As a financial adviser here are three things that I talk to people about that they don’t like to hear

1. Save more than you think you need to save.

Most people I talk to understand the importance of savings. However not everyone does it. The ones that do generally save for emergencies. For example, appliances that need to be replaced or for a new car. Its rare that they save for retirement.

When I talk to people about the amount of money, they need to save most are shocked. I suggest saving 25% of your after-tax salary. Yes, it is possible to live on 75% of your salary. This will ensure that you have money for emergencies and more importantly help you take advantage of opportunities when they arrive.   

2. Stop trying to time the markets.

One of the most common responses I hear from people when it comes to investing is “I am waiting for the right time.”

“So, when is the right time?” The right time is now!

Most people try and time the market. It doesn’t matter if its shares or property. They want to wait for the perfect time to invest. They feel markets are overvalued and so they wait and wait and wait.

No one can time the market. Professionals struggle to time the market. If professionals get it wrong, what makes us think we can do it better?

My advice to people is if they are ready to invest then the time is right now. Doesn’t matter if markets are high or low. Have a plan and still to it!

3.  What's your backup plan?

If you become sick or injured and can't work, how are you going to survive, what is your plan B? I ask this question to everyone and the most common response is “I don’t know”.

A sound plan B will ensure that if you are not able to work due to injury or sickness your income will continue and your lifestyle will not be affected.

Have a plan B

Do you find that when you do the groceries you always shocked at how much the bill comes to? You look at the trolley and think how does all that cost so much!  

Well here are 3 simple ways to help you reduce your grocery bill next time you go shopping

Always shop on a full stomach

How many times have you gone grocery shopping on an empty stomach and bought things you do not need? I know I have! Shopping on an empty stomach will prevent you from buying unnecessary things.

Set a budget and stick to it

This is my favourite as I know it works if you do it. Every time I set budget for groceries; I walk out not spending more than that. By setting a budget you force yourself not to buy things that you don’t need. Take a calculator with you if you need to. Theses your phone will do the job anyway.

Buy homemade brands

If you're not loyal to a particular brand, try the homemade brands. I know for some things I will only buy the brands that I like. However, for other things I am happy to buy the homemade brand. For example, I am very particular when it comes to honey and therefore, I will only buy my favourite brand. However, when it comes to butter, the homemade brand suits me just right. Buying the homemade brands will help cut the bill.

Next time you go shopping try the above things and let me know if your grocery bill has reduced as a result.

Do you find it hard to live below your means?

If you are like most people then the answer is yes! A lot of us struggle to live below our means. Credit card debt and personal loans are perfect examples of this. I meet a lot of people who have an outstanding credit card debt that they are struggling to repay.

If you want to create wealth long term you have to live below your means. Otherwise, you will fall into a debt cycle that you will struggle to come out from.

Here are 3 simple ways to live below your means

Know the difference between a need and a want.

When I do a budget session with clients this is something we put a lot of time and focus on. We go through their everyday expenses and discuss their needs vs wants. A lot of people confuse wants with needs and as a result are not able to budget. The goal here is to focus on the needs not the wants. Remember a need is something that is essential for your wellbeing. A need is food, accommodation, bills, medicine etc. Wants are desires such as eating out, new clothing, car stereo etc. I am not saying not to buy wants. I am saying don’t confuse a want with a need.

Stop comparing yourself with the Jones.

This is something a lot of people struggle with – comparing oneself with others. When we see our friends or family buy the latest “thing” we have to go out and buy it as well. If a friend buys a new car, we think that our car needs an upgrade and we go out and buy a new car. This attitude will never help us to live below our means. One of the best ways to stop comparing yourself with others is to be grateful with what you have. If you focus on having an attitude of gratitude you will stop comparing yourself with others period!

Learn to cook

How much do you spend eating out? If you look back at your last 3 months bank transactions you will be amazed at how much you spend eating out. I have never met anyone who underspends on this category! If you want to live below your means then learn to cook. Imagine how much money you potentially can save if you learn to cook? Don’t know where to start? These days there are so many ways to develop this skill. Just go online. Don’t make the excuse you don’t have time. Everyone has the same amount of time in a day. It’s what you prioritise within the time you have that matters.  

Whether you're a first home buyer, first time investor or need help with your budgeting and financial planning - we can help.

Saving for a deposit to buy a property is one of the hardest things to do especially if you are renting or you have kids. The cost of living is increasing all the time however are wages are not! It’s harder and harder to find anything left over to put towards your savings.

Here are 3 simple ways to fast track your deposit

Be realistic when it comes to your purchase price.

Unfortunately, a lot of people want to buy their forever home now. This is part of the reason why they just can’t get the deposit needed. They want the big house straight away. Be realistic when it comes to your purchase price. Start small and them move up from there. After a few years you can revaluate your position. Start small first.

Create a savings plan.

Most people don’t save because they don’t have a savings plan. This is vital! A savings plan will help you track all your expenses. I suggest you go through your last 3 months bank statements and track all your expenses. This will help you determine where you are overspending and find ways to cut costs.

Assume you already own the property

This is my favourite. Assume you already own the property you want and now put aside all the expenses you will be paying towards that property towards savings. For example, council rates, strata costs, utilities etc. This will help fast track your savings.

The above it will assist you to save for your deposit and get you closer to purchasing that property!  

If you assistance with home loans or financial planning, please get in touch as we would love the opportunity to assist.

Do you struggle when it comes to savings?

If you are like most of my clients then the answer is yes. Here are three practical tips to help you save more.

1. 48-hour rule

I heard about this rule a few years ago. When you are thinking of buying something whether its new clothes, shoes or even a car, don’t buy it straight away. Wait for 48 hours before you purchase the item. By waiting 48 hours you have allowed yourself to rethink the purchase and determine if you really need the item or just want the item.

2. Automate your savings.

When you get paid set up an automatic transfer of a specific amount from your bank account to another account that you cannot touch. This will prevent you from spending all your pay check. It is a great way to force yourself to save. Make sure that the account you are transferring the money into is an account that you cannot easily get access too. A great amount to start is 10% of your income and then slowly build from there.

3. Track your expenses.

When was the last time you tracked your expenses? By tracking all your expenses, you will know where you are overspending and you can immediately cut back on those expenses and start saving. If you don’t know where to start, I suggest looking at your last 3 months bank transactions and go through all your expenses. Its tedious I know however once you do it you will not need to do it again as you will have the list of most of your expenses. Alternatively, there are apps that you are able to download that will summaries your expenses or your online bank app may have this feature. I suggest tracking your expenses daily if not then at least monthly.

If you need help with budgeting, please get in touch with us as we would love the opportunity to assist.

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