Are you a Spendy Young Thing?

Oh Tony.

Tony, Tony, Tony.

For those who don’t know, Tony Alexander is the chief economist at BNZ and he said a few things about Spendy Young Things (SYTs) not saving properly for a house.

Tony would like you all to have a house, you see, but you do rather spend a lot on things he says you don’t need. Like landscape gardening (!), lattes and smashed avocado on toast at your favourite Sunday brunch spot.

Of course, the real reason you don’t have a house has nothing to do with the price of avocados and more to do with the price of houses and Tony’s comments have been debunked by those who point out that buying a house 30 years ago took considerably less of your weekly take-home pay than buying today and perhaps if Tony were to look at things that way he’d see why SYTs have basically given up saving for a deposit. Pass the kale salad, if you please.

But.

But…

Putting aside for a moment the need to save for a house and let’s just think about saving for the future. Any future. You might decide to buy a house in 20 years’ time or you might decide to go on holiday in five years, either way you need to save and so underneath it all, Tony might have a point about saving.

Saving is hard work and it means going without your favourite things and wearing sack cloth and darning your own socks. So chop chop, let’s get to it.

Actually, that might not be the case. There might be another way to save that means you can eat your cake avocado and have it too.

Saving is always painted as such a chore but really it doesn’t have to be. The problem tends to be the goals we’re aiming for are so huge that when you’re looking at that donut or bottle of pinot or pair of shoes on sale your perspective gets all screwed up. There’s no way not buying this coffee is going to make a blind bit of difference to the end goal so I might as well just buy it and be done with it.

For once, you really don’t want a sense of perspective.

Instead of aiming for your goal every time you spend any money, let’s not think about the goal at all. It’s too far away and too scary. Instead, let’s look at how you spend your money and whether you can make any savings on that side of the equation.

I like coffee. I used to drink gallons of it but found I couldn’t sleep at night and wasn’t terribly much fun during the day time and I had to go to the loo an awful lot and so I decided to have only one cup of coffee a day, at about ten in the morning.

I struggled with it, I fought against it, I used to slip up and sneak in an extra but somewhere along the way something interesting happened.

I began to really enjoy drinking coffee.

Oh my goodness, I can’t tell you how good it was. I’d savour it. I’d smell it, I’d consider it up close. I’d sip it. I’d admire it.

It’s become a ritual for me and one I’d hate to lose. Coffee stopped being a fuel and became something I enjoyed again, quite by accident.

This wasn’t a cost-saving measure, this was a caffeine-reduction measure and one I was reluctant to take part in, but it worked and I felt better as a result.

Saving works the same way. Work out what your absolute costs are each month (rent, power, water, internet access, insurance, whatever). That’s your ground zero – without these things you can’t survive.

On top of that add your things you absolutely would not want to live without. That one coffee a day for me was non-negotiable. My wife couldn’t care less about coffee but for her it’s our Netflix subscription. The kids don’t care for Netflix but can’t possibly live without Spotify.

These are your non-negotiables and they’ll differ from person to person, and even from year to year. For you it might be that avocado on toast special at the café or it might be a subscription to Sky TV or the gym membership or yes, Tony, it might be the landscape gardener. But you have to have a life and you have to have some fun so you might as well build it in.

Beyond that are your fritters. No, not corn fritters with bacon and some really nice sour cream  (you SYTs are obsessed with food, clearly), I’m talking about the things you fritter away without realizing it.

Like your phone bill.

I pay about $100 a month for my mobile because it’s a business phone and that’s what they cost. Well they used to – I haven’t actually looked for more than a year because who looks at these things. Now that I’m talking about it I can see that a mobile with unlimited calls and txts and 6GB of data can be had for $50 a month.

Holy cow, that’s good!

And if I can make unlimited calls, do I need to have a landline with a toll calling deal as well? Actually, no I don’t. So let’s get rid of that entirely.

Now I’m saving closer to $100 a month. That’s $1200 a year and I haven’t had to change anything about my day-to-day life.

What about my power bill? What about my insurance? What about my car? What about that credit card – I discovered I was paying for a platinum card which was giving me rewards that I never used. What a waste! Now I don’t pay for a fancy card but oddly that doesn’t stop me from using it. Who knew!

A friend of mine has a bumper sticker about driving to the gym which costs money so you can burn fat versus cycling, which uses fat and saves you spending on the gym. He’s taken it to the full extent and done away with having a car altogether. When he goes long distance he hires a brand new car for the weekend and saves himself a fortune over the year.

Taking a hard look at these kinds of bills that just nibble away at your money is essential because you work hard for your money and you should enjoy it when you spend it.

And that’s true whether you’re saving for a house or not.