News

Those who offer financial services in Perth and across Australia are applauding an ongoing government effort. Courtesy of the Australian Securities and Investments Commission (ASIC), Australians are going to continue to become smarter about money. ASIC plans to enhance their website called “Money Smarts” and extend the reach of its Money Smarts program to more schools than it currently reaches.

The changes are part of a three year program that is designed to help raise financial literacy in Australia. The Organisation for Economic Co-operation and Development (OECD) is teaming up with ASIC to provide a national framework that encourages the government, business and education sectors to cooperate and help improve financial literacy.

This news comes on the heels of a recent OECD survey in which 15 year-olds across the globe participated in testing to determine their financial literacy. Australians came in fourth, only to China, Belgium and Estonia, out of 18 highly-developed countries. The baseline or average was 500. Australia scored 526 while China scored 603, beating second place Belgium by 62 points.

These changes are going to happen, even though funding for the program was cut 12% in the May 2014 budget.

When first time clients or potential clients talk to our financial advisors in our Perth office, the conversation usually turns to a common question: “How can I save money?” While we can’t give specific advice here and recommendations will be general in nature, it is safe to say that most people have resources they don’t know they have.

When we don’t budget properly and don’t watch where our money goes, we spend a lot of money we don’t know we’re spending. Often, it is on things that we don’t really need. A recent study by moneysaverHQ, part of News Corp Australia, revealed that the average Australian could save $8,000 a year by substituting less expensive alternatives for popular discretionary purchases.

Recent ABS statistics show 3% annual inflation, the highest since 2011. Alcohol and tobacco are up 7.1%, education is up 5.1%, health is up 4.9% and recreation and culture are up 3.3%.

How to Save Painlessly

Here are the moneysaverHQ suggestions on how to save money every day and how much they will save the average Australian.

If you have talked about retirement planning to a financial advisor in our Perth office, you probably know how diligent and thorough we are in helping our clients leave nothing to chance when planning their futures. While we never give specific financial advice in blog posts due to the individual and unique nature of every financial situation, we would like to present some general actions that are worth consideration for anyone approaching retirement.

Pay Down as Much Debt as Possible

Ideally, you could start your retirement with a “clean slate,” owing nothing. We know that life is not always ideal, but paying off debts is a great place to start for most Australians.

Pay Off Your Mortgage

If you own your home free and clear, you are free of what is usually the largest monthly financial responsibility for any family. It is a lot easier to enjoy retirement when you don’t have to make a house payment every month

Set Your Affairs in Order

This means filing a last will and testament. In the event of your untimely death, your heirs will need access to your money. Lack of a will can cause it to be tied up in court. It will save a lot of grief for your survivors.

Choosing a financial advisor in a city like Perth can be daunting. There are so many that it can be difficult to know who is legitimate and who isn’t. Sometimes it seems like anyone can hang a sign on a door and tell people they are a “financial advisor.” Here are some tips to finding the perfect financial advisor for your needs.

Trustworthy Firm

You want a financial advisor who works for a trustworthy firm. This can be a local firm or it can be a national firm. Whatever the case, you want your financial advisor to work with a firm that has a track record of success. You want a financial advisor whose company has much more to lose by misleading you than they have to gain.

Experience

You want an experienced financial advisor. If you do get a beginner, you want to make sure that they are being mentored by someone else in the company with a lot of experience. The stronger the company behind the advisor, the more likely it is that the advisor is subject to constant review and feedback to ensure high quality performance.

Results

You want a firm that has a great reputation for obtaining results for their clients. This is usually the result of a variety of factors, leading to the next requirement.