Young Accumulators (Age 25-35) – What Should They Consider?
In this life stage, your income increases and wealth accumulates. This is also the time when you may think about marriage and perhaps buy your first property. Some useful financial planning tips include:
If you are saving for a specific purpose such as a deposit for a property or a wedding, having a budget and the discipline to stick with it will help you achieve your goal faster. Track your progress monthly to see whether you have achieved your target. Review your budget periodically and make necessary changes to ensure it remains relevant to your goals and objectives. Setting up a separate bank account for a specific purpose can help you focus on your goal.
Do your research on any government incentives to help first time property buyers (such as the First Home Owner Grant and the First Home Super Saver Scheme) and whether you are eligible.
Look out for special offers on home or investment loans – this may save you a substantial amount of interest and fees over the loan term. Consult a mortgage broker to find out what is available.
Put in place risk management options such as life insurance, especially if you have a young family or a significant level of debt.
Taking out a life insurance policy whilst you are young and healthy makes it easier to pass the medical / health requirements of the insurer. There are many types of life insurance covers such as death, total and permanent disability (TPD), income protection and critical illnesses. You want to understand what each category covers and whether it is suitable in your situation.
If you can save regularly and wish to invest, consider putting some money into superannuation in addition to your employer contributions. In Australia, superannuation remains a tax effective way to save for retirement but generally your funds will be locked up and you will not be able to access it until you reach a certain age.
Starting to invest early may help you grow your wealth and be financially ready for retirement sooner. One of the benefits is the compounding of any positive investment returns if you reinvest income or gains from your original investment.
Call us on (02) 72028382 or email us on admin@japhiawealth.com.au if you wish to know how we may be able to assist your financial planning needs.
GENERAL ADVICE WARNING: The above is general advice only and does not take into account your personal circumstances or objectives. You should seek your own independent financial and tax advice to ascertain whether and how the above applies to your particular situation and whether it is likely to meet your objectives, prior to making any financial and investment decisions.