When the movie Speed came out in 1994, I was in year 6. I was just old enough for Mum and Dad to let me watch the M15+ rated flick and it blew my mind. One of the most iconic scenes is when the bad guy tells Keanu there’s a bomb on the bus, he has limited time to figure out the facts, perform some sick stunts, fall in love with Sandra Bullock and save the day! “What do you do?, what do you do?!”
So, in dedication to this iconic 90’s blockbuster, here’s your very own “Pop quiz hot shot” –
10 questions you should be able to answer, with speed. Are you on top of your game? (Your life depends on it):
1. What’s the latest financial goal you ticked off?
This should be easy. If you’re setting clear goals, true to your values, the last goal you kicked should have been meaningful enough to remember. Even if it was a low financial goal. If you’re not sure or struggling for motivation to set financial goals, do something about it
2. What’s your monthly spend?
If you don’t know this off the top of your head grab a notepad and add it up. If you don’t know what’s going out, how do you know how much you could save? Don’t forget that the little things add up. Email me for a simple budget calculator I use with my clients.
We generally calculate what we call a “basic” monthly spend: everything we need for the month. Then “extras” which is all the additional things that when it boils down to it, we could probably do without. Think meals out, online shopping, movie tickets, spray tans (not me).
3. What’s your monthly save?
How much of your hard-earned can you squirrel away? This should be the basis for setting all your financial goals. If the answer is zero or you’re in the negative, revisit question 2 and cut where you can.
Revisit my 4 easy savings tips for how to create life-changing money habits.
4. What is your mortgage interest rate?
Chances are if you own your own home (read: have a stake in it at least!) your mortgage repayment is likely to be your biggest “basic” expense each month. The rate you pay back depends on what deal you entered into with the bank. The beauty about this (especially at the moment!) is it’s a highly competitive market and there are always new deals to be had.
Make sure you know what you’re rate is and whether it is the best you can do. If not, we can access 50 different lenders and do all the shopping around for you – hit me up!
5. What is your savings interest rate?
So there’s always a lot of talk about mortgage rates and you may have ticked off question 4 easily. But how much is the bank paying you on your savings? Remember the reason banks hold accounts for people is to use your money for the lending they do, so they pay you interest on your dollars. Again don’t forget this is also a competitive market and just because you have your mortgage with one bank don’t necessarily mean the savings account you have with them is the best option for your money. A great place to begin is a high-interest online savings account.
6. What’s the balance on your credit card/s?
Ok, peeps this is a must know. If you want to see something scary check out ASIC’s credit card debt clock – “This clock shows how much Australians owe on credit cards. With around $32 billion owing, that’s an average of around $4,200 per card holder.”
Know what you owe and have a plan for paying it off. If your credit card is out of control, stop spending (cut it up, or at least take it out of your wallet), revisit question 2, and get a plan around how to get back in control.
7. What’s the interest rate on your credit card/s?
Again a competitive market, and massive trap for newbies. Be wary of applying for a high interest credit card. What’s high interest? Anything above 15% in my opinion.
8. What’s your credit score?
You need to have a good credit rating in order to be able to borrow money (from banks not your parents). Things such as how many previous credit arrangements you’ve had (anything from phone plans, gas bills, right through to mortgages), and any time you’ve been in trouble with lenders or service providers. Many times you may not even be aware.
This mystical rating was previously guarded by the institutions like a prison dinner. These days, it’s much more transparent. Read this blog by the “Spending Hacker” to get some more info and links to check your credit score online.
9. How many super funds do you have?
The answer to this question should be one (unless you’re keeping an extra one open for a good life insurance policy). If you have super from various previous employers in a range of different super accounts follow this link to the ATO website for instructions on how to search for and consolidate your super.
10. What’s the next financial goal you’re working towards?
Ok, so if you’ve managed to get all the way to question 10 you should have a good idea of your current sitch. So what’s the plan???? Make sure you have your next financial goal sorted, vision-boarded, whatever it takes. Get cracking!
These questions are just the start of understanding your full financial profile and you should be able to answer them at all times. If you can’t then make some more time for your own financial education and seek out someone who can help. If you’re not on top of it, you could be at worst losing money and at best missing out on opportunities.
Last question – Who’s driving the bus?
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