Looking to purchase your first home? We can help with our back to basics tips.

I heard on the radio this morning that only 67% of Australians own their own home which is the lowest it has been since 1954. I never blindly trust the media but there is no doubt that people are doing it tough. 

There are many things out of our control such as interest rate changes, housing prices, rental costs and increases to living expenses. What we need to do is be smarter, get the right advice, have a plan and keep ourselves accountable.


Luckily there is still plenty of opportunity out there. Go back to basics with these simple steps.

• Budget - Budgeting doesn't have to be complex. Allocating a portion of your pay each week or fortnight can get you in good spending habits, prepare you for future mortgage repayments, reduce your living expenses, reduce the likely hood of taking out personal loans and show genuine savings. These are all seen positively when applying for finance.

• Save Money - People can be put off by needing a deposit. When we are kids we are taught to save for the items we want. Shouldn't buying a house be the same? As a general rule most lenders will let you borrow around 90 - 95% but charge you Lenders Mortgage Insurance once you borrow over 80%. This all should be taken into consideration with your advisor and mortgage broker.

• Set a realistic time frame - Buying property is a goal and all goals need a time frame. The longer the time frame the easier it can be to optimise your financial position but you will also need to allow for price rises. If your time frame is short then you need to be more stringent with your cash flow.

• Talk to your family - Rarely do I come across family who don't want to help each other wherever they can. By having someone go guarantor on your loan it can reduce or eliminate the need for a large deposit without incurring Lenders Mortgage Insurance.

• Talk to a specialist Mortgage Broker and Financial Adviser - A Mortgage broker finds you a suitable loan. A Financial Advisor builds you the strategy to get you into your first home and then pay it off. At Constancy Wealth Management we do both and would be happy to help. Visit our website www.constancywealthmanagement.com.au

What you need to know Constancy Wealth Management is an Authorised Representative and Credit Representative of AMP Financial Planning Pty Limited ABN 89 051 208 327 AFSL 232706 and Australian Credit Licence 232706. This information does not take your circumstances into account, so read the relevant disclosure documents and consider what’s right for you.  If you acquire an AMP product or service, AMP companies and/or their representatives will receive fees and other benefits, which will be a dollar amount and/or a percentage of either the premium you pay or the value of your investments.  Ask us for more details.


This post contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information

Learn how to budget

When it comes to budgets there are endless tools, apps, websites and other resources that are supposed to make it easier. You can even pay subscription services to track your spending and provide you with regular reporting.


I've done a fair bit of work helping my clients with budgeting and I found it could be difficult to keep the costs low, the information accurate and inspire behavioral change. Having two out of three won't get results.


I would like to share with you what works for us and our clients so that you may be able to motivate yourself into good spending habits.

• Leverage off electronic banking - The problem with cash is you have no record of what you spent your money on unless you keep receipts and lets face it not many people do. By leveraging off electronic payment services such as eftpos we can then use our internet banking for full spending records.

• Categorise 3 months of your Income and Expenses - Using your internet banking go through and categorise three months worth of your income and expenses. I found three months gave a pretty accurate number as it averaged out your employment income and included quarterly expenses such as rates and electricity.

• Compare equal payment frequencies. - Everything is relative. I like to annualise spending over a year, a month and week/fortnight. It is easier to understanding your spending habits that way. For example has it ever annoyed you how expensive your electricity bill  is? How does your fast food spending compare quarterly? You know how much you spend on your phone bill every month so how does that compare to your alcohol spending?

• Look for your biggest luxury expenses - Generally these will have the most opportunity to cut down spending and start saving. Give yourself an allowance for these expenses but try not to go over your allowance.

• Use bucket strategies - I am a big fan of bucket strategies. After creating your budget you will know exactly where your money is going, how much money needs to be spent on Mandatory expenses, Discretionary expenses that you can cut down on and Luxury expenses you can allocate an allowance for.

• Keep it simple - Try not to over complicate your budget or optimise it too much too early. If you try and squeeze every saving out, limit yourself too much or keep blowing your budget you are likely to revert back to having no budget at all. Remember we want to change the way we think about money and how we spend money to positive experience.

www.constancywealthmanagement.com.au
Debt Management | Property Investments | Mortgage Broking | Retirement Planning| Insurance 


















What you need to know Constancy Wealth Management is an Authorised Representative and Credit Representative of AMP Financial Planning Pty Limited ABN 89 051 208 327 AFSL 232706 and Australian Credit Licence 232706. This information does not take your circumstances into account, so read the relevant disclosure documents and consider what’s right for you.  If you acquire an AMP product or service, AMP companies and/or their representatives will receive fees and other benefits, which will be a dollar amount and/or a percentage of either the premium you pay or the value of your investments.  Ask us for more details.


This post contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information