Each year in early May, the Treasurer delivers the Federal Budget and many people across Australia listen intently. The Budget tells us how the government intends to spend its revenue in the coming year, whether it can afford to give us tax cuts, and whether it expects to spend more (deficit) or less (surplus) than it receives.

Budgets are also important on a personal level, especially when living costs are rising and uncertainty abounds in global financial markets. So it’s worth having a look at how we’ll cope with the increasing cost of living. 

Save more or spend less?

Is it easier to save more, or to spend less?

They might sound like the same thing. After all, saving is what we do with whatever’s left over after spending, isn’t it? 

Well, not quite. You see, it’s easy for spending to get out of control, and many people actually find it easier to focus on reducing their spending than saving towards a goal. 

Take control

To begin with, work out where your money goes. Start by keeping track of everything you spend and what you spend it on. Split it into categories based on necessity. Things like mortgage repayments, utilities and essential food obviously go in the ‘must spend’ group. Some things will be ‘optional but important’, and others will fit into the ‘frivolous’ category. 

Do I really need this?

After a few weeks you’ll have an idea of where your money is going then it’s time to start asking yourself a couple of questions:

• Do I need to spend this much on this category?
• When I over-spend, what can I do to prevent it happening again?

It’s worth remembering that every year in Australia we spend billions of dollars on food we don’t eat, clothes we never wear and services we don’t use. So for many people, gaining control over spending doesn’t mean ‘doing without’, it just means being sensible about spending. There are a lot of things you can enjoy for free, and you can even turn a ‘thrift campaign’ into a hobby.

Watch debt 

Pay off credit cards within the interest-free period to avoid high interest costs. If that’s not possible, investigate consolidating high-interest debt into home loans or other lower cost loans. When borrowing, make sure you leave a ‘comfort zone’ to ensure you can meet your commitments. 

Talk to us about preparing a personal budget that doesn’t require you to do without or give up everything you love.
Call (02) 4926 2300 or email. 

To discuss your budget and how you can better manage your finances, please do not hesitate to contact the expert and friendly team at Leenane Templeton. 

The post How’s your budget – surplus or deficit? appeared first on Newcastle Financial Planners & Financial Advisors.

The 2015 Budget made sweeping changes for individual taxpayers and families with its focus on improving the economy.

Car expense deductions

The Budget has introduced new modernised methods for calculating work-related car expense deductions from the 2015/16 income year. The ‘12 per cent of original value method’ and the ‘one-third of actual expenses method,’ which are used by less than 2 per cent of those who claim work-related car expenses will be removed.

The ‘cents per kilometre method’ will be modernised, allowing workers to claim a deduction for each kilometre driven in the car for work based on a schedule of typical costs. Under the new regime, one rate will be set at 66 cents per kilometre to apply for all motor vehicles. Taxpayers can continue using the ‘logbook’ method of calculating expenses if they do not want to use the cents-per-kilometre approach. These changes will adjust car expense deductions to align with the average cost of running a car.

Pensioners

The plan to index the pension to the Consumer Price Index has been axed. Instead, the Budget will be making the savings from people with substantial private assets.

Ageing workers

A flexible wage subsidy will give older Australians approaching retirement an incentive to remain in the workforce with the possibility of receiving a bonus later. It will also shorten the length of time Australians over the age of 50 have to wait on income support or the pension before they qualify for job incentives.

Amendments to the new Restart program will offer older workers incentives for training to further assist them with retraining for a job and prevent them from falling back on unemployment benefits or pensions.

In addition, employers who hire job seekers under the age of 30 or workers aged 50 or older will share in a redesigned national wage subsidy pool from 1 November 2015. Eligible employers will be granted a subsidy of up to $6,500 for hiring a job seeker under the age of 30, an indigenous job seeker, a parent returning to the workforce, or a long-term unemployed job seeker. They can also receive up to $10,000 under the Restart program for hiring workers aged 50 or older.

Families

The childcare scheme has received a major overhaul to support low income families. Families with access to maternity leave through work will no longer receive government assistance in the form of the existing Parental Leave Pay (PLP) scheme from 1 July 2016. This measure will prevent families from double dipping into both schemes.

Under the new proposals, both parents must do at least eight hours a fortnight of work, training or study to qualify for any childcare support. Families earning up to $65,000 will receive 85 per cent off childcare fees, while stay-at-home parents with a family income over $65,000 will no longer secure childcare subsidies.

A two-year nanny trial starting on 1 January 2016 will assist the parents of approximately 10,000 children, especially those working for emergency services or living in regional areas, without access to regular childcare services.

Rural Australia

Farmers can continue the Drought Concessional Loan Scheme for another year. Farmers will also be able to claim fences and new water storage as tax write-offs.

Call (02) 4926 2300 or email us.

To discuss the 2015 budget and how it will affect you, please do not hesitate to contact the expert and friendly team here at Leenane Templeton.

The post 2015 budget outlook for individuals and families appeared first on Newcastle Financial Planners & Financial Advisors.

With the holiday season fast approaching, it’s tempting to throw out the year’s careful planning and budgeting to splurge in the name of Christmas. But getting into the Christmas spirit doesn’t mean you have to get into debt. Follow these tips on how you may be able to emerge in the New Year debt-free.

Set a budget

First take some time out to review your current finances. Determine how much you can realistically afford to spend without getting into the red. Remember to include gifts and entertainment as well as all the small things that come with the season like cards, stamps, decorations, food and travel. Next make a list of everyone you plan on giving a gift to and decide how much you want to spend on each person. Finally check that the total figure you want to spend is not beyond your budget. You may need to reduce the amount you’re able to spend on each person or reassess the number of people on your list.

Start early

Before you know it, Christmas will be upon us. In fact, the department stores have already started spruiking their Christmas wares. By shopping early, you can look out for sales and great deals for later in the year. You also have time to comparison shop rather than last-minute shop; where your panic to pick up something (anything) will usually mean spending more.

Look for savings and incentives

If you choose to use your credit card, look for any rewards or discounts that may be available through your credit provider.

Also try to shop online first as you’re less likely to impulse shop and can easily compare prices across various websites. There are plenty of online retailers that offer savings across a number of product categories such as fashion, skincare, make up, fragrances, books and electrical appliances. You can also find discounts through online community classifieds, auctions and daily deal sites.

Remember who you’re shopping for

When you’re shopping for family and friends, it’s very easy to find things which will be just perfect for you. This is a very common mistake which is sure to break your budget. Christmas shopping isn’t a ‘one for you, one for me’ deal. Don’t buy it. If you really need to have it, wait until after the holidays when it’s more likely to be on sale.

Stick to your budget

Remember that a deal is not a deal if you can’t afford it. Once you reach your budget limit, stop.

Save early

Get off the overspending merry-go-round by saving early for next year. As soon as the holiday season is over, determine next year’s Christmas budget and set up automatic direct debits into a dedicated Christmas savings account. You’ll be all set by the time the department stores bring out their tinsel again.

Source: IOOF, October 2014.

If you’d like more advice on how to manage debt and build a savings plan, speak to one of our financial planners today.
Call (02) 4926 2300 or email us.

Leenane Templeton accountants and financial planners are her to help with any questions you may have on debt and staying debt free, especially over the Christmas period.

The post All I want for Christmas is to survive debt free appeared first on Newcastle Financial Planners & Financial Advisors.

It is now 3 months into the 2014/15 financial year and the hours you spent setting your annual budget are probably a distant memory, but now it’s time to get your budget out again and review your progress since 1 July.

A budget is a living document. It is the underlying tool that sets the direction of your business… your guide to success.

Printing off your Profit & Loss report at the end of each month and doing an actual-to-budget comparison will help you focus on areas that might need your immediate attention. Maybe revenue on a certain product or service is down, or your expenses have blown out in a particular area. Being aware of this on a monthly basis means you can deal with it immediately and employ strategies to remedy any variations. Leaving it until the end of the quarter, the half year or the year will not give you as much control, placing extra stress and strain on you and your staff.

If you have been putting it off, don’t waste another minute… get your budget out of the drawer, print off your current financial statements and start comparing.

Take control and guide your business to the success you deserve.

Our accountants and financial advisors are at hand to discuss any business budget enquiries you may have.
Phone (02) 4926 2300 or email us.

Disclaimer

If you would like to discuss your business budget, please do not hesitate to contact the team at Leenane Templeton.
 

The post A business budget is your guide to success appeared first on Newcastle Financial Planners & Financial Advisors.