Spring Clean your Finances

With Spring in the air, and everything fresh, we thought that it is also a good time to freshen up our finances. We checked out the Money Smart website at the Australian Securities & Investments Commission and it had some great ideas. Here are a few that might help you:

Freshen up your loans

After you’ve finished spring cleaning your house, spend some time tidying up your loans.

• Try asking your lender if they can give you a better deal on your interest rate.
• Consider consolidating some of your high interest debts into a longer term loan with a lower interest rate.
• Try paying a few extra repayments.
• Consider utilising an offset account.
• Do you really need a redraw facility or is it just dragging out your loan term by encouraging further spending?

Review your bank accounts

• Check the return that you’re earning on your savings. Can you get a better rate by switching financial institutions?
• What about changing the type of account or locking some money away in a term deposit?
• Are you utilising back accounts that don’t charge fees?

Review your budget

Make sure you are setting and tracking your spending. Set realistic saving goals and review your level of spending.

• Are you getting the best deal on your electricity, telephone and gas? Are you taking steps to minimise your electricity, gas and water usage?
• What about your insurances? When was the last time you shopped around? Ensure that your insurances provide adequate cover and that you are aware of any shortfalls.
• Do you have a fixed budget for gifts, including Christmas?
• What about clothes. Can you wash them or do you have to pay for dry-cleaning? Do the items in your wardrobe mix and match with other items in your wardrobe? Do you take advantage of stock take sales or end of season clearances to pay less for the things you need?
• Do you use a grocery list or do you impulse buy as you walk up and down the aisles?

Tidy up your superannuation

• Do you have multiple super accounts? Consider consolidating your accounts to save fees, but be wary not to mess up your insurance entitlements.
• Are you invested in the best investment option for your stage of life? If you are a long way away from retirement, then you have time to ride through sharemarket corrections and can afford to be at the growth end of the spectrum. If you are nearer to retirement then maybe you should be being more conservative to protect your capital.
• Do your super funds have your correct personal details? Have you changed address, phone number or email address? Keep your details up-to-date so your money doesn’t end up in lost super.
• Make extra contributions and maximise the tax result. The sooner you make some extra contributions to super, the less sacrifices you will need to make in the future and the more financial choices you will have. You can now claim superannuation contributions personally up to specified limits.

Change your money habits

Making small changes to your everyday spending can help boost your savings throughout the year.

• Consider making your lunch at home rather than buying it.
• Borrow books and DVDs from the library.
• Avoid using your credit card and only pay with cash.
• Check your bank statements regularly to identify possible errors/scams.
• Cut down your coffee and/or alcohol intake.
• Have people over for dinner rather than going out to restaurants.
• Cut down on your takeaway meals.

Utilising these ideas and others will help you progress down the pathway towards financial security. At Potts & Schnelle, we work with our clients to help them secure their future. Give us a call or request an appointment if you would like to chat about your business, your tax, your investments, or your superannuation.