Below we have our 4 top tips to future-proof your finances. If there’s anything we all learned from share market downturns, recessions, and global crises, it’s that no one is immune to economic upheaval. While an emergency fund and savings provide some measure of security against financial pressures, these may not be enough if the problem persists for months or even years. 

When financial misfortune strikes, all, and even middle to upper-class families are at the mercy of uncertainty unless they are well prepared. And even then, immunity can be tested. Financial misfortune can come in the form of a global pandemic, sudden unemployment, a business closure, family breakup (divorce), or something bigger like a severe health condition requiring long-term treatment.

It’s never too early to start. Always get personal financial advice when looking to build your family’s financial resilience: Don’t leave it to chance – Plan & Prepare!

To get you started future-proofing your family finances in a way that helps you secure you and your family’s future, we have some tips to ensure you’ll be able to weather challenges that’ll come your way.

4 Top Tips to future-proof your finances

Here are our 4 top tips to future-proof your finances.

1. Budget your expenses.

During times of plenty, the temptation to overspend is strong. Budgeting and budget awareness is probably one of the most common tips mentioned in any of the best personal finance books. And this one is a no-brainer. However, this is also advice where a lot of people falter by not doing it wisely. To start, review your monthly budget and identify areas for cost savings. While eliminating all indulgences is unnecessary, it’s good practice to reduce recurring expenses and bills.

Change your spending and watch your savings grow

For starters, you may decide to eat out once a week instead of several times. You could also work on raising your credit score or reviewing insurance payments – shop around. That also goes for utility bills, reviewing streaming services and unused gym memberships etc. There are many ways to reduce spending without it having a big effect on your daily life but the long-term gains can be staggering.

People may start out well but then life happens, or an impulse immediate gratification purchase happens, and you’ve immediately undone ALL your good work. This is where all plans go out the window and you go back to old pleasure-seeking habits and forget about what you were working towards.

HINT: Staying focused on your long-term goals and watching your accounts grow is inspiring. And with every cent you shave off your budget, you’ll be increasing your emergency fund or save enough to purchase a life insurance policy. All together, these will help in building the groundwork for your financial future.

2. Pay off debt.

People who are deep in debt experience stress, both on normal days and in times of need.

If you have too many loans, even a minor setback, such as a rise in interest rates or a drop in household income, could become a major problem. The unsettling reality is that certain debt, like mortgages, can last well into retirement.

 

When it comes to successful debt repayment, experts in personal finance in Australia advise people to apply the ‘avalanche approach’ . That is, giving high-interest loans priority and pay more, while paying the minimum amount due each month on ongoing low APR bills.

You can keep yourself motivated to pay off debt by using the best personal finance software available to monitor your financial growth.

3. Identify multiple income streams.

While it’s recognised that a well-paying profession is great, if a recession were to happen, or some global crisis hits, it comes with the risk of job losses and income setbacks. There was a time when parents having good jobs was enough to keep a family financially secure. But that reality is now in jeopardy, therefore, it’s better to have more than one source of income.

This could come in the form of extra part-time employment to build bigger cash reserves, a small-scale side business, or investing in alternative investments to give you a bigger financial buffer. When you take advantage of opportunities to earn a few extra dollars, you’re not only protecting your finances but also building them up at the same time.

4. Build appreciating assets.

Creating cash reserves to build appreciating assets will give you the confidence and equity finance you need to grow your wealth further. And also builds a safeguard for you that prepares you for any future and unexpected expenses. It will also allow you to take advantage of future investments or investment opportunities to buy appreciating assets, that will eventually create an additional income.

Securing your family’s future

Future-proofing your family finances is a noble, practical goal that requires commitment and discipline.Good thing information is on your side, as you have access to some of the best tips for free, as well as great help and information like the tips shared here.

If this article has inspired you to think about your own unique situation and, more importantly, what you and your family are going through right now, please contact us for personalized advice. 

Or call us on 08 7111 0022
Make the rest of your life the best of your life.

P.S. The only thing left is for you to act and sign up for our ‘Weekly Tips’ here.

Need help? 

If a long-term wealth strategy to build and protect your wealth is important to you, call us on 08 7111 0022 or  to book a time with us. 

Make the rest of your life the best of your life.

 

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Disclaimer: This article is educational information only. It is not intended to imply any recommendation about any financial product(s) or to constitute tax advice. The information in the article is reliable at the time of distribution, but may not be complete or accurate in the future.

General Advice Warning: The information is provided for information purposes and is of a general nature only. It is not intended to be and does not constitute financial advice or any other advice. Further, the information is not based on your personal objectives, financial situation or needs. You are encouraged to consult a financial planner before making any decision as to how appropriate this information is to your objectives, financial situation, and needs. Also, before making a decision, you should consider the relevant Product Disclosure Statement available from your financial planner.

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