You are in a remote location for sometimes up to a month, thousands of kilometres away from home and are paid a fat six-figure salary. That #fifolife includes making an appearance at the airport in your hi-vis and heading back to site like clockwork. Ah, the dream, right? But then why do most FIFO workers have no more than $10k in their bank account? Even though just about everything is covered for onsite?
FIFOs often start with the idea of doing it short-term. Their primary objective was to make a large amount of money for a few years, in order to pay down the mortgage or set themselves up. When speaking to FIFO workers, we have found that a lot of them are years down the road and are actually no closer to where they want to be than they were when they first set off to site.
We have found that FIFO workers are often at the mercy of spending more and giving in to those cravings as they see money in their bank grow past a certain “comfort buffer”. So how does one get out of the FIFO financial mindset, and get on track?
Make a budget and stick to it
The good old B-word. Yes, you’ve heard it before – BUDGET! Creating a budget can be incredibly helpful when accurately identifying how you are spending your money. This will then help you implement some discipline and get that financial strategy underway.
Keep a financial log book
Record all the money that comes in and out of your bank account. This should play hand in hand with your budget to ensure that you are sticking to it and monitor expenses. Being on top of a log-book will enforce structure and there are plenty of apps (free and paid) that can help you make this easy.
Remember your reasons and goals
Remember why you signed up for this life in the first place. You wanted to save big to be able to make big purchase decisions – right? Stick to the plan then! Don’t get side tracked with a fancy car or a star-studded holiday. Keep the eye on the prize.
Don’t JUST rely on your high-end wages to get wealthy
Don’t get us wrong, a healthy wage is important. It puts a roof over your head and gets food on the table. But you won’t get ahead of the curve by mindlessly spending those big bucks with no streamlined direction. It is all well and good to be making $200k-$300k but if you keep spending your money on fancy toys or going on a monthly trip to exotic places (Bali, Europe, America, sound familiar..?), you certainly won’t be seeing much in your bank account.
Income Protection is a must
Who would pay for your mortgage or other living expenses if you physically couldn’t work? What if things hit the fan and you needed months and months off to get a shoulder or a knee surgery from what you got up to on R&R? If your lifestyle is conditional on your income, this is not an option.
It is time for that financial health check. Speak to us, we can help you break out of that FIFO mindset.
Where is my money going? What is my future financial goal? These are the sort of questions that you need to reflect on and take to a financial planner who will readily walk you through this challenge.
When working with a competent Financial Planner who specialises in helping FIFOs, a proper discussion on an exit strategy is devised and actively put into place. We identify what your timeline should and would look like for you and then we evaluate methods on how to efficiently and practically bring this strategy to life.
Kora Drage is an Authorised Representative of Financial Wisdom Limited ABN 70 006 646 108, AFSL 231138. The information contained in this article may contain general advice. It does not take into account your financial circumstances and objectives. You should consider talking to a financial adviser and read the relevant Product Disclosure Statement (PDS) before making a financial decision. Any views and opinions provided in this article may not reflect the views and opinions of Financial Wisdom Limited.