It's easy when you're on a low income to assume that investing is out of your financial reach. Don't let go of your investment dreams just yet- check out these frugal investment tips for low-income Australians and start your journey towards investment success now.
Organise your current finance system first
If your finances are currently a chaotic source of stress, you'll feel like any sort of investment strategy is out of your reach. Financial freedom is a process requiring lots of little steps- and your first step is to get your current financial system organised and under control. Draw up a budget and start reducing your spending wherever possible- try meal-planning, renegotiating your electricity and phone bills, shop around for a better interest rate or insurance deal. If you feel like this is outside of your skillset, try using some of the helpful tools on ASIC's MoneySmart website, or seek financial advice from an experienced professional. Saving an emergency fund should be your first step, so that you have a little savings buffer to cover bills and expenses when the unexpected happens.
Set a realistic and achievable set of investment goals
Once you have drawn up an achievable budget, it's time to write down a set of investment goals that both align with your personal ambitions and are achievable in your current financial situation. Perhaps you want to increase your retirement savings, or you have your heart set on joining the world of property investment. Set a realistic timeframe for each of your investment goals, and then consider the level of risk that you feel comfortable with. How will you feel if the value of your investments dip? Your risk tolerance level and timeframe will also help you understand how you should invest your money to suit your personality and financial situation.
Consider tech solutions for saving and investing
If you need a little helping hand to stick to a budget, save or invest, you may want to consider a tech solution. There are a host of apps, computer programs and technology tools on the market that offer to help individuals manage their money. When selecting an app or tech tool to enhance your personal finance system, do your research to ensure the company is reputable and the app is a worthwhile, safe addition to your financial strategy. Alternatively, check out the free personal finance apps offered by MoneySmart to help you reach your savings and investment goals.
For more financial assistance and personalised investment advice, contact your local financial planning expert today.