Mozo guides

How to make a personal financial plan in 7 easy steps

Financial man piggy bank

They say that “failing to plan is planning to fail”, and nowhere is that more true than in personal finances. Having a solid financial plan is super important for making your money work for you. 

With a financial plan, you’ll want to have a clear outline of your goals as well as the balance of short term and long term spending through your budget. 

Here are 7 easy ways to tackle this:

Understand your financial goals

Before you start diving into investments and savings, it's important to first assess your financial goals and risk tolerance. An example of some financial goals could be:

  • Your child's education 

Knowing your objectives will help you choose suitable places to keep your money. You wouldn’t want your cash locked in a 5-year term deposit to only realise you needed the money after two years. Not only would you get a lower interest rate, but term deposits usually require you to give 31 days notice before you get your cash back anyway. 

Have a debt plan

Getting control of debt and planning for how to get it sorted out is important, regardless of whether your long term plan is to have savings in retirement or paying a home deposit. Taking care of student loans, credit cards, and personal loan debts quickly can help. 

Also, if you’re aiming to purchase a home, taking care of debt can improve your chances of getting the loan that you want.

Build an emergency cash fund

Your emergency fund is a well of cash you keep in case of unexpected expenses. These can range from medical bills and emergency repairs, all the way up to losing your job. For this reason, it’s usually recommended that you keep an emergency fund between three to six months worth of spending. 

Also, another use for your emergency fund is to keep it in an offset account if you’ve taken out a home loan. Essentially, an offset account is an everyday bank account that’s linked to your loan. The larger the sum of cash in the account, the lower your interest repayable on your home loan is. You will usually be able to withdraw from the offset account whenever you need the money.

Design a money saving budget

While keeping long term goals in mind is a significant component of the financial plan, it’s also important that you keep your weekly or monthly budget in mind. Budgeting for both long and short term goals can be useful as a way to manage your expenses. 

For your financial plan, your budget should include the split of cash flowing to short term expenses, the emergency fund, and then towards long term savings.

Cut discretionary spending

When making a budget, you should have a good idea of where all your cash is going. A lot of people come to a realisation when they make their budget—there’s a lot that’s spent on stuff that really doesn’t matter. 

When cutting, think about what it is you need or actually use. There’s no point in keeping a streaming subscription when you barely watch anything on it. You might be drinking too many expensive coffees, where making your own may be better. The point is, there are lots of little things that—once you see the monthly costs added up—could be seriously impacting the cash that could be going towards your long term goal or emergency fund.

Assess your financial risk tolerance

Some ways of letting your money grow are riskier than others. It’s important to assess what level of risk you find comfortable with as you need to keep your strategy consistent. An inconsistent flip-flop between safe and risky deposits can actually be damaging to your goals in the long run as you’ll likely miss out on the benefits of compound interest.

If you want to gain the maximum benefits of your financial plan, deposit your money where you feel you can consistently contribute without feeling the risk is too overwhelming.

Where to put your money: savings, term deposits, and more

Now you need to think about where you’ll keep your money for your long term goal. Ideally, you’d look for your money to grow at a rate that matches inflation. However, depending on your risk tolerance, this might not be realistic.

Here are some options:

  • Savings Accounts are generally the safest option when looking for a place to let your money grow. Current savings account interest rates have reached relatively high numbers, but keep in mind that the interest rate is variable and can fall depending on the cash rate.  
  • Term Deposits can be a good way to stash money that doesn’t need to be touched for a while. With the current high interest rate environment, this has made term deposits an increasingly popular option with some savers. 
  • Share trading can be a good place to put your money, but it’s a risky strategy if you jump in blindly. Always make sure you do your research before investing

Also, it’s a good idea to check if your money is held with an authorised deposit-taking institution (ADI) as this will generally be covered under the government guarantee for deposits up to $250,000.

Looking to grow your cash? At Mozo, you can compare high interest savings accounts and term deposits on our main hub page. Alternatively, you can check out some of the providers in the tables below. 

Savings account comparisons on Mozo - last updated 15 April 2024

Search promoted savings accounts below or do a full Mozo database search. Advertiser disclosure
  • Mozo Expert Choice Badge
    High Interest Savings Account

    5.75% p.a. (for $0 to $250,001)

    4.40% p.a.(for $0 to $250,001)

    Yes up to $250,000

    Bonus rate for the first 4 months from account opening

    Reward yourself with a higher rate for your good savings habits with the Rabobank High Interest Savings Account . Receive the maximum rate when you grow your balance by at least $200 each month. No Account keeping fees. No minimum balance.

  • Savings Account

    5.35% p.a. (for $0 to $250,000)

    4.75% p.a.(for $0 to $1,000,000)

    Yes up to $250,000

    Bonus variable rate is available for the first four months.

    Competitive introductory variable rate for first 4 months (on deposits up to $250,000). No account keeping fees to pay. Multiple 2023 Mozo Experts Choice Award winner.

  • Reward Saver Account

    5.25% p.a. (for $0 to $1,000,000)

    0% p.a.(for $0 and over)

    Yes up to $250,000

    Intro bonus rate of 5.25% for balances up to $1,000,000 for the first 4 months, reverting to 3.25%. Minimum deposit of $50 and no withdrawals.

    Introductory bonus rate for balances up to $1,000,000 for the first 4 months. Minimum deposit of $50 and no withdrawals. Start your account online in under 10 minutes and earn interest on balances up to $1,000,000 (T&Cs apply). No monthly account fees, helping you save smarter and faster.

  • Mozo Expert Choice Badge
    AMP Saver Account

    5.40% p.a. (for $0 to $250,000)

    1.20% p.a.(for $0 to $5,000,000)

    Yes up to $250,000

    Enjoy a bonus rate when you deposit at least $1000 per month with the AMP Saver Account.

    No account fees. Unlimited transactions when linked to an AMP Bank transaction account. Easy online access to your money. Option to link your savings account to an everyday transaction account. 2024 Mozo Experts Choice Award winner.

  • High Interest Save Account

    5.10% p.a. (for $0 to $250,000)

    0.10% p.a.(for $0 and over)

    Yes up to $250,000

    Deposit at least $200 to either Spend or Save account from an external source each month.

    No monthly fees on any of your save accounts. Split your money with up to 10 Save accounts. Set savings targets and track the progress of all your Save accounts. Deposits guaranteed up to $250K per customer.

  • Savings+Bonus

    5.00% p.a. (for $0 to $250,000)

    2.00% p.a.(for $0 to $250,000)

    Yes up to $250,000

    Earn a generous interest rate on your at-call savings (T&Cs apply). Interest is calculated daily and paid to you monthly. A $5 monthly membership fee will not apply if your total account balances with First Option Bank exceed $1,000 or you have a credit card or loan with the bank.

  • MoneyMAX Account

    No Current Offer

    4.75% p.a.(for $1 and over)

    Yes up to $250,000

    Unlimited access 24/7 via Banking App, Phone & Internet Banking. Interest is calculated daily and paid monthly. No transaction fees or monthly service fees. No minimum balance or withdrawal restrictions. Online access only.


^See information about the Mozo Experts Choice Savings Account Awards

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