These 8 pearls of financial wisdom will help you achieve your financial goals by shifting your focus to the long term instead of being fixated on the present.

What do you want and how will you get it? 

What are your retirement goals and objectives? Where are you now in relation to those goals? Create a plan that sees you enjoying the fruits of your labours and act now to make sure your financial goals are achieved. When creating or modifying your financial plan make sure to be realistic and set achievable timeframes.

It’s not just about returns 

Every investment has some degree of risk. Understand the differences between the various investment assets available and make your decision wisely. Everyone has a different comfort level and risk appetite, generally the more risk you take you will be awarded with a higher return. As you grow older, you might prefer stable returns as opposed to higher returns. So make sure to discuss with your adviser about your financial goals, circumstances and risk appetite to make the most suitable investments tailored to your financial circumstance. 

Share it around  

To help reduce risk, share your investments across several asset classes – and within those asset classes. The right balance can depend on your financial objectives, the time you have available to invest and your risk tolerance. Diversifying across a range of asset sectors and industries reduces market risk and can improve your investment potential. You don’t have to worry about trying to time the markets for the right time to invest. With a diversified portfolio, you are always in the market.  

Don’t forget Super 

Superannuation will be your bank account when you’re no longer working so consider ways to boost your super fund balance. At least 9.5% of your income is being contributed to your Superannuation, so make it count. How you invest your super will make a big difference to your retirement. Remember, you can choose what your Super is funding so choose a fund that aligns with your values. And if you are making additional personal contributions, be aware of the annual limits as penalties will apply if you exceed those limits.  

… Or Tax 

Tax is the trickiest area of all. Always seek professional advice. A restructure of an underlying asset, an investment vehicle or ownership structure could help you minimise tax and maximise your return. Determine your tax bracket and be aware of your claimable expenses and deductions. And make sure to lodge your tax returns on time to avoid any penalties.  

Retirement can last another lifetime 

Thanks to medical technology and improved lifestyles we are living much longer lives. Being prepared for a longer retirement means that you money must last much longer, so do not be too conservative with your investments. You can also make additional contributions to your Super, be sure to invest in a Super fund that aligns with your values and brings you positive returns.  

Stay Cool 

You are in this for the long term so when market fluctuate and investments unexpectedly fall in value, don’t panic and sell. Over the last 100 years global share markets have experienced many major setbacks, including the Great Depression of the 1930s, several wars, the ‘crash of 1987’ and the Global Financial Crisis 20 years later. But for every low, a recovery has followed – they just take time. Make sure to discuss with your adviser prior to making any decisions, review your portfolio and stay focused on your long-term goals.  

Keep Learning 

You are never too old to learn. Financial advisers have an important role in giving you tailored advice, but you still need to make your own informed decisions. Make sure you understand your plan and if not ask questions or do more research to expand on your financial wisdom.

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This article presents 5 tips to survive a decline in income.

Since precautionary measures were heightened to slow the spread of COVID-19, almost 1 million Australians have lost their jobs. According to the Australian Bureau of Statistics, Australia lost 7.5 per cent of its jobs between 14 March and 18 April. If you’re one of the many Australians who has lost their job, it’s understandable that you may be feeling stressed about managing your finances. These tips will help you manage your finances if you experienced a decline in income.

Put together a new budget 

The first thing you need to do if your income has fallen is put together a new budget. With a reduction in your income, you’ll likely be looking to reduce your fixed and discretionary expenses. Put together a budget that includes your essential expenses such as your home finance or rent payments, bills, and groceries. This is also a good time to assess which expenses you can do without until your income rises again.   

Set up payment plans 

Losing your source of income can be stressful, especially when you have ongoing payments to meet. If you’ve put together your new budget and you’re not sure you’ll be able to meet your regular payments, speak to your finance consultant about setting up a payment plan. The important thing is that you do this proactively and keep communication open as having these conversations now will put you in a much better place to negotiate. 

See what support you may be entitled to 

The government has announced a range of support packages available to people who have lost their source of income or those who have experienced a significant decline in income. Check which support you may be eligible to receive and organise all of the details you need to apply. Full details about the Federal Government’s measures to support individuals and businesses are available on the Treasury website.  

If you’ve lost your income due to illness or injury and you have income protection insurance, check what claims you are eligible to make and what payments may be available to you. 

Identify potential savings 

When you put together your new budget, you probably identified expenses you could do without such as gym memberships and other discretionary expenses. To identify further savings, check if you can switch to cheaper providers for your utilities such as electricity, gas and internet and consider winding back your home finance payments if you have been paying extra. 

Seek advice from financial professionals 

In stressful times, it can be hard to look beyond the current period of financial stress. However, this is also an opportune time to reset your financial plan for the future. Take this opportunity to speak with your financial professionals, including your home finance consultant or broker, accountant, and a financial adviser to manage your finances now and into the future effectively. 

Moving forward 

At a stressful time for people, it’s important that you don’t feel like you need to weather financial challenges alone. Taking the time to see what support may be available through the government’s support packages is a good place to start. And to set up a financial plan for the future that also addresses your current financial challenges, make sure you speak to a qualified financial professional for tailored advice. 

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