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Managing money on a low income

Increasing living expenses and commitments can make it challenging to manage and save money, especially for low income earners. Here are some tips that may help you reduce financial pressures on a low income…

Prioritise high-interest debts:
If you have a lot of different debts to pay off, prioritise them by their interest rates. Paying off high-interest debts first can prevent you from unnecessarily losing money from interest fees.

Track your income:
Keeping track of all your income, whether it’s wages, government support or investments, can help you get a good sense of how much you’re able to spend and at what time. This can prevent you from spending too much too soon before your next income payment, and plan out the best time to pay major expenses without running out of money.

Budget:
Creating a spreadsheet with your expenses and income can help you maintain an appropriate amount of spending and tell you if you’re overspending. It may take a few tries to develop a budget that suits your lifestyle, but trial and error will provide you with an accurate estimate of how much you need to set aside for different expenses. Sticking to your budget will help you grow your savings every week.

Automate savings:
Setting up automatic transfers into your savings accounts can put you into the habit of spending less. This can be especially useful if you struggle with budgeting and want to grow your savings.

Cut back on expenses:
Unnecessary spending, such as entertainment and eating out expenses can be cut down to maximise your savings. Simple things such as packing a home-made lunch and opting for a home movie night instead of the cinema can make a huge difference if you keep it up.

Smooth your bills:
If you struggle to pay large bills all at once, contact your utility providers and ask them if they will let you smooth your bills. This means that you can make small payments more frequently instead of paying one big bill once a year. This may make it easier to budget your expenses and maintain a steady income/expenditure balance.

Increase your income:
You can increase your income by starting a side hustle or making an effort to generate more money by simple tasks such as blogging, pet sitting and selling possessions you don’t need. This can reduce the amount of financial strain you may be under.

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Changes To Employers & Super When Stapled Funds Come Into Effect 1 November 2021

Posted on September 20, 2021 by admin

This year has seen a lot of amendments and changes to the rules governing superannuation funds and their providers by the Federal Government that may have an impact on how you as an employer deal with super.

Are you aware of the changes to “choice of fund” rules that you might need to be aware of as an employer of new to the workforce employees?

Currently, as an employer, you may be paying contributions to your new employees into a  default superannuation fund of your choice if they have failed to provide you with their own choice of superannuation fund details. This may be due to not having a superannuation fund (as in, the employee is new to the workforce), or as a result of other circumstances.

As an employer, you must provide all new employees with a Superannuation standard choice form within 28 days of their start date. They may also be provided with one if:

If the employee holds a temporary working visa or their super fund undergoes a merger or acquisition, they will not be able to choose their super fund themselves.

From 1 November 2021, if you have new employees start and they don’t choose a specific super fund, you may need to request their ‘stapled super fund’ details from the Australian Taxation Office.

A stapled super fund is an existing account that is linked, or ‘stapled’ to an individual employee, so it follows them as they change jobs. This change aims to reduce the number of additional super accounts opened each time they start a new job. If a new employee does not have a stapled fund and they do not choose a fund, the employee’s super can be paid into the employer’s default fund.

With fewer superannuation funds being opened, employees are less likely to generate ‘lost super’ as they transition through their employment periods and various careers leading up to their retirement.

As an employer, you’ll be able to request stapled super fund details for new employees using the ATO’s Online services for business.

To get ready for this change, you can check and update the access levels of your business’ authorised representatives (such as your accountant or bookkeeper) in Online services. This will mean you’re ready to request stapled super funds if needed. It will also assist in protecting your employees’ personal information.

As an employer, you legally cannot provide your employees with recommendations or advice about super unless you are licensed by ASIC to provide financial advice. You can give your employees information about choosing a fund however, including:

Remember, registered tax agents and BAS agents like us can help you with your tax and super queries. Come and speak with us about your options, and to ensure that you are compliant with your super requirements as an employer.

If you are a new employee entering into the workforce, and you’d like to know more about your options when it comes to superannuation, you should have a serious discussion with providers and conduct your own independent research on the funds available.

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