The start of a new financial year and two rate cuts from the Reserve Bank of Australia make this the ideal time for Australians to review their finances, according to Dixon Advisory.
Around 10 million low and middle income earners will receive a tax refund of up to $1,080 over the next few months. The two rate cuts would also mean people could save $1,000 per annum on a $400,000 mortgage, although making the same payment at the lower interest rate would help them get rid of a mortgage quicker.
Nerida Cole, head of advice at Dixon Advisory, had three suggestions of steps people could take to review their finances.
These were: Paying down high cost debt such as credit cards first, then the mortgage; looking at long term investments including super and finally, reviewing the rules of super and if they could be boosting contributions.
She said: “Keeping on top of debt is important and making sure you are paying down high interest loans and credit cards as fast as possible is a key move.
“For younger super fund members, taking a more growth focused approach is usually the way to go because they have more time on their side.
“We have an ageing and growing population – that makes funding retirement one of the biggest ongoing challenges we face as a nation.”