Some investing steps to get you through the holiday season, the new year, and for the future…

It’s about that time of the year again, with Christmas fast approaching and the new year just around the corner.

It’s a time to unwind, to reflect on the year that was, and to look and plan for what’s ahead. It’s also a perfect time to make sure you’re on track to have the best chance of investment success.

So, with all this in mind, here’s 12 financial tips to help you get through the Christmas period, the new year, and beyond.

Tip 1: Remember the ghosts of Christmas past.
There’s an old saying, “look before you leap”. If you ended up with a big overspending hangover after last year’s Christmas celebrations, think about what you could do to avoid a repeat of that this year.

Tip 2: Avoid bad Santa debt.
As well as trying to tighten your Christmas spending belt, also think about how you’re going to pay for your Christmas gifts and celebrations. Credit cards make spending very easy, but they generally levy high interest charges if you can’t pay off the balance.

Tip 3: Put money in the pudding.
Some people follow an old tradition by putting coins inside their Christmas pudding. This is meant to bring good luck and wealth to those who find them. In a practical sense, if you can, consider putting extra money aside to build up a savings buffer.

Tip 4: Follow the money.
If you’re not keeping track of your spending it’s difficult to know where you stand financially. Having a budgeting system in place will give you a clear picture of your regular income and expenses on an ongoing basis.

Tip 5: New year, new directions.
As we head towards the new year, think of taking some new financial steps. These could include staying on the same financial path you’re already on, but increasing your savings momentum, or heading in a different financial direction altogether.

Tip 6: Review your financial goals.
Before making any financial decisions it’s always good to take stock of your broader goals. Your circumstances may change over time, so you may need to make some adjustments to ensure your goals are still as relevant today as when your set them.

Tip 7: Review your investments.
The new year can be a good time to recheck whether your current investments are still aligned with your strategies for building wealth over time. Sometimes it’s necessary recalibrate your holdings to ensure they’re finely tuned to your broader objectives.

Tip 8: Spread your investment eggs.
One of the key principles of investing is to spread investments across different assets to avoid being overexposed to a particular area. Make sure you’re happy with your current spread of investments and make some adjustments if you feel they’re needed.

Tip 9: Invest for success.
Investing regularly can make a huge difference over time. Even investing small amounts, including extra concessional contributions into your superannuation account, can result in large financial gains over the long term, especially for investors who stay the course.

Tip 10: Harness the power of compounding.
Investing is good, but reinvesting can be even better. Reinvesting all the investment returns received over time will compound your returns. Scientist Albert Einstein called compound interest the eighth wonder of the world.

Tip 11: Consider an enduring gift.
The best gifts in life are those that can keep on giving. For parents or guardians, this could include a financial gift to a child in the form of an investing account. Making regular investments on a child’s behalf can help to give them a great financial head start.

Tip 12: Read all about it.
Lastly, when it comes to investing, it pays to be well read. Subscribe to Vanguard’s free weekly Smart Investing newsletterto read about investing trends and strategies, portfolio construction, exchange traded funds, our latest forecasts, and more.

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This information has been prepared by Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263). We have not taken your objectives, financial situation or needs into account when preparing this information so it may not be applicable to the particular situation you are considering. You should consider your objectives, financial situation or needs, and the disclosure documents for any financial products before making any investment decision. Before you make any financial decision regarding Vanguard’s financial products, you should seek professional advice from a suitably qualified adviser. Past performance information is given for illustrative purposes only and should not be relied upon as, and is not, an indication of future performance. This publication was prepared in good faith and we accept no liability for any errors or omissions.

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