7 ways to save while paying off debt.

Despite what many people think, building up your savings at the same time you’re paying down your debt is possible. And it doesn’t require perfection or a finance degree. Just a few small, smart, repeatable habits is all it may take to get your savings working harder for you.

Here’s 7 practical ways to do it.

1. Know what you owe (and tackle the costly stuff first)

Start by listing all your debts and how much interest applies to each debt – credit cards, personal loans, HECS, home loan, etc. Once it’s all in one place, focus on paying off your debts with the highest interest rates first. These are the ones that tend to grow the fastest and cost you the most over time.

2. Get a clear picture of your budget

If you don’t already have a budget, don’t overthink it. Simply check your bank statements from the last few months and group your spending into categories. A free budget planner can make it easier. Seeing everything laid out can be empowering – and a great way to spot ways to turn the dial on some of your spending.

3. Trim the spend that doesn’t spark joy

When you review your spending, chances are a few ‘how did that add up?’ moments will pop up (hello, food delivery). But you don’t need to cut out all the fun. Just identify the things you won’t miss and redirect it towards building up your savings or pay down your debt.

4. Pay yourself first (future you will say thanks)

Instead of saving whatever’s left over, flip the script. Set up an automatic transfer to move a portion of your income – say 10% – straight into savings each payday. Because it happens automatically, you’re less likely to notice and spend it.

5. Treat credit cards with care

Credit cards can be handy, but interest add ups fast if you don’t pay it off by the due date. So if you use one, always aim to pay the balance in full each month. If you only pay the minimum, you’ll be hit with interest which can undo your hard work elsewhere.

6. Let small change do the heavy lifting

Automatically rounding up your everyday purchases and moving the spare change into your saving account is another no-brainer way to build the habit without feeling it. Over time, cents can turn into dollars. And dollars into something you’re proud of.

7. Boost your savings with bonus interest

Some savings accounts also offer the chance to earn bonus interest when you meet certain criteria. It’s a smart way to accelerate your savings so you can do your thing even sooner.

The takeout

Saving while paying off debt at the same time might sound like a juggling act. But it’s really just about building a few good habits and letting them do their thing. Take it step by step, celebrate the small wins and remember: progress beats perfection every time.