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Making money work for you: 5 strategies to make money work harder


This guide outlines strategies for making money work for you even when facing an economic downturn. Yes, there’s a great deal of uncertainty arising from COVID-19. But don’t be fooled into thinking you have zero control over your money this financial year! We’re grappling with a global pandemic, recession, surging unemployment and uncertainty about when and if things will return to normal.

As such, it’s more important than ever to start the new year on the right footing, adapt to our changed reality and make our money do some of the heavy lifting for us.

Making money work for you: 5 strategic ways

  1. Even crisis has options for making money work for you

For every loser there is a winner: someone who acts while others are too scared to try. So look past the losers to find the silver linings. For instance, investments tied to health, food production, logistics and telecommunications have generally performed well in recent months. And as essentials, they should continue to do so, regardless of what happens with the coronavirus.

Also, price slumps now are likely to be recouped over time, meaning you can buy a bargain today and watch it appreciate in value as the economy recovers. Ultimately, it’s all about your end game. Playing the markets day-to-day is akin to gambling. But taking a long-term view over investments means you’re much more likely to generate positive returns.

  1. Pay debts faster

Interest rates are currently the lowest on record. The official Reserve Bank of Australia (RBA) rate is just 0.25 per cent; most mortgage rates have a 3, even a 2, in front. And they’re expected to stay low for the foreseeable future.

So, use them to pay down your mortgage faster or to consider borrowing to invest. It could save you tens of thousands of dollars in interest over the life of your loan!

  1. Beef up your super

Superannuation is an important safety net for us all once we’re no longer working. And there are benefits to stashing any surplus cash into your super now. Firstly, there are generous tax incentives for making additional contributions – particularly if doing so brings your taxable income down to a lower tax bracket.

There’s also the ‘carry forward’ rule, effectively allowing you to catch-up on periods when your income and hence super contributions may have been lessened – such as losing your job or being pushed onto government support.

If you’re among the thousands of people who used the government’s early access scheme for COVID-affected workers, it’s even more important to repay what you withdrew: $10,000 out now could be a loss of $200,000 over the next 30 years. Plus, the government offers co-contributions for low income earners – essentially free money towards your retirement.

  1. Doubling down in making money work for you

If you’re married or in a de facto relationship, it’s not just your own financial position you need to address in making money work for you, but also that of your partner. After all, many people have sadly suffered loss of income due to COVID. Is your other half out of work or earning a reduced income this year? Are they self-employed? Are they likely to have a job once government support ends?

It’s important to revisit your household budget and adapt it to any new reality. If you’re lucky and things work out, then you can reinstate those little luxuries. If not, you’ve already made sacrifices that will preserve some much-needed cash.

  1. Just start making money work for you NOW

Too many people will let another year go by and it’s another year gone. So, my biggest advice in making money work for you is also the simplest: just start. Any positive change you make to your personal finances now will have long-term benefits. Some things to get started with are:

  • Reviewing household bills: You could be getting cheaper insurance, utilities and other services just by shopping around.
  • Refinancing loans: Again, shop around for better alternatives and investigate whether it’s better to consolidate multiple loans into one.
  • Review your subscriptions: I’d put money on the fact you’re paying for at least one subscription you no longer use.
  • Claiming tax deductions: Don’t pay more tax than you need to by not understanding what you’re eligible to claim. An accountant can be a worthwhile investment!
  • Start investing: When it comes to investing, time is your friend, so make a start and give yourself more time for it to ride the waves.

5 tips to manage your money

Changing financial habits requires some care and a lot of attention to detail. But, like everything else in life, it is (mostly) a matter of adaptation in making money work for you. With a little discipline, you’ll be able to achieve incredible results — or maybe even start investing with little money .

Set financial goals and objectives

The first step in knowing how to manage your money is to have clear goals for making money work for you. It is essential that you know where (and how soon) you want to get there. It may seem like the kind of complex reflection, but honestly it’s not. What are your future goals? Separate into:

  • next 6 months;
  • for 1 year from now;
  • for 5 years from now.

From there, establish what you intend to achieve, financially speaking, in making money work for you. It can be getting rid of a series of debts, clearing the overdraft or even buying your first property. Maybe your big dream is to buy a car? It could be anything.

Here you will record your goals and put an estimated value for each of the goals. Only then will you be able to truly know if your plans are consistent with your current reality.

Catalog all expenses

In order for you to go far in this process of financial re-education, you will have to face the harsh reality of your expenses. To do this, put time into a spreadsheet all the bills you pay recurrently (and what is additional).

You know that breakfast at the bakery? Small expenses can greatly affect your financial health. It can also be that unplanned purchase of clothes or gifts. At first, your expenses can be daunting — and that’s okay. What matters at this stage of making money work for you is that you have clarity (and full transparency) about where the money is going.

Carry out financial planning

Now that you know what your financial goals are and where your money is going, it’s time to start getting your hands dirty and structuring change for making money work for you better.

Here you will fully focus on your financial planning. Think about what accounts can be cut, what habits deserve to be changed, and even what you need to do to increase your income. These are small changes for making money work for you that can even help ensure a smooth retirement.

Again, set goals for the short, medium and long term. Think of an annual clipping and a monthly clipping. First look at what is possible to change today, right now. Then launch a more distant goal — which might even be to structure a career change, to increase recurring cash inflows.

After all, managing your money is an issue that involves a lot of details, far beyond wasting money. Among them, you may need to learn more about financial education.

Invest in financial education

Knowledge of finance, investments or the good use of money is not part of Brazilian culture. Hence, you may need to invest in your financial education. It doesn’t matter what your profile is when studying. It is possible to take online courses, read books or, if necessary, hire a consultant in the field. Perhaps you see that an expert person can guide you out of debt and start investing .

Learn to save and invest for the future

Finally, roll up your sleeves and put everything you’ve learned into practice. Here is the time to save to invest in the future. At this stage, you will already have a lot of clarity about how financial out of control is a serious problem. So, take the opportunity to change your habits.

After discovering the differences between saving, saving and investing , you should go back to your short-term and long-term planning and reflect on goals for managing your money.

About Helen Baker'

Helen Baker is a licenced Australian financial adviser and author of two books: On Your Own Two Feet – Steady Steps to Women’s Financial Independence and On Your Own Two Feet Divorce – Your Survive and Thrive Financial Guide. Helen is among the 1% of financial planners who holds a master’s degree in the field. Find out more at | Note this is general advice only and you should seek advice specific to your circumstances.

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