TOP TEN TIPS on making personal decisions in finance1. Start with what you’ve got
Keep it simple to begin with. What is your income? How reliable is it? How much cash do you have saved? Is it any of it spoken for (for debts, repayments etc). Establish an accurate picture of your ongoing worth.
2. Know yourself
Analyse your spending and saving habits, and be ruthlessly honest. If you’re no good at saving, it’s best to know that about yourself. Because then you can implement strategies for wealth building that don’t FEEL like saving.
3. Know your goals
Personal finance decisions are different for everyone. Do you want to own three houses? Travel overseas every year? Retire at the age of 40? Set your kids up for life? Whatever your goals are, write them down. Once you have something concrete to work towards, your personal finance decisions will get easier to make and manage.
4. Keep track of your money
This requires a little bit of discipline, but is not as hard as you think. Set up an efficient spreadsheet. If you’re not sure how to do this, give us a call and have a chat to one of our Loan Planners to see how we can help.
5. Educate yourself
If you are serious about improving your personal finance you will benefit from knowing the basics about banking and tax. What bank accounts suit you best? Are you minimising tax and maximising earnings? Make an appointment with your accountant or enrol in a short course at your local TAFE, CAE or private business school.
6. Basic investing guidelines
How much risk can you stand? What is better for long term investing – property or shares? How does the current economic situation affect investment options? What are the tax laws for investing? Write yourself a list of questions and start researching.
7. Loans and credit
Make sure you have a clear picture about what you owe. Do you have a timeline for becoming debt free? A Tradies Finance loan planner can help you consolidate your debt and loans so you minimise fees and expenses.
8. Make a regular date with your finances
Once a month, set a few hours aside and work through all of your personal finances. This way you can keep track of whether you are getting ahead or falling behind and start to devise strategies to get you where you want to go.
9. Get a financial mentor
This might be your accountant, financial planner, a relative who is good with money, or you might decide to join an online network or advice forum. People who are good with personal finance are the best people to advise you.
10. Big picture small picture
Know how much you need day to day and month to month. Balance that with your long term goals. How much are you willing to sacrifice short term to achieve long term personal wealth? Small investments and actions on a regular basis can lead to very big returns over a long time. It’s worth the effort.
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