19 Jan 2018

5 Ways to Boost your Financial Health in the New Year

The new year is a great time to set yourself some new goals and resolutions and one excellent area to overhaul is your financial health. Whether your objective is to boost your retirement savings or purchase your first property, here are 5 easy steps you can implement to set yourself up for a financially healthy 2018.

Set a goal and have a savings plan

Set yourself a realistic goal to achieve by the end of the year. It can be anything from saving a certain lump some of money or paying off all your credit card debts, to investing your money in shares that you’ve been wanting to give a go. Write down your year-long goal and implement a strategy to make it happen. If you’re wanting to boost your savings, try to set aside a minimum of 10% of your salary each week. Likewise, if your goal is to pay off any debts, lock in a set amount each week to pay off and set up a direct debit so the repayment happens automatically after pay day.

Stick to a budget

A budget will show you exactly where your money is going each week or month and it’ll ensure you will always have enough money for the things you need. Write down all your regular outgoings (food, car expenses, rent/mortgage repayments, utilities etc.), including any savings that you plan to put away. This will show you clearly how much you have left over each week to be used as ‘spending money’. Using a realistic budget to forecast your spending can really help you with long term financial planning. You can then make realistic assumptions about your annual income and expenses and plan for long term financial goals.

Review your insurances

This one is often swept under the carpet and seen as less of an immediate priority. However, it is important to have enough insurance to protect your family, your home and your income if the unfortunate were to happen. Ask yourself a few questions: who would support you financially if you were to lose your job or became unable to work? Are you covered if your house was broken into or harmed by fire? Are your car policies up to date and suitable for your current circumstances? Take the time early in the year to do a complete insurance review to ensure you have the proper coverage for your needs and budget, you can even speak to an insurance specialist to get the best advice for you.

Invest your money wisely

If you contribute consistently to your super and savings accounts and still have some extra money available, consider putting it into other investments. The key is to always follow the biggest investment rule: never invest in something you don’t understand. Do your research thoroughly and find opportunities that are best suited to you. Consider setting up trust funds for your children to take advantage of the power of compound interest as early as possible and arrange your investments in a way to best minimise your taxes.

Get financial advice

For most people, managing finances can be totally overwhelming and require time that they just don’t have to spare. Speaking to a financial advisor can give you a huge advantage when it comes to boosting your financial wealth. They can advise you on everything from budgeting, to investment opportunities and insurance needs. Whatever your goals, getting advice from a qualified financial adviser can help bring you closer to achieving them in 2018.

This article was contributed by REBAA affiliate member 1st Street Financial