The Sydney Morning Herald
The founder of financial modelling website PlanYourWealth, Aaron Greaves, says the start of the financial year is a great time to make decisions. ''The first thing you've got to do is get to that point where you've made the decision to be serious about your finances,'' Greaves says.
''Once you've made that decision, you have to know your numbers: know what your assets are, know what your liabilities equal and, just as importantly, know your cash flow, know where you spend your money and your savings potential. If you spend more than you earn, then you can't save.'' The best way to know your numbers is to draw up a budget, Greaves says. ''Very rarely people have actually prepared a budget and if you don't know those things you've got no idea and no confidence going forward,'' he says. ''How can you invest in property or super if you have no idea what you're able to achieve?'' Once you have a solid understanding of your financial position today, you can begin to make realistic projections. Greaves says most plans are based on bridging the gap between what people would like their future financial position to be and what it actually is.