รรอลสำฦต

Making better financial decisions

Top tips for money management

There’s nothing like a global pandemic to force us to reassess our lives and lifestyle. Things we previously took for granted have suddenly leapt into focus, and we are paying much closer attention to the things that keep us safe and secure.


We asked รรอลสำฦต alumnus Kevin McDonald - financial advisor and co-director at  alongside fellow รรอลสำฦต alumnus Jarryd Vinton - to share his top tips for navigating our way through the confusion and finding some ways to budget carefully, make good decisions and take smart action.

“Some of the most helpful coping responses we have seen during COVID-19 - making your own sourdough, starting a veggie patch or trying new recipes in the kitchen – are those that help us feel in control,” Kevin explains.

“While my tips may not be as delicious, I do believe they will help you take back some control.

“As a financial adviser I have fielded a lot of repeat questions lately such as “Should I sell my investments?”, “Will the market keep falling?”, “Should I switch my super?” or “Should I invest while the market is low?”.

“Unfortunately (for all of us) I cannot predict the future. What I can do for you right now though is share the key questions and steps down the path to better financial decision-making,” he says.

Map out key targets

For many of us the uncertainty of the coming months makes it tough to lock in plans but that doesn’t mean we shouldn’t look to the future. In fact, with this uncertainty I believe that occasionally taking time to shift your focus, at least for a short time, to the medium and long term, is a healthy way to gain a sense of control.

To start off I encourage you to put together a simple dot point ‘wish list’ that you believe to be somewhere in the realm of possibility for you. This is not about what you have but rather the life you want to create. If you have a significant other, get them involved in these exercises too.

As an example, a ‘wish list’ of common targets might look like this:

  • Car purchase - $30k in 2022
  • Overseas holiday - $10k every second year
  • Kitchen or bathroom renovation - $20k in 2023
  • Home upgrade - $800k in 2024
  • Time off work to start a family – Fund a $4k/m shortfall in 2025 and 2027
  • Retirement – Age 65 with spending habits similar to now

Quick tip - Getting stuck in the details at this early stage is counterproductive. Sketch the outlines of a few targets and rough expected costs that you can come back to add colour to later.

Understand what you spend

It is overhyped but undervalued how important it is to understand what you spend and how it impacts your options in the years ahead. It’s not sexy but budgeting helps you take control. While it takes some time, the steps are straightforward.

  1. Download credit card and bank statements as a CSV to look at what you have actually spent over the last 12 months (this captures those annual lump sum expenses like car rego).
  2. Separate out expenses that were truly one-off, unexpected expenses that aren’t likely to happen again.
  3. Be honest with yourself on that last point and consider adding a buffer based on your experiences, because life happens.
  4. Take your total annual spend and divide it by 52 weeks OR 26 fortnights OR 12 months depending on how often you are paid each year. If you have a spouse on a different frequency, then divide by lower amount.
  5. Compare this to the after-tax income hitting your bank account. Is it more or less and by how much?

If you’ve followed these steps you’ve put in some hard yards and made progress towards regaining some control. I’d say you’ve earned yourself a cuppa to relax and ponder the next two sections.

Quick Tip - If you’re struggling to get through this, I’ve had clients suggest a glass of red helped.

Check your alignment

The purpose of the above steps is to help you see your current spending habits and sit them alongside what you really want.

You can now see whether or not you are regularly able to set aside money for your key targets if you continue with your current spending habits.

Quick Tip - Use our  to see if you can set aside enough to hit your key targets.

Take some time to consider whether you’re comfortable with what you spend and your ability to hit your key targets. Most of us will face trade-offs here. Take this opportunity to plan out how to reduce your spending on items that aren’t necessary or aligned with how you want to live your life.

Take action

It is tempting to manipulate your planned spending and start investing however I encourage you to first prove that you can consistently put aside money in a way that you can sustainably maintain. Following on from the above, choose a figure you can regularly put into a separate bank account and do this for 3-6 months to prove you can.

Quick tip - It’s not a bad idea to start with a lower amount than you can probably afford, building the discipline of regular saving if you aren’t already, is the key here. Create momentum and then wealth.

Once you’re confident in your regular savings some important considerations before investing include:

  • How long will the money be invested? The longer money will be invested the more aggressive you can be. For example, if the target is two or three years away I would be reluctant to invest in anything other than a bank account or term deposit.
  • If markets fall (further) then is there a point where you’d lose sleep over your investment and sell out at a loss? Consider potential emotions first as they often out-vote logic.
  • Don’t invest in something you don’t understand. Build your knowledge with our 

Further questions to take control

Even with the current uncertainty I know that by following these steps and developing a plan to follow you will immediately start taking back some control that will help you make better financial decisions.

Other valuable conversations we often facilitate with our clients for the first time are:

  • Through your super fund you are a part owner of many companies both in Australia and internationally. Have you checked to see if the companies you own through your super fund are ? 
  • What would you do if you or a partner became ill, injured or even passed? What would you like to happen and how can you work towards that while you can?
  • We know that change is inevitable. What are some potential changes to your current circumstances over the coming months and years? How likely are they?

A financial adviser can’t predict what your future journey will look like, but we can help you ensure the decisions along the way align with what is truly important to you.


Kevin McDonald
Bachelor of Commerce, 2010

Jarryd Vinton
Bachelor of Commerce, 2008