Planning for an emergency fund after credit card debt

If you are trying to get out from the grip of a credit card debt, it’s important to build up an emergency fund to stop the temptation to reach for the card again. Here are some tips to help you build up that fund.

How much money do I need?

Ideally, you want to build up to having 3 months of living expenses, to cover any expenses as well as losing your income source. This doesn’t need to be your current living expenses, rather a pared down amount that you could live on if you need to live simply for a few months. Look at the amount you need for rent, bills and food as well as any other regular expenses that you need to pay.

Where should I keep it?

You need to ensure that you can’t easily access the funds, so don’t leave them in your normal transaction account (or hidden under the bed!). A good place to keep your emergency funds is in an online only account which offers a high rate of interest and is still easy to transfer into your account in an emergency (but not tempting you each time you do your day-to-day banking). While longer term savings can be held in places that earn higher returns such as share funds, due to the fluctuations in the market this isn’t a good place to keep your emergency funds. (You don’t want to be laid off by your employer, as well as facing a stock market collapse and reduction in your emergency savings at the same time.)  

What counts as an emergency?

You are the only one who can decide on what is an emergency in your budget, but generally this should be an event that you can’t have planned for. Large annual (but regular) bills such as car registration and rates should be included in your regular budgets, as should average amounts for medical expenses, house maintenance and other amounts that come in on an irregular basis. 

Where do I get the money?

Now that you’ve pared down your budget to pay off that nasty credit card debt, you can start redirecting your payments into building your emergency fund. You can also funnel other large payments such as work bonuses or tax returns into this account. 

If you would like more advice on building an emergency fund, you should speak to a financial advisor, who can give advice specific to your circumstances.

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Getting The Most Out of Your Tax Returns: Claiming a Depreciating Asset

Australians are expected to file their tax returns every year by October 31st  for the financial year ending on June 30th. This should give you plenty of time to learn about the many different deductions that you can claim to get more of your tax returns. In particular, if you own a depreciating asset, you can claim the decline in value of the asset in your tax return.

What Is a Depreciating Asset?

A depreciating asset is best defined as an asset that has a limited effective life. The asset can reasonably be expected to decline in value over the years. A good example of this kind of asset would be a car. From the moment that you drive your car off the lot, the value of the car decreases by at least 11%. There are some limitations in regard to the type of depreciating assets that you can claim. An asset that is claimed elsewhere on your tax return, such as a work-related expense, will not count.

Who Can Claim the Decline in Value of a Depreciating Asset?

Not everyone can claim the decline in value of a depreciating value on their tax return. Only the holder of the depreciating asset can claim the deduction. In the event that there is more than one owner, each owner will need to calculate their interest in the asset.

How Do You Calculate the Decline in Value?

There are two different methods you can use to calculate the decline in value of a depreciating asset: the diminishing value method and the prime cost method. 

The diminishing value method basically assumes that the decline in value of the asset each year is a constant percentage of the base value. If you opt to go with this value, the decline in value will get progressively smaller each year.

The prime cost assumes the value of the asset will depreciate constantly over its entire life, and as a result, the asset will experience a constant decline in value each year.

You are free to choose either method for calculating the decline in value of each asset; however, once you have chosen a particular method for an asset, you cannot switch to using another method at a later date.  For the exact formulas, speak with a tax refund agent since the formulas will change based on when the asset was acquired and when the depreciating value is claimed.


If you’re unsure of how to claim a depreciating value as a deduction on your tax return, speak with a tax return agent. By taking advantage of all the deductions that are available to you, you can maximize the amount you’ll receive or minimize the amount you owe

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Don’t Go Direct; Use an Insurance Broker

From a general point of view, buying an insurance policy product directly from the insurance provider cuts out the middleman, in this case, the insurance broker. In other words, you are dealing with the insurance company directly rather than via an agent. Nevertheless, while you suppose you are saving on costs by going direct, nothing could be further from the truth. Further to that, buying directly from an insurance firm passes on a level of risk to the consumer, which many actually don’t recognise exists. This article explains some reasons why consumers should use insurance brokers instead of buying insurance products directly from the insurance company.

A good deal at no extra cost

Brokers have at their disposal the capacity to promptly check charges and coverage with many insurance companies. Note that brokers normally work with a dozen insurance carriers. Given that rates often differ widely from one insurance company to another, they can get you an attractive deal, which you may not be able to get by yourself. Similar to comparison websites, insurance brokers are paid commissions by various insurance firms for selling their policy products. This simply means, as a consumer; you don’t foot the bill for having the agent shop around a good deal for you.

One stop shop

Insurance brokers are your one-stop-shop for all your coverage requirements. Typically, agents don’t just sell one insurance product. They sell a variety of insurance products including auto, health, renters, and business insurance among others. Moreover, on comparison websites, you will not unearth coverage for features like illness or income protection that ought to be tailored to complement your needs. Furthermore, you are less likely to find bespoke or special coverage on there. Therefore, if you want to cover something like a valuable antique or an art collection, an insurance agent will know where to get it for you.

A safety net

In the event that an agent does a blunder such as selling to you an insurance product that is meant to meet your requirements but fails to do so, that  broker may be responsible to you for misconduct, which is known in insurance circles as errors and omissions. Every certified insurance broker enjoys errors and omissions coverage, similar to a surgeon who enjoys malpractice insurance coverage. You can file a lawsuit against the broker and their negligence insurance to receive compensation resulting from their failure to look after your interests. This a safety net that every consumer enjoys when dealing with a certified insurance broker. In contrast, when you choose to go direct, you have no certified and insured broker taking care of your interests. You are simply responsible for all your insurance decisions, and for the blunders, you are likely to commit. There’s no existing level of protection.

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5 Ways to Get Your Hands on Cash Today

If there’s more month left than pay check and you have some outstanding bills or an unexpected expense you’re going to need some fast cash. There’s no shortage of ways to make some extra money such as taking an extra job, completing online surveys or starting a side business, but what if you need money today? Here are five ways to get some instant cash.

Return Recent Purchases or Gifts

Did you treat yourself to new clothes, games or electronics earlier in the month or recently receive a gift? Take these items to the store for an instant refund. Even if you don’t have a receipt, some stores will offer a refund on store-branded goods such as clothing. If you’re not sure if a store offers cash refunds, as some offer store credit, call ahead and check their returns policy.

Recycle Scrap Metal

Do you have unwanted metal items cluttering up your garden or garage? Copper, brass, aluminium, and steel can all be taken to your local scrap metal recycling centre and exchanged for cash. The exact amount you’ll get per kilo of metal is subject to market fluctuations, but you’ll be given a no obligation quote once your metal is weighed. Copper and brass are high-value metals, so look for old plumbing pipes, door handles, electrical wires, and light fixtures.

Sell Your Concert Tickets

If you’re in possession of sought-after, concert tickets you won’t have a problem selling them quickly. Advertise your tickets on local classified sites and sell them for at least their face value. You may be disappointed to see them go, but at least you’ll have the peace of mind that comes from knowing your financial obligations are being met.

Be sensible when meeting a potential buyer; meet in a public place, try to take a friend along with you and avoid being scammed by insisting on cash instead of a cheque or online money transfer.

Pawn Some Valuables

Pawn shops lend money on an item you offer as collateral such as jewellery, electronics, tools, or musical instruments. They keep your valuable and give you a cash amount equivalent to the value of the item, and you have a few weeks to return to the pawn shop and buy your item back. You’ll have to pay an agreed amount of interest if you return to get your goods, but there’s also the option of not returning to collect the pawned item. Items that aren’t bought back become the property of the pawn shop and they can sell them on.

Get a Cash Loan

Cash loans from a few hundred to a few thousand dollars can be processed the same day you make your application, and the application process is less stringent than that of traditional loans. This type of loan is designed to be paid back within a few months, so it’s a good option if you know you can meet the repayments using your subsequent pay checks.

You can apply online or over the phone and most cash loan companies will give you an instant decision. You’ll have to provide some supporting documentation such as proof of address and income, but these can be submitted electronically. Once approved, funds are immediately transferred to your bank account.

If you’re at risk of missing an essential bill payment such as rent or utilities, consider the above suggestions for accessing quick cash. They may not be ideal ways of boosting your bank balance under normal circumstances, but they do offer a lifeline in emergency situations. For even more tips, consult resources like Mobile Money Australia.

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What You Need To Know About Quantity Surveyor Services

If you are in the construction industry, you have likely heard of quantity surveyors. If you own a small construction business, you may not think that you need this type of professional service. Before you overlook the need of a quantity surveyor, consider the following services and how each can help your business.

Project Cost Management

One of the key reasons that you should use a quantity surveyor is for their project cost management services. They can come in and review the project to determine a budget for the project and cost management throughout each phase of the project. They can then review the costs and re-evaluate if you come in below or above the original cost budget for that phase. This service allows you to stay on target and within the costs you have without overextending the project financially.

Risk Management

When you first start the project, or make a bid on a project, you may not know how to evaluate the risk of the project. This aspect of the construction project deals directly with the end result delivering the financial and business benefit that the hiring company expects. For example, if the property owner wants to have a grotto connected to their pool area as part of their hotel and you can’t deliver this due to the budget or location then that would be something assessed during risk management.

Disputes and Resolution

Even if you don’t believe your project needs a cost management service or risk management, there is one aspect that you may need. A quantity surveyor also provides dispute resolution services. This can be ideal if you have a difficult property owner, construction team, or anyone who may have an issue with the way the construction project is being handled. Instead of spending valuable time and money handling the dispute and coming to a resolution, you can leave that to the quantity surveyor.

Additional Costs and Expenses

No matter how much you plan out your construction project, you will likely have additional costs and expenses. Your quantity surveyor can take these costs and expenses into account and work them into your project cast management scheme. They can also determine if there are areas were expenses can be cut if it is necessary to the success of the project.

These are just four of the many services that a quantity surveyor can bring to your project. Before you overlook or discount their services, consider a consultation to discuss what they can bring to your construction project. For more information about quantity surveying, contact a company like Just Depreciation.

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3 Ways to Save Money on Commercial or Business Insurance

Business or commercial insurance is a necessary part of operating your company, although it’s no doubt an expense that many business owners wish they could reduce. After all, your commercial insurance doesn’t bring customers through your front door or help you to sell any products. While you can’t eliminate insurance altogether, there are some ways you can usually save money on its cost. Note a few tips on how to do this.

1. Implement employee wellness programs

You may be able to save on health insurance for your employees if you implement wellness programs. Employees who are healthier overall will cost an insurance company less money for treatments and doctor’s visits, so the insurance company may pass this savings on to you, their customer.

Wellness programs can include weight loss support, smoking cessation programs, subsidised gym memberships, and even flu shots. Ask insurance carriers like National Corporate Broking Pty Ltd about these programs as they may have ones in place that they can implement at your office.

2. Implement loss prevention programs

Preventing loss when it comes to your commercial property is like implementing employee wellness; your insurance company may save money because of reduced claims, so they pass some savings on to you.

Loss prevention programs can include fire safety instruction at your facility, disaster preparedness, additional or updated fire alarm systems and materials like fire doors, flood retaining walls, and so on. Anything you can do to protect your property can reduce your insurance premium.

3. Use properly insured subcontractors or temporary employees

If you use subcontractors who do not have proper insurance, a customer or client of yours can easily sue you for damages done to their property or for unfinished work. In turn, your insurance company may be liable for those damages. Properly insured subcontractors can help you cut down on that risk so that in turn, your insurance company will be less liable.

This can also be applied to clerical staff, accountants, and other skilled office workers. You might consider using temporary workers or contract labor, from a company that provides insurance for their workers. In turn, you won’t need to provide them with health insurance and may be able to reduce your premiums for worker’s compensation, unemployment, and other types of insurance.

Be sure you discuss all these possibilities for savings with your insurance agent before you invest in certain programs or make changes to your personnel. This will ensure that you can actually save money on your premiums with these options.

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3 Ways to Improve Your Credit Rating

You’ve probably never seen your credit report, but the rating which it is assigned can hugely effect your life. A bad credit rating could prevent you from getting financing for anything from a new house or car to a strong credit card, or see you find only deals which offer incredibly high interest rates.

Australia’s negative credit reporting system can make it hard to improve your score, but there are still a few ways you can help yourself out.

Correct Your Debt to Credit Ratio

Let’s say you’re earning a good wage, and that you’ve never missed a payment on your $5,000 limit card. That’s great—but you might still look like a credit risk if that card is kept right up close to the limit if you only pay off the lowest possible amount each month.

Unfortunately, this can make it appear as if you’re still using the card to live beyond your means. If you consistently reach the end of the month at $5,000, then simply pay back $2,000 and start again, it can make it appear as if you simply can’t spare the other $3,000 each month to totally clear the dept. Instead of letting this happen, keep the ratio between your debt and your credit limit as low as possible.

Demonstrate Stability

Keeping old current accounts open for as long as possible improves the length of your credit history, so try to avoid changing unless you truly need to. Additionally, only apply for credit if you actually need it.

It’s too easy to pick up credit cards everywhere now, even at retailers. These are usually offered with a tempting incentive; they might save you $25 on a larger purchase, or allow you to gain more loyalty points. However, constantly applying for more credit is liable to put off potential lenders. They may fear that you are attempted to live on borrowed money.

Get in (Some) Debt

If you want someone to loan you an appreciable amount of money, you’ll need to have been in debt before. Crazy, but true. You can’t be judged on something you’ve never done before, and your risk level can’t properly be assessed without any borrowing history. Organisations might find no credit rating more appealing that a negative one, but it’s far from ideal.

If you don’t have any credit history, try to secure a credit card with a low spending limit. As long as you stay on top of your payments, this will demonstrate to potential lenders that you’re able to manage your own finances and pay money back on time.

Rebuilding your credit rating isn’t something that will happen overnight, but the sooner you start taking control of your finances the sooner they’ll improve. Consult resources like Maddern Financial Advisers to create a plan to maintain a better credit score or gradually get out of debt.

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Why It Is Beneficial To Hire A Tax Accountant To Complete Your Tax Return

Are you due to complete your taxes, but wonder if you should do it yourself or hire a tax accountant so that all the paperwork is done for you? There are many reasons why hiring a tax accountant is better than doing the paperwork yourself – one of which is the ability to get a higher tax refund. However, to find out if going with a tax accountant is really for you make sure to find out that benefits they bring, and you can do that by reading on.

  • Paperwork can be confusing: Some people simply hate paperwork and if you are one of those people then filling out the taxes can seem like the worst chore of the year. Fortunately, a tax accountant can take that care of all the paperwork so that you do not have to trouble yourself with it. They can also keep you up to date on the progress of the paperwork, which means you can be confident your taxes are getting sorted out.
  • Increase in tax refund: There are many factors that a tax refund is going to hinge on, such as the total income for the year and work related expenditures. By making a few mistakes, you could potentially be reducing the amount of money you should get in the form of a tax refund. On the other hand, a tax accountant will know exactly what to do so that you legally get the most money possible on your tax refund. The increase in tax refund money that you are likely to get means the tax accountant service will at least in part pay for itself.
  • Send paperwork on time: A tax accountant will know the deadlines that the tax forms have to be sent off by, and will stick to them religiously. However, if you do the taxes yourself then day to day life can get in the way, and as a result you forget to do them. Consequently, you might get a fine which could have been avoided if you simply hired a tax accountant.
  • Understating your taxes: A tax accountant will not only fill out your tax forms, but will also explain the different legalities and rules surrounding certain things that you need clarification on. This allows you to learn more about how to fill out a tax form, and that means you could do the job yourself in the future.

For more information, contact a company like Taxwise.

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I'm a working artist and it can be hard to make money stretch sometimes. I have to be really smart about how I use credit cards, as well as making sure my budget is precise. When I have a big show if I sell a few pieces I can eaily find myself making a year's salary in one night and needing to stretch that until my next big sale. I also have to be savvy about keeping a track of my tax deductions to maximise my cashflow over the year. If you are also making a living from your art, this site should be useful to you as well.

September 2016
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