The glow of New Year’s fireworks may be a distant memory, but there’s another new year upon us that for many of us is more important. That’s right, the new financial year is here, and now is the perfect time to get your finances in order.
Below are our tips to hit the ground running and get the most out of your hard-earned cash.
Time to plan
The new financial year presents a terrific opportunity to re-valuate your goals and aspirations as they may have shifted over time. Take stock of where you are now and start making a plan to work towards where you want to be.
Implement a forced savings plan
As many of you know, I am not a fan of budgeting. It is like a diet – hard to follow and often not practical in everyday living. Instead, start a forced savings plan!
A forced savings plan directs money, automatically, on a regular basis to where it needs to go. This might be to an offset account, into super, into an investment bond, off the mortgage, etc. Every person is different and their forced savings plan will be unique to them.
By implementing a forced savings plan you develop new spending habits as you essentially have less cash flow available to live off. This will automatically limit your expenditure, without having to track all your spending!
Topping up your superannuation
It’s never too early to start putting a little bit extra towards your retirement savings. Superannuation is one of the most tax effective retirement tools we have access to. This new financial year you should sit down and consider how you can better utilise your super.
For many people, the mandatory superannuation guaranteed contributions (SGC) are not enough to generate a sufficient nest egg. By tipping in a little extra to your super you can save tax and build wealth through the power of compounding investment returns.
Review your insurance
Over the past financial year your financial circumstances may have changed and now might be a good time to review your personal insurance needs to ensure you have the right cover to give you and your family peace of mind.
Life insurance today is not a one-size fits-all solution and you can tailor your insurance cover is to your lifestyle so look at your policy and see if it still fits your needs.
One thing to look at is how much debt you have – over time it may increase or decrease so a regular review will make sure you’re not underinsuring yourself or, conversely, paying for cover that you don’t really need.
It’s also a good idea to allow for future financial responsibilities, not just the ones you have currently. For example, consider your child’s long-term education needs or your spouse’s upcoming retirement.
Review your will
If you don’t have a will, you need one! If you do have a will, consider how your circumstances have changed and consider if this warrants reviewing your will.
A will is something we all procrastinate on and unfortunately it often means people die intestate. Don’t leave your family with this hassle, just get it sorted.
Sometimes we all need a little push to do the things we’ve been putting off, and the new financial year presents a perfect deadline to make some new resolutions.
Once you’ve decided what your goals are for the new financial year, the next step is turning those dreams into reality. So why not sit down with me today and put your plans into action? It might just be something worth celebrating.