Four Easy Steps To Renovate Your Financial Future
Autumn is upon us and if you’re like me, your New Year’s Resolutions are as distant a memory as those lazy summer days we enjoyed, in those precious few weeks of holidays!
So, let’s get re-focused and make sure your financial future is as secure and strong as it can be with these four simple steps:
1. Renovate Your Equity – Hello Ms or Mr Bank Manager or Mortgage Broker
I love to keep in touch with my ex clients, especially to tell them how much their amazing properties have come up in value. However, if you don’t have a buyer’s agent to keep track of the market for you, do you know what your property is really worth?
As I always say, knowledge is power and after the recent property boom, enjoyed by most of Australia, you may find yourself with much more wealth than you realised.
Not only will this help you sleep easier, it may be enough to purchase your next or first investment property which will really pump up your long-term wealth strategy.
So, as part of your financial plan, get all of your properties, including your family home, re-valued on the same day every year, so that you know exactly where you stand.
Tip 1: When organising valuation/s with your bank, check that they walk into your properties to see exactly what they’re valuing. “Desk top” valuations are very unreliable especially if you’ve renovated since you bought.
Tip 2: If valuing investment properties make sure your tenant isn’t spooked! Your Property Manager will need to make it clear to them that you are not selling and simply want to know the value of the property for your own finances. You don’t want to unnecessarily be left with an empty apartment.
Tip 3: Only do this if you have a very good idea that your property has come up in value. If you feel that your property may have come back in value, then do not let a valuer anywhere near it!
Tip 4: Once you know how much equity you’ve made, consider drawing down a lump sum of money to put in your mortgage’s off-set account. By having cash set aside for emergencies, even if the worst was to happen, such as losing your job, illness or an accident, you’ll know that you have a certain amount of funds available to safety net your living expenses, including your mortgage.
2. Renovate Your Mortgage – Hello again Ms or Mr Bank Manager or Mortgage Broker
With money being so cheap in recent years, most of you will probably be on a good mortgage rate but are you sure you can’t do even better? Hit the phone and call all the banks and other lenders or better still, get your Mortgage Broker to do the work for you. Shop around and you could end up saving yourself $1,000’s per annum!
3. Renovate Your Will – Hello Ms or Mr Solicitor
As your life is probably fast paced and ever changing, you’ll need to update your will regularly. If you’re part of the 65% of Australians who don’t even have a will then make the call now! You, and no one else, should be in charge of where your hard earned assets go.
Visit your solicitor if any of the following have happened since you last updated your will...
- You have bought/sold a property
- You have got married or divorced (including de-facto relationships)
- You have had a child or grandchild
- You have changed your mind about who to leave your assets to
- Any of your beneficiaries circumstances have changed, especially if they’ve died
- Your executor has died, become unwell or unwilling, changed their name or been convicted of a crime
- If you’ve changed your financial affairs in anyway such as sold or bought a business, set up a self managed super fund or retired
For more information please check…
4. Renovate Your Insurances – Hello Ms or Mr Financial Planner
Again, if your circumstances have changed maybe it’s time to revisit your insurance policies? Talk to your Financial Planner if…
- You’ve bought or sold a property
- Your income has changed
- Your responsibilities have increased or decreased (including having children)
- You’ve been widowed, got married or divorced (including de-facto relationships)
There you have it. Tick off each of these simple four steps each year, building your wealth will become easier and more importantly, you will become increasingly empowered and confident.
As always, best of luck and feel free to reach out with any property questions or observations you may have.