Having a financial plan in action is one of the most important things you can do in…
During this time of social distancing and self-isolating many Australians have taken to iso-cleaning and iso-renovating with Bunnings recording record sales. If you have been using this time of home isolation to get to those small jobs around the house that you had been putting off, you might also want to consider doing an iso-financial health check. While this concept may seem daunting, there are several practical and easy steps to carry which could result in your iso-health check being one of your more beneficial iso-tasks.
Find Your Lost Super
Recovering lost super is relatively simple. The ATO gives us a few ways we can search for and recover our lost super but essentially it is as easy as filling out an online form or making a phone call. Whatever method you choose, to make the process easier get your relevant information together, such as your Tax File Number.
So how do you know if you have lost super? The ATO lists three main reasons; if a super fund hasn’t been able to contact you in the past, haven’t received any contributions or rollovers for five years, or if they don’t have your address after another fund has transferred you over. If you are a lost member your super fund may still hold your money. Super fund must report inactive accounts to the ATO. They also have to pay inactive low balance accounts to the ATO, so it is beneficial to take control and claim back what is yours.
Get Financial Advice
If you were to give yourself a physical health check, you would get advice from a doctor. Getting advice from a financial adviser is your financial health check equivalent. A good financial advisor will help you work out your goals and strategies for your own personal situation. Financial advice can cover a whole scope of life stages. Whether you are planning for retirement, organising your budget or preparing to purchase a home, it may be worth getting professional advice. You don’t have to wait for a windfall to get professional advice either, however if you do have some spare funds, now may be a time to consider investing.
Make a Budget
The idea of a budget can seem intimidating, especially in the case where your financial health may need a little improvement. However, a budget is essentially your own tool for organising where you want your money to go. No matter what your situation is in life, whether you are fresh out of school, married with children, or looking to retire; making or reassessing your budget might be one of the methods for getting your financial health back on track. Like Dave Ramsay suggests, ‘A budget doesn’t limit your freedom, it gives you freedom’.
Check For Sneaky Subscriptions or Fees
Tying in with organising your budget, isolation is a good time to go through your credit card or bank account to make sure there are not any subscriptions being paid unawares. These days subscriptions tend to be commonplace and yet no matter how cheap, seem to have a way of adding up. It could (literally) pay to spend some time going through your accounts to see what recurring payments are eating into your budget. You could do this possibly through your online banking, or even in your iTunes, Google Pay or smartphone settings, if perhaps some apps and purchases are slipping under the radar.
Review Your Home Loan
Even with interest rates at an all-time low, it is still a good time to review your home loan. It is a worthwhile exercise to investigate if your home loan can compete with other lenders in the market. You could do a google search, contact your bank and ask for a better deal or enlist the help of a mortgage broker. Either way, your home loan is generally the biggest expense of your life, saving a few percentage points could save you thousands over the course of your loans. This is one area where a little effort can provide big gains.
Make a Will
A will is a legal document that shows how your assets are distributed after you pass away. Without a will in place, the State dictates where your assets will go. If you have assets and loved ones that rely on you it is prudent to have a will. This being said, when it comes to Estate Planning and drafting wills, decisions can be overwhelming. Making the wrong decision can be upsetting and cause conflict in the long run. While in isolation consider seeking professional advice from a solicitor who specialises in Estate Planning matters and finally get that will you have been putting off.
Start Thinking About Tax Time
While the days in isolation are long, the months seem to fly by, and 30 June will be here before we know it. Now is the time to see if there are any decisions you could make that will make a difference to your tax. For example, it may be worth bringing forward and making the most of your tax-deductible expenses. There may also be an opportunity for methods such as income splitting and negative gearing. If thinking about tax time gets your head in a bit of a spin, you might want to speak to a trusted accountant or professional to make the most of your tax return this year. If you leave it till after 30 June, you will be too late.
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5. Bored in Iso? Give Yourself a Financial Health Check