Going over your finances isn’t fun, unless it’s payday and the numbers have increased. Doing a financial reset at the beginning of the year, though, and setting goals will ease your anxiety in the long term.
Where’s the money going?
This is slightly gut-wrenching, but it’s time to put on your adult pants.
Check out the transaction history across your credit and debit accounts. Figure out what you’re spending money on that’s not essential. The gym membership, those multiple coffees (essential in times of crisis, but still…), flowers, parking, and the list goes on.
How much does parking and coffee add up to at the end of a week? Do you really go to that second gym to justify the money it’s taking from your account?
Get an app or two
There’s financial management/budgeting apps that connect to your bank account. Depending on the settings, you’ll get daily updates about how much you’re spending and what’s left in the monthly budget. It’ll keep you honest and on-track.
Most banks (ANZ, BoQ, NAB etc) have apps available for customers to access their accounts. Logging in on your phone is simpler than checking your computer, with the added bonus of making transfers and paying bills from the palm of your hand.
The $5 trick
Not everyone uses cash these days thanks to touch pay and credit cards. This handy savings hack, though, will save you hundreds during the year. If you’re paying for something with cash, at the farmers market for example, don’t put any $5 notes in your wallet for later. Put it in the piggy bank instead (or an old Vegemite jar).
Besides saving some extra cash, you’ll get a little endorphin boost from putting that money away. Saving money is just as satisfying as spending it. Marie Franklin, a journalism professor, saved $50,000 over 13 years thanks to this method. No, that’s not a typo. Get that Vegemite jar ready!
You can invest in anything: shares, gold, or property. If you can’t make up your mind, make an appointment with your financial advisor. There’s a range of investment products available to suit your goals, whatever they are. The idea is to put some money in the investment account every month and forget about it. It’ll accrue interest and automatic investing will let your nest egg grow.
Look at your super
Haven’t made a plan for retirement? That’s a plan to fail. You might have a superannuation account from your first job that’s still active, but have you paid much mind to it? Ask around about super funds, how they operate, and what they can do to maximise your savings for retirement.
We support our clients taking charge of their finances. Read these for more advice to make it happen