Basic financial tasks can seem overwhelming, but they can have a big impact. Consolidating super funds or setting up a savings booster might take only a few minutes, and could turn into thousands of dollars in extra savings in the long term.
We asked three financial experts to share their best no-brainer financial tips – and the advice that helped them achieve their own financial goals.
1. Try to take a long-term view
Owen Rask is a financial educator who helps Australians learn more about managing their money through his business, Rask. He says many people are still thinking in the here and now rather than into the future, where they need to be focused.
“We tell everyone that mastering your finances is a two to three-year apprenticeship,” he says. “Everyone thinks that they need to solve the problem right now. And while that sounds great, it is very overwhelming. There are many different things – budgeting, super, insurance, tax, investing – to consider.”
He suggests choosing one aspect of our finances and taking a deep dive into it before moving on. “There are some high impact ones that cost nothing, like switching your superannuation fund to a better performing fund that will work with lower fees,” he says. “That’s an absolute no-brainer, simple thing that anyone can do without having to feel overwhelmed.”
2. Feel good about taking small steps
Rask says we should start by reframing the way we think of “small steps” – not as a second-best option, but as a crucial part of achieving financial freedom.
Glen James, host of the My Millennial Money podcast, says we should feel really good about making some relatively simple changes. “Small steps give you something immediate you can do right now to get wins on the board,” he says. “It’s less overwhelming and feels more achievable to accomplish. Rather than saying, ‘I’m going to save $5k this year!’ alter it to, ‘I’m going to save $100 a week’. Celebrate putting that amount away each week, and watch your goals be achieved over time.”
As a starting point, Rask suggests using a roundup app such as Raiz. Every time a purchase is made, it gets rounded up and the difference is automatically invested. “It can be as little as a couple of dollars at a time,” Rask says. “I don’t even really notice – it’s part of my daily routine.”
3. Make sure your superannuation is right for you
As Australians move through their careers, many of us find ourselves with multiple super funds that have been set up on our behalf. Most of these accounts attract fees, which accumulate over time.
The head of financial advice at CareSuper, Matt King, says we could all benefit from learning a bit more about how our super works, and making sure we’re using the right product for our circumstances.
“It’s probably not something that people lean into as much as they should, for a variety of reasons,” he says. “You want to find out where your money is invested, how it’s invested, and the options within it. Even if you think you understand it, it doesn’t hurt to check.”
He suggests learning more about our super funds by using online calculators, checking investment returns, and finding out whether profits are invested to benefit members or shareholders. “If you’re able to make informed decisions,” he says, “you’re going to have it working harder for you than if it were a set and forget.”
Rask says even a small increase in super contributions can make a significant impact over time. “Ten dollars a week invested into super could be as much as $80,000 by the time you retire,” he says. “But let’s put that in another way: $10 a week now could actually buy you a year in superannuation.”
Checking existing super funds – and consolidating them – is quick to do through MyGov. “Superannuation is your money,” Rask says. “It is the ultimate savings vehicle. It’s low-taxed, you’ve got forced savings going from your employer, you can deposit your own money. It’s a fantastic savings vehicle and investing vehicle.”
James recommends contacting your super fund directly to learn more. “In Australia, superannuation is a no-brainer. Get to know where your super is and how it’s invested – give them a call to chat.”
4. Create good habits … even if you take a few missteps along the way
“Know that we all make mistakes with our money,” James says. “Get to know your behaviour, your tendencies and habits, and be deliberate in changing them to what achieves your goals, instead of working against them. Aim for slow and steady progress.”
Rask says getting into the habit of saving and investing money is what’s most important – even if the figure itself is changing while the cost of living bites. “You may have been saving $100 a week a year ago,” he says. “Maybe now you’re saving $10. But it’s still $10. Keep that habit going. When things change for the better – and they will – you want kick it into overdrive.”
James agrees. “We rarely change our situations overnight; it’s usually the result of years and years of behaviour,” he says. “Of course, we set big savings or investing goals, but we achieve them through small financial habits each week.”
5. Follow these simple tips
With just a few small tweaks, we can be well on our way to long-term financial success, these experts say. But what are their final, no-brainer tips for making sure we get there?
Rask says: “Just 10 minutes a day listening to a podcast, reading a finance book or following someone on social media is time very well spent. The compounding of knowledge is superior to that of money. The faster you can learn, the better you will be in the long term.”
For James, it’s about taking control of where our money is going and how we’re managing it. “I share my 80/10/10 rule with my community as a simple way to keep on top of your finances,” he says. “This allocates 80% of your take home pay to living costs, 10% to investing and 10% to giving. Stick to those guidelines and you’ll be on your way to managing personal finances better.”
Finally, King reminds us there’s always time to give our final super balance a boost. “You can add to super from when you’re a teenager to when you’re 65 or thereabouts,” he says. “That’s a long time. You can always make a difference to how you end up in retirement. Pick up the phone and get some advice. It’s not too late.”
Learn more about CareSuper, a super fund run to benefit members.
This information is general advice only and does not take into account your particular financial needs, circumstances or objectives. You should consider your own investment objectives, financial situation and needs and read the appropriate Product Disclosure Statement and Target Market Determination before making an investment decision. You may also wish to consult a licensed financial adviser. Past performance is not a reliable indicator of future performance and you should consider other factors before choosing a fund or changing your investments.
CARE Super Pty Ltd (Trustee) ABN 91 006 670 060 AFSL 235226. CARE Super (Fund) ABN 98 172 275 725.
