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Money Management Made Easy: 7 Finance Hacks for Australians

Personal finance management is an essential skill for achieving and maintaining financial stability. Taking regular stock of our income, expenses, debt, investments, and net worth can help us map out a plan to reach our goals.
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Updated: 15 May 2024

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Keeping track of our financial situation can also help identify areas that could save money on insurance premiums or tax refunds.

For many Australians, it can take time to make ends meet and plan for the future. Many need help saving regularly or budgeting effectively and may find themselves in a cycle of paying off debts. Taking control of finances is a great step towards achieving long-term financial security.

Key facts

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Track your spending

Budgeting apps are available now to make these tasks easier. These include Frollo, Beem, and Spriggy. These apps allow users to stay on top of their finances with detailed records of transactions and customisable financial goals.

Additionally, users can establish budgets quickly by monitoring their expenses across categories, such as groceries or eating out and comparing them against their income. When you have the right resources, tracking finances is easy, so it’s a good idea to look into setting up a budgeting app and start taking full control of your money.

Budgeting

Knowing where your money is coming from, where it’s going, and having accurate records of transactions enables you to make informed decisions. Through budgeting, you can plan ahead and ensure you’re on track with long-term goals like retirement savings or homeownership.

Budgeting can be difficult, but it’s essential for accomplishing financial goals. To get started, track your income and expenses continuously for an accurate picture of where your money is going each month. Then assign percentages of your total income to different categories such as food, housing, transportation, and savings. Once the breakdown is complete, adjust spending with savings and ensure bills are paid on time.

Saving money

The earlier you start saving, the better off you will be in the future. Setting aside some of your income as soon as you begin earning can make a huge difference in how prepared you are for any eventuality and may even lead to more opportunities.

Start small with simple strategies such as setting a budget and tracking your spending so that budgeting becomes part of your normal routine. Over time, you’ll grow accustomed to saving and eventually feel more capable and secure in managing your finances.

Insurance

Having adequate insurance coverage is important to protect yourself, your family, and your possessions. Having the right types of insurance and enough coverage to guard against possible losses due to unexpected events. Different individuals have different needs regarding life insurance, so it’s important to take the time to assess what you would like covered and how much protection is appropriate for your budget and lifestyle.

It’s also wise to periodically review your existing coverage to consider any changes in your life or assets. Professional help from an experienced insurance agent can be invaluable in helping you find the most appropriate life insurance policy for your specific needs.

Managing debt

Debt can be a burden that weighs on people’s minds and makes it difficult to lead a happy life. Having a handle on debt and keeping it under control is important, as it can quickly get out of hand and become overwhelming. Managing debt means being aware of how much is owed, taking steps to pay down debt over time, and ensuring not to acquire any new debts in the process.

Start by obtaining a clear view of your financial situation: Determine your outstanding debt, interest rates, and when payments are due. Once you have these details sorted out, prioritise which debts must be paid first and make a budget that fits within your income limitations. When creating a budget, set aside extra monthly money to pay off the debt quickly. Lastly, communicate with lenders and creditors if necessary – they may be able to offer assistance in helping reduce your payments or increase your credit limit. Debt Payoff Planner, Qapital, and Mint are useful apps for your debt.

Investment

Investment is essential for financial stability and future growth for individuals, businesses, and nations. A secure financial situation enables individuals to save for emergencies, regardless of income. Although an effective investment plan requires careful thought and research to ensure maximum returns on small and large investments, it can bring great rewards when done correctly.

Begin by setting realistic goals and outlining why you want to invest in the first place. Are you investigating investing to save for retirement or simply trying to grow your assets? Then determine how much time and effort you are willing to put into it — this will help guide your decisions as you learn more about different investment strategies. Next, research the various types of securities available, such as stocks, bonds, mutual funds, or exchange-traded funds – don’t forget, diversifying your investments is always a good idea. Finally, develop an investing plan and timeline before embarking on the journey. Robinhood and E-Trade are good apps for beginners.

Taxation

Maximising deductions and credits can greatly impact the amount of taxes you owe. Before filing, it is important to research which deductions or credits you may be eligible for to help minimise the taxes owed. Additionally, keeping detailed records of charitable contributions and business expenses can help list the correct deductions when filing. Taxpayers can also look into opening a retirement account, such as an IRA, as this could qualify them for certain tax benefits, resulting in decreased taxable income. TaxAct Express and YNBA are effective tax apps to use.

Frequently Asked Questions and Answers

Australians can practise better money management by setting financial goals, having a budget and sticking to it, tracking their expenses, making monthly payments on time, creating saving targets and planning for the future. It can be useful to use automatic savings plans that are linked to a bank account, which transfers an allotted amount of money into a separate savings account each month. Additionally, being mindful of what you spend your money on is important in creating healthy financial habits.

A good starting point is to list all your monthly expenses, including rent, food, insurance, and loan payments. Then total up how much income you make each month, deducting your necessary expenses. This will give you an idea of how much money is available each month towards savings, debt reduction, or other goals, such as home improvements or travel. Lastly, adjust your budget as needed to reflect your current financial situation as it changes over time.

First, try budgeting and tracking your daily, weekly, or monthly expenses to see where to cut back. Next, take advantage of any discounts or sales offered by local businesses. Additionally, wait to make necessary large purchases to know you are getting the best deal. Finally, limit unnecessary spending on items such as dining out and entertainment.

Regarding debt, the best first step is to create a plan for tackling it. You should take both short-term and long-term measures — such as paying off the debt with an initial lump sum if possible, creating a budget that leaves enough room for regular payments on the remaining balance without wiping out your other income and expenses, setting up automatic payments whenever possible, and researching available resources like credit counselling or debt management programs.

Saving money is a great way to start making your money work for you by setting aside a regular amount in a savings account and earning interest. Investing can also be a great way to make the most of your money, as it can help to increase the value of your assets over time, although it does carry some risk. You will need to decide what kind of investments you are comfortable making and which may have the highest returns on your investment. Additionally, budgeting and understanding how taxes work can be very helpful in making sure that you make the best financial decisions possible.

Some common missteps include investing too conservatively, neglecting retirement accounts, overspending by taking on too much debt, and racking up credit card debt may sound familiar. Failing to compare shops when making big purchases is another mistake many Australians make, often paying more than necessary for the same item when a little research could save them hundreds in the long run. Lastly, paying too much for insurance coverage can be an expensive blunder and is all too common in Australia, so using comparison websites is recommended.

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Specialist

Megan has extensive experience writing about health and life insurance in Australia. Megan has a special interest in health and wellness. She relies on her background in counselling psychology to convey the latest findings in a manner that is most beneficial to ComparingExperts readers. In every article she writes, Megan aims to uphold the standards of the Private Health Insurance Intermediaries Association (PHIAA) which ComparingExpert is part of.

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