Managing your personal finances is not always as easy as people think it is, largely because there is much more to it than simply making it to the end of the month with a bit of cash to spare. That is how children manage their finances and it doesn’t work. As we get older and the demands of the real world become both more exacting and harsher, we need to plan and budget. And we need to think short term, long term and in between as well. Because, yes, making it to the end of the month without going broke is indeed important, but there is a lot more too it than that. Making it to the end of your life with money is also important.
So how exactly do you make sure that you are on a sound financial footing? The answer is simple really – don’t assume that you know what you are doing and consult an expert for some advice. A quick online search for something like ‘financial advisor Canberra’ should provide you with a solid starting point if you don’t know who to approach. Once you have identified a qualified expert, here are a few things areas where you should look to seek help.
Long term Insurance
Life might be great, and you are earning well, putting food on the table and providing for your family. But ask yourself the question what happens if you die tomorrow? Or worse yet, what happens if you are incapacitated tomorrow, alive, but unable to work. For too many people this is a reality as accidents and tragedies strike on a daily basis. As much as paying for things like life or disability insurance are grudge purchases, ask anyone who has ever lost a breadwinner at a young age and they will tell you the importance of this type of cover.
If you don’t know how to budget, you need to find out. It is not difficult but for those who have never done it before it can be tricky getting started. In short, a budget is a simple plan that informs you about how you are going to spend your money. It is the best way to ensure that you are not derailed by impulse buys and that you plan properly on what to spend and where to spend it.
Having money for a rainy day is very important. Your advisor will be able to help you through the process, letting you how much you should be saving and where it is best to put it. And work together with the expert to come up with a strategy. You need to be thinking about investing for your retirement, but you also need to think shorter term as well. Saving for a holiday or to buy Christmas presents at the end of the year without ruining the budget. These are all elements that need to be considered when you are making plans.
Before you can move forward from a position of strength you need to get rid of your debt. Debt can often be a difficult trap to get out of and it can often feel like a desperate situation to be in. But your money expert will be able to help you manage the situation as effectively as possible. If you are in debt, don’t be embarrassed about it, confront it head on, seek advice and solve the problem – the sooner the better!