Financial Freedom
Financial Freedom is a concept that means different things to different people depending on their stage of life, and
relationship with money and wealth.
There are 8 financial review points that I recommend you think about each year, when you complete you annual income
tax return:
1. Plan for your Tax Return – Do you have a record keeping system that ensures you are keeping receipts and records
for all expenses that relate you earning assessable income, to ensure you maximise your income tax deductions.
Are you keeping a log book for all your work related travel, such as business kilometres, or are you entitled to claim
car expenses under the cents per km method which does not require a logbook to be kept? Are you claiming a tax
deduction for your income protection insurance? Are you claiming any self-education costs for any learning that is
related to your employment? Can you claim a % of your home rent, electricity and water as a deduction for home
office expenses? If you are in a refund position, lodging your tax return as soon as possible after 30 June, will mean
that the refund is in your bank account, earning you interest income.
2. Reviewing your Superannuation – Do you regularly review your superannuation accounts? Do you have more
than one superannuation account, and if so, what is the benefit for holding more than one superannuation
account? Do you have any lost super, that is superannuation that you have lost track off, because you have had
multiple employers over time, and not rolled all your superannuation balances into one account. Do you know
what fees and charges you are paying your superannuation provider? How much you are paying for any insurance
that is held through your superannuation account? Is this insurance still required?
3. Superannuation Contributions using Salary Sacrifice – Have you considered making additional superannuation
contributions? This can potentially save a considerable amount of income tax, and assist you in building your
wealth.
4. Review and Document your net asset position – I encourage all my clients to prepare a basic spreadsheet, each
year, that lists all their assets and liabilities. This list includes the current market value of your home, motor
vehicles, direct shares and superannuation accounts, as well as all debt, including credit cards and mortgages.
Preparing this list, shows exactly what assets you control at that point in time.
5. Prepare your annual budget – when you have a clear understanding of where all your hard earned money goes,
it can provide hints as to where you can make some savings.
6. Review your interest rate and loan features – is your lender offering you a competitive interest rate and annual
loan fee. A few enquiries could save you a lot of money.
7. Review your Insurance cover – your general insurance, such as motor vehicle and home and contents as well as
your personal insurances such as life insurance, income protection and trauma cover, are likely, large parts of your
budget. Have you considered bundling your general insurances and getting a quote from another provider? This
may provide a bargaining point with your current supplier.
8. Review your Estate Planning wishes – do you have a current will, power of attorney and guardianship documents
if you have dependent children. Does your superannuation fund have a valid Binding Death Benefit nomination in
place, as superannuation is a “non estate” asset and not dealt with by your will?
In my experience, a good annual review of your financial health and related matters, will provide you with financial
piece of mind that you are on track to achieving your financial goals.
LISA CAHILL is a Chartered Accountant and Self Managed Superannuation specialist
with over 18 years of experience. Lisa has a passion for improving people’s financial
position from a wholistic point of view. Lisa is a highly sought after speaker in the
area of Self Managed Superannuation, and regularly presents at industry conferences
and for Sky Business. Lisa has grown up on the Central Coast, and has a five year
old daughter, Tahlia, and a one year old son, Jet. You can learn more about Lisa and
Fusion Partners by visiting their website www.fpcc.com.au
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