Your financial wellbeing matters: 4 tips to build a financial foundation

Ben Wauchope
Financial Advisor Ben Wauchope shares tips to build financial security.

financial wellbeing matters

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Establishing financial wellbeing in the long term requires practice and commitment. Here are some tips to build a foundation for financial security.

Know your why

What does financial wellbeing mean to you? Define what you really want, why you want it and understand what makes you tick.

Far too many people rush into wealth creation before they spend enough time to define their destination and understand what motivates them when it comes to money. We all have existing money beliefs and many of these beliefs might hold us back from achieving our goals.

Take some time to really think about what’s important to you. Is it spending time with your kids and family, upgrading the family home, ensuring your children get a great education, ensuring you are financially prepared for retirement or is it having fun (i.e. spending money on things and experiences that bring you happiness)?

Establish a financial mindset

Financial Mindset is the most important, yet the most overlooked part of financial literacy. Most of us believe that wealth is purely IQ — based on numbers and figures, making the right financial decisions, buying the right investments and allowing money to do all the hard work. The reality is that it is you that is the constant in any financial decision that you make. You view your world through a specific lens that influences how you react to certain situations, how you choose to use and manage your money and more importantly, how you spend. Your mindset is a muscle and it is something that needs to be trained, particularly when it comes to money.

Know your numbers

Know your numbers, such as:

  • your income (what you earn)
  • expenses (what you spend)
  • debts (what you owe), and
  • assets (what you own),

Knowing your numbers is the first step in sorting out your finances because it provides a clear picture of your current financial situation. Without this knowledge, it is difficult to create an effective financial plan that is going to help you achieve your why.

When you know your income, expenses, debts, and assets, you can understand your cash flow, which is critical to managing your finances effectively. You can identify what it costs you to live, and areas where you may be overspending or where you can cut back on expenses. One of the key aspects to any financial plan is ensuring that you are spending less than you earn.

Additionally, knowing your assets and liabilities can help you determine your net worth. Net worth is the difference between your assets and liabilities and is an important indicator of your overall financial health.

Overall, knowing your numbers is one of the key foundations for financial planning. It helps you understand your financial situation and identify areas for improvement. With this knowledge, you can create a financial plan that is tailored to your needs and goals and take steps towards achieving your version of financial freedom.

Pay attention to your finances

Paying attention to your finances, such as knowing what interest rate you are paying on your debts, whether you are making the most of any salary packaging entitlements or understanding how your superannuation is invested, is essential to your overall financial wellbeing because it allows you to make informed decisions that can drastically improve your financial position.

Here are some reasons why:

  • Helps you avoid unnecessary expenses: By understanding the interest rates you are paying, you can identify if you are overpaying on your loans, credit card debts or mortgages. Similarly, monitoring things like your car, home and contents and private health insurance can help you identify if these are competitive within the market and if not, will help free up money that you can use to pay off debt, save or invest.
  • Helps you improve for the future: Monitoring your superannuation investments can help you build a solid retirement fund. Knowing what your super is invested in, understanding how your fund is performing, what fees you are paying and making appropriate adjustments can help you maximize your returns and ensure that you have enough money to retire comfortably.
  • Helps you improve your after-tax income: Salary packaging living expenses can improve your after-tax income by allowing you to pay for certain expenses with pre-tax dollars. When you salary package expenses, you arrange with your employer to have a portion of your pre-tax salary set aside to cover certain expenses, such as rent, mortgage payments, or even groceries. This means that the amount you set aside is deducted from your gross salary before tax is applied, reducing your taxable income and therefore reducing the amount of tax you pay. This means that you have more money available to cover other expenses or save for the future.
  • It's important to note that salary packaging living expenses is only available to employees of certain organizations, such as government and non-profit organizations. If you are eligible, it's worth considering as it can be a valuable way to reduce your tax liability and improve your after-tax income. However, it's important to seek advice from a qualified financial advisor or accountant to ensure that you are making informed decisions and maximizing the benefits available to you.

In summary, paying attention to your finances allows you to take control of your money, make informed decisions, and plan for your financial future, ultimately leading to greater financial well-being.

Want more advice?

Ben has written a blog about how a qualified financial advisor can help you at any stage of life and also joined us on the podcast to discuss how nurses and midwives can ensure financial wellbeing.

If you’re experiencing anxiety about your finances, we’re always here to talk it over. Reach out to Nurse & Midwife Support — free, confidential, 24/7. Call us on 1800 667 877 or email us.

About Ben Wauchope

Financial advisor & Director, Wealth Health Co

Armed with a Bachelor of Commerce from UWA, Ben started his financial planning career in 2013 and has since worked for three different private wealth, broking and accounting firms as a senior financial advisor.

During this time, Ben undertook further studies and successfully completed an Advanced Diploma in Financial Planning, Self-Managed Super Funds and Margin Lending. Ben has also achieved all of the educational standards as required by the Financial Adviser Standards and Ethics Authority (FASEA).

When his nose is not at the grindstone, Ben loves spending time with wife Steph, their son Leo and their two furry boxer kids Billie and Mr Wilson. Ben is also a 20+ year member of the Fremantle Football Club, visits his local gym regularly and enjoys fishing, 4WDing and boating with his friends.

Contact Ben on 0477008502.