100 Ways to Improve 1% – Part 11
This post will be another part of my series “100 Ways to Improve 1%”.
If you are on the FIRE journey, then chances are you have already modified the “big-ticket” items when it comes to your expenses, this is looking at exploring some more fine-tuning touches you can make to your everyday life.
This list has been derived from the people at ChooseFI
Below are the links to the other sections that are part of this series:
Part 1 – Exercise and Personal Growth
Part 2 – Debt
Part 3 – Emergency Fund Savings
Part 4 – Home Expenses
Part 5 – Transportation Expenses
Part 6 – Groceries and Dining Out
Part 7 – Shopping and Services
Part 8 – Internet, Phone and Entertainment
Part 9 – Travel and Sightseeing
Part 10 – Earning Extra Money
Part 11 – Investing and Retirement Planning
Part 12 – Job and Career
Part 11 – Investing and Retirement Planning
89) Find Investments With Lower Fees
Active index funds typically have much higher fees than passive index funds, and typically do not provide better long-term returns. Sticking with passive index funds can reduce your fees you will pay long term.
Instead of investing in diversified ETFs, you can also invest in the individual components of the ETF to reduce overall fees as well.
90) Use Tax-Advantaged Accounts
If you are a high income earner, it makes sense to maximise your Superannuation contribution to take advantage of the tax concessions associated with superannuation investments.
91) Find a Broker With Low Brokerage Fees
There is no reason to be paying anything over $10 per trade, and if you are regularly investing, the brokerage fees can end up being significant amounts. There are plenty of low fee brokers available, and it is relatively easy to move to a different broker to take advantage.
92) Learn about Tax-Optimisation Techniques
I am not advocating for tax evasion at all, but you can still optimise your tax payments to legally reduce the amount of tax you pay. This is mainly relevant to high income earners, where it is most likely to talk to a tax accountant to discuss ways to significantly reduce your tax burden.
93) Automate Your Investing
It is easy to become emotional when purchasing investments and adding a human element can often lead to poorer returns. Automating your investments allows you to eliminate human input to maximise your returns. Develop a system, stick to it, and do not deviate. Not only does it make it less stressful, but it should also provide better returns overall.
94) Gradually Increase Your Retirement Contributions by 1%
To take advantage of tax concessions and give yourself the best chance at a long financial independent retirement, start by increasing your superannuation contributions by 1.00%. Your contributions might only be $500 per month, increasing it by 1.00% would be another $5.00, an amount you will barely notice but will in Retirement. Every 2-3 months increase it by another 1.00% until you reach your maximum threshold.
95) Keep Detailed Records of Your Assets and How To Access Them
This might not help save you money, but if you were to unexpectantly pass away, trying to determine where your assets might be difficult for family. Employing a lawyer to track everything down could become expensive. If you instead keep a record of everything it should at least save your family money as they will have records of everything. It only needs to be a 1-page document outlining all your accounts where your investments currently are.