Sam is a 28 year old graduate who has recently accepted a rural posting as a Medical Registrar. While she is looking forward to her posting, she is also undertaking further study for specialisation and is finding herself rather time poor. She has assets of $25,000 (cash and superannuation) and debts of $10,000 (credit card and personal loan). Sam’s rural posting is 2 years with an option to extend should she wish to. It is her intention to use that time to continue with her education. Sam recently got engaged, but has made the decision to get married after her rural posting. She is also planning on saving a deposit for a property in Melbourne which she and her partner intend to move into in 3 years.
Sam is a young, enthusiastic doctor who loves her work but gives little thought to the future like most people at this stage of their life. Odyssey Smart Money helped Sam define a vision for the future along with some short and long term goals to work towards. Listed below are some of Sam’s areas of concern: 1. A lack of understanding of how she spends her money from month to month.
4. Banking and finance in general; does her financial institution offer the services she needs.
2. Budgeting in general; she has never developed or implemented a budget.
5. How to develop a plan to save money for both expected and unexpected expenses, reducing reliance on credit.
3. Given her time constraints, even if she develops a budget she is not confident she will have the ability to track her ongoing performance.
Once we identified Sam’s needs and goals we were then in a position to provide solutions to help achieve them: 1.
We assisted Sam with getting visibility over her finances by having all accounts (bank, credit card, etc) uploaded onto one platform, providing clarity of her entire financial position irrespective of what institution she uses.
2. We implemented a structured approach to budgeting by completing an Odyssey Smart Money Plan, helping identify current levels of income and expenditure. 3.
Even with the extensive time constraints she faces, via contact with the OSM Team and ongoing monitoring of the budget against actual expenditure, we were able to assist Sam realise she would need slightly longer to save the deposit for her proposed property given her current income levels and fixed expenditure.
4.
After helping Sam gain visibility and control of her financial situation, she was able to realise the main financial institution she currently uses does not adequately cater for her short and longer term saving and debt needs, making the choice to move easier.
5.
Sam established a series of online bank accounts as a form of structured savings. Sam’s expenses are now accounted for and allocated to different accounts on a fortnightly basis in line with her pay cycle.
Sam's Smart Money Plan We are Sam's personal financial coach and our aim is to help her take control of her money. By tracking Sam's situation in real-time and with pro-active smart money management, we were able to help her make the right decisions so that she can stay in control and she can be sure to have the lifestyle she desires, now and in the future. With the help of cutting edge smart money technology, Moneysoft, Sam can see exactly what she is spending and saving, across all of her bank accounts. We took the following steps to set up Sam's Smart Money Plan and to track her performance on a daily basis:
Step 1 - Adding Accounts Moneysoft can acces over 200 different accounts. By viewing all of Sam's financial information in one location, we gain useful insights and can make better-informed financial decisions to reach her goals sooner. Adding the accounts was a very quick process, as Sam could add them with her online banking login details.
With Sam's first goal being addressed, getting visibility over her finances and monitoring her expenditures, we can now look into her other goals. Sam's main goals for the next five years are visiting family in Europe, saving for her wedding and saving a deposit for a property in Melbourne.
Step 2 - Setting Goals & Expense Calendar Irrespective of what stage in life you are, knowing where you are and where you would like to end up is the first step in creating a path to achieve those goals. OSM holds Sam accountable for contributing to her savings goals and she can visually monitor her progress through Moneysoft.
The next step in assisting Sam achieve her goals is to develop an expense plan she can use to guide her on the path to smart money management. As she has very little experience working with expense planning, the OSM team has worked with Sam to help her determine what part of her current expenditure she believes is fixed and what areas are more flexible.
Step 3 - Develop an Expense Plan A good expense plan is one that is realistic, consistent and achievable. While many people feel they have some understanding of how and where their money goes from month to month, it is surprising just how quickly smart money management can be left behind as the daily pressures of work and life take priority.
Many people believe setting an expense plan is the most difficult element of smart money management. What many do not realise however is that is that an expense plan that is not monitored is not a plan, merely a dream.
Step 4 - Track your finances Fundamental to smart money management is not only having an expense plan but tracking your expenditure against that plan. With the support of the OSM team, Sam now has the ability to establish an expense plan and monitor her performance against that plan.
With each of Sam’s main concerns now being addressed, or in the process of being so, she has the ability to focus on what is important to her while ensuring that with ongoing support of the OSM team she manages to stay on track to achieve her longer term goals.
Step 5 - Report on your progress The OSM team will assist Sam achieve both her short and longer term goals by providing ongoing support and reporting. The accountability and focus Sam feels she achieves by receiving monthly and quarterly reviews are assisting her in achieving her goals in a more realistic and efficient manner.