Grow Your Money While You're Young - Here's How

Check out your expenses on the reg

Usually when you’re starting out your working life, it’s a little easier to cut down on spending than it is to ask for a higher wage or salary. More money saved means more money you can put into a savings account, your super or invest - creating something called a passive income.

A good tip that we recommend you try is sitting down regularly with a list of your transactions over a couple of weeks or a month and see where your money is going. Make sure you put some good tunes on or get yourself a treat to keep it light and breezy. You might notice a couple of old subscriptions or free trials that you forgot to cancel, which you can usually nip in the bud in a couple of minutes flat!

Put extra money into your super

This is a great method if you want to play the long game when it comes to saving money. Your superannuation is basically a mandatory retirement fund that your employer pays on top of your take-home salary. Your super fund provider takes that money and invests it for you so that you have a nest egg for when you retire (or if you want to make a deposit on your first home).

What a lot of people don’t know is that you can contribute money into your super fund on top of the legally required contributions. The two main ways to do this are through salary sacrifice and through personal super contributions. The first method is useful because superannuation contributions are usually taxed at a lower rate than your usual income tax rate. Contributions after your tax has been paid don’t get a lower rate, but you may be able to claim them as a tax deduction.

Super is a lot like a savings account where having more money in your super early on can have a ‘snowball’ effect which can mean you’ll have more money later down the road. The only drawback for this method is that you can’t access your super for everyday expenses - so you have to be pretty sure you won’t need the money any time soon.

Consider looking at some extra investments

Investments can seem a little scary from the outside, but an investment is basically a purchase that you make now with the aim of using it to make more money later.

You can invest by buying and selling physical objects such as property or collectables, financial products such as stocks, bonds, or ETFs, or even invest in yourself by getting extra training and qualifications.

There are a couple of golden rules when it comes to investing. First of all, don’t invest money you can’t afford to lose. It’s a good idea to make sure all your needs are met before taking risks with your money.

The second rule is to do plenty of research. No investment is risk-free (and you should avoid anyone who tells you otherwise). The more you learn about the product or asset the more you can understand the risks involved and whether it is a good fit for your goals and circumstances.

If you’ve made it to the end of this article, or even just clicked on it and scrolled straight to the bottom, you’ve already embarked on a great big-money journey - so congrats!

Are you still looking to learn some more about all the money stuff you didn’t learn in school, why not check out our super-short course FinLit? We take you on a tour through some of the basics when it comes to saving, spending, investing and more! Take a squiz over here.

The above content has been created by Year 13 in conjunction with Westpac as part of a paid partnership. The information is general advice only, does not take into account your personal circumstances and you should do your own research and seek advice before acting on this content.