The whole world seems to be talking about recession and GFC Part Two at the moment. We’re told the Australian economy is in an enviable position but how prepared is your household for an economic downturn?
Australia’s employment rate remains high, the government wants to return its budget to surplus, wage growth is healthy and housing affordability has improved.
Yet however promising our outlook may be, we’re not immune to global weaknesses, and it’s always worth paying close attention to your own financial security.
Your Money Magazine has a guide to five steps you can take to safeguard your financial wellbeing.
Put yourself to the test; how secure are you financially against the following criteria?
Feeling secure in your employment has wide-ranging ramifications for you and your family. It can mean the difference between feeling happy and comfortable, and lying awake at night. The best way to either maintain or gain job security is by up skilling and making further investments in your education.
By keeping up to date with technology, including new internet tools, hardware and software, you’ll ensure you aren’t overtaken by the wave of those in-the-know.
It is also worthwhile reviewing the terms of your contract, and ensuring you’re not unaware of a potentially problematic clause in your agreement.
It’s a simple notion, yet so many of us don’t do it. By putting away just 10% of every pay cheque, you will slowly be adding to your overall financial security.
Transfer 10% of each pay cheque to a high-interest account, or even invest it over time to yield excellent savings results. At current rates your savings can earn as much as 6.51% interest so don’t settle for less than 4%.
Level of debt
If you’re drowning in debt, or even just looking to reduce your debts, now is the time to stop borrowing and do something about it.
Be honest with yourself about your problems, set payment priorities, contact institutions for payment plans, and most importantly: make a realistic budget and stick to it.
One of the simplest yet most effective things you can do is to work out a weekly budget and stick to it. Be honest about your incomings and expenditure and it will pay off.
One way to start is by recording all of your expenditure for one month, including bills, rent, mortgage repayments
, groceries, entertainment, etc. You will easily see where you can reduce costs, and put the savings back into your savings account. Click here
to get started with our budget template
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