A Year Like No Other...
This year will go down in the history books as a year like no other. In 2020, $35.8 billion was ripped out of super funds as part of the COVID-19 Superannuation Early Release Scheme – predominantly, I assume, because we didn’t have a cash cushion to get us through the financial crisis caused by the pandemic.
At one stage more than 100,000 people were asking for a payment extension from one energy provider alone. And let’s not forget the number of mortgage holders who couldn’t make their repayments. At the peak in June it was estimated 10% of all mortgages and small business loans – worth $274 billion – were placed on hold.
But it hasn’t been all bad news. It appears quite a few of us have managed to squirrel away some savings. Total household wealth rose by 1.7% to a record high of $11,351 billion in the September quarter, according to data from the Australian Bureau of Statistics (ABS). Average household wealth grew by $6,850 to just over $440,000 per person.
The ABS reported this was driven by the largest growth in deposit accounts on record and an increase in residential assets. Throw in a sharemarket that is now trading at close to a 10-month high and you can see how some of us got a little richer over the year.
Whether you were able to turn lemons into lemonade in 2020 largely comes down to how prepared you were for the unexpected. When it comes to making money the old saying “look after the cents and the dollars will follow” is a good rule to apply.
Don’t beat yourself up if you didn’t invest $1,000 in one of the top growing stocks featured in the Money Mondays newsletter this week and don’t be too concerned if your suburb didn’t make the top-performing suburbs list. Instead, vow that next year you will focus on the small stuff.
Don’t pay any more than you have to on your energy bills, your home loan, your groceries, and start investing the savings regularly to become the best financial version of yourself.
I hope you have a wonderful Christmas – whatever that may look like for you this year.