How to save money with your spare change

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How to save money with your spare change

Martine Allars

Updated 14/12/2022

How to save money with your spare change

End of the working day means time to round-up for me.

Time to read : 3 Minutes

It's getting harder to save with everything costing more, but it is still possible.

Remember it's not how much you earn, it's how much you spend that counts.

Mission #8 – how to save money with your spare change

Even though inflation is affecting everything we buy, I still believe we can all continue to save – even if it's only a few dollars and cents.

🫰🏻At this time last year, the average Aussie had $3559 in savings – but that's the average across all ages. As we get older, we tend to have more, with over 75s averaging $44,289.

💸 Since then we have had eight interest rate rises and with inflation at 7.3% this quarter, our savings have taken a big hit – dropping from 8.3% to 6.9%.

👀 One in five Aussies have less than $1000 in savings to lean on in case of emergency.

This is where my little saving trick comes in – I simply use my spare change to save.

Let me explain how...

How does it work?

Think of it like an old-fashioned piggy bank, where you used to dump all your spare change.

But instead you do it digitally – e.g. you go grocery shopping and you account has 806.75 left, so you transfer the $6.75 into your savings or mortgage or offset account.

If you haven't tried this before here is what you need to know:

There are savings accounts that do this automatically for you and can you decide to round to the nearest dollar or figure.
You can also find apps that also do this – some even have a fun feature where you can see how much you have saved by doing it.
Another option is to invest those extra dollars, which is also a way to leverage your spare change.
Some of these apps cost money, but if they motivate you to save then they might be worth it.
Rounding up isn't just for savings either, you can use it to pay off debt or give to charity.

Here's my round-up lessons...

No app required. I am a bit of a nerd but I tend to check my accounts every day (sometimes twice – hey, it's good for security too!) – and transfer anything odd... so if I have $108.99, I'll transfer $8.99 into my offset.
I tap everything now. I can't remember the last time I went to an ATM, so those odd numbers are helping me to seriously boost my bottom line.
At the start of my savings journey I used the round-up to pay off my credit card debt. I also used any bonus income, like birthday money to do that too. Long story short, I don't have any credit cards any more, but I get that they work for others. I love my debit card.
Small things add up... I am easily putting an extra $50 a week against my offset and that really helps reduce the interest that I am paying on my mortgage.
It's a worthwhile effort. So yes, I could have an app, but I don't like giving my bank details out and find it really satisfying transferring money to my offset... I think of it as my digital version of a coin jar.
Savings don't have to be complicated. I think sometimes we over think savings, I know because I did it myself. I used to think if I didn't put away some magical figure like $100 a week it wasn't worth it – but that isn't true, these odd dollars and cents make a huge difference to my money goals.
Treats. In the beginning of my savings journey I was really not very nice to myself. The thing is that doesn't work. So when I save more than my target each month, I now give myself permission to do something nice with a bit of the excess. Friday night ramen, I am talking to you!
Is it worth it? Absolutely yes, it's a simple, easy and tried method worth testing in your own life.
Auto-it. So I haven't tried this yet, but writing this story makes me want to give it a go. I'm going to see if my bank has the option so I can save even more.
Savings is a journey and not a destination. And by that I mean, don't beat yourself up if it isn't perfect and if you don't hit every goal you set when you expect to. The main thing is you are on your way.

How much did I save?

A fair bit actually this year – that's because not only do I transfer odds and ends into my actual mortgage as well as my offset, I also always overpay.

My current variable rate loan repayment is $287 a fortnight – it was $221 at the start of the year... and I pay $300 a fortnight, so still $13 ahead.
I might increase it to $350 in the new year though. It's my way of practicing paying higher interest rates (which still show no sign of abating).
I'm still in a good position with the fixed rate part of my mortgage (1.99% I love you), till July.
That's $973.20 a fortnight, and I am currently transferring a $1000, so let's say $25 ahead.
In February, I am upping my mortgage repayments from $1300 a fortnight combined to $1650 in preparation for the increase in July or an extra $450 a fortnight then I was paying in April ($1200) this year.

My random round-ups also saved me just over $2K this year.

Randoms: $2000

Variable: $312

Fixed: $600

Total: $2912 a year.

🫶 Not too shabby, round-ups!