularly large issue for people in Canberra. You value your house much more than anything and that’s ok but what works for you isn’t going to work for everybody.

It’s nice to save and cut down on expenses but really you need to work what out what you value. Like I really value my café coffee much more than I value the $45 a week it costs me so it’s in my budget. Is me being miserable without the coffee really worth the savings to me no – but I already save more than 20% of my pay.

But then I’m more than happy to compromise on other less important things.

devils_advocate 9:07 am 13 Jan 17

Maya123 said :

dtc said :

So now that you have foregone things that are enjoyable, scrimped and saved and lived on second hand and unexciting cars and paid off your house for 25 years and become a millionaire….what happens?

As in you either spend your money when you are too old to really enjoy it (sure you can enjoy some of it, but there will be limitations) or your give it to your kids. Great.

Oh come on, there are lots of activities to enjoy that don’t cost lots of money. You have a very limited outlook if you think things have to cost money to be enjoyable. Show some creativity. By the way, it didn’t take me 25 years to pay off my home loan. I did it in five, on a very ordinary income. How? First I bought the cheapest house for sale at the time, then I rented out the other bedrooms, I bought almost no new clothes in that time, only some cheap underwear as needed. Took cheap holidays, which I thoroughly enjoyed. Grew my own vegetables and based my eating around this as much as possible. Rode my bike much more than I drove my car to save on petrol. I also went on long distance bike rides for some of my holidays, which were wonderful holidays. I socialised, but not in restaurants. I rarely had takeaway, doing my own cooking…as did my tenants too, in case you think this is rare. I also rarely bought fizzy drinks or alcohol, as this is a big expense, and I didn’t yearn for them. Then I was debt free. A wonderful feeling, and that brought ‘freedom’.

In my opinion, excessively (obsessively?) focusing on the expense side of the balance sheet is a losing strategy. I think it’s somewhat irresponsible to tell people that constantly chipping away at their outgoings is going to lead to financial security.

On reflection, I think that instead of cutting out genuinely wasteful expenses, it would be nice to see an article discussing how to cut out wasteful people. You know, the people who appear to be well-meaning but in reality waste your time, energy and positivity by their negativity, self-pity and at times straight out jealousy. And who resist your most well-thought-out, well-supported advice on how they could change things, and persist with complaining about the same problems year in, year out.

Oftentimes it can be tough to cut these people out of your lives, because you may have known them for years, decades even. OT I know, but I can’t recall having seen such a long shopping list of how to identify these people and reduce their impact on one’s own life, and it would probably better position people to succeed.

Maya123 6:30 pm 12 Jan 17

dtc said :

So now that you have foregone things that are enjoyable, scrimped and saved and lived on second hand and unexciting cars and paid off your house for 25 years and become a millionaire….what happens?

As in you either spend your money when you are too old to really enjoy it (sure you can enjoy some of it, but there will be limitations) or your give it to your kids. Great.

Oh come on, there are lots of activities to enjoy that don’t cost lots of money. You have a very limited outlook if you think things have to cost money to be enjoyable. Show some creativity. By the way, it didn’t take me 25 years to pay off my home loan. I did it in five, on a very ordinary income. How? First I bought the cheapest house for sale at the time, then I rented out the other bedrooms, I bought almost no new clothes in that time, only some cheap underwear as needed. Took cheap holidays, which I thoroughly enjoyed. Grew my own vegetables and based my eating around this as much as possible. Rode my bike much more than I drove my car to save on petrol. I also went on long distance bike rides for some of my holidays, which were wonderful holidays. I socialised, but not in restaurants. I rarely had takeaway, doing my own cooking…as did my tenants too, in case you think this is rare. I also rarely bought fizzy drinks or alcohol, as this is a big expense, and I didn’t yearn for them. Then I was debt free. A wonderful feeling, and that brought ‘freedom’.

dtc 5:06 pm 12 Jan 17

So now that you have foregone things that are enjoyable, scrimped and saved and lived on second hand and unexciting cars and paid off your house for 25 years and become a millionaire….what happens?

As in you either spend your money when you are too old to really enjoy it (sure you can enjoy some of it, but there will be limitations) or your give it to your kids. Great.

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