How To Get Financially Fit In 2018

How To Get Financially Fit In 2018

by | Feb 10, 2018

IS IT NORMAL TO…

NOT HAVE MADE ANY INVESTMENTS BY THE AGE OF 30?

Got your (measly) life savings sitting pretty in a low-interest bank account? Join the club. “It’s quite common to have used your 20s to make the most out of life and put finances on the backburner,” says financial planner Chris Bates. But if you’re ready to get your Wolf of Wall Street on, hit up microinvesting apps such as Acorns, which automatically invest your spare change. So that $3.50 flat white rounds up to become 50 cents in savings. Interested in a larger investment? Research and chat to a pro to find out what suits you.

RELATED: Research Reveals That Active Aussies Are More Likely To Keep Financially Fit 

IS IT NORMAL TO…

NOT KNOW IF HEALTH INSURANCE IS WORTH IT?

If you have no idea, don’t worry – it’s a point of contention among financial experts, too. Lisa Barber, wealth coach and author of A Woman’s Guide to Wealth, says it really depends on your level of income. “If you don’t have an appropriate level of private hospital insurance cover and your income is above a certain threshold, you will have to pay a Medicare levy surcharge,” she explains. Vanessa Stoykov, a finance industry thought leader, reckons getting insurance with extras like dental when you’re young can be wise in the long term. “If you’re preventative in your 20s and 30s, that’s a hell of a lot better than having to fix it in your 40s and 50s,” she says.

IS IT NORMAL TO…

NOT KNOW WHAT TAX DEDUCTIONS I CAN CLAIM?

“Sure! That’s what you’ve got an accountant for,” says Stoykov. If you don’t have a go-to money man, just get one to do your tax return once, says Bates, “then see what they claim for you”. Things you may not have thought of? Your start-of-year stationery, books or mags relevant to your field, and even sunnies (if you work outdoors). “The best thing is to talk about your profession and let them decide what’s claimable,” adds Stoykov. Then you’ll know for the future, too.

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IS IT NORMAL TO…

HAVE SUPER IN DIFFERENT PLACES AND NOT KNOW WHAT TO DO WITH IT?

According to the ATO, 45 per cent of us have multiple super accounts. But while you may not be alone in two-timing your primary fund, that’s no excuse for not getting your retirement plans in order. “It’s a little bit lazy to have multiple accounts,” Bates says. “If you’ve got five funds, how do you actually know what your super’s worth at any point in time?” Luckily, most funds offer to consolidate your super for you, so you don’t have to do the hard work. Get on it.

RELATED: These 5 Money Mistakes Are Seriously Stuffing You Up

IS IT NORMAL TO…

STILL BE LIVING PAY CHEQUE TO PAY CHEQUE IN MY 30S?

While it ain’t ideal, Bates says counting down to payday like this isn’t out of the norm. “When you look at the numbers, salaries haven’t gone up and costs (especially rent) have, so it’s very hard for people to get ahead,” he says. So what’s the solution? Barber suggests using a 50:30:20 ratio. Put 50 per cent of your net income to committed expenses such as rent and bills, 30 per cent to discretionary spending (like that smashed avo toast) and 20 per cent to savings and investment. “The ratio is simple to work with and you can quickly start to see your savings and investment grow,” she says.

IS IT NORMAL TO…

NOT HAVE A CREDIT CARD?

You’re in the minority: a 2016 Finder survey revealed 70 per cent of Aussies have a credit card. But you may be dodging a bullet if you don’t. It won’t hurt your credit rating to go without, and Canstar research shows the nation pays more than $15 million a day in interest on credit card debt. For the majority of us who buy now, pay later? It’s time to pull a Rachel Green and cut up those cards, says Stoykov. “Credit cards are death for some people. Make a New Year’s resolution to find one with zero per cent interest, transfer your balances and pay off one card.” Smart!

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