While most of us know we have to save for a comfortable retirement or a rainy day, attitudes towards saving and financial wellbeing are always changing. At RaboDirect, we’re pretty excited to have just released our first white paper, the RaboDirect Financial Health Barometer – A Five Year Review, which looks back at our past research and reveals a thing or two about Aussies savings habits.We looked at superannuation, thoughts on financial advice, and confidence, finding that the more informed Aussies were about their financial situation, the happier, more confident and more likely they are to save.
In 2014, Aussies’ average savings in a typical month was $908, a figure that fell to $705 in the 2015 survey. At the same time, in 2014, 49 per cent of consumers agreed or strongly agreed that they were confident with their finances, and 57 per cent agreed or strongly agreed that they were informed about financial matters, those figures dropped in 2015 to 45 per cent and 49 per cent respectively.
We also found that those who said they’re completely happy with life were 1.4 times more likely to feel in control of their finances.
So what does that mean for you?
Taking a few simple steps will help you build your savings and confidence, making all the difference to your back pocket now and into the future.
Here’s some tips to take the reins and get passionate about your pennies:
1. Have a plan and goal in mind. We found that since 2011, more people are planning for their long-term financial future, increasing from 35 per cent to 41 per cent. So join the financial plan club today! Take some time to think about both your short and longer-term savings goals and your current savings accounts. For example, if you’ve got savings you know you don’t need to access right away, think about an account that rewards you for keeping your savings at arm’s length, such as a Notice Saver.
2. Pique your interest in interest rates. With interest rates so low, it’s time to review where you keep your savings, as your savings may not be working as hard as they used to. Start by reviewing the interest rates on your current accounts and look into alternative high interest options to ensure your savings plan is packing a punch. Don’t be one of the 40 per cent of Australian’s saving in a transactional account and missing out on $2.3 billion* in potential interest.
3. Get your ducks in a row. As the end of the financial year approaches, it’s a good time to review your finances and make sure you’ve got everything in order for your tax return. As a start, here's three simple rules about lodging a tax return from ASIC’s MoneySmart:
- Keep receipts for all your deductions, including education, work-related expenses and other expenses that you may be able to claim.
- If you can't prove you spent it you can't claim it. If you are unsure about something get qualified advice if you make a mistake it's your responsibility.
- Make sure your get help and advice from someone who knows what they’re doing. The MoneySmart website has a range of resources to help to find independent and accredited advisors and accounts.
- If you’re managing your own SMSF, read more great tax tips here.
There’s a real opportunity for us all to boost our savings by becoming more financially informed. For more tips and findings from our research, read the full white paper report.
* Roy Morgan Single Source, 12 months to April 2015 (n=33,630) Australians aged 14+ years who hold a transaction account
Disclaimer: The views expressed, and any advice given, in the above article are those of the author, and do not necessarily reflect the views of RaboDirect. We recommend that you seek professional advice before making any decisions relating to the matters discussed in the article.