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How to save for your wedding

How to save for your wedding

It’s meant to be one of the happiest days of your life, but with the average Australian wedding costing couples upwards of $35,000 (according to ASIC) many marriages start off with debt hanging overhead. 

If you or your partner have champagne tastes on a beer budget there are many ways you can cut down costs on the big day and still have a dream wedding.

  1. Choose your ‘big ticket’ items first

At the beginning of the planning process it’s important you talk to your partner about which ‘big ticket’ items you’re willing to take the budget version of and which you aren’t.

Maybe you’ve always dreamt of a live band as opposed to a great Spotify playlist, or you’d rather fork out for an amazing photographer instead of a limousine. Whatever you choose, try to make sure you and your partner are on the same page, or can compromise, for the sake of your budget. 

  1. Make a strict budget

Speaking of budgets, it’s crucial that you make a strict one and stick to it. Pinterest has a lot of great resources for ready-made budgets over various timelines prepared by wedding experts.

  1. Set up a high-interest savings account

According to ASIC’s MoneySmart website, 82 per cent of Aussies used their savings to pay for their big day, so why not help those savings to grow without risky investment?

By setting up a high-interest savings account specifically for your wedding you can take advantage of higher than average interest rates. High-interest savings accounts traditionally limit the number of withdrawals you can make or require minimum monthly deposits, making them a helpful wedding savings tool.

  1. Move back in with your parents

While it’s not the most ideal living situation, if you’re willing to put up with your family or the in-laws for a few months, you could help save a few extra thousand dollars for the wedding of your dreams.

  1. Sell your car

If public transport is decent in your area, selling your car could be a viable option for you to make a few extra thousand dollars (and cut down on transport costs) while you plan your wedding.

  1. Book in off season or not a Saturday

It goes without saying that Saturdays in Spring are the most sought-after wedding dates for couples. This also means venues can charge through the nose during ‘wedding season’. Cut down on costs by having your wedding in the off season (Autumn to Winter) or on a Sunday.

  1. Consider a competitive wedding loan

According to ASIC’s MoneySmart website, 60 per cent of Aussies take out a loan to pay for their wedding. If you’re the type of person who is responsible at paying bills on time, taking out a competitive wedding loan is another option to consider.

By utilising comparison site such as RateCity, you can choose from a range of wedding loans with a number of features, such as redraw facilities and the ability to make extra repayments.

  1. Don’t tell them it’s for a wedding

As you’ll quickly learn while planning, the second the word “wedding” appears the price seems to double! Another trick that’s worth a try (if you’re not opposed to little white lies) is to not tell the vendor that what you’re requesting is for a wedding. While you may not get away with it for the dress, it’s worth a try for expenses such as catering or transportation.

  1. DIY invitations/website invitations

If letter-pressed, gold leaf covered invitations didn’t quite make your ‘big ticket expenses’ list, why not make your own? For the crafty types out there, DIY invitations can be a sweet, personal touch for those receiving them.

You can also make a website invitation through platforms such as The Knot. These are a popular alternative to traditional snail-mail invites, and can be completely personalised to suit your style.

  1. Handy alcohol hacks

Racking up a huge bar tab is one of many ways people can blow their wedding budgets. However, there are a couple of ways you can cut down the cost of cocktail hour.

Some venues will let you bring your own bottles of spirits, so keep an eye out for specials and discounts on bulk purchases at liquor stores. Another way to save is by only serving beer and wine on tab, or just serving a signature drink, that way people can still celebrate for free or pay themselves if they want another type of drink. 

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Learn more about savings accounts

How to make money with a savings account?

Savings accounts make you money by earning interest on your savings. The more money you deposit, the longer you leave it in the account, and the higher the account’s interest rate, the more interest you’ll be paid by the bank or financial institution, and the more your wealth will grow.

To make sure your savings account makes money and doesn’t lose money, it’s important to maintain a large enough minimum balance that the annual interest earned exceeds any annual fees charged on the account.

What is an ANZ locked savings account?

An ANZ locked savings account locks your money and prevents you from spending. You may use a standard savings account as the account where your salary is deposited. You can then withdraw funds when needed, but aren’t able to make purchases with it. However, this account may not grow much as the continual withdrawing of funds will limit the interest you can earn.

With a locked savings account in ANZ, you know your savings will grow because you can’t access the money. You can also qualify for a bonus when you deposit at least $10 per month and don’t make any withdrawals. To help you with this further you can set up an automatic transfer from your regular ANZ savings or transaction account so you don’t forget to make a monthly deposit.

Your ANZ locked savings account offers you a base interest rate of 0.1 per cent per annum plus an additional bonus interest of 0.49 per cent per year. The interest is calculated daily and credited to your account on the last working day of the month.

Can you have multiple ING savings accounts?

Yes, you can open up to nine accounts with ING at any particular time. If you’re saving money for various goals, such as buying a car or taking a holiday, you can name each of your multiple ING savings accounts differently.

To get a Savings Maximiser account, you’ll need to deposit more than $1000 every month and make at least five additional purchases. If you also want to grow your savings, from 1st March 2021, you can earn up to 1.35 per cent per annum variable interest on one account with a balance of up to $100,000 when you also maintain an Orange Everyday account.

With ING, multiple savings accounts can help keep track of all your savings goals. All the accounts offer flexible withdrawals where you can withdraw as low or as high as you want without impacting your earning interest rate. However, you can only earn the bonus interest on one account. To apply for a Savings Maximiser account, you can visit ingdirect.com.au.

Should I open a Commonwealth locked savings account?

If you have trouble saving money, a Commbank locked savings account could be a potential solution. A locked savings account won’t let you make withdrawals and as such, it can help you grow your savings balance if you keep topping it up. 

The Commonwealth locked savings account advertises high-interest rates and minimal maintenance fees, along with a host of other incentives that will encourage you not to touch the money. 

The account offers a higher interest rate for each month that you make limited or no withdrawals, as well as regular deposits. 

To qualify for a Commonwealth locked savings account with the advertised features, you will need to fulfil specific criteria such as:

  • Depositing a fixed minimum amount into the account every month.
  • Making a fixed number of deposits each month.
  • Making a minimum or no withdrawals each month.
  • Maintaining a minimum account balance.

How much money should I have in my savings account?

A good rule of thumb when working out a minimum balance for your savings account is to make sure that you’ll earn more in annual interest on your savings than what you’ll be charged in annual fees.

If you’re saving with a specific goal in mind, prepare a budget so the interest you earn on your deposits will help you efficiently reach this goal. Online financial calculators may be helpful here.

What is a Westpac locked savings account?

The Westpac locked savings account (also known as "Westpac Life") can help customers reach savings goals faster through bonus interest. Customers receive 0.2 per cent standard base interest with a variable bonus rate of 0.35 per cent when the closing balance at the end of the month is higher than the opening balance.

There are some conditions to earn the bonus interest on Westpac's locked savings account, though. First, you’ll need to increase the balance each month either through a deposit or not making any withdrawals, and then link it to a Westpac Choice account and make at least five eligible payments using your debit card. Please consult your bank as to what an eligible payment is. 

What are the two types of NAB locked savings accounts?

With a locked savings account in NAB, you can earn bonus interest and learn financial discipline. NAB offers two types of locked savings accounts, each with their own terms and conditions.

The NAB Reward Saver account pays a variable base interest rate of 0.05 per cent per annum and a bonus interest of 0.55 per cent. You’re eligible for the bonus if you make a minimum of one deposit on or before the second last banking day and have no withdrawals in the month.

Meanwhile, the NAB iSaver account provides 0.05 per cent as the standard base interest rate and a fixed bonus margin of 0.55 per cent during the first four months from the date of opening the account. You can park your cash in the account and enjoy unlimited monthly transfers between linked daily bank accounts without impacting the interest rate.

How does interest work on savings accounts?

The type of interest savings accounts accrues is called compound interest. Compound interest is interest paid on the initial deposit amount, as well as the accumulated interest on money you have. This is different from simple interest where interest is paid at the end of a specified term. Compound interest allows you to earn interest on interest at a higher frequency. 

Example: John deposits $10,000 into a savings account with an interest rate of 5 per cent that he leaves untouched for 10 years. At the end of the first year he will have $10,512 in savings. After ten years, he will have saved $16,470.

Can you set up direct debits from a savings account?

It’s not usually possible to set up a direct debit from your savings account to cover ongoing expenses or bills, as savings accounts are structured around growing your wealth by earning interest on regular deposits, and discouraging withdrawals.

Some transaction accounts allow you to set up direct debits and also earn interest, though you may not enjoy as much flexibility as a dedicated transaction account, or get as high an interest rate as a dedicated savings account.

What is the interest rate on savings accounts?

As banks frequently change their rates, the most accurate way to look at interest rates on savings accounts is to use a savings accounts comparison tool. When you look at the savings rate check what the maximum and minimum rates are. Often banks will offer you a promotional rate for the first few months which is competitive, but then revert back to a base rate which can sometimes be less than inflation. Ongoing bonus rates are often a safer bet as they will keep rewarding you with the maximum rate, provided you meet their criteria

What is a savings account?

A savings account is a type of bank account in which you earn interest on the money you deposit. This makes it one of the easiest and safest investment tools.

Can you direct deposit to a savings account?

Yes. You can make one off payments or set up regular direct deposits into a savings account. This can be organised easily through online banking or by making deposits in a branch. Talk to your lender to find out the easiest way for you to set up direct deposits.

Can you have a joint savings account?

Yes. Joint savings accounts can be useful for two or more people wanting to combine their savings to meet shared financial goals, including spouses, flatmates and business partners.

Some joint savings accounts require all parties to sign before they can access the money. While less convenient, this extra security can help encourage all parties to meet their shared financial goals.

Other joint savings accounts allow any of the account holders to access the money. These accounts can be convenient for financially responsible couples that trust one another implicitly. 

Who has the highest interest rates for savings accounts?

As banks frequently change their rates, the most accurate way to know who currently has the highest interest rate is to use a savings account comparison tool.