Kickstart 2025 with Smart Financial Decisions…

The start of a new year is the perfect time to revisit and refine your financial plans. For many, January serves as a natural checkpoint to assess their current strategies and set goals for the months ahead.

While the calendar year has just begun, it’s worth noting that we’re already halfway through the 2024–25 financial year. This means there are fewer than six months left to implement any financial strategies tied specifically to this tax year.

The clock may be ticking, but there’s still ample time to address both short-term and long-term financial objectives. By acting now, you can take advantage of opportunities before the financial year ends and position yourself for success in the next one.

Here are five key steps to help you stay on track:

1. Reassess Your Goals

Financial goals evolve over time, so it’s essential to periodically review them. Do your current goals still align with your priorities? Are they realistic and achievable?

Take some time to reflect on both your short-term and long-term objectives. If necessary, adjust them to match your current circumstances. Recalibrating your goals now will ensure you remain focused and aligned with your financial aspirations.

2. Reevaluate Your Budget and Spending

Your budget is the foundation of your financial plan. Reviewing your income and expenses will help you assess your capacity to achieve your goals.

If you don’t already use a budgeting tool, consider implementing one to track your finances in detail. Look for areas where you can cut back on expenses and redirect funds into savings or investments, including superannuation.

This review should also include strategies to manage debt. Prioritise paying off high-interest debt, such as credit cards, and explore options like mortgage offset accounts that can help reduce repayment costs.

3. Monitor Your Investment Portfolio

A well-diversified investment strategy is key to managing risk, but market fluctuations can alter the balance of your portfolio over time.

For instance, global share markets saw strong gains in 2024, which may have increased your portfolio’s exposure to shares. If this shift no longer aligns with your investment strategy or risk tolerance, consider rebalancing your portfolio to restore your preferred asset allocation.

Regularly reviewing your investments ensures they remain aligned with your goals and risk profile.

4. Maximise Superannuation Contributions

With six months left in the financial year, now is the time to evaluate your superannuation options and take full advantage of recent changes.

As of 1 July 2024, the concessional contribution limit (taxed at 15%) increased from $27,500 to $30,000, while the non-concessional (after-tax) contribution limit rose from $110,000 to $120,000.

Options to explore include:

• Starting or increasing a salary sacrifice plan.

• Catching up on unused concessional contributions.

• Using proceeds from asset sales to boost your super.

For more tips, check out our article, It’s Super Hump Month: Make the Most of It, which outlines six ways to enhance your super contributions before the financial year ends.

5. Prioritise Estate Planning

Estate planning is a critical yet often overlooked aspect of financial management. A well-structured estate plan ensures your assets are distributed according to your wishes and safeguards your legacy.

Key steps include creating a legally valid will and determining how your assets—such as real estate and superannuation, which together comprise the majority of household wealth—will be allocated.

Dying intestate (without a will) can result in your assets being distributed in ways you may not have intended. Consulting a licensed financial adviser to develop a comprehensive estate plan can help address potential tax implications and ensure your beneficiaries are well-prepared.

Act Now to Build a Stronger Financial Future

The beginning of the year is an ideal time to take control of your finances. By reviewing your goals, budget, investments, superannuation, and estate plan, you can set yourself up for success both in the short term and beyond.

Don’t wait—start making these proactive steps today to make the most of the remaining financial year and lay a solid foundation for the years ahead.

Rick Maggi, Westmount Financial, Financial Advisor/Planner, Perth