Jan 24, 2022 2:32:40 PM

Get Financially Fit in 2022

Topics: Mortgage Broker, Financial Health, Home Loans 0

The beginning of a new year is a good time to get your finances in order and establish some financial goals for the year ahead. By making just a few small changes to how you spend and save, you could set yourself up for the best year ever when it comes to managing your finances. So, whether you’re looking to clear your debt, boost your savings, or grow your retirement fund, follow these 5 tips to help you get financially fit in 2022.


1. Re-set your budget

Sticking to a budget is a big part of financial success. A good budget helps you get a clear picture of your incomings and outgoings and provides an opportunity to make improvements to either of these. But budgets aren’t meant to operate on a “set and forget” basis. While a budget should guide your financial decisions, it should also be dynamic, changing as your financial and personal situation changes. For example, if you get a new job, move house, buy a new car, all of these changes will have some impact on your budget.

So if you haven’t already done so, consider starting the new year with a budget re-set: draft a new budget for the new year. A budget re-set lets you draw on learnings and trends from the year before and then make changes to how you spend and save. It’s a chance to look ahead to any major purchases you’re considering during the year and plan how you’ll save or spend towards these.

2. Bust your debts

Start the new year with a strategy for paying down your debt. You could choose to clear your high interest debt like credit cards and hire purchase, as this type of debt can easily spiral out of control and leave you in a worse-off position financially. Pay at least the minimum monthly amount due, but if you can afford to, make extra repayments to clear your most expensive debt first.

Or you may choose to focus on paying down your smaller debts first, as each amount cleared gets you one step closer to being debt-free, and each little win helps you stay motivated and on course. If you’re struggling to stay on top of multiple debt repayments, consider a debt consolidation loan that rolls all of your existing debt into one lower interest repayment so you save on interest charges.

3. Boost your super

Making extra contributions into your super is a good way to grow your retirement savings. And that’s something your future self will thank you for! Even the smallest amounts add up over time. You can make extra contributions by salary sacrificing, having your employer pay part of your pre-tax income into your super account. Any voluntary payments you make will reduce the amount of tax you’re required to pay.

It’s a good idea to review your Super at least once every quarter to check that your fund is performing well, as that can make a huge difference to the amount you get when you retire. Use the ATO’s YourSuper comparison tool to see how your fund stacks up in terms of performance and fees. And get advice before you switch funds.

4. Book a financial check-up

Just as you would schedule a regular health check or a dentist visit, so too is it worth booking a regular check-in with your broker. A financial check-up is a chance to review your goals, to see how you’re tracking, and to make any changes that may be needed. And being accountable to someone could help you stay focused on reaching your financial goals.

A financial check-up is also a chance for your broker to review your current interest rates, to ensure you’re getting the best deal available to you. Many borrowers end up paying thousands more in interest charges simply because they don’t get around to refinancing when interest rates drop.

5. Review your credit report

Lastly, request a copy of your credit report to review, paying careful attention to any errors or inconsistencies, so you know where you stand when it comes to applying for future credit. Your credit report contains a history of your current and past debts, as well as your repayments. Lenders use this information to decide whether or not to lend to you. You can request a free copy every three months.

For more financial advice tailored to fit your lifestyle and financial situation, contact the team at Mortgage Express.

While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken by Finservice Pty Ltd (Mortgage Express) for any errors or omissions. This publication does not constitute personalised financial advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. A Disclosure Statement is available on request and free of charge.

Finservice Pty Ltd (Mortgage Express) is authorised as a corporate credit representative (Corporate Credit Representative Number 397386) to engage in credit activities on behalf of BLSSA Pty Ltd (Australian Credit Licence number 391237) ACN 123 600 000 | Full member of MFAA | Member of Australian Financial Complaints Authority (AFCA) | Member of Choice Aggregation Services.