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Financial Planning

5 tips for getting on top of financial housekeeping

23 July 2018

Money & Life team

Money & Life contributors draw on their diverse range of experience to present you with insights and guidance that will help you manage your financial wellbeing, achieve your lifestyle goals and plan for your financial future.

Remember the last time you did a good spring clean? It probably felt good. And guess what? Getting your finances in order feels just as good, and it’s even more rewarding.

The start of a new financial year is a great opportunity to clean up your act with your finances. Here are five tips to make this year your best yet.

Take a day

Set aside an entire day to do your financial housekeeping. If you can afford to take annual leave, choose a weekday when you can more easily make phone calls and work uninterrupted.

Make a fresh start

Ever calculated your net worth? Although daunting at first, it’s a helpful starting point to see where you’re at financially and to help you decide on some achievable goals. And it’s easy: subtract your liabilities (what you owe e.g. mortgage, loans, credit cards) from your assets (what you own e.g. home, super, savings).

Next, write your financial goal for the year. It might be to improve your net worth by a specific amount by this time next year, or to funnel money towards a specific debt so you can take a guilt-free holiday in 2019. Commit to it by marking a progress review in your calendar every three months.

Sort out your savings

Let your financial goal guide you here, and review your savings plan to make sure you can achieve it. Then shop around and take advantage of promotional rates that give you favourable interest. The same goes for debts.

But if you really want to clean up your act, challenge yourself to a spending fast. For one month you’ll purchase only essentials, putting all other income towards supplementing your savings or making a dent in your debt. Not only is it a fun challenge, it will teach you more about your spending habits (and why you may not be hitting those savings goals) than any spreadsheet can.

Get your bills in order

Review regular outgoings to make sure they still fit your needs. Open up your latest power, phone and internet bills and check the billing breakdown to see if you’re paying too much for services. Comparison sites like Finder, GoSwitch, and WhistleOut will give you the numbers you need to start afresh or get a better deal with your current providers. While you’re there, save your sanity and the planet by requesting to go paper free — these days you only really need originals of legal or notarised documents in your paper filing.

Be good to your future self

Superannuation, mortgages and insurance might not be the most fun way to spend your money, but this last tip might save you quite a bit.

Aim to increase your superannuation contribution for every year you get closer to retirement.

Wondering whether to put more towards super or the mortgage? They’re both important, but don’t rush to put more money on your mortgage: salary-sacrificed super above your employer super guarantee is taxed at only 15%, and the returns could be greater than the interest on your mortgage. Do the sums to find the balance that works for you.

As with your savings and bills, assess your insurance needs against your goals. Many insurance policies can be tailored to fit, so consider choosing one policy to customise now. If you’re not in a hurry, mark your calendar for May 2019 to take advantage of EOFY insurance offers.

Getting on top of your financial housekeeping can save you stress and money. Make it easier by setting aside a day to work through, and by this time next year you’ll be rewarding yourself for getting closer to your financial goals. If your efforts reveal that you need more in-depth advice, a CERTIFIED FINANCIAL PLANNER® professional can help you develop a plan to get your finance back on track. Find a local CFP professional today using Match My Planner.