Noel Whittaker
Noel Whittaker

Keep financial resolutions solid

Welcome to another new year. This is the time when we make many resolutions about getting our life and our finances on track but unfortunately, the intentions get lost in the daily grind. An effective solution is to prepare a “net worth statement” which is just a sheet that lists your financial assets and liabilities. This becomes the base for your future strategy.

On one side, write down assets such as your real estate, shares, and superannuation but don’t include items such as cars and furniture as they have no long-term value. On the other side, list all your loans and include the interest rate, the monthly repayments and whether the interest is tax deductible. You now have a working document.

Next, think about each asset in turn and decide if it should be sold. Also, if you have investment property, try to figure out if it still has potential or whether it’s time to get rid of it and upgrade to something better.

If you have loans on which the interest is tax deductible make sure they are on an interest only basis. This ensures you maximise your tax benefits, and also frees up money to speed up the payments on the non-deductible loans. Next arrange your budget so that you pay back the smallest non-deductible loan as quickly as possible. Once the smallest loan is paid off you can use the money that is no longer needed for its payments to attack the next smallest loan.

Remember the name of the game is to increase your net worth – the difference between your assets and your liabilities. Adopting the above strategy will enable you to maximise capital growth while quickly reducing your debts.

Noel Whittaker is a director of Whittaker Macnaught Pty Ltd. His advice is general in nature and readers should seek their own professional advice before making any financial decisions. His email is

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