A study conducted by the Australian Stock Exchange reported that nearly 25% of investors over the past two years were aged 18 to 24.These young Australians were found to be knowledge seekers, keen to take on life and begin their journey towards financial security.
A study conducted by the Australian Stock Exchange reported that nearly 25% of investors over the past two years were aged 18 to 24.
These young Australians were found to be knowledge seekers, keen to take on life and begin their journey towards financial security.
If this describes you, congratulations! You get it, you really do. You’re Next Generation Investors who know that building financial independence starts early.
However, according to the same study, Next Generation Investors, aware of their inexperience, are uncomfortable making financial decisions.
If this is also you, here are our tips for laying the foundations for a wealthy future!
If there’s one thing guaranteed to keep you awake at night it’s debt. Naturally, some debt can’t be avoided and is considered ‘good’ debt, like when you borrow to buy a house.
But ‘bad’ debt is sometimes unnecessary and often comes with high interest; best avoided where possible. You know we’re talking about credit cards, right?
Credit cards can fast-track you into debt-strife, particularly as tap-and-go transactions are just so quick and so easy.
Additionally, while those buy-now-pay-later schemes can be useful for emergencies if, say, your fridge packs up, they’re a trap if you don’t stay in control.
Sure, online shopping and bill-paying means using cards but you can avoid using credit.
Functioning the same as credit cards, debit cards use your money instead of the bank’s. They can be linked to your bank account, or loaded with cash which is handy for keeping track of your spending, as you can only spend as much as you’ve loaded.
If you do end up with debt, be accountable. Pretending it’s not there won’t make it go away. Further, unpaid bills can grow through late fees and penalties.
Read the fine print on contracts and understand what you’ve signed up for. Late payments and loan defaults can result in legal action, even bankruptcy, destroying your credit rating for years!
Pay down debt as soon as you can by:
On the topic of spending, get into the habit of tracking yours. Using a simple spreadsheet, or an app from your bank, log your purchases and reconcile spending with receipts.
You’ll see exactly where your money is going and spot any areas of unnecessary spending, like those items you really don’t need but are the coolest ‘must-haves’.
Don’t fall for it; ‘must-have’ is a marketing term. True must-haves are basics like food, shelter, transport and medical – not the latest trends and gadgets.
We’re not saying don’t treat yourself occasionally, but to pause and consider whether the item is really worth burdening yourself.
Think you’re too young to worry about superannuation? Prefer to put your money toward something for now rather than later?
You may be right, but don’t dismiss super altogether. Here are some things you can do that won’t impact your current finances:
You’re entitled to live, and you’re entitled to a social life. We’re not saying save or spend, we’re suggesting you can do a bit of both.
Regular savings accounts are available from banks and other financial institutions, and offer a variety of arrangements. For example:
Do your research, particularly websites providing independent product comparisons.
A professional financial planner can tailor a plan specifically for you. They will consider your debt, income, goals and much more, and work with you to structure a strategy for now, and into the future – you may even be surprised at how inexpensive good advice can be.
So, there you are! The future is laid before you and it’s loaded with potential; all you need to do now is get on with it.
You need to consider with your financial planner (or adviser), your objectives, financial situation and your particular needs prior to making an investment decision. Sensibly Pty Ltd and its authorised representatives (or credit representatives) do not accept liability for any errors or omissions of information supplied on this website
Nick Shanley, Steve May, Luke Styles and Shanley Financial Planning T/A Steve May Financial Services are Authorised Representatives / Corporate Authorised Representative of Sensibly Pty Ltd, AFSL 533923. Please refer to our website at www.stevemayfs.com.au to reference our Financial Services Guides.
Shanley Financial Planning Pty Ltd trading as Steve May Financial Services (ABN 19 612 825 180) is a Corporate Authorised Representative of (1265706) of Sensibly Pty Ltd (AFSL 533923)
Nick Shanley, Steve May and Luke Styles are Authorised Representatives of Sensibly Pty Ltd (AFSL 533923)