So you’ve seen the light. The days of partying and wasting money are behind you. Maybe you’ve settled into a relationship, or maybe you’re just feeling like it’s time to be a little more financially responsible – but where to start?
Often when people choose to see a Financial Planner for the first time it’s because they know they need to get their finances in order but don’t really know how to start.
Here are our top tips for those beginning their financial journey.
Understand where your money goes.
This sounds like it should be easy, but often it’s a huge source of stress. Living from pay to pay with little to show in the way of savings isn’t the way to get wealthy!
With a bit of effort and some discipline, you can get on top of where you spend your money, identify areas of overspending and start to put money away towards your goals.
Develop some financial goals
Start to think about your short term and long term goals. Start small and then think of the future.
Once you have an idea of what you’re looking to achieve it’s easier to put a plan in place to reach those goals.
If your goal is to update your car in two years, or perhaps to save a house deposit over 5 years, you can work towards understanding how much you’ll need to save on a regular basis to get there.
Likewise, lend a thought to when you would like to retire and how much money you’ will need to live the life you wish to enjoy. Retirement might seem like a vague and distant concept but if you don’t have a goal you’re never going to reach it.
Get your current stuff sorted
Take some time to research the best banking and savings structures for you.
Look at your superannuation fund and choose a suitable investment option.
Nominate beneficiaries to your superannuation fund.
Consider consolidating your super funds if you have more than one (be careful you don’t lose insurance benefits you wish to keep).
Make sure you’re insured
Yes, you should insure yourself. You are the most important asset you own!
If you’re young with few financial commitments there’s no need top overdo it, but it’s important you don’t leave a financial hole for your family if you pass way. It’s also important you don’t leave a financial hole for yourself if you’re unlucky enough to become seriously injured or unwell.
Income Protection insurance Life insurance, Total and Permanent Disability insurance and Trauma insurance are all worth researching and considering.
Get a Will in place
Many people don’t have even a simple Will in place let alone an Enduring Power of Attorney.
Getting these simple structures in place can save your family a lot of stress and costs if the worst happens.
Finally – get good advice
Seek out a Financial Planner that has your best interests at heart. Make sure they don’t have a financial interest in the products they recommend and make sure you fully understand their fee structure before agreeing to work with them.
A good financial planner will be in your corner, keep you accountable and help you avoid making costly mistakes.
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.
