02 9255 8888
Locumsgroup | Tax Returns - Accounting Services - Financial Advice
  • About Us
    • Who We Are
    • What We Do
  • Services
    • Tax & Accounting
    • Financial Advice
    • Mortgage Advice
    • DIRECT PROPERTY
  • Useful Tools
  • News
  • Contact Us
  • Search
  • Menu Menu

New Year. Time to review your finances!

News

We all know that the New Year is the perfect time to review your finances and set new goals for the year ahead. In case you missed your planning session on the first day of January – here is another chance! This is a great time to get clear on what is going on with your finances.

If COVID-19 has taught us anything, it is that unforeseen emergencies occur, and without proper planning, your budget could fall apart should an emergency arise.

We have listed our Top Tips below:

  1. Conduct a ‘stocktake’ of your current position:

Over the Christmas and holiday period you can spend and splurge.  It is therefore vital to do a general ‘stocktake’ in the New Year to know exactly how you are tracking toward your financial goals.  Remember, It is much easier to get where you want to go when you already know where you are!

Tip:  Prepare a simple spreadsheet, list your assets and liabilities, and see what your equity position looks like.

  1. Pay down your non-deductible debt:

If possible, 10% to 15% of your income should go toward reducing your non-deductible debt. There are a few options for managing debt and it is worthwhile considering consolidating your debts.
The only way that you are going to reduce your debts and get clear on your saving goal is when you accept you need a realistic weekly, monthly, and annual budget. It takes time to develop a budget that works; and it changes along your income and your needs.  But it’s essential to keep at it. Once you have got it right, your debts will come down quickly.

Tip:  Clear your debts before saving.  While this takes some discipline, the interest rates on savings accounts are much lower than credit-card interest rates – other than very special card deals. This means that you’ll be debt-free a lot more quickly if you clear your card debts before you save.

There is of course an argument for a reserve of savings before you’ve cleared your credit cards as it helps you build a savings habit.  However, the numbers don’t support the argument, so we still advise you to eliminate your credit card debt first.

  1. Create a Budget:

The greater your understanding of your personal spending patterns the easier it is going to be for you to take a commanding role in the management of your money.

All businesses and practices have a clear understanding of income receipts including the sources of revenue and have a clear understanding of the expenses over the year.  The problem is, even in the cases where a business or practice budget exists, personal income and expenses can remain a mystery!  At the end of the year most people simply don’t know how much money they spent on clothing, on food, on utilities… no idea!

The pattern-breaker for this type of behaviour is as we have discussed to complete a personal budget.  It has nothing to do with changing your income and spending patterns; that will come later, it has everything to do with KNOWING where your money comes from, and where it goes to.

Prepare a personal budget and do it now.  If there are any numbers that you are not sure of, you can estimate or guess and go back and confirm later.  The main thing is to get a first run-through to get a personal profile and get a grasp of your finances.

By completing this exercise, you will immediately put yourself in an elite minority of people what can account for their own personal finances.

Tip:  Ask our team today for the Locumsgroup downloadable template budget info@locumsgroup.com.au

  1. Do a weekly check in with your accounts:

A great habit to get into is to allocate time in your diary each week and review your weekly expenses. You will gain a greater understanding as to your spending habits and ensure you are not spending on things that can’t be accounted for.

Tip:  When creating an annual financial plan, create quarterly milestones.  These will allow you to benchmark how you are tracking with your progress. If that doesn’t happen then readjust the plan, move the goal, or play catch-up.

  1. Create an internal dialogue with yourself:

Every time you go to make a purchase that is outside of your general expenses, ask yourself, “how does this fit in with my financial goals?” This is a great way to keep yourself accountable on ad hoc purchases that may come up and be a distraction.

Tip:  Be accountable to yourself for discretionary spending.

  1. Establish an emergency Fund:

If you haven’t already done so, it’s important to establish an emergency fund. It’s also worth adding in an estimated cost for emergency expenses such as to car repairs or a new hot water heater! It’s better to overestimate than underestimate, so be generous.

Tip: Your emergency fund should be at least 2 to 3 months’ worth of expenses (or access to credit for a similar amount). This fund may take a while to establish but will be worth it in the long haul.

At Locumsgroup, we assist in creating financial freedom for our clients. As part of that process, we will complete a personal budget for you, so you have a clear picture of your cash-flow profile. This will assist you in taking control of your financial life.

If you want to take the steps towards financial freedom, then contact us for a complimentary consultation.

March 1, 2021/by Jennifer Ahearne
Share this entry
  • Share on Facebook
  • Share on LinkedIn
  • Share by Mail
https://locumsgroup.com.au/wp-content/uploads/2021/03/lg-feb-post.jpg 360 640 Jennifer Ahearne https://locumsgroup.com.au/wp-content/uploads/2020/12/locum-new-1-300x109.png Jennifer Ahearne2021-03-01 17:03:282021-03-01 17:04:58New Year. Time to review your finances!

Latest News

  • NEW FINANCIAL YEAR | NEW BEGINNINGSJuly 12, 2022 - 11:59 am

    With the 2022/2023 financial year in full swing, it’s time for new beginnings and New Year’s resolutions. From having clear goals and budgets, to dedicated time spent aside each month to review your financial targets, it’s imperative to start your financial year journey early. At Locumsgroup, we work by a philosophy of four key questions […]

  • Prepare for End of Financial Year Tax TimeJune 20, 2022 - 3:13 pm

    With tax time right around the corner, it’s time to start closing out the current financial year: At Locumsgroup, our expert accountants are equipped with advanced knowledge and understanding to help you get the most out of your tax planning and the preparation and lodgment of your income tax return.  Saving you money, time, and […]

  • Financial trends that have shifted in 2022May 31, 2022 - 3:41 pm

    We are currently in the fifth month of the year and there have already been extraordinary global affairs that have affected the financial trends for the rest of 2022. Inflation Even before Russia’s invasion of its neighbour, Ukraine, countries across the globe were experiencing rising inflation rates. The costs of goods and services are up […]

  • Does your savings account look very healthy?December 17, 2021 - 10:15 am

    The pandemic has shifted spending and saving priorities for many individuals, and has provided a chance to put aside a larger amount of cash into savings. This is widely attributed to the nation-wide lockdowns with people not being able to go out to shop and spend.   A key metric is the amount of unallocated […]

Quick Links

  • Tax & Accounting
  • Financial Advice
  • Mortgage Advice
  • Property Advice
  • Blog
  • About Us
  • Privacy Policy
  • Client Resources

Contact Details

Level 4, 8 Spring Street
Sydney NSW 2000
PO Box R242
Royal Exchange NSW 1225
P: 02 9255 8888
Fax: 02 9247 2868
Email: info@locumsgroup.com.au

Connect

Keep up to date by following us:

  • Facebook
  • LinkedIn

© Copyright 2012 – 2020 Locumsgroup.

Locumsgroup Asset Management Pty Limited ABN 71 113 009 626 | Australian Financial Services Licence Number: 339567
Locums Nominees Pty Limited ABN 084 426 415 | Australian Credit Licence Number: 396340 | Locumsgroup Private Accounting Services Pty Ltd ABN 66116 993 670 | Tax Agent Number: 72898005

TEN TIPS TO MAXIMISE YOUR RETURNS FROM INVESTMENT PROPERTY 8 Ways To Pay Off And Consolidate Your Credit Card Debt Faster
Scroll to top