How Aussies can avoid the ‘spaving’ trap

In a world where the temptation to splurge is everywhere, it's easy to fall into the trap of 'spaving', aka - spending to save. While it may seem like a savvy strategy at first glance, this trend can quickly lead to financial pitfalls if not approached with caution.

So what exactly is 'spaving,' you might ask? It's the act of spending money in order to save money in the long run. Whether it's purchasing discounted items in bulk or signing up for memberships with promises of exclusive deals, 'spaving' tricks consumers into thinking they're making smart financial choices when, in reality, they may be overspending in the name of saving, and let’s face it, we’ve all done it.

While there's nothing wrong with seeking out bargains and deals, it's essential for Aussies to approach 'spaving' with a critical eye. Here are a few reasons why:

  • Impulse Spending: The allure of a good deal can be hard to resist, leading to impulse purchases that may not align with your financial goals. Before succumbing to a 'spaving' offer, take a moment to consider whether it's something you truly need or if it's just a tempting bargain.
  • Hidden Costs: Many 'spaving' deals come with hidden costs or requirements that may not be immediately apparent. Whether it's a subscription fee, minimum purchase requirement, or expiration date on discounts, it's crucial to read the fine print before committing to any 'spaving' offer.
  • False Savings: While 'spaving' may seem like a great way to save money in the short term, it can actually end up costing you more in the long run if you're not careful. Overspending on unnecessary items or locking yourself into long-term contracts for the sake of a discount can ultimately undermine your financial stability.

So, how can Aussies avoid falling into the 'spaving' trap? Here are a few tips:

  • Stick to Your Budget: Before making any purchase, whether it's a 'spaving' deal or not, always refer back to your budget and financial goals. If a deal doesn't align with your budget or isn't something you need, it's best to pass it up.
  • Do Your Research: Before jumping on any 'spaving' offer, take the time to research the product or service and compare prices from different providers. This will help you determine whether the deal is truly a bargain or just clever marketing.
  • Practice Delayed Gratification: Instead of making impulse purchases in the name of saving, try practicing delayed gratification. Take a step back and give yourself time to consider whether the purchase is something you genuinely want or need. If it's still on your mind after a few days, then it may be worth considering.

While 'spaving' may seem like a smart strategy for saving money, it's essential to approach it with caution. To find out more about savings accounts to help you reach your savings goals sooner, see below.

Compare savings accounts - last updated 15 June 2024

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  • Savings Account

    5.35% p.a. (for $0 to $250,000)

    4.75% p.a.(for $0 to $1,000,000)

    Yes up to $250,000

    Bonus variable rate is available for the first four months.

    Competitive introductory variable rate for first 4 months (on deposits up to $250,000). No account keeping fees to pay. Multiple 2023 Mozo Experts Choice Award winner.

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    5.10% p.a. (for $0 to $250,000)

    0.10% p.a.(for $0 and over)

    Yes up to $250,000

    Deposit at least $200 to either Spend, Bills or Save account from an external source each month.

    No monthly fees on any of your save accounts. Split your money with up to 10 Save accounts. Set savings targets and track the progress of all your Save accounts. Deposits guaranteed up to $250K per customer.

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    5.45% p.a. (for $0 to $250,001)

    1.50% p.a.(for $0 and over)

    Yes up to $250,000

    Increase balance by $200 by the end of each month

    Reward yourself with a higher rate for your good savings habits. Rabobanks’s PremiumSaver is simple - receive the maximum rate when you grow your balance by at least $200 each month (T&Cs apply). Plus, your savings help our Aussie farmers produce the food we love to enjoy.

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    Savings Maximiser

    5.50% p.a. (for $0 to $100,000)

    0.55% p.a.(for $0 and over)

    Yes up to $250,000

    For customers who have an Orange Everyday account, deposit $1000 into a personal ING account, make 5 eligible transactions and grow their nominated Savings Maximiser account each month.

    Great variable rate every month when you grow your balance each month in addition to other eligibility criteria. No ING fees to pay. Save even more with ING Everyday Round Up. Mozo Experts Choice Awards Everyday & Savings Bank of the Year winner for 2024.^


^See information about the Mozo Experts Choice Savings Account Awards

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