Saving hard earned cash can be a difficult task for many people but there are some simple tips to help you invest in your future.
Putting away $2 a week can be the first step in helping you reach your savings goals, along with always carrying cash and revealing your spending habits to loved ones.
The tips were pieced together to UBank and Dr Phil Harris, an Honorary Fellow at the University of Melbourne’s Faculty of Business and Economics and an expert in Consumer Neuroscience at Nuro Research.
A consumer expert, in partnership with UBank, has revealed the top tips to help people rein in their spending
Experts say using cash instead of cards is a helpful tool for saving, because people are less likely to handover physical money
It came after an experiment into people’s spending and saving behaviour was carried out by Dr Harris in partnership with UBank, where 50 people were at one stage faced with an image of their future selves and quizzed on financial decisions.
The experiment found people’s brains reacted differently to financial situations when they had a glimpse of their future, through aging technology software, compared to how they saw themselves today.
An EEG device was placed a person’s head to monitor their brain activity.
‘Humans are wired to want rewarding outcomes immediately, so it was very interesting to conduct this experiment. The results found that the people were significantly more likely to choose to save money when they became more in touch with their future self,’ Dr Harris said.
‘After interacting with visualisations of themselves later in life, 72 per cent of participants shifted their mindset towards wanting to save, versus spend money.’
According to the tips, by also visualising your saving goals, you can help train your brain to achieve your financial desires, such as a new car, holiday or home.
An experiment carried out by Dr Phil Harris in partnership with UBank found people’s brains reacted differently to financial situations when they had a glimpse of their future selves
Placing an image of what you’re saving for on your fridge or your phone’s lockscreen can help achieve that.
UBank and Dr Harris also encourage people to make saving a regular habit, where the idea is to start small with just $2 a week to ‘train your brain to put money away with a schedule and ultimately make it a habit’.
Always using cash for purchases rather than a card is another helpful way to save.
‘By simply withdrawing cash from an ATM and using that for necessary spending, you will feel less inclined to physically handover notes,’ the tips developed by UBank and Dr Harris say.
People are encouraged to share their what they’ve been spending money on with a family member or friend.
‘Giving someone else visibility to your spending habits will help keep you more disciplined about your money,’ tips say.
Dr Phil Harris said ‘people were significantly more likely to choose to save money when they became more in touch with their future self’