The beginning of a new financial year is a great time to take a fresh look at your investments, goals and budget. Read up on our top tips for making this financial year your most successful one yet.
1. Consider reinvesting your tax return
It may be tempting to take that lump sum you’ve received from the tax office and go for a big purchase. But before you put down that deposit for a new car, or make a start on those home renovations, have you considered the benefits of re-investing those funds? Whatever your preferred investment fund or method, investing your tax return can often be a wise move.
2. Revisit your financial goals
There’s never a bad time to sit down and examine your financial goals, progress and investments, but the start of a financial year can often be particularly timely. Taking the opportunity to see how far you’ve come and review what’s working versus what’s not is often a worthwhile exercise that will help you kick off the year on the right foot. A good place to start is to ask yourself whether the goals you’ve previously set are still relevant. If not, it could be time to make some changes.
3. Review your budget
A review of your budget will often be a natural extension of your goals review. Some questions to ask yourself might include: did my existing investing budget work well for me? Do I now have more room to save? Did I set expectations too high? You might consider the impact of certain factors on your goal targets, including lifestyle changes or salary changes, and make readjustments to your budget for the new financial next year. ASIC’s Moneysmart website contains free calculators and other useful tools and guidance to help you effectively budget and manage your money.
4. Compare your investment options
If you’re like most investors, you’ve got your finger on the pulse of the performance of your investments. But the start of financial year can provide a good opportunity for you to take a step back and evaluate and compare alternatives. When comparing options, don’t forget to compare fees and charges, not just the stated returns, as well as the overall riskiness of the products.
5. Stay disciplined
Once you have considered your goals, reviewed your budget and identified what investment options are available, you may be tempted to jump straight in and implement your plan. However, while making investment decisions often sounds easy in theory, the reality is it can be complex and comes with risk. Therefore, it will pay you dividends if you are disciplined in your approach, take the time to consider your options carefully, and wherever in doubt seek advice from a professional adviser before making any investments.
Written byTeam Plenti
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