EP - 18 Get Financially Organised
You have decided you want to make a change; you want to be better with your money. Maybe something has happened in your life to make this change, you have just turned 30 and feel its times to get your life together, your friend who earns less than you has just bought a house and you feel like that you may also want to buy a house someday you listen to the previous episode about travelling the world and you want to do the same. Whatever it is, you are ready to make a change, you are now sitting there wanted to take the first step. So here are my recommendation to taking The first step of getting control of your finances and Getting Financially organised
But before you can move forward you need to have a starting point and find out where you stand right now, so you can then decide how to improve.
What you will need
Excel Spreadsheet, Google Sheet or Note Pad and Pen
2 Hours per week
1 – What do you earn?
Personal Income Plan
Outline how much money you are earning right now from your 9 – 5 / regular job.
Do this by checking your past 2 Pay slips
If you have investments (property / shares / business) check your statements, call your property manager or your accountant and work out what you are earning
Important to know what your Gross income is and your net (after tax income is)
2 – Review your expenses
There is no escaping that fact that things cost money, everywhere you go and everything you do you are forever putting your hand in your pocket. Without paying attention to what you are spending it can be easy it get into bad habits and for your expenses to get out of hand.
How to figure out your expenses, go through your statements or jump online i.e. commbank auto categories your expenses into each section
Request a list of transactions / regular bills / direct debits from your bank
Make a list of everything you spent money for the past 7 days
3 – What do you Own
Check your bank accounts
Contact your bank
If you have property, ask a real estate agent for a price guide or valuation
Call your superannuation fund,
How to find the value of your super
How to do a lost super search with the ATO
Check your payslip to make sure your employer to putting in a minimum of 9.5% of your gross income into your super fund.
4 – What do you Owe
It’s time to finally open that credit card statement letter from your bank
Contact your bank or check your accounts online and find out all the details on any debts you have. Important to include big and small bills
Balance owning, interest rate, term remaining
HECS debt : Log into mygov – create a mygov account to see how much is owing on your HECS / Student debt.
5 – Calculate your net worth
Total assets – total liabilities = Net Worth
Now that you have a clear idea of where you are financially it’s time to set yourself some goals and put it into action. If you have a lot of credit card or personal loan debt, make a plan to reduce this ASAP. Want to go on the holiday, set yourself a 6 month or 12 month goal and start saving.
If you don’t trust yourself to be able to save the month, ask a friend or family member to be your accountability partner. Transfer them the money or create a joint account with them so you have someone else on the goal with you.
