After Kylie completed university and had landed a well-paying job, her only plan was to enjoy her new financial freedom. She had living to do – the future was a long way off and would take care of itself … wouldn’t it? 

Kylie’s first purchases were a trendy new hatchback car and expensive clothes suitable for climbing the corporate ladder. Enjoying her exciting lifestyle, she regularly visited restaurants and bars, and took an overseas holiday each year.

According to research conducted by Impact Leaders, Kylie’s way of life is common with one third of 18–34 year olds having no savings and excessive debt. 

It’s understandable, after all, when you’re in your twenties and early thirties, thoughts of saving for a home, much less retirement, are easily put aside. But time has a nasty habit of getting away from you – just ask your parents!

A survey by Leading Edge Trends, found that the majority of 18–24 year olds won’t own their own home by retirement, fostered by a ‘buy now, pay later’ mentality. The result is that many will be excluded from home ownership, while others will struggle with late-life mortgages and financial insecurity at retirement. 

Back to Kylie. 

A few weeks after returning from a holiday around Europe, Kylie was informed that her position at work had been made redundant. With no savings behind her, she borrowed from her parents to pay her rent and other regular bills.

Shortly after, Kylie was forced to sell her car and use her credit card to manage everyday expenses.

Fortunately, within six months Kylie found a new job, again with a good salary, but during her brief period of unemployment she’d racked up considerable debt. A large portion of the new salary would go towards her debts. It would take years to recover. 

What can you do to ensure your story doesn’t end up like Kylie’s?

Savings – a savings plan doesn’t mean restricting yourself. Even small amounts deducted directly from your wage quickly add up and can become a future home deposit or a safety net for emergencies.

Budget – sounds boring, but a realistic budget can help you to live within your means without relying on credit or feeling like you’re missing out.

Income protection – an insurance policy that pays an income if you’re injured or become too ill to work – an important consideration for young people starting out on a big career!

Get advice – not just for older or well-off people, a financial adviser helps you to create your budget and savings plan so you can take advantage of enjoying life now. 

You might not be interested in buying a house just yet, but how cool would it be if the money were available when you were ready? 

You’ll probably be surprised at how inexpensive advice is. Contact one of Leenane Templeton’s licensed financial advisers to find out how your future can gain a head start.

Call (02) 4926 2300 or email us. 

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Negative gearing allows property investors to claim any shortfall between their income and expenditure on an investment property as a deduction against their total taxable income.

Most property investors are aware of the usual expenditure deductions that they can use to offset any income earned by an investment property. Regular costs such as maintenance, repairs, interest on loans and management fees can all be used to offset rental income.

However, there are a few lesser known tax strategies that property investors may care to look at as June 30 approaches:

Refinancing your mortgage

Refinancing your mortgage usually incurs a couple of one-off costs and fees. Investors who are planning on refinancing their mortgage may care to consider doing so before June 30 in order to claim these costs as a deduction in the 2014-15 financial year.

Pre-pay interest

Property investors who have sufficient funds to pre-pay interest on a loan can do so and claim the deduction in the current financial year. It is also possible to pre-pay (and claim a deduction for) your upcoming property insurance premiums.

Bring forward maintenance expenditure

If there are maintenance tasks that you know will need to be completed on an investment property, then you may wish to complete them before June 30 in order to minimise your tax bill in the current financial year.

Stay on top of your paperwork

Make sure that you are aware of the depreciations on any fittings or repairs, as well as any other costs you have incurred, for example, strata fees, management fees or rental losses.
Property investors are highly advised to discuss their tax situation with an accountant to ensure that their activities are compliant and that tax savings are maximised.

Our accountants are ready to help you and discuss these tax tips for property investors in more detail if need be.

Call (02) 4926 2300 or email us.

For more tax tips for property investors please do not hesitate to contact the team at Leenane Templeton.

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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.
 

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Is debt ruling your life?

Student debts, credit cards and personal loans can be a source of unnecessary stress and prevent you from enjoying other things in life. Clearing your debts doesn’t have to be hard work. With the right advice, it’s possible to get your finances on track sooner than you think, meaning you can get back to living the good life, guilt free.

Here are some tips to help you get out of debt.

Plan your budget

Achieving your goal of being debt free doesn’t have to be daunting; a good way to start is with a budget. Keep a diary of your expenses and your spending. This will enable you to track where your money is going and how much spare cash you can use to attack your debt.

Pay extra

Try paying more than the minimum off your debts to bring your loan down faster. Prioritise all your debts by the interest rate you are paying. Try to get the balance down on high interest debts fi rst, as paying these off fi rst will save you more money. You can then use the money you save in interest to pay off your lower priority debts.

Consolidate

Consolidate all your higher interest debts into one lower interest debt. This could be in the form of a low interest rate credit card or a personal loan. This strategy will also reduce your interest repayments.

Ensure you have the right card

Due to the increased level of competition in the credit card space, many lenders are offering much lower interest rates and deals.

When doing your research, make sure you read the fi ne print, as cards offering low or zero interest rates on balance transfers, do so for a limited time only whereas other cards might offer a low interest rate for the life of the transfer.

Become card free

Once you have selected a low interest rate card to transfer your balance, make sure you don’t use that card for any new purchases until you have paid off the full amount from the initial transfer.

Take the first step

If you’re having difficulties repaying your debt, take the first step and speak to your lender. If you’re open and honest with your lender, you will probably find they are open to review your repayments and look at other solutions to help you out.

Speak to a professional

If you feel that you are struggling with your finances, speak to Leenane Templeton's financial planner for help with a financial strategy that can get you back on track. Call us today. Also feel free to 'Like' us on Facebook for additional blogs, posts, event information and more.

Source: IOOF, January 2013

The post Spring clean you finances appeared first on Newcastle Financial Planners & Financial Advisors.

One of the first things in controlling your money and your accumulation of wealth is to have a budget.  However, many of us do not have a budget, do not treat our money as if it was a business and wonder why we are not able to save satisfactorily.  Budgeting is a way or empowering yourself, to enable you to have control over your money. 

Many people draw up a budget that unfortunately has oversights and which can render the budget useless.  To ensure you create a realistic budget we hope the following points will assist you..

Run Your Life Like A Business

If you were a business you certainly wouldn't be happy to break-even or make a loss at the end of the year, and you shouldn't be happy doing this in life.  Aim to make a profit through proper budgeting, savings and investments.

Include Annual and Quarterly Expenses

Budget for your weekly and monthly expenses like rent or mortgage payments, food, fuel, telephone, electricity but don't forget to also include rates, house and other insurances, car registration that may be non-monthly expenses.

Unexpected and Irregular Costs

Many people forget to put money aside for unexpected costs such as car repairs or medical expenses and house repairs and maintenance.  These costs are more irregular than unexpected because we do know that our cars and houses require maintenance as do our bodies!  So put extra aside to cover irregular costs – earn interest on these savings until the money is needed.

Remember We Learn From The Past

History teaches us a lot, so ensure you look at past expenses.  Not only can you tell the costs of past car repairs and service costs, you can track when your electricity or water costs peaked perhaps with a hot summer and also medical expenses can be averaged out.

Positive Savings Plan

Rather than just saving what is left over, have a positive savings plan – decide how much you want to save and regularly put that amount aside and stick to it.  Then when you have the money you can buy what you need.  Some of our team at Leenane Templeton get the bank to take out 10% of their salary as it's deposited into their account and place this into an investment account, this accumulation of savings becomes unnoticed and if managed properly can become a significant investment through compounding.  Speak with a financial advisor in order to see what financial plan suits your particular circumstances.

Emergency Funds

Paying attention to your savings will help you build an emergency fund to see you through some unexpected times perhaps through job loss or severe illness.  Try and have at least three months worth of emergency savings.

Credit Card

Do pay your credit card off each month and not incur horrendous interest costs.  If you can't afford to pay it off you should not have purchased the goods.  Be careful with your spending and your saving and you will be amazed how much you can achieve.

It's Little Things That Add Up

That $4.00 coffee collected each morning on the way to work can cost you $80 a month, add any money you spent on take away lunch and the dollars really add up.  Consider having your own filter machine at work and bringing your lunch from home (even just for a few days a week) and you will be immediately benefitting from the savings for your budget.

Be Realistic

Be as accurate as you can be with what you know, but don't set unrealistic targets.  You will only become dissatisfied and then disillusioned with the whole process.  Having a budget is not to stop you spending, it is to ensure you have control, you can set your priorities and not feel guilty about spending.  It is to help you understand where your hard-earned money goes and when and how you spend or save.  Budgetting is about empowering you not about stopping you enjoying yourself.

Don't Overdo It

You don't have to account for every cent you spend every day.  Don't let your budgetting become a chore.  And don't be too hard on yourself, remember your earn money to enjoy yourself.  If you have not eaten out in a month and have that money set aside and would like to attend a concert with the money do so.  (As long as you aren't going to be cross with yourself!)

It's Not Set in Stone

Budgets are living documents and can be changed as circumstances change, your income may increase  and some new expenses come to light so amend your budget.  Be flexible and as accurate as possible.

Keep Written Records

Keeping numbers in our heads can lead to inaccuracy, so it is best to keep written records.  This adds discipline as well as accuracy.  This is your personal business.  Keeping a simple spreadsheet will assist.

Disclaimer

The information contained in this document is based on information believed to be accurate and reliable at the time of publication.  Any illustrations of past performance do not imply similar performance in the future.

To the extent permissible by law, neither we nor any of our related entities, employees, or directors gives any representation or warranty as to the reliability, accuracy or completeness of the information,  or accepts any responsibility for any person acting, or refraining from acting, on the basis of information contained in this communication.

This information is of a general nature only.  It is not intended as personal advice or as investment recommendation, and does not take into account the particular investment objectives, financial situation and needs of a particular investor.  Before making an investment decision you should read the product disclosure statement of any financial product referred to in this newsletter and speak with your financial planner to assess whether the advice is appropriate to your particular investment objectives. financial situation and needs.

For business advice go to www.newcastle-accountant.com.au

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