January 2010
Ordinarily I stay up late on the 31st of December to see the New Year in. This year I stayed up late to make sure that 2009 actually finished. The words that adequately describe the recently departed year I can’t use in this article.
Suffice to say, I am not the only one happy to see it finish.
In terms of money and all things financial, 09 was a beast, but now it is 2010. The year of the Tiger! Even the sound of it is pleasing. The Tiger, now that is a beast that promises much. This is a great opportunity to get it right and finances are an area that can always be polished.
If you have debt, reducing it is always a good move. If you have a mortgage, paying more than you have to on your repayment, can save you thousands over the life of the loan. Simply increase your repayments by whatever you can afford. On a $250,000 mortgage an increase of only $40 per week will knock nearly 8 years off the life of a 30 year home loan which is on an average interest rate.
The same is true of consumer debt. Credit cards, car loans and personal loans will seem like they are taking ages to clear if you are only paying the minimum repayment on the loan. Very often these types of financial facilities carry especially high interest rates so any additional repayments will help clear these debts way faster.
You’re debt free? Fantastic, save something! Vowing to save is always a tricky one. That said, if you can budget to wack part of your pay into an online, high interest savings account, it will start to build. Then other financial options will present themselves. Even if it is only a modest amount of your income at least you will have some money for a rainy day.
Maybe you already have saved or you’ve built some equity in your property. 2010 could be the year to start investing to create some wealth. With property prices moving overwhelmingly in the upward direction if you haven’t reviewed your mortgage in a year or two you might be surprised with what your home is worth. The difference between the value and what you owe is called equity. The more equity or savings you have the more you can invest.
No one wants to work for ever so why not review you situation with a professional? With your personal fitness, noone would argue that you’d do better with a personal trainer, and the same is true with your finances. Talking to a good financial planner, mortgage broker, insurance broker or tax accountant is critical to success. You shouldn’t rely on only one. A team of professionals will serve you better. Email me and I will connect you with experts I trust.
Now the hangover from the party is done and the embarrassing memories are fading fast. We have the opportunity to make some constructive resolutions. Just remember not to pave the road to hell with them over the coming months!
Evan Davis
