As of last year, there were approximately 3.2 million Australians aged between 50 and 59, a time of your life which – by all accounts – is a bit of a weird one. The kids are probably old enough to have moved out (or at least not be far off), and you might be thinking about taking that trip you’ve always wanted to do, or maybe even moving house.

​You’re almost certainly, thinking about retirement. Not necessarily exactly once you hit 60, but very likely in the next 10 years after that (the average retirement age in Australia is almost precisely 65), and you’re probably starting to dream about that new caravan or boat or various other ways retirees spend their newfound time and money.

What’s the problem?
But while retirement itself is a whole complex state of affairs, the years leading up to your retirement can pose some important decisions too. The way you position your finances now can have a big impact on how your retirement plays out and how well-prepared you feel for the second half (ish) of your life.

What you can do about it
So if you’re part of that 3.2 million-strong cohort, here’s a mini checklist of things you should think about before you hang up your work boots and start sipping on your super:

• Check your fund: It goes without saying that your superannuation is one of the most crucial things to be on top of before you retire, so start here. Check your fund’s returns for the last year, five years, and 10 years, and compare with other funds to make sure you’re in a good one. The government’s YourSuper comparison tool is the best way to assess this. Executive advisor at Viridian, Jason King, says pre-retirees should also familiarise themselves with the different types of super contributions you can make, and up to what age you can make them. For example, you can only make voluntary contributions until age 75, but once you hit 67 you need to meet what’s known as the “work test” if you want to claim a tax deduction on your super. If you think you might want to make a downsizer contribution, familiarise yourself with that too. This is the time to get across all the varying facets of superannuation, and if you’re feeling lost, advice from a financial planner or even your super fund can go a long way.
• Sus your insurance: By this age it’s very likely you already have private health insurance, and you might be thinking of taking out additional insurances such as life insurance or letting go of other insurances, such as income insurance. I’ve covered the value of life insurance in a previous newsletter, and unfortunately, it’s one of those decisions that changes based on your circumstances. However, King says no matter what, “never reduce or cancel cover before having a thorough health check, as many clients regret losing their insurance”. King says calling your insurer and working out a package that suits you best moving forward is better than spontaneously deciding to commence or cancel cover. “Be aware that the cost of cover increases substantially in your 50s and beyond, which enhances the reasons to seek a review rather than cancel in haste,” he says.
• Think about your purpose: When you’re doing like Dolly and working 9-5, work can become one of your main “activities” and ways you spend your day. But once you retire, you no longer have something to consistently take up your time, a transition which can be difficult for many people. Bec Wilson, pre-retirement guru and regular Money writer, is a big advocate of taking the time to think about what’s next in your post-work life. “Contemplate where you’ll find purpose when you no longer work and start exploring pursuits, activities and projects you can get passionate about long before you retire,” she says. “[Also] recognise that your health is crucial to a good retirement and start doing things today that your 90-year-old self will thank you for later – cardiovascular and muscle mass exercise, and a good Mediterranean diet.”
• Don’t switch off: As your retirement years approach, the number of things you need to get on top of may seem immense, and it can be tempting to stick your head in the sand. However, this will just leave you in an even worse spot when push really comes to shove, so starting early to understand the way forward is essential. Some people opt to have a financial advisor explain things for them, which is a perfectly sound strategy, but whatever you do, make sure it’s something.

Article from Dominic Powell, Money Editor 'The Age' 8th December 2024 December 8, 2024

Advice given in this newsletter is general in nature and is not intended to influence readers’ decisions about financial products. They should seek their own professional advice before making financial decisions.

Raising your kids to be smart with money gives them vital life skills.

As a parent, you can shape your child's relationship with money. Start early by showing them where money comes from, how to budget, spend wisely and set savings goals.

Talk to your kids about money
You don't need to be an expert to teach kids about money. When you can, whether at home or when you're out, start a conversation about money. By doing this, you make money part of everyday life.

How you earn money
Describe how you earn the money you spend. Explain that you get a certain amount of money each time you get paid. Say how you use that money to cover the essentials, like food, clothes and housing.

Needs and wants
Talk about how you prioritise what you spend your money on. Discuss the difference between 'needs' and 'wants' — must-haves and nice-to-haves. Encourage your kids to think about needs and wants before spending money.

Track your spending
When older kids get their first job, they may be tempted to spend all their money at once. Show them how to track their spending to see where their money is going.

Show your kids where money goes
Find everyday moments to teach your kids about money. 

When you tap and pay
Explain that when you tap your card, it talks to your bank where your money is. When you tap to pay you use money that you've made by working and saving. Each time you tap and pay, you have less money in your account at the bank.

While shopping
While shopping, teach your kids how much things cost:

• Show them how similar items have different prices
• compare how much lower the price is with a special deal or discount
• look for the unit price (for example, price per 100g) under the main price
• use the unit price to work out which item is better value

When paying bills
Show your kids an electricity bill or phone bill. Explain how many hours or days you had to work to earn the money to pay that bill.

This will help them connect working with paying for things.

Get kids involved in money decisions
As your kids get older, get them involved in budgeting, saving and spending.

Check deals
Work together to research online or shop around to find the best deal for something they want.

Plan an event
Involve your kids in planning and budgeting for an outing or a birthday party. Work through the costs with them, such as transport, food, tickets or activities.

Do a budget
Do the family budget with your kids. Explain how much money you have each week and how you spend and save it. They'll start to get a sense of the cost of living and how long it takes to save.

If they are earning money, help them create their own budget.

Use the budget planner

Help your kids put together their own budget.

Share their money
Encourage your kids to donate some of their savings to charity. Get them to choose which charity to donate to. Talk about how good it feels to help others.

This teaches them you can use money for more than just buying things.

Give kids pocket money
Pocket money can help your kids to understand the value of money.

You can choose to pay them for certain tasks, such as:

• mowing the lawn
• vacuuming the house
• making school lunches
• hanging out and bringing in the washing
• packing and unpacking the dishwasher
• washing the car
• taking the rubbish out
• walking the dog

Make sure you withhold their pocket money if they don't do the tasks. Or reduce the payment if they don’t do a task as agreed.

This teaches them that they only get paid when work has been done to a certain standard.

Encourage your kids to save
Learning to save is an essential money skill.

Piggy banks and bank accounts
Piggy banks are great for younger kids. Even though money is increasingly virtual, coins and notes help kids see and understand money. They can see their money grow as they save.

Opening a savings account is a good way to introduce kids to banking, saving and interest.

There are also apps to help kids save pocket money and learn good money habits.

Set money goals
Help your kids avoid impulse buys by teaching them to set goals and prioritise how they spend their money.

When your child wants to make an impulse buy, remind them about the goal they're saving for. Get them to work out how much longer it will take to reach their goal if they spend today.

For more information and articles:
moneysmart.gov.au/family-and-relationships/teaching-kids-about-money

​




Christmas is notoriously a time when people spend tons of money and rack up debt buying Christmas gifts for their loved ones.

However, by creating a Christmas budget and savings plan, you can have a great holiday without overspending.

So, let's discuss how to save money for Christmas to make sure you get through the holidays financially sound!
​
1. Make a list of who you are buying gifts for and how much you need to save: Also, add any travel you may anticipate or expenses that may pop up, like food for a holiday meal.
Once you have the total amount you need to save, give yourself a deadline to reach that number before you start your Christmas shopping. It's also a good idea to save a little more than your target number in case you forget to add someone to the list.

2. Open up a designated Christmas savings account to use as a sinking fund: Sinking funds are savings accounts you can designate for your Christmas or holiday savings. To simplify saving, you can automate deposits to your sinking fund.

3. Build saving for Christmas into your budget: Now that you know how much you need to save to prepare for Christmas, you'll want to incorporate this amount into your budget.
Depending on how much you need to purchase your gifts, you'll want to divide that dollar amount by the number of weeks you have between now and when you want to start shopping. This will give you a weekly savings goal.

4. Plan your Christmas shopping ahead and shop smart: November is the beginning of the sale season, so it can be easy to be side-tracked.
Shopping online can help you get your gift buying out of the way early. If you decide to go to a store, then plan ahead. Map out what days you'll be shopping, what stores you'll visit, and what you'll buy.
Remember to use coupons or cash-back apps, like Rakuten for deals and savings.

5. Stay motivated to save money for Christmas: It's a good idea to get a savings partner (AKA an accountability partner), so you can keep tabs on each other and help one another succeed. Think of someone interested in joining you as you save for the holidays and plan weekly check-ins with them!

6. Get creative with your Christmas gift-giving: Another creative way to save money on Christmas gifts is to make gifts yourself. It could be physical items like clothing, trinkets, or home-baked goods like cookies and cakes. Focus on creating memories, and staying within your budget will be easier.
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With these tips, you should be able to put a solid plan in place to avoid holiday debt and come out on the other side of the Christmas season with your financial goals intact.

Here's to a happy and financially sound holiday season from Clever girl finance and Volare Home Loans!

This article is bought to you by Clever girl finance.  www.clevergirlfinance.com/

by Clever Girl Finance

1. Set clear goals: When you set clear financial goals, you can stay on track and better understand your spending. Goalsetting is a great way to know how much money you need to save or put towards your debt.
For setting clear goals, we recommend the SMART Goal Method. It stands for:

• Specific: A clearly defined outcome of what you want to achieve.
• Method: Ways you will measure progress on your goal.
• Achievable: Make sure the goal you set is possible.
• Realistic: Ensure the plan is practical to your life circumstances.
• Timely: A detailed timeline of when you will complete your goal.

2. Get clear on your spending for both variable and non-variable expenses: Before you start allocating your money to the categories in your budget, you need to know exactly where your money is going.
In any budget, you have two types of expenses: non-variable and variable.
Non-variable expenses are payments that never change, like your rent. Variable expenses fluctuate, such as gas, groceries, and clothing.
By including non-variable and variable expenses in your budget, you can build your budget based on realistic numbers.
3. Find a system for budgeting that works for you: When choosing a budgeting style, consider what might work best for you. For instance, the cash envelope method works well if you are more of a visual person and want to focus on saving money.
Fortunately, there are many different systems to choose from. Some more popular budgets include zero-based, 50-30-20, or the reverse budgeting method. ​
Experiment with different budgets until you find the right one for your current life stage and personality.
4. Remember to pay yourself first: You should always practice paying yourself first, no matter the system you choose.
For example, paying yourself first ensures you contribute to your 401(K) at work before deciding anything else.
It can also look like ensuring you have an adequate emergency fund set aside or making a credit card payment when you receive your paycheck.
5. Create space in your budget for miscellaneous expenses: We cannot predict the future; as much as we try to, unexpected things will happen.
This is why you should create a miscellaneous category in your budget. It will help you put aside extra money when life throws a surprise or two at you.
6. Do regular check-ins with your budget as often as needed: When you start budgeting, you may get overwhelmed with tracking your expenses. This is why checking in as often as necessary to see where your money is going is essential.
Evaluating your spending in real-time can relieve you from end-of-the-month stress.
7. Adjust your budget when your life or income changes: If you decide to pivot the direction of your life, it makes sense that your old budget won’t fit your new needs.
You could also get a pay raise or a new job that affects your income; this could also cause a budget change.
Your budget will evolve over time, and it'll help keep you on track with whatever you want or need to achieve.
...
Finding the best budgeting practices that work will help you gain financial wellness (and stability).
Try different methods, adjust categories, or make more income to help when you can’t cut back anymore. Budgeting can help you you can live a life you love.

Call Catherine on 0411 849 804 to see how much you will need to save to buy your own home. 

Stay-at-home parents are often almost entirely reliant on their spouse for financial support. So, when a separation occurs, not only are they losing a relationship but they are potentially losing their financial lifeline.

But there are some things a stay-at-home parent can do to protect themselves in this situation, both before and after separation.

Article by Josephine Sergi and Natalie Stella and can be found at 
https://www.moneymag.com.au/stay-at-home-parents-separation

Before separation
1. Maintain individual bank accounts
Too often, couples only have joint accounts into which income is paid, bills are paid from and savings are accumulated.
While this can be convenient as a couple, after a separation, it can give one spouse the opportunity to restrict the other's access to funds.
Maintaining individual bank accounts is a good way to minimise the risk of potentially being "cut off" financially.
2. Make sure you know your family's financial position
It is common for one party to assume control of the family finances. However, not being actively involved and aware of the details of your family's financial circumstances (including the location of assets/liabilities, contacts, logins and passwords) can create a difficult pathway to obtain and determine what assets are held and where funds are kept.
Be sure to protect yourself by maintaining access to all financial records, including historical records.
3. Hold assets in joint names
Where assets are held in joint names, they can't be disposed of or dealt with, without both parties' consent.
Where an asset is held in the sole name of the stay-at-home parent, that is even better.

After separation
1. Ensure your assets and funds are protected
Banks will often quickly lock down joint accounts when advised of a separation, to prevent one party from withdrawing significant joint funds.
Accounts holding significant funds, such as savings accounts, offset and loan redraw accounts, should be immediately restricted to require both parties' authority to transact.
If you're a stay-at-home parent with no other access to funds, it's a good idea to secure a reasonable amount of funds to ensure self-sufficiency, at least in the short term and until financial matters are resolved.
In many family law matters a party who is not the registered owner of a property will attempt to lodge a caveat to protect their interest. However, legally, a family law claim to a property does not create a caveatable interest. Instead, you'll need to seek out specialised family law advice to determine how best to lawfully protect your joint assets.
2. Child support and children's expenses
Generally, the sole income-earning spouse will continue paying children's expenses after separation without issue, to minimise disruption to children.  However, this is not always the case.  There are two kinds of financial support you may be entitled to, for your children

• Periodic child support which is paid weekly or monthly to the stay-at-home parent to assist with the general everyday costs of housing, feeding, clothing and educating children;
• Non-periodic child support usually covers out-of-pocket expenses such as private school fees, extracurricular activities, medical expenses and the like.

3. Entitlement to ongoing financial support
In addition to child support, as a stay-at-home parent you may be entitled to receive spousal maintenance from your former spouse.
An entitlement to spousal maintenance is assessed on a number of factors, including the stay-at-home parent's reasonable expenses, their capacity to earn income, and the income-earning spouse's capacity to pay spousal maintenance, after taking into account their own reasonable expenses, and child support payable.
4. Make sure you secure accommodation
Deciding where parties will live is often one of the first steps following a separation. There may be a battle about who remains in the family home. But a property registered solely in the name of one spouse does not automatically entitle that party to remain living there. This is a common mistake.
Before moving out, a stay-at-home parent should secure financial support from the income-earning spouse to cover accommodation and living costs. Financial support for accommodation will be considered a spousal maintenance payment.
5. Remain amicable, co-operative and reasonable where possible
Working together with your former spouse to reach an agreement about interim financial support, children's arrangements and a final property settlement, provided it is safe to do so, is obviously the ideal, and most cost-effective situation.
Often, pursuing financial support can cost a lot more than what a party ultimately gains, so it is important to have reasonable and realistic expectations. Where one income previously supported one household, but now needs to be stretched to cover two, this may result in necessary lifestyle changes and a lowering of expectations.
Family dispute resolution with experienced and reputable practitioners can be an inexpensive way to assist parties who simply need an independent, impartial person to help sort out the financial arrangements in the wake of separation.
6. Understand your rights and entitlements
Seeking specialised family law advice early in the piece is key to strategically preparing for and managing the financial arrangements arising from separation.
If parties seek legal advice too late (after things have turned sour, and the opportunity to take steps to be financially protected has passed), this will likely result in escalated costs and conflict.

Need to talk to someone?
Beyond Blue: 1300 22 4636
National Debt Helpline: 1800 007 007
Family Relationships Advice Line: 1800 050 321

I am also here to talk to regarding buying out your partners share of the property or purchasing another property to live in. You do need some form of income but there are many options.
Call Catherine on 0411 849 804By Josephine Sergi, Natalie StellaSeptember 6, 2023

The holiday season is upon us, and the economic impact of the last few years may mean you need to save money on gifts this year. If you have been impacted, here are some great ideas to save money on gifts so you can keep the holiday spirit without breaking the bank.

Take smaller closer-to-home holidays
The holiday season will likely be much more streamlined and smaller than in most years. Embrace this, and use it to your advantage. Many friends and family members may not be expecting gifts at all, or will certainly understand if they do not receive one. You should not feel bad about minimising the number of gifts you give and the number of people to whom you give gifts.

You could substitute the gift you would normally give with a simple card or phone call, which will probably mean more to some loved ones, especially those you have not gotten to see very much because of the pandemic. Invest in time together (even if being together can only happen virtually), rather than presents, whenever possible.

Repurpose Other Budget Items
This budgeting trick might help you have enough money for gifts without taking on any debt to do so.

Compare this holiday season to a normal holiday season, and write down the expenses you are not paying for this year. Do you normally cook a large meal for guests, but they aren’t coming this year? That may mean significant savings on your grocery bill. Or, do you normally travel out of town? That may mean saving on plane tickets or other transportation costs. You get the idea. The point is that you might be saving some money compared to last year.

You could put some of these savings toward your gift budget. This doesn’t mean your gift budget needs to be bigger than usual, but this might give you some extra cushion.

Check Discount Sites and a Multitude of Retailers
Before you purchase anything be sure to shop around. Thankfully, this can be done from the comfort of home online. Simply look for what you plan to purchase and compare the price across multiple stores. Include brick-and-mortar stores and online retailers in your search, unless waiting for an item to ship is not an option.

If you are still looking for gift ideas and want to find good deals, the Slick deal is a great resource, and most of the sites it links to offer fast shipping.

Consider Giving Gifts after the Holidays
Australia is famous for its after-Christmas sales, like Boxing Day. Huge savings can be achieved by simply waiting pot Christmas to do your shopping. In fact, there are a growing number of Australians doing just that, Christmas is set aside for lunch and the ‘Christmas’ celebration is a set date after Boxing Day.

You don’t even have to delay your Christmas, gifts are purchased on the Boxing Day sales and then mailed to relatives.

Buy or Give Second-hand Gifts
Second-hand gifts have three benefits. First, they are cheap or free. Second, you can put them together in a hurry. And third, they can be very thoughtful. These gifts include hand-me-downs and family heirlooms or second-hand items you purchase used from storage. This has gotten much easier in recent years with the popularity of sites like Facebook Marketplace. You can shop for all ages and should be able to pick up gifts quickly, maybe even on the same day.

Go Handmade
Everyone loves a thoughtful handmade gift. These aren’t entirely free, since you need to get materials, but they are typically much cheaper than store-bought gifts. You can make gifts in a time crunch, too. There are some great guides to help you generate ideas. From bath bombs to painted coasters, this guide for last-minute handmade gifts covers a lot of options for virtually any gift recipient. If that list doesn’t cover it, here is another list of great gift ideas.

Happy Holidays!

Remember, don’t go into debt buying gifts, it could take years to pay off.

This article is bought to you by Credit Mediation Services. 

By Sarah Sharkey from clevergirlfinance.com on July 18, 2022

Managing your personal finances is an important task. However, lifestyle inflation can make it more difficult to keep your finances on track.

Luckily, there are ways to work against lifestyle creep through intentional decision making.

But what is lifestyle inflation and how can you avoid it in the first place?
Lifestyle inflation happens when you allow your spending to gradually increase over time as you desire a more luxurious lifestyle. It usually happens when your income increases over time and you increase your spending to keep pace with that rising income. With that, your income is growing but your savings rate never increases substantially.

Unfortunately, lifestyle inflation can easily sneak up on you if you let it. It might start with a simple lifestyle upgrade like the convenience of a takeout meal or the luxury of a brand new car. But it could quickly spiral into an expensive lifestyle that you can barely afford.

In the long term, lifestyle creep leads to stagnant savings and difficulty reaching big financial goals. You might struggle to save for what truly matters to you while enjoying the convenience of things that don’t truly make you happy.

An example of lifestyle inflation is you might not have the savings to fund your dreams because your budget is saturated with items that you don’t necessarily need.
Most of us will fall into the trap of lifestyle inflation without careful decision making surrounding our spending. It is natural to crave convenience and comfort. But don’t let it come at the expense of your long-term goals.

How to avoid lifestyle inflation aka lifestyle creep
Now that you've answered the, "what is lifestyle inflation" question, let’s talk about how you can avoid it.

1. Be aware of your spending choices
The first step is understanding that lifestyle inflation is a real threat. Unfortunately, it is very easy for lifestyle inflation to sneak up on you because it often starts with small choices. With time, small spending choices can add up to a very expensive lifestyle.

As you make decisions surrounding your budget, consider the threat of lifestyle inflation. When you are thinking about adding a new expense to your life, think about the reasons behind the expense.

Is it an essential item? Or will it contribute to lifestyle creep without adding a significant amount of happiness to your life?

2. Do the math of your raise
When you get a raise of any size or a job promotion, your first impulse is likely to celebrate with a splurge. After all, you’ve earned it!

Before you decide to upgrade your lifestyle, take a closer look at your raise. Sometimes a modest raise might not give a dramatic boost to the cash you have available to spend.

Take a minute to calculate the increase in your take-home pay with the raise. Some quick math will reveal exactly how much extra income you’ll be working with in your monthly budget.

To help, here's a simple pay raise calculator.

3. Treat yourself - within reason
Everyone deserves a treat now and then! But don’t go overboard and then have to deal with lifestyle inflation.

Although short-term treats can be fun, don’t let them derail your long-term goals. For example, a spa day now and then might be a fun splurge. But a regular spa appointment could be cutting into your earnings too far.

4. Set aside a percentage of your income for splurging
You should absolutely spend enough on what really matters to you. However, consider the reality of your budget before taking your purchases too far.

If you get a raise, decide how much you are willing to spend on “fun”. As you think about your increased lifestyle spending, take some time to determine how you want to use this new money to reach your long-term financial goals.

Find a balance between the two that works for your lifestyle and your wallet.

5. Add big changes to your budget gradually
When you finally get a raise, it can be tempting to upgrade several areas of your life at once. Which is especially true if you’ve been waiting on this higher income for a while.

But it is a good idea to avoid jumping into several new lifestyle expenses at once. Instead, add in new expenses one at a time to test things out and avoid lifestyle inflation.

If something truly improves your happiness or quality of life, then keep it up. If you find that a new expense doesn’t elevate your happiness, then slash it.

6. Find friends with the same goals
Our friends do influence our buying habits. That means that keeping up with the Joneses is a real phenomenon! You can be easily tempted to spend extra money if all of your friends are.

The best way to combat this is to find friends that don’t make you feel like you have to spend more just to keep up. Of course, you shouldn’t cut out people you care about over their spending habits.

But consider having a frank conversation about your financial goals and why they won’t see you stretching your budget to ‘keep up’.

It is possible to enjoy friends' company without blowing your budget. A few fun ideas include going for a walk, heading to a free museum, or hosting a dinner party.

7. Set up automatic savings
The easiest way to save is to automate it. With that, you won’t have to make the decision to save on a regular basis. Instead, you just have to make the decision to save once and the power of automation will take care of the rest.

Once you have the take-home amount of your pay calculated, consider your savings goals. If you want to make progress easily, then have your intended savings transferred directly into a separate account.

Then you can spend the extra portion that is leftover in your checking account without having to consider your savings goals.

You’ll know that the savings are being taken care of and you'll completely avoid lifestyle inflation. With that peace of mind, you’ll be able to enjoy your extra splurges without worry.

8. Don’t take out any debt
If you find yourself taking out debt to afford a new luxury, then you’ve likely taken your spending too far and are experiencing lifestyle creep. Although you might be able to afford the monthly payments, that doesn’t mean that you can truly afford something. Consider this carefully before taking on new debt.

You don’t want to trap yourself in a paycheck-to-paycheck cycle due to new debts. In fact, you might want to put your extra income towards paying off old debts!

9. Set up a budget
A budget can help you monitor your spending and help you stay on track. If you want to avoid lifestyle inflation, implementing a budget is the most effective option.

By tracking your expenses and sticking to a budget, you are less likely to allow your spending to get off track.

Take advantage of our many budgeting resources when you are first learning how to build a budget that works for you. Not all budgeting strategies will be ideal, so explore your options before getting started.

You don't have to fall for lifestyle inflation!
Lifestyle inflation can easily derail your long-term goals. The trap of short-term gratification in the form of luxury convenience can delay your plans to get out of debt, save for a down payment, or retire.

When you are adding new luxuries to your life, weigh your standard of living against the benefits of your long-term goals. In most cases, you’ll choose to pass up the convenience of a new lifestyle upgrade in favor of your long-term financial stability.