Invest
Young Aussies’ guide to getting your dollars adding up in 2021
You may have noticed something unusual happen to your bank balance since the COVID-19 pandemic hit: it went up instead of down. Capitalise on that in 2021 with these simple steps, writes Helen Baker.

Young Aussies’ guide to getting your dollars adding up in 2021
You may have noticed something unusual happen to your bank balance since the COVID-19 pandemic hit: it went up instead of down. Capitalise on that in 2021 with these simple steps, writes Helen Baker.

Restrictions mean that since March last year, we’re working from home more, had to scrap overseas holiday plans, and aren’t going out as much.
The upside of this is you’re likely spending far less than you used to.
With life returning to a more normal setting in 2021, you have an incredible opportunity to capitalise on these unexpected savings and build yourself a better financial future.
1. Credit rating
Think about what your credit rating currently looks like.
A poor credit rating can restrict you from getting a loan to buy a property, securing finance to buy a car and even your ability to get a credit card or get a new mobile phone plan.
Developing good financial habits when you’re young opens a lot of doors for you down the track. That means:
- Setting up an emergency savings fund and putting aside money from every pay check.
- Paying bills, utilities and credit card repayments on time (you’ll avoid paying late fees, too!)
- Cancelling subscriptions you no longer need — an easy way to stop cash leakage.
- Spending within your means — watch those Afterpay shopping binges and tap-and-go card payments!
2. Insurance
Don’t underestimate the value of insurances like income protection, professional indemnity and disability.
Firstly, some payments can come out of your super, so they won’t dent your bank balance.
When you’re young, you have less in savings, super and assets, meaning you’re heavily reliant on your income. What happens if something unexpected happens to you and your ability to earn that income (like a global pandemic!)?
Not only that, getting insurance cover early in life can save you big bucks later on if you can lock in a level premium, and you are more likely to get full cover as your health is possibly at its best.
3. Wills
Having a will allows you to outline who gets what if something bad were to happen to you. For example, are there relatives you specifically want to exclude due to relationship breakdowns? Are there charities you want to leave money to?
But it’s not only your own will that you should consider.
Do your parents have an up-to-date will? If you have siblings under the age of 18, who would get custody and what provisions are set aside for their care? Is your inheritance protected?
These are important factors you don’t want to be struggling with if you’re grieving their loss.
4. Superannuation
You may feel nonplussed about your super while you’re young. But there are important considerations to weigh up now.
Consolidating superannuation may not save you money like you think it will, especially if you consolidate into a higher-fee fund. Consolidating also automatically closes any insurance policies you had, and you may not be able to get those same exact benefits back again.
Also, new rules mean that super funds are required to close accounts that don’t meet minimum balance or active status requirements.
5. Student debts
Chances are if you went to uni, you have an eyewatering student debt. In some instances, you could be better off by making additional repayments.
For example, COVID stand-downs may have knocked your income down. In which case, you may have gone down a repayment band and end up paying less off your loan this financial year than usual. And bigger debt attracts more indexation (interest).
If you can afford it, consider making voluntary repayments. But do it before 1 June, when indexation is added, to benefit from the saving and pay it off sooner.
6. First home buyer incentives
Both federal and state/territory governments offer various incentives to help you purchase your first property.
These incentives, which can include cash grants, stamp duty exemptions and contributions to your deposit savings, can equate to thousands, even tens of thousands, of dollars. And they’re basically free money!
Do your research to see what you’re eligible for and how to apply, as these can differ greatly.
7. Compound interest
You probably remember your school maths teacher prattling on about compound interest at some point. Well, it benefits you most while you’re young.
Investing early in life means you have more time for those investments to grow in value — especially if you get in before you have kids or a mortgage.
Investments aren’t necessarily about saving for retirement either: imagine being able to sell a share portfolio or use investment property equity to buy your own home or start a business!
Helen Baker is a licensed Australian financial adviser and author of two books.

Spending
Consumer advocates hit back at self-regulated BNPL code of practice
The long-awaited buy now, pay later code of practice is set to come into effect from 1 March, but industry experts remain sceptical of the self-enforced rules. ...Read more

Spending
Christmas shopping not as popular as Black Friday bargains
Consumers are continuing to move their Christmas spending to November, with Black Friday sales trumping December retail sales, new research has revealed. ...Read more

Spending
EV Council on GM’s demise: Electric vehicle policies ‘Holden’ us back
Less than a year since Holden left Australia, it’s parent company GM has announced that it is going to build all-electric vehicles, which is no coincidence, an industry expert has revealed. ...Read more

Spending
How online dating is set to lift the population by 2040
The popularity of online dating will see more children being born to couples who met online and lift the overall population rate of Australia, new research has revealed. ...Read more

Spending
Collector to spend $500k on motoring history
The last Holden manufactured in Australia is going to auction this weekend, with collectors likely to spend an estimated half a million on this piece of history. ...Read more

Spending
Tobacco, trips and childcare see CPI lift
An increase in tobacco tax, the unwinding of free childcare subsidies and rising domestic holiday travel during the Christmas period saw the consumer price index lift 0.9 per cent during the Decembe...Read more

Spending
Where are Aussies looking to spend their money in 2021?
Australians are increasing their spending intentions, with travel and entertainment set to be the big winners, a new report has revealed. ...Read more

Spending
Toyota returns $18m in JobKeeper payments
An unexpected surge in sales in 2020 has inspired car manufacturer Toyota to write an $18 million check to the government, returning the amount it received in JobKeeper subsidies and touting the move...Read more

Spending
Consumer advocates hit back at self-regulated BNPL code of practice
The long-awaited buy now, pay later code of practice is set to come into effect from 1 March, but industry experts remain sceptical of the self-enforced rules. ...Read more

Spending
Christmas shopping not as popular as Black Friday bargains
Consumers are continuing to move their Christmas spending to November, with Black Friday sales trumping December retail sales, new research has revealed. ...Read more

Spending
EV Council on GM’s demise: Electric vehicle policies ‘Holden’ us back
Less than a year since Holden left Australia, it’s parent company GM has announced that it is going to build all-electric vehicles, which is no coincidence, an industry expert has revealed. ...Read more

Spending
How online dating is set to lift the population by 2040
The popularity of online dating will see more children being born to couples who met online and lift the overall population rate of Australia, new research has revealed. ...Read more

Spending
Collector to spend $500k on motoring history
The last Holden manufactured in Australia is going to auction this weekend, with collectors likely to spend an estimated half a million on this piece of history. ...Read more

Spending
Tobacco, trips and childcare see CPI lift
An increase in tobacco tax, the unwinding of free childcare subsidies and rising domestic holiday travel during the Christmas period saw the consumer price index lift 0.9 per cent during the Decembe...Read more

Spending
Where are Aussies looking to spend their money in 2021?
Australians are increasing their spending intentions, with travel and entertainment set to be the big winners, a new report has revealed. ...Read more

Spending
Toyota returns $18m in JobKeeper payments
An unexpected surge in sales in 2020 has inspired car manufacturer Toyota to write an $18 million check to the government, returning the amount it received in JobKeeper subsidies and touting the move...Read more