Read on for our checklist to help you get your finances into shape:
1. Consider the life you want to live
Let’s start with something that’s going to motivate you – consider the life you want to live. What does it look like? Would it be to buy your first house, be able to take an overseas holiday every year, start a family or simply know you will be able to live comfortably during retirement?
You might be able to picture it, or it could potentially help to write your goals down in detail. One study in 2015 by psychologist Gail Matthews found that when people wrote down their goals, they were 33% more likely to achieve them compared to those who formulated outcomes in their heads1.
That's where we come in - you come up with the goals, and we can help you find ways to achieve them.
2. Don’t set and forget your goals – it’s important to revisit them
Once you have a good idea of your longer term goals, it's important to also think about your short term goals. Can you achieve these in the time frame you want – or do you know how to achieve them within the desired time frame? Which ones are realistic, and how do you know if you are on track?
An expert like a financial adviser can help you work out if you’re on track to achieving your short and longer term goals, or if you need to make changes, either to your financial goals or how you’re achieving them.
3. A budget makes you a money boss – make sure you have one
Yes, we’ve said the word… budget (cue the eye rolls). But, it’s true! We like to call it a spending schedule, but whatever you call it - having a plan as to how you spend your money makes you the boss of it. This doesn’t have to mean scrimping on your lifestyle choices. It’s all about planning ahead, minimising unnecessary spending and diverting that extra cash to grow your savings.
Set time aside and map out your income, spending and saving habits so you can identify areas where you could make changes to help you reach your savings target. If you need help, we have a range of tools available, or ASIC’s Moneysmart website also has some great resources (moneysmart.gov.au).
4. Put your savings on autopilot
Almost nine out of ten Australians can’t explain where their money goes2. Don’t risk falling off the savings wagon. Set up a regular transfer out of your everyday account into a dedicated savings account. Try not to dip back into these unless completely necessary.
Got a savings target in mind? Read our simple strategies to take financial control and reach your personal goals.
5. Save for an unexpected rainy day
Following on from our last point, having an emergency fund is well worth the effort. The whole point is that you’ll never know when you’re going to need it, but it’s there when you do.
If you’re asking yourself, “How much do I need for an emergency fund?” read our article for some pointers as well as how expert advice can help you determine how much you’ll need.
6. Get a handle on your debt
Relying on credit to bridge gaps in your cashflow can be the start of a debt spiral. Whether you’re wanting advice around how to pay off debt faster, whether to consolidate your debt, or you just need advice to help you on your journey to becoming financially fit, give us, your Mortgage Choice financial adviser, a call.
7. Give something to your future self
The other eye roller in this list is the ‘r’ word. Retirement. Many people seem to run from the idea of wanting to plan financially for their retirement by sorting our their superannuation. But we’re here to let you know it’s worth the time it takes to sort out (and it might not even take as long as you think). It is your money after all!
An expert can help you manage one of your biggest assets, and with their knowledge, you can feel more confident in your decisions, knowing how to stay on track to reaching your retirement goals.
8. Make time
Our last tip is to just make time for your finances, regularly. Setting time aside is an important step to becoming financially fit. Schedule time to review your financial goals, and consider checking in with your financial adviser once a year, or more often if something significant changes in your life, to help make sure you remain on track to reach your goals.
As your Mortgage Choice financial adviser, we can develop a plan tailored to your needs using strategies suited to your goals and circumstances. With a range of ongoing service packages available that include options for both formal and/or ad hoc reviews to help you monitor your progress and finetune your plan where required, you could be on your way to financial fitness - with an expert on your side – before you know it.