Life feels like its busier than ever, with more priorities pulling us in every direction. At the end of most days, you slump in a chair, exhausted and try to mentally prepare for the next day before not getting enough sleep and starting again.
What feels like a busy week, turns to a month, turns to a year and you realise you haven’t caught up on your life admin for quite some time. You put in place a vague plan few years ago and think your super is ticking along as it should.
Then something changes. A child arrives, someone passes away, you receive a pay rise… now what?
You’ve been working hard and your boss has given you a pay rise. The first thing you might do is go out and buy yourself a nice bottle of champagne, but what next?
Many people will simply adjust their lifestyle to meet their new level of income, but does that align with your financial goals? Only you can answer that.
For me, weighing up the pros and cons of a new pair of shoes every fortnight or starting a little investment account comes in pretty tight.
A child arrives
An exciting time not without its challenges.
You may suddenly find yourself a single income family. Cost of living can be skewed when relying on two incomes and it is important to be as prepared as possible for the change of income.
The expenses only increase from there; childcare, education, dentists. Looking back, you don’t quite know where all your money went before you had children. Being on top of your mortgage, having an incoming producing asset or being across your possible benefits and deductions can all ease the pressure of cash flow while raising children.
A relative passes away.
Often the last thing on your mind is sorting out money at this sad time. When the time is right, you should consider your own estate plan and whether it is in line with your wishes. You may have been fortunate in receiving funds or an asset from an estate.
The rules and taxation around receiving such windfalls can be complex and using an appropriate structure or plan can ensure you are giving yourself the best options further down the line.
This is one of the biggest changes you can experience. If you were living together, going from a single household to two households puts a big strain on things.
You will likely feel like your pay doesn’t go nearly as far as it once did. You may have also been working towards joint financial goals, a new house, retiring early, or investing in a start-up.
Checking in with these goals, making sure they are still suitable for you as an individual and looking at how to get there is imperative.
Getting a plan, regaining a sense of control
When you’re experiencing change, it’s common to feel a drop in confidence or like you’re losing control.
Some research shows money is one of the most common concerns people have. A few simple tweaks may be all it takes, or you may want a full overhaul but getting your cash flow and financial plan in order can go a long way to regaining a sense of control.
Having a financial planner who you trust and has your best interest in mind can be a great asset. They can assist you through life’s changes and present options you may not have even been aware you had. Your goals may move, and being proactive in seeking advice at times of change means your finances are working for you as you navigate your way through life.
Remember, a financial plan is designed based on a single point in time, it isn’t a set and forget.
Katherine Spitzkowsky is a paraplanner and shoe enthusiast. She works with Scott Paterson at Deep Wealth, designing strategies and identifying opportunities for their clients to improve their cash flow and personal wealth positions.
Scott Paterson and Deep Wealth Pty Ltd ABN 79 616 937 010 are Authorised Representatives of Synchron, AFS Licence 243313.