Sometimes, there is no better feeling than drawing a line in the sand and starting fresh. For financial planners, the financial year changeover is one of the biggest events on their calendar and can represent a fantastic opportunity to draw a line in your own financial sand to kick off your wealth creation.

With the new financial year well and truly upon us, now is an opportune time to discuss how you can use the start of the financial year as your own opportunity to reset and refresh your strategy on how to build wealth.

What does the new financial year bring?

For the vast majority of Australians, June 30 comes and goes largely unnoticed, with the younger demographic fixated on their potential income tax return. While ‘tax time’ certainly comes with the calendar striking 1 July, for those looking more broadly at their financial situation, the new financial year resets much that is pertinent to creating wealth.
Top tip: failing to act now could mean you end the financial year having missed out on the benefits a tailored strategy could offer. The opportunity cost of failing to act could be significant.

Tax statements

People can trundle through the year making money with an idea of how much they’re earning and spending, but often it’s not until they receive their tax statements for the financial year that they can gain a much clearer picture of their total income and see what their marginal tax rate is.

In our experience, receiving tax statements is one of the big instigators for people to look at their personal finance and question what they can be doing to get the most out of their income. Whether it’s to have more money by
mastering the skill of saving, making better financial decisions, minimising their tax, or to start investing, financial goals are often spurred by tax time.
Top tip: taking the time to plan taxation strategies at the beginning of the financial year can see you end the period in a much stronger financial position.

Superannuation contributions

Speaking of using superannuation to create wealth, the new financial year also brings with it your yearly superannuation statement.

Saving money via the superannuation vehicle can be a fantastic and tax effective investment method to strive for financial freedom in retirement. Unfortunately, this year, inflation-fuelled market conditions could see your super statement report a negative return, particularly if you have above 60% exposure to growth assets. This is all the more reason to ensure you invest wisely and at the correct asset allocation by adopting the right investment strategy.

Past performance, as we know, is not a reliable indicator of a fund’s performance in the future, however, reviewing your super statement can help you understand which asset classes you’re invested in, and whether your selected investments and asset allocation have you on track to reach your retirement goals.
Top tip: When investing, it’s a good idea to determine your investment horizon (how long you’ll be investing), risk profile (how willing and able you are to take on risk in investments), and asset allocation (the mix of assets in your portfolio) to be sure your investments are working hard to meet your very specific, personal goals and situation.

Using time to your advantage

You may have heard the adage that wealth creation is
not about timing the market, but time in the market — which is precisely why the start of a new financial year is a great time to set a financial goal and implement a tailored investment strategy. Commencing a plan for the future now means that you provide your investments a full financial year to generate income, utilise compounding to its fullest and ride out the ever-fluctuating stock market and interest rates. Capital growth doesn’t happen overnight, which is why making your money work smarter and harder for you now, can mean an enormous difference in the long run.


Top tip: Understanding your investment horizon means you can tailor your investment strategy to appropriately accommodate risk factors. A longer investment horizon may mean you can safely take on more risk, which provides the opportunity to earn higher returns. With a solid plan, you can sit back and let your investments do the work for the duration of your investment horizon without getting your emotions involved — emotions and investments do not mix!

Get started today to move towards your wealth creation goals for the future

Just as building a home can’t be done without sufficient planning, building wealth can seldom be fully achieved without detailed planning. At CFV Services, we do more that just recommend investment strategies, we carefully consider each aspect of your personal and financial life to understand our pivotal role in planning and building your wealth over the long term.

Wealth creation is the foundation to financial security, built on the blocks of your investment decisions, which is why we encourage you to see the new financial year as your catalyst to get in touch with us. Our mission is to establish a long term relationship with every client that’s underpinned by trust — we keep you in the driver’s seat.

Arrive at the financial finish line you’ve always desired with CFV Services by your side.

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