Tax tips from CANNEX
Make the most of your lump sum with these tips from CANNEX .
Tax time is a wake-up call for many to take charge of their personal finances and shape up for the next financial year by using their tax return in a positive and lasting way.
You have all heard the call to invest in super but there are also benefits to be gained in reviewing your everyday banking products.
Financial services research group, CANNEX, says it is all about making your tax return work for you.
According to CANNEX, this year’s tax return can be more than a quick trip to Bangkok. You could use it to give yourself a financial facelift or, at least, a nip and tuck.
Whether you pay off a debt or save for a rainy day, you should aim to get the best value you can from your tax windfall.
Personal circumstances will dictate areas crying out for financial attention and the following tips from CANNEX provide helpful thought-starters for the young person or student through to those about to retire.
CANNEX new financial year resolutions:
Young Person/Student:
- Park your tax cheque in a savings account to earn more interest before paying your HECS debt
- If you plan to go back-packing, investigate a credit card that offers free travel insurance
- Do not pay to keep your money in the bank. Look for a no fee transaction account
- Going for a car loan? Credit Unions and Building Societies are a great start.
- Think debit before credit and you would not over-spend
- The phone is not free. A mobile phone plan is like an unlimited credit card so try pre-paid instead.
Family:
- Send your tax return straight to a special purpose savings account like holidays, Christmas etc
- Start a kids savings account. Divide up your lump sum between each child and do the same thing next year
- Review your mortgage. Are you getting the best deal or should you switch to save money?
- Bundle all your insurance to take advantage of discounts for loyalty
- Consider a salary sacrifice to fund a major family purchase e.g. laptop, mobile phone
- Fine tune your financial literacy. Teach sound money basics to the whole family.
Pre-Retirees:
- Put your tax return into your mortgage to reduce bad debt, i.e. debt you cannot claim tax benefits on.
- Spend time educating yourself on new financial products and features now available
- Review insurance policies. Take advantage of over 50s discounts
- Top up your superannuation with your tax cheque.
- Investigate new ways of banking. You may be surprised how you can save
- Learn more about new tax incentives. Working later in life can pay off
The final piece of advice, according to CANNEX, is to start planning for next year’s return.
Now is the best time to look forward and plan where you want to be financially when that next tax cheque arrives.
4-Jul-2007