Personal Finance Guide for Settling in Australia
Household budget, credit score, savings and investing, and superannuation, presented from a settler's perspective for managing money in Australia.
1. Budgeting
Rent, food and transport take up a different share of income in Australia than you may be used to. Track your spending for the first six months, then set budget ratios that fit you.
The 50/30/20 rule
Recommended by Moneysmart (ASIC). Allocate after-tax income as follows.
- Needs (50%) — rent, groceries, utilities, transport, insurance.
- Wants (30%) — dining out, travel, hobbies, subscriptions.
- Savings, investing, debt (20%) — emergency fund, extra super, student debt.
Budgeting apps
Major bank apps such as CommBank, ANZ, and Up Bank provide spending insights by category. Standalone apps like Pocketbook and MoneyBrilliant are also popular.
2. Credit score
In Australia your credit score affects rental applications, home loans and credit cards. History from your home country does not transfer, so you build it from scratch.
Credit bureaus
Equifax, Experian, and illion each maintain a score. Scores can vary across bureaus, so check yours regularly using the free annual report.
How to build credit
- Sign up for a mobile postpaid plan in your name — the lowest barrier to credit history.
- Register electricity, gas, and internet bills in your name and pay by direct debit to avoid arrears.
- Use a low-limit credit card and pay it off in full each month — keep usage below 30% of the limit.
3. Savings and investing
Using savings accounts
- Emergency fund — keep three to six months of living costs in a high-interest savings account.
- Bonus interest conditions — meeting minimum monthly deposits and withdrawal limits unlocks higher rates.
- Term deposit — higher rate for fixed terms, but breaking early forfeits interest.
Investment options
There is no single right answer. Diversify according to your risk tolerance and timeline.
4. Super and pension
Australian superannuation builds retirement savings from compulsory employer contributions plus your own. Non-residents can use it too, and there is a refund option (DASP) when you leave Australia permanently.
- Employer contribution: 12% (from 1 July 2025 — the final legislated rate).
- Salary sacrifice — pre-tax extra contributions reduce taxable income.
- Compare fees — Industry Super Funds (lower fees) versus Retail Super Funds (more options).
Advanced Guide — From Protecting Your Assets to Family Financial Planning
Once your accounts are open and your budget is running smoothly, the next stage is protecting what you've built and planning for tax, debt and life's turning points. Here are the financial topics you'll actually run into from your second year in Australia onwards.
Asset Protection & Insurance
Building vs Contents Insurance — Renting vs Owning
Building insurance, which covers the structure itself, is the owner's responsibility — and lenders often require it as a condition of a home loan. If you're renting, you don't need building insurance at all; you only need to consider contents insurance to cover your own belongings. The most common misconception is that your landlord's landlord insurance will cover your possessions — it won't.
Working Out Your Contents Cover — the Underinsurance Trap
Calculate your sum insured on a new-for-old replacement basis — what it would cost to buy all your appliances, furniture and clothing brand new. Lowball the figure and you'll only be partially compensated when something goes wrong; that's underinsurance. Use the calculators on ASIC's Moneysmart (moneysmart.gov.au), and always check the Product Disclosure Statement (PDS) to see whether flood cover is included.
Income Protection & Default Cover in Super
Income protection insurance, which replaces part of your income when illness or injury stops you working, often comes bundled by default with death and TPD (total and permanent disability) cover inside many superannuation funds. Check your super fund's member portal first for the cover amount, waiting period and benefit period, then take out separate cover only for the shortfall — that's how you avoid paying for the same thing twice.