Financial Planning Foundations

When you build a house, it is important to have sound foundations. This means that you will have a strong base to support your home. The same applies to building your long-term wealth. Good foundations are vital.

What makes good financial foundations? Two of the keys are risk management and regular savings. What does risk management mean? It means recognising that things can go wrong at times and having a plan in place to cope with that situation. Examples of this would be health insurance, life insurance or other forms protecting against financial loss. It would also extend to having a valid Will and Enduring Power of Attorney in place.

Regular savings can take place in a number of ways. One of the first things you can do if you are keen to increase your savings is to review your Budget. This will show you how much savings capacity you have. If you are working, your superannuation is an example of regular savings.

If you want to increase your super savings, there several options for you to consider such as co-contributions, salary sacrifice, spouse contributions or super splitting. A non-super savings plan is also useful. The secret to this kind of saving is being consistent. Even if they are small amounts but saved regularly. You do not miss the small amounts coming out of your pay packet, but over time, they do add up.

Having the right foundations, means you can build a sound retirement future. If you want to start to build a solid financial foundation you might find our Super savings Options and Budgeting sections of help.