Your financial wellbeing is just as important as your physical and mental wellbeing, so it’s worth pausing and taking stock to really understand your financial situation, set goals and put a plan in place to achieve them.

Here are three steps to get started:

Best practice around reviewing your finances begins with a calculation of your net worth. Save this somewhere so it’s easily accessible, and you’ll have a simple and effective way to measure your progress against a set goal. Include all of your assets (property, cash etc.) and liabilities to calculate a final figure.

Next, pick a couple of items from your financial portfolio, whether they be credit card or mortgage, superannuation accounts or insurance policies etc, and do some research to find out whether you’re getting the best possible deal. Interest rates, fees and risk profiles should be checked at least every few years for each of your accounts. Just as compound interest can be enormously effective over time, so too higher fees and costs can result in far less wealth at the end of your investment period.

Spend some time getting to know your investments. How much is in your super? How is it invested? Are you on target to achieve your final goal? What changes would make a difference? Ask questions and seek clear and relevant answers as if you’re looking after the world’s most important retirement nest egg …because you are!

Then, depending on your stage of life:

• Managing your discretionary debt early will ensure you are able to free up surplus cashflow which you can start allocating towards protection, savings and investment strategies.
• Consider maximising the effects of compound interest and perhaps even saving a little tax by salary sacrificing a small amount – perhaps $20 to $50 a week – into your super. A little now adds up to a lot later. Be wary not to exceed contributions caps though.
• Check that your investments are allocated correctly to match your risk profile and the fact that you have several decades to ride out any market turbulence.
  
• Analyse your insurance needs and check you have the correct levels of cover. You possibly have people that rely on you to provide for them. Make sure you, and they, are suitably protected.

• It’s time to put measures in place to manage your debts like credit cards and personal loans as a result of your discretionary spending, so make that a priority for the next few years and track your success using your net worth document.
• Insurance is vital at this stage of life as you’ll likely have dependants and/or major responsibilities, such as a mortgage. Check you have the right level of insurance cover.
• Consider what you can do at work, or outside of work, in order to improve your earning potential.
• Analyse your superannuation and figure out whether you need to begin maximising contributions (but don’t exceed contributions caps as additional tax will then apply).
• Depending on your comfort with risk and your time left in the market, your portfolio’s risk/growth exposure should be periodically fine-tuned.

• How long will your retirement wealth last? How are your investments performing? This is perhaps the most important period of life to ensure your portfolio and retirement income stream are suited to the lifestyle you’re dreaming about when you finally stop work.
• Is your estate protected? Organise a will and enduring power of attorney if you haven’t already done so.

Talking to a financial planner can help you understand your situation and make confident financial decisions (big or small) so you can get the most out of life.