January is when most people make New Year’s resolutions. A fresh start! But when it comes to your financial life, July is actually the better time to hit reset.
The beginning of the new financial year puts your money back in focus. You’re thinking about your tax return, your spending, your budget and your financial goals.
You are in a money mindset, so let’s take advantage of it …. Here are the money moves I think you should make now.
A new financial year, a new you
Before we get into them, have a little talk with yourself.
Whatever happened with your money last year is a lesson – not a failure.
Maybe you spent more than you planned, the family holiday blew the budget, or you never got around to comparing bills, cancelling subscriptions or investing more. Life happens.
Be kind to yourself. A new financial year is your chance to make better decisions from here.
So, let’s focus on what comes next.
5 money moves to make before the new financial year gets away from you
1. Give your tax refund a job before it arrives
A tax refund is a financial boost, but can easily disappear into everyday spending if you don’t have a plan for it.
Decide now what its role is. It could help you:
Decide now what role it will play. It could help you:
- Pay down debt: Reduce high-interest credit card debt or make extra mortgage repayments.
- Build a safety net: Add to your emergency fund so unexpected costs don’t end up on credit.
- Boost your super: Make a voluntary contribution if it suits your circumstances and benefit from the tax advantages.
- Work towards a bigger goal: Put it towards a longer-term plan, such as investing, saving for a home or another major milestone.
Make the decision before the money arrives, not when you’re wondering where it went.
2. Draw up a one-year money roadmap
July is a great time to check where you are financially and where you want to be – with the numbers in front of you.
By now, you’ve likely completed your tax return and have a clearer picture of your income, expenses and overall position. Use this moment to reset your goals.
While it’s important to keep the bigger picture in mind, start with what’s right in front of you. Think about the next 12 months. Do you want to build savings, reduce debt, invest, renovate, take a holiday or simply feel more in control of your money?
Then look further ahead: what’s on the cards over the next five years – and beyond?
Write down your goals and set reminders to check your progress. I’m a big fan of the 15-minute money challenge – a quick monthly check-in with your partner or yourself to make sure you’re still on track.
3. Find the money hiding in plain sight
July is the financial clean-out season.
Review your home loan, insurance, internet, mobile and energy bills. Run a quick comparison to see if you can get a better deal and either ask for one from your provider, or switch to another.
Plug any money leaks by cancelling unused subscriptions and auto renewals.
A little financial housekeeping can save you hundreds in minutes.
4. Know what changed on 1 July – and what’s coming
The new financial year often brings changes that can affect your household budget.
Here are a few worth knowing about:
- Payday super: Super contributions are now required to be paid at the same time as wages, rather than quarterly. Check your super account to make sure payments are landing.
- Tax cuts: The lowest income tax rate has dropped from 16 per cent to 15 per cent, giving millions of Australians a boost to their take-home pay.
- Simpler tax deduction: Eligible taxpayers can claim up to $1,000 in work-related expenses without keeping receipts.
Energy bill relief: Some households will continue to receive energy rebates and cost-of-living support, depending on their state and eligibility. - Small business change: The $20,000 instant asset write-off is being made permanent.
Proposed changes:
- Capital gains tax: From 1 July 2027, the 50 per cent CGT discount would change to an inflation-based discount with a 30 per cent minimum. Existing investments protected.
- Negative gearing: Future residential investment properties would face limits from 1 July 2027. Existing arrangements protected.
- Self-managed super fund property borrowing: New SMSF borrowing for residential property purchases would be restricted.
Check whether any of these changes affect your household or financial plans.
5. Give yourself a pay rise
You don’t always need to earn more money to feel better off. Sometimes the biggest yields come from making sure more of what you already earn is working towards your goals.
Small changes add up over time, too. Consider:
- Adding to automatic savings: Even an extra $20 or $50 each payday can add up over the year.
- Netting extra money: Finished a loan, cancelled a subscription or received a pay rise? Catch that money and put it towards savings, your mortgage or investments before it gets absorbed into everyday spending.
- Rounding up repayments: Putting a little extra towards your mortgage or debt can reduce interest and help you reach your goals sooner.
- Boosting your super: If your budget allows, extra contributions help to grow your retirement savings.
The trick is to automate – money that never reaches your spending account is much easier to save.
Happy new financial year
A new financial year is a chance to start the year right.
It’s not about making a heap of financial resolutions you’ll abandon by September. It’s about choosing a few realistic money goals and practicing good habits that last.
Stay on course and remember: the best financial resolutions are the ones you actually keep.
