It’s a brand new financial year, so why not make a fresh start?
Achieving your financial goals isn’t simply a matter of earning more. It’s also about making your money work smarter for you.
Build a budget
Making a budget will help you keep your spending on track, so you can save more and pay off debts faster. By having a clear picture of how much money is coming in and how much you’re regularly spending, it will be easier to find ways to cut out unnecessary costs.
Start by keeping a record of all your earnings and outgoings for at least a month. Then, you can spot ways to reduce your spending, like bundling your phone and internet, or shopping in bulk.
With a clear budget in place, you may discover that your debts are costing you more than they need to be. Consider shopping around for a better deal on your home loan, or choosing a credit card that has a lower monthly interest charge. With some simple calculations, you’ll soon see how these kinds of debt management strategies could save you a lot of money over the long term.
Streamline your super
By consolidating your super you can usually save on fees and charges, which can add up significantly over the years. Having a single super account also means less paperwork, so it’s easier to keep track of how your retirement investments are faring, or to change your investment strategy to suit your life stage. And if you think you may still have funds lurking in an old super account somewhere, you can find your lost super using the Australian Tax Office’s Super Seeker tool. A word of warning though – when consolidating your super accounts, make sure you look into the potential risks – for example, there may be potential exit fees or loss of insurance.
While you’re focusing on your super, it might also be a good time to consider increasing your contributions through a salary sacrificing arrangement. This can be a tax-effective way of boosting your super, because additional contributions of up to $25,000 are usually taxed at a rate of only 15%.
Investigate your insurance
With any financial plan, it’s worth making sure you have the right types of insurance cover for your circumstances. Having adequate life insurance and total permanent disability insurance means your family’s lifestyle will be supported if you pass away or become permanently disabled, critical illness can cover medical and other expenses, while income protection insurance can provide vital regular payments to cover your bills and expenses if you’re unable to work due to illness or injury.
But how much insurance is enough? It all depends on your needs, debts and income. The default cover offered through your super fund may be sufficient, but often is not — and it could mean you save on premiums and have less paperwork to deal with than if you had multiple policies through different insurers. However, everyone’s situation is different, so it might be worth getting professional advice before making any major insurance decisions.
Get the right advice
A skilled financial adviser can help you make the most of your money and achieve your lifestyle goals. To find out more contact:
Ryan Kelly (Western Australia) ryank@spfgroup.com.au or 0432 051 778
Stevie-Jade Turner (Eastern Australia) steviet@spfgroup.com.au or 0433 313 099