A 28-year-old corporate lawyer has spilled her secrets on how she saved $35,000 in 12 months using a simple budgeting method anyone can follow.
Aleks Nikolic explains how putting a label on the planned future use of the funds can help boost your savings — making it harder for you to spontaneously spend your earmarked money on other things.
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“I find it so much easier to save if you know what you’re saving for,” the Sydney woman tells 7Life.
“Putting $500 aside for an ambiguous future date is hard. But $500 towards flights to Europe feels so much more satisfying.
“In my case it was a house deposit — I knew every $500 brought us closer to our dream home.”
Aleks Nikolic has spilled her secrets on how she saved $35,000 in 12 months. Credit: Mike Jeffrey’s Photography
Aleks says she used to struggle to save money for years after earning just $300 a week and falling into a credit card debt.
Eventually, she found a simple way to set aside her hard-earned cash.
The trick is to simply have a specific purpose for your savings.
“Having just a big bucket of cash that includes your emergency fund, home savings etc makes it really easy to dip into that money and not know what you’re stealing from,” she explains.
“When you label your accounts with exactly what they’re for, (it) makes it really hard to steal from your holiday fund knowing that you’re taking away money from flights or accommodations.
“And that makes it a lot easier to say no to those purchases.”
Aleks says one of the best ways to budget your earnings is to automate your savings.
“I try to reduce any decision making associated with saving money. All my savings are completely automated,” she says.
“On the day my pay comes in, I automatically set aside $800 into a separate account.
“I think many of us leave budgeting to a manual process.
“But lots of decision making around money makes it seem dull, hard, and you can easily spend more than you intended if you have to decide each week: Do I put this money away or do I go out for drinks and have four margarita cocktails at $25 a pop?
“My bank automatically puts the money into separate accounts without me thinking about it.”
The lawyer explains how putting a label on what the funds will be used for can help boost your savings. Credit: Aleks Nikolic
Over the years, Aleks has been working as a lawyer and as a people manager whose role involves the process of hiring, leading and developing team members.
“I have really focused in the last couple of years in both increasing my primary source of income but also creating new streams of income,” she says.
Aleks acknowledges her corporate roles are a “privilege”, which have contributed — along with hard work — to her ability to save.
She saved $35,000 in 2023 because she knew she needed the money for a mortgage.
“The savings was specifically intended to boost our house deposit to try to offset the impact of interest rates,” she says.
“It is a huge privilege to have this much disposable income to save.”
For any unexpected earnings such as tax return or work bonus, she allocates the funds into a savings account of her choice.
“I decided that any windfall was going to go towards this goal,” she says.
“This meant my tax return, cashback, interest saved on other accounts, dividend payments and even refunds I received — every dollar automatically goes to this account so I don’t have to think about it.
“My work bonus was also a significant contributor to the goal.
“I highly recommend this because it can be a total money game changer.”
Aleks explains how saving more money than you need can prevent you from fully enjoying your life today.
“This may seem crazy but trying to save too much is a mistake,” she says.
“Budgets have to be sustainable and life needs to be fun. Your budget needs to work for your needs and your wants if you’re going to be able to live with it long term.”
Aleks says she keeps three months of her salary saved in her emergency fund in the event of unplanned expenses.
“This is deeply personal because everyone’s comfort, level around money and job security is different,” she explains.
“I keep three months in my emergency fund of bare bones expenses. When I was living at home and didn’t have a mortgage, I kept a month.”
Aleks suggests approaching your financial priorities like you might approach trying to lose weight. Credit: Aleks Nikolic
For those struggling to save money, Aleks suggests looking at your financial priorities in the same way as you might look at trying to lose weight.
“No one gets fit overnight,” she says.
“I did the whole restriction, overspending and even credit card debt cycle when I was learning to manage my money.
“But much like fad diets, a sustainable budget is more effective than a lemon water budget of trying to spend $0 for a fortnight.”
When she was trying to get better with money, the biggest challenge she had to overcome was figuring out “why” she was overspending.
“When I realised it was often boredom, anxiety or discomfort, I came to the shocking realisation that no amount of clothes was going to make me feel better,” she says.
“Learning to put money towards things I cared about, like holidays or experiences, and less toward things that provided a temporary balm to my anxiety, such as clothes shopping and eating out, I found I was able to save a lot more and it was really easy.”
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