July 1 marks the new financial year in Australia, which means tax time is under two months away.
And while spring might still be four months away, it’s still a good time to “spring clean” your finances and get a fresh start to the coming financial year.
But what does spring cleaning your finances actually entail?
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According to Quantum Financial financial planner, Christine Costa, there are a few tips and tricks to see what can be updated, cancelled or paid off:
Track your spending
Keeping an eye on your everyday expenses seems a little tedious, but Costa says ASIC’s TrackMySPEND app is a great way to do it all on-the-go.
“The saying ‘knowledge is power’ is truly relevant in saving money,” she says.
"In this sense, monitoring your bank and credit card statements via an app [like] TrackMySPEND to identify how you’re spending your money allows you to make informed decisions about your future spending.”
It’s a manual budget tracker, but if that doesn’t work for you, Costa says banks like the Commonwealth Bank, St. George and ANZ offer their own spend-tracking services.
Shop around to find the best deals
Looking at your regular expenses and negotiating with your providers to change up your deals can be hard, but if they think they’ll lose you as a customer, Costa says they’re generally willing to help out.
“These are things like your bank fees, your internet and mobile,” she says.
A lot of us have had the same bank account since we were children, so Costa says it might be high time to switch up fees that could no longer be appropriate to you.
Credit card fees are also a big drain, so looking at whether you still use your credit card, or whether you’re using it more, and finding the appropriate rates and providers is important.
We all know you’re not using that $600 gym membership
Reviewing your subscriptions is also a great way to spring clean your finances.
“If you’re paying for them and not using them, you should consider why you’re paying for them in the first place,” she says.
“If you’re not using your old gym, paid TV, or paid music anymore, why are you paying for them? These are cash flow leakages which can easily be saved.”
So, Netflix’s “Are you still watching?” has taken on a whole new meaning.
Set a date for tax time
Tax time is a pretty overwhelming, last-minute gathering of receipts and certificates, but Costa says simply setting the date in your diary and getting prepared early is the key to avoiding all that stress.
“While people are watching the telly, they can start collecting receipts and getting their tax deductions together, and if we lock that date it we can get our refund as soon as we hit July and August.”
Consolidate your super
Superannuation funds charge you insurance and admin fees, which can eat away at inactive accounts and deplete your super balances.
Consolidating your super funds is a really easy way to avoid losing money through fees, and if you have a myGov account, it’s as simple as clicking “consolidate” on your listed superannuation accounts, and your balances will transfer to the account that you receive employer contributions from.
Costa says it’s worth keeping an eye on the insurance inside your super accounts.
“It’s probably a really good idea to check your insurance in those accounts, because you may be cancelling insurance that could be valuable to you.”
In fact, while this won’t come into play until 1 July this year, superannuation providers are required to pay inactive, low-balance accounts to the ATO.
So, next time you’re in your myGov account consolidating your super, use their lost super search to find any super you may be owed, and add that to your consolidation.
Pay off high interest rate debts first
If you have any debts, Costa says you should figure out which ones are charging the highest interest rates, and pay them off first.
“Speak to your lender about how long it will take you to pay your debts off if you contribute a specific amount, and whether you can pay it off sooner by paying more,” she says.
Once you know when you’re debts will be paid off, put that in your diary and, Costa says, “get excited”.
“There’s nothing worse than having an open-ended date, so lock it in and get excited about when you’ll have your debts paid off.”
Unclaimed money search
There’s around $1.1 billion in lost shares, bank accounts and life insurance according to ASIC’s MoneySmart, and by doing a quick name search through the MoneySmart website, you can find out if there’s a gold mine waiting for you.
“If you’ve moved address or if banks haven’t been able to contact you about shares, dividends or interest rates, it’s definitely worth doing a search,” Costa says.