Hi and welcome to this week's episode of Money with Alpha. Bit of a practical episode this week where I wanted to go through my top three money ideas to get you some money momentum. It's one of those things we sometimes get a little bit sort of stayed in our, how we deal with life in general, especially when it comes to Money that we're like, well, what do I, what do I need to do? What do I need to focus on? There's so many things, what do I prioritize on? It's, it just gets a bit overwhelming after a while and you just stop thinking about it and you keep on doing what you have been doing and that sometimes not necessarily going to get you where you need to go. So aside from the clarity side of things, which I won't necessarily touch on today, I'm just going to talk about just the three main things. So firstly is invest regularly. Secondly, saving habits and thirdly, check your insurances. Now that last one is probably a little bit of a different one, but trust me, having worked in this space for a while, I'm always amazed at how much can be saved in premiums for individuals, for business owners, on personal insurances health, home, like all of home and contents like, you name it. There's so many different ways because we pay so many different types of insurances. But I'll get to that one. Firstly, I want to talk about investing. It's a very volatile world at the moment. Lots is going on, things are going up, things are going down. It's, it's quite erratic and it might seem a little bit overwhelming to go, well, is now even a good time to invest? Do I just let the whole thing slide and wait till things get better? Or clearer or, you know what, whatever it is. And the answer is, well, for the answer to everything, relationship with money is it depends. But my way of doing things, what my suggestions are, is to just invest. If you are in Australia and you're paying superannuation, you will be paying superannuation anyway like that and you're an investor if you have a superannuation account, but to do it regularly, monthly, quarterly at the most. That way you can start to sort of ride out things when the market goes up and down. There was quite a sharp drop recently and I was like, okay, I always have a little bit of money set aside for things like that. So I was like, okay, I'm going to get in and buy some now while the price is down. So you can do that as well, if you really want to. But generally speaking I'm not a fan of trying to time the market because it's so hard to know how people are going to react to different pieces of news right now. It's there's lots of, lots of announcements being made by leaders of the world which are impacting our market. So it's hard to, to keep track of what's going to happen when and how it's going to respond. So I'm just like slow and steady a little bit regularly. It's not the big gestures that tend to make the most impact when it comes to money unless you're buying a property, but it's just that steady, steady things that you keep going. So if you have ETFs or exchange traded funds, I would just keep on buying the ones that you've got. Look obviously at what they're return is if they're even doing all right. But yeah there's for the most part if you're in index funds and you're across a multitude of companies and asset classes then you're usually pretty okay because your risk is hopefully spread out well enough. So investing look at the returns that you're getting in your superannuation fund. Check where you're invested. Look at your age as well. This is something that I was recently having a conversation with a client about. They're approaching the sort of the 10 year mark when they're going to look at retiring and they still have quite a lot sitting in sort of riskier assets. And now's really a good time to start to look at shifting into more conservative types of assets. Still keep some, some growth assets in your portfolio. But to look at starting to adjust and bring more things into sort of like cash, fixed interest, something that's a little bit more solid and defensive as the word is used in the portfolio space. Theres some super funds out there that will are actually starting to do that automatically without you having to think about it. So I know Vanguard has a product in that space and some of the other companies are doing. I think it's like life adjusting or life cycle, something along those lines are the terminology that they're using where they'll automatically start to shift your portfolio as you age. So it's important to, if you aren't in that to actually do it actively yourself. So there, that's the space of investing that, that's an important part of building wealth and to have enough in retirement to be comfortable saving is the next one. So saving habits is important. It's important to have that mentality and for your mindset to know that you are, you can put money aside for things. So you don't always have to put things on credit, you don't have to refinance, you don't have to, to, you know, go into debt to get things or to have the lifestyle that you want that actually save for things. It is, it's just a good discipline to be able to have. I've always got a, I call it my buffer fund, which is essentially like an emergency fund where, you know, if something breaks in the house, like a few years back we had, within six months we had the dishwasher broke, the pool pump broke and the washing machine broke. I was like, there was a third one. And so that's what the buffer fund is for, is when things come up that you're not anticipating and you need to find like a chunk of cash. Cash in order to, to fix the problem. Because ultimately that's what money really does. It fixes problems, it makes things easier, you know, etc. So that's important. It's also important to save for fun to have money set aside so that when you do want to go on a holiday, you've got money there for it. So you don't come back from that holiday and have this huge credit card bill and all this debt to pay and you're like, oh my gosh. I just feel like I haven't had a holiday now because I've got all this other worries to worry about. So it's important to do that as well. And if you're a business owner, you've got a whole other set of money management to do. I'm just focusing on the personal finances today. So saving is a really good discipline to get into. With that buffer fund, I had a goal of six months worth of living expenses and once I hit that goal, I stopped putting extra money into it and just let the high interest that I, it's in a high interest bank account just sit there and churn over. And these, this is not money that you invest. This is money that sits in a bank account where you want to put a chunk of it in a term deposit or you have a high interest savings account. It's got to be like easily accessible and highly liquid, which means you can take it out quickly. You don't have to sell anything to do it. So that's what that is. If you're saving for a house then you can have a fund where you're adding money into it to save for the house. If you have a mortgage and you have an offset account there are more and more banks now that allowing you to have split offset so you have it all still acts to, to reduce the interest that you're paying on your home loan. But you can have that money set aside for different things. It just makes it a lot easier to manage the money when it is split out. So that's getting into the habit. And saving is a habit. It's having that goal. Like for instance with the buffer fund, have the goal that you want to reach the dollar value. You could even go so far as, which is what I did initially was say, okay, I wanted to reach this amount. Say I wanted to two years to get there. How many, how much would I need to put aside every month in order to get to that goal in two years time? It just makes it a little bit easier to know that you've chunked it down. Not just, it's this arbitrary number that you pulled out. It's like, I'll just put $100 a month in there. Well, how many years is it going to take you to get there? If you're putting $100 a month in, you might need to put 500amonth in to get there in a time frame that's actually useful for you. So it's important to, to set these goals. Even the, even to do with fun. I had a client recently who really wants to take her, her children to New York. I was like, well, how many of you are there? What are the airfares like? Just do a rough like costing of what it would all cost. When do you want to go so that you've got the amount and the time frame. So you want to go in the next sort of, you know, five years or even three years. And sometimes it's, you know, having a holiday five years in the distance is a little bit too far. But two to three years might be a bit easier. And then go, okay, well what I need to save every month in order to get the amount of money that I need in order to have that trip. So it just makes it easy. And then also when you have, if you end up getting like a bonus or a pay rise and you've got extra money, it makes it a lot easier to know what to do with that money because you know what you're going to do. You're going to, you're like, okay, I'm going to put this in this account. I'm going to put that on that account. I'm going to have another account for something else, like saving for a car or whatever it happens to be. So it just makes it a bit easier. So that's the saving habits one and then insurances is another. I'm constantly amazed at how much money that I get. I save each year on insurances and that when I look at clients and how much they're paying for their insurance premiums, it's phenomenal. Like we, when you think about all the various insurances that you can have, you've got health insurance for one, that's a pretty substantial chunk. Then you've got some of your personal insurances, your life insurance. If you've got like total and permanent disability insurance, trauma insurance, income protection insurance, like there's a lot of insurances just in personal, personal insurances. Then there's other things like if you've got a home, you've got home insurance, contents insurance car insurance, might be boat insurance. There's just, there's pet insurance. There's so many different things that you can insure and the, what's actually included in them is not always what you need. So it's important to review them every year. You know, if you look at your life insurance, especially over time again, I had a client recently who they had paid off their home loan. They only had a little bit of debt left on an investment property and that was it. But yet they were insured for about $800,000. I was like, well, that's quite a lot of money to to insure for. Generally speaking, you want to be able to cover your immediate debts. And then if there's education for a child or anything else that you could foreseeably see that your partner may have to outlay. That's the amount as you get older and debt reduces. You don't need to necessarily be insured for as much because also your premiums are going to go up because you're getting older as well. So it's really important to actually review those. You can contact your insurance company each year to review it with somebody. You can contact a financial planner to do a review of your insurances as well. It's important because you literally, like just this year I made a couple of adjustments to some of our insurance policies and I saved nearly $2,000. It's, it's significant and I do this regularly. The other thing too, when you look at your contents policy, what Are the limits that you've got. I used to have some jewelry like as a portable item. And what I didn't realize, and it took one person to explain it to me, and I'd been paying this premium for a number of years, was that I was insured. If I took everything out all at once, I was like, well, I'm not going to be wearing all my jewelry, I'm not going to be taking all my photographic equipment out all at the same time. But I ended up saving about 300 on the policy just by removing so many things, being able to be taken out as portable items. And I was like, well, I'm only going to really do like one or two things maybe at once. And even then is it really that valuable? So I had to do that. But it took someone to explain that to me. I didn't know. So check out those sorts of things as well. And just find tooth comb, do a review. It takes like 30 minutes if you're sitting on the phone with somebody. And sometimes you can even just call up to ask for a loyalty discount. Because you see a lot of the insurance companies, they're promoting, oh, you know, new customer special deal. And you're like, well, what about a loyal customer who's been with you for, you know, five plus years? If you call up and ask for a loyalty discount, they will generally give it to you, but you've got to ask for it, they're not going to offer it to you. So it's a really interesting thing. Every single time I've done that, it's worked and they haven't even needed to go to their manager. Like, I'm amazed. I was like, really? Okay, so why don't you just offer this? But anyway, it is the it is the process and the way it works. So those, those are just three relatively simple but not always easy ways to, to get some money momentum going. So I'll just recap those. So the first one was to invest regularly. If that includes sort of adding extra into your superannuation account or chopping up your ETFs or investing in shares, whatever, or saving for an investment property or paying extra repayments on an investment property, whatever that looks like. You just make sure you're doing something to invest. It doesn't have to be all of those things. It can be one of them only just to do that, that just little by little it adds up. And then the second one is to save have a habit of saving so that you are actually putting money aside for things and relying less on debt. Very important to do that. Just from a habit perspective, a discipline perspective, consistency. And just so that your mind gets into the frame of mind that it, you know, you can do, that's. That it's not something that's out of reach for you, especially if you've been used to putting stuff on credit in the past. Because that's, that's what I grew up with. That's what my mum used to do. She just put things on credit and when it got too much, just refinanced. Either did a debt consolidation, refinance loan, or, you know, put credit cards. All consolidated them. And it took. I mean, that's. I knew at the time that wasn't good because I could sense the stress that she had. But it's taken a while to get into that habit for her to go, okay, well, that's, that's, that's not, that's not the pattern that I want to have in my life anymore. So that's important. And then the third one was insurances do a review every year. You can do it at the same time. I know. Some people do the review in like April. So this time of year, when we look at, you know checking our fire alarms or smoke alarms in the house, do a insurance review at the same time. I did mine in January. I think it's because it was like a new year thing. I don't know. But anyway, I now have January as that. So. And it's generally driven by when I get the policy renewal. So I'll be like, oh, okay. So why. Yeah, so I made some big changes to my car insurance as well as to the home contents, actually consolidated it and made a few adjustments and saved a, like, tremendous amount. Like, I couldn't believe it. So shopping around and just having a conversation and doing a quick review makes a really big difference. So now that money can go towards something else. A holiday, investing. Yeah, a little bit of everything, to be honest. So, like, set aside some time to do that. Actually schedule it in and it will happen. If you don't schedule it in, it can just fall away. It can just be a thing that sits on your list and you just kind of keep carrying it over from one week to the next to the next month to the next month. And then it's a year gone by and you get your policy renewal. Like, I really thought I should do that now. So this is your reminder to do it today, at least schedule it in today. Even if you don't do it today, schedule it in today. Okay. With that, have a wonderful week and I will catch you next week.
