The start of a new financial year is the perfect time to get your financial affairs in order. Whether it’s tidying up your paperwork, assessing your portfolio, or dealing with outstanding issues, there are plenty of practical actions you can take to set yourself up for success.
Organise Your Paperwork
Dealing with paperwork is a task most of us love to hate. However, taking a day to tackle your ‘To Do’ pile and growing mountain of filing could be a great investment in yourself. Moreover, you might identify some potential savings.
Set Your Budget
A lot can happen in a year, so reviewing your budget to ensure it aligns with your goals makes sense. This helps track your changing expenses and ensures you’re not overspending. If you don’t have a working budget, now’s the perfect time to start. There are plenty of budgeting apps and tools available online to help you get started.
Assess Your Investment Portfolio
Another important step at the start of the financial year is to assess your investment portfolio. Consider these key questions:
- Why did you start investing and have your circumstances changed?
- What is the investment performance? Is it in line with your expectations and benchmarks?
- Should you consider diversifying into different asset classes?
- Is dividend reinvestment the best option for you, or should you take the dividend income as cash?
- Is your risk appetite still the same, or should you adjust to be more aggressive or conservative?
Review Your Insurance Policies
Now is a good time to closely examine your insurance policies and consider whether they match your needs and risks. Also, note policy renewal dates so you can shop around for the best price.
Understand Federal Budget Changes
Staying updated on Federal Budget initiatives can be useful. Measures aimed at easing the cost of living, such as the government’s energy bill rebate and Stage 3 tax relief, can provide a financial boost.
Review Your Superannuation
An annual review of your super account is vital to ensure:
- Your investments and risk strategy are appropriate
- The fees are reasonable
- Any insurance policies in your super account are suitable
- Your employer contributions are being made
- Your death benefit nomination is up to date
- You don’t have multiple accounts incurring unnecessary fees
Consider a salary sacrifice strategy, where you ask your employer to make extra super contributions from your pre-tax salary. These contributions are taxed at 15%, plus an additional 15% if Division 293 tax applies to you (income over $250,000).
Additionally, it’s not too late to top up your super balance for this financial year using either concessional contributions (from your pre-tax income) or non-concessional contributions (after-tax income). Remember the caps on payments, which from 1 July will be $30,000 for concessional contributions and $120,000 for non-concessional.
Get Expert Advice
Setting yourself up for a fresh start this year with these strategies can help you achieve your financial goals. For personalized advice, reach out to the Inspired Money Team for a complimentary review of your current situation on 0862227909 or by emailing admin@inspiredmoney.com.au.
Current as at June 2024
