The 2025 financial year, which finishes on 30 June 2025, is nearly over. At this time of year, it's a good idea to consider whether there are moves we can make to improve our longer-term financial situation.
The great thing about finances is that our decisions can deliver significant improvements in the long term, thanks to the power of compounding.
Investors have a month and a half before the end of FY25. There are plenty of ASX shares that also have a financial year at the end of June 2025, so a lot of decisions may be happening around the country in the next few weeks.
For me, there are three areas I'm thinking about.
Buy ASX shares
The last few months have opened up a number of ASX share opportunities due to the sell-off following US tariff announcements.
Some of the investments I made included MFF Capital Investments Ltd (ASX: MFF), Pinnacle Investment Management Group Ltd (ASX: PNI), Siteminder Ltd (ASX: SDR), Pro Medicus Ltd (ASX: PME), and Elders Ltd (ASX: ELD).
I'm always on the lookout for opportunities, including in the next few weeks before the end of the financial year.
I think owning ASX shares could make the biggest difference for my long-term finances.
As an example, if I invested $5,000 in ASX shares and they returned an average of 10% per annum for the next 30 years, according to Moneysmart's compound interest calculator, they would become worth $87,247.
Consider tax deductions
I'm actively thinking about whether there are any tax-deductible purchases that would be worth making in the next few weeks.
If I need the item, it's a good time to make the purchase because there is less time between spending the money and doing the tax return (and making the claim). The benefit of the deduction comes sooner.
Accountants/tax agents are the best people to ask about what deductions could be made in the next few weeks, depending on the industry someone works in. There are also investment-related tax deductions that people could make, such as investment subscriptions or interest paid on borrowed money used to buy income-producing shares.
Ensure excellent savings account
The RBA has already cut interest rates once this year, and there are expectations that more cuts could come in the coming months – one could happen before the end of the financial year.
With how much interest rates could change, I think it's important to be aware of which savings accounts are offering good interest rates. If they're not offering an attractive rate, it could be worth considering another financial institution or even ASX dividend shares for stronger passive income.
While I prefer to have my money invested, I'll always have a bit in a savings account, so it's a good idea for that money to be as productive as possible.
