Most people would acknowledge that saving money, be it for a wedding, a car, retirement or just a rainy day has some serious benefits. However, compared to spending, saving is not nearly as much fun and seldom gets labelled as ‘cool’. But perhaps that’s because we don’t look at in the right way, what if saving money drew on the ninja; dedicated to removing bad debt? Guest writer Peter Wood, provides some tips on becoming a savings ninja.
Savings ninjas are known for their unorthodox techniques, survival skills and the ability to overcome adversity. If you apply the true essence of a ninja to your savings regime, you may find the inner discipline required to flip debt on its head, however bad your spiral may be.
Savings: Where you start doesn’t matter
A disciplined and focused savings plan can yield results far quicker than you may think. Like the historic ninjas who were recruited from working class roots, it may start with channelling small cash amounts in the right direction.
Imagine slashing more than a third of the time it takes to pay off your home loan. That could be as simple as $100 a week. If you had a $300,000 home loan at 7 per cent over a 30-year term and started out immediately paying $100 extra each week, you would slash more than 11 years from your loan. More importantly, you would have saved more than $185,000 in interest.
Too demanding? Well, what would $50 a week do? It would still save you more than 7 years and $123,000. Like the ninja ethos, it’s less about energy bursts and more about commitment to ongoing discipline.
Is saving the stuff of legend?
Ninja training is said to evoke some mythical abilities including invisibility, walking on water and even control over the natural elements. However, common sense might tell you this is the stuff of legend.
An out-of-reach savings plan might feel also ‘mythical’ to you. Consider playing to your inner strengths instead. The average Aussie spends more than $31 a week on alcohol. In NSW it’s $39. Harnessing this could see you on your way to finding that $50 mortgage boost.
Ninjas were known for their ability to collect intelligence and secrets – and will never attack without a clear and concise strategy.
- An intelligent quarterly plan will ensure you hit yearly targets – review blogs and articles online and discover how others map out realistic debt forecasts.
- Follow banks and financial speakers on twitter – do not underestimate the power of being ahead of the trend. When financial changes take place and new breaks, you’ll tend to hear it on twitter first.
- Get involved with modern debt weapons of knowledge such as mortgage repayment calculators and use these to assess whether you’re getting the best deal.
- Know how the interest works in high interest savings accounts and research clever ways to make the most of your rates.
- No one knows superannuation better than a superannuation advisor – follow them online, read their blogs and channel this knowledge into getting the most out of your super (both before-tax and after-tax contributions).
Use your tools wisely
You can never be too prepared – in mindset and with your debt-fighting apparatus.
Thanks to tools such as automated loan payments, keeping up with repayments happens automatically – meaning no excuse to skip a week here and there. Savings calculators and finance apps can help you keep on top of your goals and assess where changes may need to be made and online banking applications can mean you can bank anywhere, at anytime.
An essential kit would include:
- A selection of financial blogs bookmarked and read on a daily basis
- A twitter profile with connections made with financial experts
- A savings calculator
- Automatic payments set up
- A suite of financial apps
The power of teamwork
Despite their lone stealth image, ninjas didn’t always work alone. They would scale walls in pairs, or groups of ninjas might have built human platforms to scale greater heights.
Consider savings ideas that harness the power of a family or a couple, such as income splitting. This financial year, the tax-free rate increased from $16,000 to $20,452. A couple can now split their income equally and potentially receive up to $40,904 each year tax-free. A further $33,396 of taxable income then comes under the 20.5 per cent marginal rate.
Whatever your ninja or debt assassin skill level, ancient techniques could prove timeless for boosting your level of savings. More discipline when it comes to your regime could mean results that can be passed down for generations.