With the costs of living skyrocketing, it’s little wonder Australians are on the search for clever ways to consider money and finance. Seriously, $6-$10 for a humble lettuce and the amount it costs to fill your car now is enough to make your eyes water. A boost to the minimum wage means very little for those of you in the middle-income brackets. I’ve been a managing partner, specialising in accounting, for more than 24 years ago and since then I’ve learned a thing or two about clever investments. There are better ways to grow your wealth than pinning your hopes on winning Powerball, so keep reading.
Consider Salary sacrificing
What if there was a way for you to pay off a new car or your mortgage and pay less tax? It sounds like a win/win situation, doesn’t it? Salary sacrificing can be used for more than simply topping up your superannuation, such as paying for childcare, financial advice, or even a holiday.
Your ‘agreed’ purchases are paid for from your pre-tax wages, so you’ll get less money in hand, but then you’re also only taxed on the amount you get in your hand. Of course, this agreement needs to be set up between you and your employer, but make sure it’s set up properly, so you don’t end up paying fringe benefit tax at the end of the year. Before signing any agreements get them check out by an independent, certified financial advisor.
Domain flipping
You can make money out of selling domain names. This involves purchasing cheap domain names and holding on to them until they’re in demand. Like any investment, domain flipping comes with its risk, but if done correctly it can prove to be very lucrative. Power.com sold for $1.2m, the com.au domains sell for less, but still fetch a good amount of money. For example, poker.com.au and deals.com.au sold for $100,000 each. It’s advised to stick with major event titles, locations, trending searches, generic names, industries and business names.
Invest in yourself
You can claim a tax deduction for self-education and study expenses, such as course fees and textbooks, if the course results in a formal qualification related to your current career path. For example, if you’re an apprentice hairdresser and doing a hairdressing qualification at TAFE, then you’d be eligible to claim a portion of the fees, textbooks, and travel. In addition to claiming tax, you’ll be able to approach your employer for a pay rise for upskilling.
Index funds
Index funds are sometimes known as ETFs or Mutual Funds. If you’ve ever wanted to dabble in the stock market, this is often a good place to start. The Standard and Poor’s 500 index (S&P 500 index) tracks the top 500 companies and are lower risk than other forms of investment. It means you don’t have to pick individual stocks. Buying one share gives you access to 500 big US companies and helps balance the risk.
~Novel Serialisation: Heavens Fire~
Before making any investment decisions, talk to a trusted financial advisor.
By Gerry Incollingo
Gerry Incollingo is the Managing Partner of LCI Partners, a firm that specialises in accounting advisory, lending, wealth, property, insurance and legal.
