How to manage your FIFO finances
With such a strong mining presence in Queensland, it stands to reason that a lot of people in the state are working on a fly in fly out (FIFO) schedule.According to a Queensland Treasury report from June 2013, at this point there were 22,900 non-resident workers on-shift in the Bowen Basin region.
And while there has been something of a downturn in the resources sector, there are still "hundreds" of non-resident workers in Bowen and Collinsville, according to the report. So clearly, there's still a strong FIFO workforce in the area.
For many people, this could be a new style of working, and one that requires a certain level of financial restraint. Due to the irregular hours and high income, it can be difficult for mining workers to manage their money effectively.
So how do you manage FIFO finances?
Get on top of debts
If you have a credit card with significant repayments to be made, or perhaps a car loan that you're behind on, these should be among your first priorities when you earn a FIFO wage. Refinancing debts into one line of credit at a low interest rate is one way of simplifying the payments, and managing these will improve your credit score if you want to buy a property through a mortgage broker down the line.
You're likely earning a lot of money – tackle the debts first to put yourself in a positive position.
Make the most of the tax benefits
Do you know about the tax benefits of being a FIFO worker? The Australian Taxation Office notes that usually, you need to own a home that you use and enjoy to get concessional tax treatment, which means you can get fringe tax benefits. If you're working remotely like many do in the Bowen Basin and Whitsundays, you can get these tax benefits much more easily than other Australians who have to own a property for their own use.
On top of this, the 12 month limit on the concessional treatment doesn't apply to FIFO workers. By making sure you're aware of these sorts of benefits, and incorporating this into your financial planning, you might be able to set yourself up nicely for the long term.
Working on a FIFO basis can lend itself to heavy spending in the periods where you aren't working. But by treating your finances with a bit more care and by working the system, it's possible to turn your income into a very lucrative nest egg for investment later in life.