If you're saving for a holiday, a new car or even a home deposit, it can help to have pointers to guide you.
Sure, a high-interest savings account is a good start for scoring interest and keeping your hard-earned cash locked away for a period of time. But in terms of reaching your financial goals, how do you motivate yourself?
Dreaming of white sand and palm trees?
Expedia recently released its 2014 Insiders' Select List, which outlines the hottest hotels from around the globe. The top pick was California's Lakehouse Hotel and Resort. Indonesia's Bali is a haven for holiday makers – Seminyak's Blue Karma Resort scooped up second place.
Saving for a home deposit or retirement is smart, but remember that a little rest and relaxation is important too. There's your first tip to saving for a financial goal: Have something to look forward to within your means, whether it's a relaxing long weekend or annual overseas trip.
"Although many Australians are experiencing a shortfall of cash between pay cheques, these households are likely to be including savings and debt repayments into their monthly commitments. With this in mind, Australians continue to take a sensible approach to household financial management," noted John Arnott, ING Direct Executive Director of Customers.
By being proactive about your finances and repaying debt, you'll feel like you earned that fantastic holiday.
Need a new car or a property upgrade?
Sure, it's great to see your high-interest savings account growing over time. As much as we'd all love a holiday in an exotic location, sometimes life's practicalities get in the way.
If your car is spending more time at the mechanic than in your garage, it might be time for a new vehicle. Perhaps you're done with renting and want to start building up equity in your own property.
There we have the second tip to saving for a financial goal: prioritising.
There's no point enjoying a luxurious holiday if you're going to return to an expiring lease or broken car. By contrast, if you're in dire need of a little rest and relaxation, have some annual leave saved up and your living situation is stable, you'd be better off treating yourself to a rejuvenating getaway.
Set a time limit
Are you racking up big dollars on your credit card and struggling to see how you'll save for a holiday, new car or home deposit?
Here's the third tip for saving for a financial goal: Set yourself a time limit for paying off high-interest debt, whether you've taken out personal loans or have been relying on your credit card too much.
If you continue to pay off debt at the minimum rate, it'll be a long time before you can realise your financial goals. Once you've paid off this kind of debt, you can focus on making some serious savings.
Start small, then reach for the sky
Let's say you're saving for a house. If you want to avoid Lenders Mortgage Insurance, you'll need a 20 per cent deposit.
To lock in a $400,000 property, you'll therefore need an $80,000 deposit. That sure ain't chump change — in fact, such a large amount can be a little daunting.
Here's your fourth tip: Start with small savings goals, so you can check them off faster. For instance, your first goal might be to save $5,000, then $10,000, and so forth. By achieving smaller goals more frequently, you may find yourself a lot more motivated.