SET YOUR GOALS TARGET KEY AREAS MAINTAIN THE GOOD HABITS BEEF UP YOUR SUPER PREPARE FOR THE UNEXPECTED

Put your cash through its paces with these tips from financial advisor Helen Baker

For many of us, 2020 has been a year for focusing on our health. But it’s not just our physical wellbeing we’re worried about. With change at every turn, it’s also been a time for monitoring our “financial health”. “There’s a great deal of uncertainty arising from COVID-19,” Helen Baker, a licensed financial advisor and author of On Your Own Two Feet: Steady Steps to Women’s Financial Independence.

“We’re grappling with a global pandemic, recession, surging unemployment and uncertainty about when – and if –things will return to normal.”

But there are steps you can take to keep your finances as strong as possible.

“It’s more important than ever to start the new year [2021] on the right foot, adapt to our changed reality and make our money do some of the heavy lifting for us,” Baker says.

Follow these steps to keep your bank balance as fighting fit as possible …

As with any fitness program, the key to success is all about taking manageable steps to set yourself up for long-term results. None of those short-term fixes! Whether it’s a new house, car or planning for that overseas holiday you want to take next year, it helps to set tangible goals that you can work towards. “What are your dreams?” Baker asks. “Knowing what you’re aiming for will allow you to focus.”

Next, take an inventory of all of your expenses and break them into sections. How much budgeting do you need to do for bills? What about holidays? What is left for savings and investments? “Just like you would use different weights on different areas of your body, breakdown how much you want to spend,” Baker says. “Allocate the heavy lifting to the important areas.”

Most of us have altered our spending habits over the past few months, so if you’ve found that you’ve actually been saving money, aim to keep up the good work post-lockdown and pandemic. “Run through your list to see which ones you can continue to keep, such as cooking at home rather than buying food for lunch every day,” Baker suggests.

“Superannuation is an important safety net for us all once we’re no longer working. And there are benefits to stashing any surplus cash into your super now,” Baker says. “Firstly, there are generous tax incentives for making additional contributions.

There’s also the ‘carry forward’ rule that effectively allows you to catch up on periods when your income, and hence super contributions, may have been lessened – such as losing your job or going onto JobKeeper or JobSeeker.”

“Protect what you’ve built with the right insurances – private health insurance, general insurance and personal insurances,” Baker advises. “Make sure you have enough insurance for you and your partner, or else you may find yourself in some trouble.” It’s also important to be mindful of any insurance through super you might have, especially if you’re planning on consolidating your funds. “Do not rollover your superannuation until you have fixed the insurance levels you need because you may not get cover elsewhere,” Baker adds. “Once it’s rolled over, you’ve lost it.” Consider it added to the to-do list!

When it comes to saving for the future, every bit counts.

REVIEW YOUR HOUSEHOLD BILLS

“You could be getting cheaper insurance, utilities and other services just by shopping around,” Baker says. “Review your subscriptions – I’d put money on the fact you’re paying for at least one subscription you no longer use.”

CLAIM YOUR WFH EXPENSES

If you’re new to working from home, you may be surprised by what you can deduct. “Don’t forget to claim your working from home expenses,” adds Baker. “An accountant can be a worthwhile investment.”

DOUBLE UP

Consider enlisting a shopping buddy that you can go halves with on bulk items. “Sharing bulk purchases with your sister or friend or mum can halve your overall spend and reduce wastage,” Baker suggests.