We know that financial health can be just as important as physical and mental health when it comes to your overall wellbeing. Whether you’re looking to improve your budgeting, reduce debt, or plan for your future, here are five easy-to-follow tips and practical strategies that can help set you and your family on the path to financial success.
Budget: Know where your money goes
When was the last time you reviewed your budget? Regularly checking in on your spending can help you stay in control, helping you reach your financial goals.
Creating and sticking to a spending plan is one of the most effective ways to stay financially secure. Start by reviewing your spending over the past six-months against how much you have earned. Are you happy with how much you have saved?
One helpful approach is the “bucket method” – you allocate your expenses into different categories for things like, bills, groceries, entertainment and savings. This way you can see where your money goes and adjust your spending in those areas where you feel you need to.
If creating a spending plan seems overwhelming, remember taking small steps is better than none.
Manage debt: Stay on top of what you owe
Have you listed all your debts and their interest rates? Understanding which debts to tackle first can save you money in the long run.
Not all debt is created equal. Good debt – like student loans or a mortgage – can be an investment in your future, but high- interest debt, such as credit cards, where the borrowed money is used to purchase things that often decrease in value, can be a financial drain. Start by listing your debts and their interest rates, then focus on paying off the high-interest ones first. If you have a mortgage, it might be worth exploring options to refinance for a better rate.
Build an emergency fund: Prepare for life’s unexpected moments
Do you have an emergency fund? If not, start small and build your savings over time.
An emergency fund is a financial safety net that helps you weather unexpected expenses – whether it’s a surprise medical bill, car repair, or a job loss. Aim to set aside 3-6 months’ worth of living expenses in a separate account. Start small and add to it whenever you can, using any unexpected income (like a tax refund or work bonus) to boost your savings. Having this buffer may help you avoid dipping into your long-term savings if life takes an unexpected turn. If you have a mortgage, putting this money into an offset or redraw account can help decrease the interest you pay on debt – providing you with two benefits!
Invest wisely: Grow your wealth over time
Have you reviewed your investment strategy recently? A little planning can help you grow your wealth more efficiently.
Investing is one of the best ways to build wealth for the future. If you haven’t reviewed your investments lately, now is a good time to check if they still align with your goals. You may want to consider strategies like dollar-cost averaging, where you invest a fixed amount regularly, no matter what’s happening in the market. This can help you cope with market fluctuations and build a well-diversified portfolio that works for your financial goals.
By setting up a regular investment plan, you “pay yourself first”, and live off what is left – it is a way of forcing yourself to save and living within your means. We don’t often notice the money we don’t have – by investing it before we get the chance to spend it, we are setting up a better future for ourselves.
Plan for retirement: Set yourself up for a comfortable future
When was the last time you checked your superannuation? Consolidating accounts could save you money on fees.
You can never start saving for retirement too early. Take a look at your superannuation accounts to make sure they’re all working in your favour. Consolidating multiple super accounts into one can reduce unnecessary fees and help you keep track of your savings. Regularly reviewing your super ensures it’s still aligned with your retirement goals, helping you build a comfortable future. Be careful though about potentially losing insurance benefits within your superannuation. Expert advice can help you protect your family, while growing your wealth more efficiently.
Small steps, big results
By incorporating these simple strategies into your everyday financial habits, you can build a solid foundation for a secure and stress-free financial future. Saving for retirement can seem like a big challenge. But most big challenges are really just a series of smaller ones. Tackle enough smaller challenges and you will have achieved big things.
Need help along the way?
If you’re unsure where to begin or need help, we recommend speaking with a financial adviser. Personalised advice can give you the confidence you need to achieve your financial goals.