Top pieces of financial advice we give our friends and family
As financial advisers, our clients turn to us for help with many aspects of their finances. But have you ever wondered what financial advisers tell family and friends to do with their money? Here are the top things we advise those who are close to us.
This applies to many things in life – jobs, relationships, saving and investing. If you can’t commit to something, you’ll never get anywhere. Saving for a house? Bust a gut and try earning more, while cutting back and spending less. Want your cake and eat it too? Go for it, just accept the fact that you won’t go anywhere.
Typically in life we’re led to getting an education, landing a job, buying a house, having kids and retiring by 65. While this is fine for some, it doesn’t work for everyone. How about starting your own business rather than buying a home? What about having five investment properties paying themselves off while you’re renting with a water view at a bargain cost? There is more than one way to get ahead and succeed, so don’t feel the need to conform. Get financial advice to help you reach personal lifestyle aspirations.
Stop looking for shortcuts
Want to make $1 million this year with only $20 down? Buy a lottery ticket. Making money doesn’t come easy, but it is easy to do if you’re patient. Stop buying hot tip stocks and speculating, it’s no better than the casino. Get some blue chips, or buy property and build your capital slowly.
Acquire quality assets
If you want to be financially independent, you need to build passive income streams for the future. Buy quality assets that will increase in value over time and hold onto them. Focus on growth when you’re young, focus on income when you’re retired.
Take control of your super
For most Australians, super is their largest investment outside of their home. Yet many don’t pay attention to it until they’re ready to retire. Take time to understand your super to minimise fees and maximise returns. Check you’re not missing any super using the ATO’s super look up tool, consolidate your accounts, check your fees and ensure you’re getting an appropriate return for your life stage. While this may take a bit of research and signing a few forms, it could make you tens or hundreds of thousands of dollars better off.
Beware of investment seminars
Please be wary of investment seminars. There can be some valuable information at these sessions. However more often than not, most of the time is spent selling to you, rather than giving you something of value. If you must go, don’t be lured to sign up on the spot. Instead, find someone you trust to share the ideas with so they can counter the false optimism that the sales process builds.
Get the right advice
A good lawyer, accountant, banker and financial planner can provide invaluable guidance throughout your life. Good ones will know much more than you do about their particular fields, and their advice can add a lot of value to your long term financial future. Do your research, ask around and when you find a good one don’t let them go!