The majority of us dream of the day we pack in work for good - especially if that retirement also means we have a guaranteed income for life. To some this is an unattainable dream, but it can happen if we take the proper steps beforehand. What do we have to do to make the dream a reality?

Investing in managed funds can be the answer. You don't need a lot of money to invest in a managed fund. Some let you start with as little as $1000, others prefer twice that amount. In today's economic climate, nearly everyone can save that. Even those who have no job can find ways to save a little at a time until they have the necessary amount. So what if it takes a whole year - or even two?

With a managed fund, investors pool their money and the fund manager invests it for them. This is the easiest and simplest way anyone can start to save for their retirement. The profits from the initial investment must be ploughed back into the fund of course, otherwise it will all be spent on present needs or wants. But after a lifetime of re-investing the profits there will be a significant amount to retire on. And those who are wise enough to see the benefits will continue to save for investment purposes so that the initial deposit will swell a great deal over time.

Self-managed superannuation is another option for making the dream come true. This option should not be taken up lightly as there is a lot of work involved with running a self-managed superannuation fund will have to be the trustee and you are directly accountable for everything that happens to the SMSF.

The responsibilities of a trustee are many. There are strict guidelines that you must comply with and failure will bring down the wrath of the tax office upon your head. You must lodge both an income tax return and a superannuation fund return on an annual basis. As well, there must be superannuation member contribution statements lodged every year. An approved auditor must be appointed to do an audit annually. And records must be kept for ten years. There are also restrictions on investments that must be complied with.

In fact, many people feel that the amount of work involved is not worth the benefit and so go with managed funds. Unless you have experience and plenty of time, this is a good decision.

Maybe this is an obvious tip, but sometimes the obvious isn't so obvious to some (If that makes sense)



Always leave your credit cards at home to remove the urge for impulse buying. Leave them in a locked drawer and only get them out when you need to pay for something like an airline booking and then pay it off within the interest free period that most cards offer.

If your card doesn't offer an interest free period, Shop around for a credit card that does.

You've all heard the expression "the rich get richer and the poor get poorer" right?

Well to my way of thinking there is one major difference between financial winners and financial losers.

Winners borrow money at low rates of interest for assets such as property and shares that increase in value as time passes.

Losers on the other hand borrow at high rates of interest on consumables like furniture and cars that decrease in value, in the case of new cars around 20% as soon as they leave the showroom.

While interest rates are at the lowest they have been in years do the right thing (if you are able) and borrow some money to invest in quality assets.

Aren't you glad that the end of the financial year doesn't come at Christmas time? Instead, June rolls around and we have to be prepared for all the extra work necessary to sort out our finances. But why not be a wise owl and get in ahead of time? You can save yourself a bit of stress by being prepared. Get all your receipts to hand and do that bookwork right now. And to start with, how about trying to save money? If you inspect all those phone plans and electricity or gas and insurance bills you may find that switching to another provider can save you heaps. Of course, you know to always read the fine print so you don't sign up for something unpleasant.

You can often save in the home, too by donning warmer clothes before turning on the heater or working with the weather to dry clothes instead of using that convenient but costly clothes dryer. Looking at your saving accounts is another way you may be able to save money and make more interest. Online savings accounts are often fee-free and give wonderful rates of interest compared to ordinary savings accounts.

If you've been putting off buying that new monitor or printer for your business, remember that it is tax deductible. But there have been recent changes to what you can claim, so check that out too.

An emergency fund is good insurance

You may have gone to a lot of trouble to work out a budget so you know just what bills are coming in and how much you'll need to pay them. Then you feel that anything left over is yours to spend how you like. That is true of course; you've earned that money and so you have the right to spend it.

But before you go out and blow the lot on a party or the latest electronic gadget, remember that life has a habit of taking some unexpected turns. And usually money is needed to cover the costs. If you have only enough cash set aside to pay your expected bills, what happens when you get an unexpected one? Your water heater could suddenly develop a serious leak, the car may need unexpected repairs, or illness may keep you from working for some months.

If you've set aside money in an emergency fund such as a savings account or short term deposit, you won't need to worry how you'll cope financially. Sure, you feel that your credit card will get you out of any financial hole, but don't forget you have to pay that back. And if you don't pay it in time, you'll get hit with the highest interest there is. Using a credit card to cope with unexpected bills could well be digging a financial hole that it is very difficult to climb out of. So creating a special fund to cope with emergencies is a sensible thing to do.

The recent $93 million lottery draw got me thinking if buying lottery tickets is the best way to a better lifestyle.

Do you buy a lottery ticket every week - or more often - in the hopes of winning the big one? Do you constantly dream about what you will do when you finally win the lottery? Take a trip, buy a new car or house, and help out the kids? Why leave your finances in the hand of Lady Luck who is known to be so fickle?

While we know that someone has to win, the chances of winning a significant amount of cash in a lottery is really poor. In fact, experts tell us we have less than three one-hundredths of one percent chance of winning a lottery.

Instead, tot up the amount of money you spend each week on lottery tickets; it might surprise you just how much it is. Especially if you multiply that weekly amount by 52 to see how much you spend in a year. Now multiply your yearly amount by 5 to see how much you'll have spent in five years.

Add about 8% to that total to see how much you would have got if you'd saved that amount in a term deposit instead of spending it. Of course it won't be quite accurate, because you would have to start off with just your first little weekly total, but savings mount up over time. And you don't have to depend on Lady Luck for your increase.