The weekly demands on your pay-packet may seem large, however sometimes it's a good idea to take a step back and look at the bigger picture.
Accumulating wealth is often a process of paying yourself first. Finding the discipline to put aside a portion of your income for future needs, whether it be for a holiday, future purchases, retirement etc., can make a huge difference.
The sooner you start the better (as illustrated in starting young). This is due to the compounding effect that your savings will have as time goes on. The important thing is that you start making your money work for you - this goes for your savings, your investments and your superannuation.
Which Investment Is Right?
There are literally thousands of investment options out there. Selecting investments will depend your individual investment style and investment characteristics.
Some investments won't see much return in the short term, so if you need access to your money, these investments might not be for you. It's important that you talk about these issues with your financial adviser before investing.
Tax Efficiency
Using Structures Selecting the right structure to hold your investments can make a difference in the amount of tax you will pay. Depending on the investment type and amount, you will generally pay between 0% and 46.5% per annum.
Future Tax Planning By optimising your situation for tax you need to take into consideration both short and long term outcomes. It’s all well and good claiming tax deductions on your current investment strategy, but if the end result sees you realise tens of thousands in tax, has this strategy really been tax efficient?
Investment Characteristics Not all investments are taxed the same. When choosing investments, it is important you take this into consideration. This will ensure your investment doesn’t generate any unnecessary tax burden.
Your financial planner will be able to help you work out the best structure for your current and future investments, helping you to maximise your tax deductions and reduce your overall tax.