16 November Optimising Savings November 16, 2020By ICI Administrator Aspire 0 By Fran Hughes is a Certified Financial Planner and Head of Financial Solutions at Nexia Perth www.nexia.com.au Australians in capital cities spent an average of $358 per week in the December quarter in commuting costs before the pandemic hit (i.e. $18,616 per year). With COVID-19 and restrictions to work from home, Australians are flushed with savings otherwise spent on travel. Here are my top 3 ways to optimize funds within savings. Build up an emergency fund A study by Deloitte Access Economics[1] found that 13.4 million Aussies don’t have emergency savings to fall back on if they are out of a job. While we could not have predicted a pandemic, it certainly has exposed the financial vulnerability of not ‘saving for a rainy day’. A general rule of thumb is build up three to six months’ worth of living expenses in an interest earning bank account. Start saving for your First Home Owning a home is the great Australian Dream. Perhaps this is just what you needed to kick off the savings plan for the deposit on your first home. There are many ways to optimize savings for your first home, including the First home super saver (FHSS)[2] introduced by the Australian Government in 2017. The FHSS scheme allows you to save up to $15,000 per annum for your first home inside your super fund, whilst receiving a tax break. For someone who is on $80k income, salary sacrificing $288 per week of the otherwise commute cost into the FHSS could mean a tax saving of up to $2,920. Build an investment portfolio Starting a small investment portfolio has never been more accessible. With the introduction digital investment platforms such as Raiz, Six Park and CommSec’s Pocket, you are able to build up an investment portfolio as a long term wealth creation strategy. A general rule of thumb is to invest for a minimum of 5-7 years and consider your tolerance to risk. [1] Source: Financial Consciousness Index (FCI) by Deloitte Access Economics. [2] Source: https://www.ato.gov.au/individuals/super/withdrawing-and-using-your-super/first-home-super-saver-scheme/. Related Posts Advice for parents with adult kids at home: helping your little ducklings to fly The latest Housing Income and Labour Dynamics (HILDA) survey paints a stark picture of the affordability for young adults to move out of the family home. It found that over 50 percent of young Australians aged 18 to 29 still live with their parents, with the numbers climbing faster for women. How To Replenish Post Withdrawal From Super For many working Australians effected by the economic fallout of COVID-19, the government’s early release of super scheme has been a lifesaver, with the money accessed from retirement savings helping provide additional support at a time of financial uncertainty. How do you replenish? My top 5 ways to rebuild your superannuation balance without breaking the bank. Get back on track With the end of daylight savings (in some regions) many people say good bye to their training habits as it is starting to get cooler and there simply isn’t the available light to train in. When people say this to me I simply inform them that these are simply excuses to stop getting their training done, and let the good habits of the last 6 months slip by, so here are a few little rebuttals to most excuses. How to Save Money on Your Food Budget Now more than ever, families need to look at ways in which they can save money on their weekly grocery bills. We have placed together a number of steps that can see you not only decreasing your food budget but saving for that much needed holiday, renovation or new home. An Extraordinary Opportunity Now Available to the Tasmanian Civil Industry Civil Contractors in Tasmania can now access courses from the Institute of Civil Infrastructure (ICI) courses using Keystone Tasmania funding. Is It Time To Review Your Insurance? The current health crisis has put on a spotlight on the need for life and disability insurance. But with household budgets under pressure from the economic fallout, Australians are balancing the need versus affordability. Comment (0) Comments are closed.