I celebrated my 40th birthday this week and spent some time reflecting on what I would tell my 20-year-old self about money,if I could. Here it is:
1. Track your spending.. Review your spending regularly for insights into.
2. Be aware that your spending reveals your true values. My highest values are freedom,health and education and I try to make sure my spending aligns with them. Figure out yours.
3. Refine,refine,refine. I’ve had myriad attempts at trying to set up a household budgeting system.,but it took time and much refining.
4. Claim handbags on tax. Segue alert! Did you know,or briefcase,which you use for work purposes worth less than $300 each year. Get on it.
5. You to buy a home. A steady income and a modest amount of savings can get you there.
6. Buy a home,if you can. You’ll need somewhere to live rent-free in retirement and the capital gains you make are tax free. Governments also have shown repeated committment to protecting property values.
7. Be nice to your parents. If you lack a 20 per cent home deposit,they can go guarantor on the missing amount up 20 per cent to avoid you paying lender’s mortgage insurance.
8. If you didn’t win the parental lottery,look up the government’s.
9. Don’t spend on a wedding what could be a home deposit.
10. You don’t need to be Warren Buffet to invest in shares. With micro-investing sites and apps,like CommSec’s Pocketbook,Raiz and Spaceship you can start investing with small amounts. Always check the fees first.
11. Don’t know where to start? (ETFs) that track a broad index,such as the ASX200.
12. Your super is real money.,if you can,to maximise tax breaks. You’ll only pay 15 cents in the dollar in tax,as opposed to your marginal tax rate.
13. If your super balance is under $500,000,you can rollover unused concessional cap amounts (currently $25,000 a year) from previous years. Check your MyGov account.
14. If you’re going to tip in extra to super from your after-tax dollars, for a nice,fat tax refund.
15. Buy secondhand. Get over the “ick” factor. Use Facebook Marketplace or Gumtree to.
16. If purchasing in store,ask the sales assistant:“What’s the best price you can do on this?” Smile.
17. Shop at Aldi..
18. Don’t waste food. Freeze things before they go off.
19. as much as you can.
20. Shop around for everything,from insurance,to,even.
21. Increase your insurance excesses – the out-of-pocket cost you agree to pay in the event of a claim – to.
22. Only if you can see that your benefits received will exceed the premiums you pay.
23. After age 31,maintain private health insurance to avoid paying the Lifetime Health Cover Loading on policies. You can ditch cover for just under 3 years and still avoid the loading.
24. If you earn over the income thresholds for the Medicare Levy Surcharge,take out the most basic hospital cover to avoid paying it. It’ll most likely be cheaper than the surcharge.
25. Use to shop around on health insurance.
26. Go to for cheaper electricity bills. In Victoria,you need to use.
27. Try for internet and telco deals.
28. For loans,use,,and.
29. Invest in your health. You are your own best asset. Your ability to generate income depends on your physical and mental health. Spend a bit of money to protect them both.
30. In pay negotiations,always let them make the first offer. Failing that,ask for twice what you want and then be happy when you get half. Be prepared to walk.
31. Do a job in which you have a “comparative advantage” – one that both suits your skills and which you can do relatively better than everyone else.
32. Remember the true cost of something is what you give up to get it. That includes not only money and time,but also the “opportunity cost” of the next best thing you could have done with that time and money. Choose carefully. Live deliberately.
33. Travel as much as you can. where you contribute a little each month to afford nice holidays.
34. A man is not a financial plan. Plans go wrong. Always keep yourself financially independent.
35. Childcare costs as much each year as the ritziest sandstone-clad private school. Brace for it.
36. Kids don’t cost as much as you’d think because your lifestyle adjusts to accommodate them.
37. You don’t need $1 million to retire. The age pension isn’t going anywhere and many people will use it to supplement their retirement income.
38. Save for tomorrow but also live for today.
39. Life goes quickly but is also long (touch wood). Plan for it.
40.You are capable of achieving so much more in 40 years than you could ever believe.
With time and patience,you can afford the life you want. Small differences today can make a big difference to your financial future. You’ve got this.
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