Saving money rather than spending it gives us no instant gratification but it is the road to eventual financial freedom. Here are some tips on how to get there.

Have a budget.

Make a note of exactly where your monthly income goes. Aim to have both a spending and saving budget and try to stick to it throughout the year. Motivate yourself by constantly reminding yourself what you are saving for – be it a house deposit, an education fund or a retirement fund.

Spend less.

If you want to spend less, the very first step is to pay attention to what you’re spending money on. Then think seriously about the necessity of everything you buy. Try to avoid impulse purchases by giving yourself the time to think carefully about whether you really need and can afford the item.

Avoid debt.

As a rule of thumb, all loans except your home mortgage are bad. So try not to take on any new debt and pay off your credit card in full every month. Keep a rainy day fund so that emergency expenses don’t end up on your credit card. And if you are in a position to pay off debt, focus first on the most expensive debt.

Isolate your deposit account.

The best way to save is to automate the process by setting up a direct debit to a deposit account. This creates a savings habit and will make you much less likely to reduce or stop monthly contributions. And mentally putting this account out of easy reach will help you avoid the temptation of raiding it in the short term.

Invest in your future self.

Financial planning is essentially about how we should allocate our money over our whole lives. For most of us, this means we must put some money away (in investments and pensions) for a time when we have no employment income. To put it simply, buying a Ford Fiesta now rather than a Ford Focus (and investing the difference) could mean your 70 year old self can drive a Lexus (rather than a Yaris!)


Need independent savings and investment advice? Just call Money Smart on 01 276 0006 or email