Australia spends more than it earns – this is why we have a ‘budget deficit’. Recent governments have danced around the issue of reforming our expenses or increasing our taxes, but whichever way you cut it, a significant chunk of our budget goes to healthcare and aged expenses.

Here is the ABC’s estimate of our expenses for the 2015/2016 budget year. From the $434bn budget, $61bn goes to aged assistance, $38bn to families, $12bn to the unemployed, $40bn on medical and pharmaceutical benefits, and $16bn on public hospitals. These are among the single biggest items on the budget, and they are growing – in several cases faster than revenues are.

It seems safe to say there will be cuts or changes to the way these funds are allocated (or an increase in taxes), especially in the areas of healthcare and pensions. Once you’re retired, there’s very little you can do about it asides from going back to work – so the sooner you get your financial house in order, the better.

It’s not all that bad…surely?

I can recall being told from a very young age that I would be unable to rely on the pension when I was older, as it would no longer be available. I have my doubts whether this will happen in my generation, but with an ageing population and rising life expectancies, somewhere along the line there has to be a reduction in expenses or an increase in funding for aged pensions and health care.

One of the benefits of a benevolent government is that changes are incremental, and intentionally designed not to upset the apple cart too soon. The downside is that individuals could reasonably expect a gradual erosion of some services or increase in their burdens – such as by the recent funding cuts to diagnostic imaging services.

Shares for everyone!

Whatever your stage of life, there’s a company whose investment strategy will suit you. Younger investors can look to take on a little more risk with a portfolio of  growing businesses like Nearmap Ltd (ASX: NEA). Or Speedcast International Ltd (ASX: SDA), an emerging satellite services provider that was recently elevated into the S&P/ASX 200 (INDEXASX: ^AXJO) (ASX: XJO) index.

Other opportunities include very high quality businesses like Cochlear Limited (ASX: COH) and Sirtex Medical Limited (ASX: SRX), both of whom develop their own proprietary products and deliver them to markets with great demand characteristics – the hearing-impaired and the cancer-stricken. Both businesses serve just a tiny fraction of the total patients who could benefit from their services, giving them plenty of opportunity for growth.

It starts with YOU

Almost half of the Australian population lives pay-cheque to pay-cheque. One in five individuals earning more than $200,000 per year lives this way. It’s never too late, and you’re never too old to start organising your finances.

That’s where The Motley Fool comes in. Readers get instant access to loads of free content, including our 13 Steps to Financial Freedom, as well as insightful and timely articles on the free website. For as low as $199 a year, investors also get access to The Fool’s full catalogue of high-income stock picks, every ‘Buy’, ‘Sell’, and ‘Hold’, going right back to the very first recommendation.

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Motley Fool contributor Sean O'Neill owns shares of Nearmap Ltd. and Sirtex Medical Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.