Tag Archives: Advice

Love & Money

Hello all you Valentines!!  Sending kisses and much love to you gorgeous couples!

Did you know though, that money issues rank constantly in the top 10 reasons for divorce? Probably something you don’t need reminding of on what’s supposed to be the most romantic day of the year!

But then, communication issues, infidelity and bedroom boredom also rank pretty highly…  And ok, I’m not here to give solutions to those marital woes…  I’ll leave that to the experts!

But love and money can be a tricky subject, and communication has a huge role to play in this area.

And whether you’re a big marshmallow preparing for the most romantic day ever… or it’s just commercial hype and gets a big miss in your house, it’s always worth chatting about money.  Not sexy perhaps, but certainly smart.

Although discussing finances is a must before moving in together, committing to a relationship or opening a joint bank account… it’s an ongoing area that affects nearly every part of our daily lives.  Without the dosh, there’s no food on the table, roof over the head, annual holidays or even the hint of a lifestyle.

Being upfront early can also open your eyes to traits in your potential partner that you might want to know about sooner rather than later.

If there has to be a Top Tip, it’s to discuss money issues with your partner and that’s long before it gets to the shouting match stage.  Relationship goals are usually a joint decision that need sane and calm discussion (sometimes easier said than done… “honey, I’m pregnant!”)

People can have incredibly different attitudes to spending and saving which can cause much friction.  It’s great to be upfront with each other and admit which style is more yours.  Savers hate it when spenders come home with a new impulse purchase and the rates and water bills have just come in.

Helping spenders understand the needs of the family budget may help curb spending, or having a set amount to spend on ‘whatever’ may allow for the bills to be met, and have a little fun too.

If you’re not brave enough to pool your resources, based on previous trust issues, it’s a good idea to sit down and work out what your joint expenses will be.  You can either have a joint account that you both put an equal or set amount into each pay frequency or commit to paying certain bills instead.  That way, living expenses are covered, but ‘what’s yours is yours’ and remains that way.  My mother much preferred ‘what’s yours is mine and what’s mine’s mine,” so whatever works for you!

And when you’ve both been through the wringer before and are looking at starting over, especially if you both have your own families, it can be really smart, if not terribly romantic, to arrange a Binding Financial Agreement (also known as a pre-nup) so if things don’t work out, you both know exactly what you’ll get on exit and protect what you’ve brought into the relationship for your children.  It’s worth getting legal and financial advice for this one, and can put everyone’s mind at ease.  It may not send you to the dance floor for a tango in a fabulous dress with a rose in your teeth, but it’s certainly practical.

In many families, there’s one partner who’s a little more money savvy and the other often delegates the family finances to that one.  But not knowing what’s going on may be fine while everything is roses, but you’ll be kicking yourself if things go wrong and you’re clueless about what you have.  So talk about it, and make sure you’re ‘kept in the loop!’

And if your partner isn’t willing to share about your joint finances and everyday budget and spending and savings, something is likely off, so start sniffing around.  Intercept mail and let the bloodhounds loose.

Other families have issues where one partner is a much higher earner than the other. Being ‘with someone’ doesn’t mean you need to lose your financial identity though.  It’s important to work out what your shared goals are as a couple and how they’ll be addressed but it’s critical to have your own goals too.

So, it’s not rocket science, and if you want your current honey to still be your Valentine in years to come… start the talk, and never stop.

When should I start Investing?

I’m often told, “when I have money, then I’ll come to see you…”

I take this to mean that most people really aren’t sure about why they should see an advisor or believe that they only help people  who have funds to invest.  Not always true!

So, if you’re someone who isn’t really sure about when to start, here’s a few questions you can ask yourself to see how you’re tracking…

  1.  Do you live within your means and spend less than you earn?
  2. Are your personal loan payments up to date and credit cards paid off monthly?
  3. Do you have an emergency fund for a rainy day?
  4. Are your personal protection plans in place, covering your life, health and income?
  5. Are your superannuation funds all consolidated and invested in line with your risk profile?
  6. Are you comfortably repaying debts like a mortgage and could still manage to do so if interest raise increased?
  7. Do you have a regular savings plan now?
  8. Is there a specific goal that you’d like to achieve with an investment plan?

If you can happily respond with a Yes! to all these areas, chances are you’re ready to roll!  If not, see where you can improve your current situation before taking the leap.

Investing for many women requires a bit of soul searching.  What’s the purpose of the investment?  Is it just long term growth?  To achieve a holiday goal?  Extra savings to supplement retirement income?  To save for your children’s education?  Is paying down debt a higher priority?  Often, these reasons or needs require different time frames for the investment and different levels of risk that you’re prepared to take.

Share market and property investments are typically viewed as long term investments (five to seven years plus) and for those with a more assertive or aggressive profile.  Cash, term deposits and fixed interst styles of investment often mean a shorter term need is to be met, where preservation of capital is paramount.

An adviser can help you articulate your goals and work out your risk profile.  Chances are, you may invest very differently with your superannuation savings than you would for that trip you’d like to take next year, amd each rqeuire a very different strategy.

If you’d like to find out your Risk Profile, drop me an email and I’d be happy to forward you a questionnaire to see where your levels of tolerance sit.

What does an Adviser really do?

The term financial adviser or financial planner has been around for a long while.

When I left school though, I’d never heard of a Financial Adviser and certainly didn’t know it was a career path, or that it was the one I would take.

I knew about Life Insurance Agents or Brokers, Accountants, Economists and not much else.  So if you’re like I was, and not really sure what a planner did, allow me to enlighten you…

Advisers are Authorised Representatives of an organisation that is licensed by ASIC (the Australian Securities and Investment Commission.)  Some choose to hold their own license, some are through non-aligned companies and others are through big corporates that you may recognise such as AMP, MLC (NAB) or ANZ.

The upshot is, you need to be licensed to give advice and that’s a role we take pretty seriously.  People pay us for what we know, meaning we’re in a very trusted position and one that we don’t take for granted.

When you initially meet or research an Adviser, chances are you’ll be provided with their Financial Services Guide and Adviser Profile.  This outlines what your Adviser is allowed to provide advice on.  Some are very limited and choose to specialise in a particular niche, such as Insurance or Self-Managed Super Funds (SMSF.)  Others are educated in many areas and are called ‘generalists.’  Additional accreditation may be achieved in areas such as Aged Care and SMSFs.

Most covered areas include investments, finances, budgeting, insurance, superannuation, retirement and pre-retirement planning, estate planning, risk management, business risk mitigation and taxation.  Advisers are usually only too happy to let you know the areas that they’re qualified in and can offer advice on.

Chances are, seeing an adviser can add value to your personal financial situation, so why not consider a meeting with a planner real soon!  Most offer their initial consultation at their own time and expense, so what have you got to lose?

Holiday Tips Time!

So, you’ve waited all year and finally it’s here! Your time off is sorted, bags are packed, and you’re ready to go! It’s holiday time!

Most people love their vacations and look forward to them for a long time. But instead of coming back to a maxed credit card, what are some ways you can ensure things run smoothly – and return home debt free, with great memories?

Usually, you’ve got a fair idea of when you can travel, where you’d like to go and how long for. With the internet now, it’s easy to work out how much everything will cost, far in advance.  Sites like TripAdvisor and Booking.com amongst many others mean you know what you’re getting, and just how much you’ll be paying.

It’s always a good idea if you can pay off all your travel, flights and accommodation prior to heading off to take advantage of lengthy booking time discounts, and also work out how much you’d like to have as a daily budget. If I’m heading to the USA, I like to average around $250 per day spending money, if it’s Asia, I’ll likely need a lot less. (This is to cover meals, transfers, sight-seeing and day-to-day activities outside of travel and accommodation costs.)

It’s then easier to work out your total spend based on your research. As an example, you might allow for the following if heading to Asia:
Flights $1,500
Accommodation $2,000
Spending Money $2,000
Total trip cost: $5,500

If you have a year to plan, this means you’ll need to set aside $106 per week. Break it down into how often you’re paid. If it’s fortnightly, that’ll be $212 per pay period.

This is also a great way to work out whether or not what you’d like to do is affordable. If you can’t take the appropriate amount each pay period out to cover costs, and still make ends meet, it’s time to rethink. Can you wait for happy hour or a sale on flights? Do you need to rethink your accommodation options or planned experiences? Should you go for a shorter amount of time? Or find somewhere else to head to altogether?

Also, if you’re going overseas, send your spending money to a Travel Money card where it can store your funds in the appropriate currency. Most banks offer this service, as do Virgin and other providers. Make sure the card is chipped too, so it’s accepted in more places and that you can take cash withdrawals of your funds at ATM’s when you’re on the move.

It’s also a great way to average out the ups and downs of currency fluctuations instead of waiting for ‘the right time’ to buy. Even if you’re travelling domestically, this is still a great way to keep funds segregated just for your holidays.

And if you’re someone who has to buy gifts and ‘stuff’ and often need to grab an extra suitcase before you head back, my top travel tip is to throw in a large vacuum storage bag. This way you can suck the air out of all your clothes, and leave room for those extra items, without the last minute cost of excess luggage or another new suitcase!  Most hotels are happy to supply the vacuum!

And never, ever leave home without your travel insurance! I hope you’ll never need it, but for the peace of mind, it’s totally worth it.