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Why a Money Buddy could help you achieve your 2020 savings goals.

January 10, 2020  |  #Money Management

Ever noticed it’s a lot easier to turn up to the gym if you have a friend joining you? So why not do the same for your finances? Introducing the Money Buddy! A Money Buddy could be the accountability you need to stay focused on your goals and actually achieve them.

If you’re serious about sticking to your budget and achieving your 2020 financial goals finding a reliable and trustworthy friend to act as your Money Buddy and join you on your financial journey could be the thing that makes 2020 the year you reach your goals and improve your financial health. But how do you choose the right friend and how does a Money Buddy make a difference?

 

Understand how a financial adviser can support you with your need for financial security. Get in touch.

 

Why having a Money Buddy helps?

 

1. A Money Buddy will help you stay accountable

Ever heard the saying “those who write down their financial goals are 42% more likely to achieve them’’?[1] As well as writing down your financial goals, sharing your goals with people who you trust can help to keep you accountable and increase the chance of you reaching those goals.

You might decide with your Money Buddy that you want to save $5,000 in the next 6 months, so you need to save $200 a week in order to do that. Each week you call each other and check in on how you’re tracking. You may even find you have some savvy saver tips to share. Having someone hold you accountable also means you need to fess up on the weeks you accidentally impulse buy and spend your “savings money” on the latest trending product that you couldn’t possibly wait to have. The thought of having to fess up might be enough to stop you from pressing “BUY NOW” all together! And yes, it still counts even if you ‘Buy Now Pay Later’ over 4 easy fortnightly payments.

If you want to make a start by saving $1,000 in 10 weeks, join our Money Bounce Back Challenge and refer a friend to get your savings goal started! Join here.

 

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A Money Buddy will make you accountable and less likely to impulse buy.

 

2. Friends can make a massive impact on your social spending

“We are the average of the five people you spend the most time with” a famous theory by motivational speaker Jim Rohn. This refers to not only behavioural choices like how many times you go out together a week or go shopping but all areas of your life including your mindset, salary, career goals, values, aspirations, and personal success. For example, your friends are all saving roughly $100 a week but you know you’re capable of saving $300, you never end up saving more than $150 at best because you don’t feel the pressure or expectation to be saving more. Where comparatively if your friends were all saving $300 a week it’s more than likely that you would be reaching closer to saving the full $300.

If your friends aren’t on the same page as you when it comes to financial goals and they are still set on going out two nights a week and owning the latest gadget instead saving it towards something bigger, it may be time to start networking and find some friends who have similar goals. Look for people who inspire you and who aren’t going to derail you from your own journey to success.

 

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The right friends can inspire you and keep you on your own journey to success.

 

3. A Money Buddy can prevent you from giving up early

Saving isn’t easy and it can sometimes feel like you have to live out your days like a hermit in fear venturing out of the house, as any error of judgement could lead to you blowing your savings account! The beauty of a Money Buddy is that they are going through this with you! Just like when your gym buddy is dragging you along the cycle class you were adamant on skipping out on a Money Buddy may convince you to choose a movie night instead of going to the cinemas.

Having someone on the same savings journey with you who is consciously aware of what you are trying to achieve means you won’t feel alone in your efforts and like you need to give up your entire social life.

 

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Saving is not an easy task however you don’t need to feel alone in your efforts.

 

So how do you choose the right Money Buddy?

 

Although having anyone hold you accountable is better than having no one there are some considerations to make when choosing a Money Buddy.

Finances can feel very personal so it’s important you choose someone you feel comfortable sharing your savings and financial goals with. You don’t need to share salary or a detailed budget but opening up about money can be harder than you originally thought.

One great way to start money conversations is to identify your goals. To get your head around this you may want to start by listing your achievements for the last 12 months. This can help you set the scene for the year ahead. You may also want to have an expert on your side, participate in deliberate savings, and know what your next investment is. You can download our resource on personal goal setting to create your picture.

Another great way to start to talk about money is by identifying your Money Mindset. It can provide valuable insights into how you approach your relationship with money as a start-point to having meaningful conversations. We discuss this further in our article on how to talk about money.

You will want to find someone who is in a similar position to you or who is a good role model. You don’t want anyone who is going to resent you for having big dreams and potentially being able to save more than you can. It’s good to find someone who is happy with their own financial situation, or who has clear goals for achieving their own financial goals.

 

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Ideally, your Money Buddy should be someone you see and speak to regularly.

 

The run-down on how to make a Money Buddy work

 

  1. Choose someone you see and speak to regularly. You need to be able to comfortably check-in with your Money Buddy and although it’s not crucial it helps if you normally spend time together so you can switch the expensive night out to a fun night in.

 

  1. Work out a time and place if you’d like to meet face-to-face to talk about your progress regularly. This may be weekly or fortnightly.

 

  1. Set your goals and share them with each other whether it’s to save $600 a fortnight or save $20K for a house deposit. Your goal could even be saving $3,000 in your emergency fund or $2,000 for a special holiday. However big or small every dream and goal really does count! A larger long-term saving goal helps to set milestones, for example, you want to save $16,000 in a year. Each quarter you need to save $4,000 so set quarterly milestone goals.

 

  1. Create a Budget together as creating a budget can seem like a daunting task so why not do it with your Money Buddy to see exactly where your money is going and where potential savings lie. You never know it might be fun and generate a few laughs! You can use our free budget planner

 

  1. Keep your eye out for any savvy saver tips you may have picked up. Be tuned in to financial information, i.e. review articles, watch the News, google topics of interest.

 

  1. Celebrate the wins! Congratulate each other on reaching milestones and final savings goals!

 

Financial advice can help you to achieve your goals and dreams. Speak with an Adviser about how we can assist you on your path to financial freedom.

[1] https://www.inc.com/peter-economy/this-is-way-you-need-to-write-down-your-goals-for-faster-success.html

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