Be Financially Fit this 2024

The beginning of a new year is a good time to get your finances in order and establish some financial goals for the year ahead. By making just a few small changes to how you spend and save, you could set yourself up for the best year ever when it comes to managing your finances. So, whether you’re looking to clear your debt, boost your savings, or grow your retirement fund, follow these 5 tips to help you get financially fit in 2024. 

1. Reset your budget

Sticking to a budget is a big part of financial success. A good budget helps you get a clear picture of your incomings and outgoings and provides an opportunity to make improvements to either of these. But budgets aren’t meant to operate on a “set and forget” basis. While a budget should guide your financial decisions, it should also be dynamic, changing as your financial and personal situation changes. For example, if you get a new job, move house, or buy a new car, all of these changes will have some impact on your budget. 

So if you haven’t already done so, consider starting the new year with a budget re-set: draft a new budget for the new year. A budget re-set lets you draw on learnings and trends from the year before and then change how you spend and save. It’s a chance to look ahead to any major purchases you’re considering during the year and plan how you’ll save or spend towards these. 

2. Bust your debts

Start the new year with a strategy for paying down your debt. You could choose to clear your high-interest debt like credit cards and hire purchase, as this type of debt can easily spiral out of control and leave you in a worse-off position financially. Pay at least the minimum monthly amount due, but if you can afford to, make extra repayments to clear your most expensive debt first. 

Or you may focus on paying down your smaller debts first, as each amount cleared gets you one step closer to being debt-free, and each little win helps you stay motivated and on course. If you’re struggling to stay on top of multiple debt repayments, consider a debt consolidation loan that rolls all of your existing debt into one lower-interest repayment so you save on interest charges. 

3. Boost your super

Making extra contributions to your super is a good way to grow your retirement savings. And that’s something your future self will thank you for! Even the smallest amounts add up over time. You can make extra contributions by salary sacrificing, having your employer pay part of your pre-tax income into your super account. Any voluntary payments you make will reduce the amount of tax you’re required to pay. 

It’s a good idea to review your Super at least once every quarter to check that your fund is performing well, as that can make a huge difference to the amount you get when you retire. Use the ATO’s YourSuper comparison tool to see how your fund stacks up in terms of performance and fees. And get advice before you switch funds. 

4. Book a financial check-up

Just as you would schedule a regular health check or a dentist visit, so too is it worth booking a regular check-in with your broker. A financial check-up is a chance to review your goals, see how you’re tracking, and make any changes that may be needed. And being accountable to someone could help you stay focused on reaching your financial goals. 

A financial check-up is also a chance for your broker to review your current interest rates, to ensure you’re getting the best deal available to you. Many borrowers end up paying thousands more in interest charges simply because they don’t get around to refinancing when interest rates drop. 

5. Review your credit report

Lastly, request a copy of your credit report to review, paying careful attention to any errors or inconsistencies, so you know where you stand when it comes to applying for future credit. Your credit report contains a history of your current and past debts, and your repayments. Lenders use this information to decide whether or not to lend to you. You can request a free copy every three months. 

For more financial advice tailored to fit your lifestyle and financial situation, contact Donna at Lending Connections.