12 June 2014
With the end of the financial year upon us, Suncorp Bank is urging those lucky enough to receive a tax refund to resist the urge to splurge and invest it wisely.
Suncorp Bank Executive Manager Craig Fenwick said investing the average tax return of almost $2500 now could pay off in the long term.
“Before you hit the shops, it may be wise to consider a tax return as an opportunity to improve your financial position,” Mr Fenwick said.
“Buying little luxuries may be fun in the short term but the smartest option is to view your tax return as a financial boost that can work hard for you and ultimately help you reach your long-term financial goals.”
1. Pay off your debts.
Using your return to reduce the balance of a debt will cut down on the amount of interest you pay each month and save you money. Start by paying your highest interest debts, such as credit cards and personal loans, first.
2. Deposit into your mortgage.
If you have a home loan, it’s well worth using your tax return to make an extra payment. For instance, depositing a $2000 tax return as a lump sum into an average $300,000 mortgage can reduce a 30-year loan by approximately six months and save a mortgage holder almost $11,000.1
3. Set up a high interest savings account or a term deposit.
An online savings account, such as the Suncorp Bank eOptions account, currently offers a 3 month flexiRate of 3.70 per cent p.a..2
4. Contribute to your super.
Deposit extra funds into your superannuation and reap the financial rewards when you reach retirement. For example, a 25-year-old making a lump sum payment of $2000 into a superannuation account could boost their retirement balance by more than $27,000.3
5. Invest in yourself.
Take a course or enrol in a second degree, or postgraduate study. The long-term financial gains may be more difficult to measure, but one of the best investments you can make is improving your skills and qualifications.
“Ultimately, the choices we make today will determine whether we reach our long-term financial goals,” Mr Fenwick said.
For more information on managing your savings visit www.suncorpbank.com.au.
Media Enquiries: Anthony Donaghy 07 3835 5561 or 0477 315 472
Suncorp Group includes leading general insurance, banking, life insurance, superannuation and investment brands in Australia and New Zealand. The Group has around 16,000 employees and relationships w ith nine million customers. It is a Top 20 ASX listed company w ith over $93 billion in assets. Today Suncorp is Australia's leading regional bank, largest domestic general insurance group, and second largest in New Zealand and has representation in 450 offices, branches and agencies throughout Australia and New Zealand.
1 Figures based on an interest rate of 6.55% p.a. w ith the lump sum payment made 1 year after settlement.
2 Interest rate effective 11 June 2014.
3 Figures based on annual returns of 7.50% p.a. reinvested. No allowances have been made for inflation, taxation, fees or expenses. Based on a retirement age of 65.