So talk to a financial planner about life insurance, income protection and total and permanent disability (TPD) insurances, and ensure they are accounted for in your numbers. We consider appropriate insurance to be an asset, but hopefully an asset you never have to call upon.

Credit Card account (bank account) Unless you have been living under a rock, you know what a credit card is. It provides you with a credit limit. You are free to spend up to this limit, but at some future date it needs to be paid back. For the record, it’s also technically a bank account. Within our Money SMARTS system, the credit card is very

Living & Lifestyle account (bank account) The Living & Lifestyle account’s purpose is to be the vehicle for ‘spending money’. And to make it easier for you to spend, you give it to yourself as a weekly allowance. That’s why we like to call it your ‘7 day float’. Yes, it’s your apportioned weekly allowance to pay your day-to-day living costs. Once

Financially organised – You now know you are working with a rules-based money management system that is designed to get your household finances and money management in order to achieve your financial purpose.

It helps you live within your means: What happens when households don’t have a Provisionings jar is this money gets sucked into the general ‘regular spending’ money. This means that when the time comes to make the purchase there isn’t enough money available, so what most people do is, yep, whack it on the credit card or take out a loan to pay for

We immediately found that it was the solution to our uncontrolled spending but without the bank account set up it wasn’t perfect. We started to think in terms of discretionary spending, asking ourselves ‘Do I really need this?’ and ‘Am I prepared to eat into our financial future for this item?’. The effect was immediate for us.

Helpful tips in calculating the Credit Card jar Just like striking the right balance for spending money in the Living & Lifestyle account, the same is true with our bill spending. We want to achieve a healthy surplus where we can, so when you’re thinking about what you spend your money on, it’s helpful to prioritise your thinking into ‘critical’,

In saying that, look for a card that has up to 55 days interest free: doesn’t charge any annual fees or other fees; has the ability to ‘auto sweep’ or direct debit from your Primary account to repay the rolling balance (explained below); potentially offers loyalty or rewards points.

The interest rates on your loans move from time to time, and this will impact your numbers. Your utilities’ bills go up – electricity or gas bills. (Although we challenge you to shop around and find a better deal from alternative utilities’ providers.)