Question 1

How do I calculate my net worth in Australia?

Accepted Answer

Your net worth is everything you own minus everything you owe. Assets include cash savings, investment portfolios (ETFs, shares, crypto), superannuation, property equity, and vested RSUs. Liabilities include your mortgage balance, personal loans, HECS/HELP debt, and credit card balances. The number itself matters less than tracking it consistently — monthly snapshots reveal whether your financial decisions are moving the needle. Grove aggregates all of this automatically and takes a daily snapshot so your net worth updates without a spreadsheet.

Question 2

Should I include superannuation in my net worth calculation?

Accepted Answer

Yes — super is typically one of your largest assets, and excluding it gives a distorted picture of your wealth. The catch is illiquidity: super is inaccessible until you meet a condition of release (generally age 60), so many people track it separately as "retirement wealth" rather than grouping it with investable assets. For FIRE planning especially, knowing your super balance alongside your outside-super portfolio is critical — both compound in parallel but become accessible at different times. Grove tracks both and lets you see your complete picture in one view.

Question 3

Why should I track my net worth regularly?

Accepted Answer

Most Australians have a rough sense of what's in their bank account but no clear view of whether their total financial position is improving. Regular net worth tracking creates clarity: you notice when lifestyle inflation erodes savings gains, when your investment portfolio surpasses your home equity, or when debt paydown is ahead of schedule. The psychological effect of watching a single number trend upward is also a genuine motivation tool. Grove takes a daily snapshot automatically, so you get the insight without maintaining a spreadsheet.

Question 4

What are the income tax rates in Australia for FY 2025-26?

Accepted Answer

For the 2025–26 financial year: $0–$18,200 at 0% (tax-free threshold); $18,201–$45,000 at 16%; $45,001–$135,000 at 30%; $135,001–$190,000 at 37%; $190,001+ at 45%. Most taxpayers also pay the 2% Medicare levy on top. The 16% rate is legislated to drop to 15% from 1 July 2026. Grove's PAYG calculator applies these brackets automatically — including Medicare — so you can see your estimated take-home pay across different income scenarios.

Question 5

How does the Medicare levy work in Australia?

Accepted Answer

The Medicare levy is an additional 2% charged on top of your income tax, funding Australia's public health system. Most taxpayers pay it in full, but low-income earners are exempt below approximately $26,000 in taxable income. Higher-income earners without private hospital cover may also face the Medicare Levy Surcharge (MLS) — an additional 1% to 1.5%. Holding an eligible private hospital policy eliminates the surcharge entirely.

Question 6

How are RSUs taxed in Australia?

Accepted Answer

RSUs are taxed as ordinary income in the year they vest — the market value of the shares on vest date is added to your taxable income at your marginal rate. A large vest can push you into a higher bracket for that financial year. After vesting, any gain between the vest price and your eventual sale price is a capital gain, eligible for the 50% CGT discount if you hold the shares for at least 12 months from vest date. Grove's RSU module tracks your vesting schedule, models the income tax impact at vest, and applies the correct CGT cost base when you sell.

Question 7

How does capital gains tax work in Australia when I sell shares or ETFs?

Accepted Answer

When you sell shares, ETFs, or crypto for more than you paid, the profit is a capital gain added to your taxable income and taxed at your marginal rate. Your cost base is the purchase price plus transaction costs like brokerage. If you hold the asset for more than 12 months, the 50% CGT discount applies — halving the taxable gain. At a 30% marginal rate, a $20,000 gain becomes a $3,000 tax bill rather than $6,000. Grove tracks every parcel, calculates unrealised gains in real time, and flags which holdings qualify for the discount.

Question 8

What is FIFO parcel matching for CGT in Australia?

Accepted Answer

When you've bought the same asset multiple times and then sell some units, FIFO — First In, First Out — means your earliest-purchased parcels are treated as sold first. Your oldest parcels are most likely to carry the largest unrealised gains, and their CGT discount eligibility depends on when you originally bought them. Maintaining a parcel-by-parcel ledger is essential for correct CGT reporting and becomes complex fast if you've made many purchases via dollar-cost averaging. Grove maintains a full FIFO parcel ledger for every holding automatically.

Question 9

Can I use capital losses to reduce my CGT bill in Australia?

Accepted Answer

Yes — capital losses directly offset capital gains in the same financial year, and any excess carries forward indefinitely. Capital losses cannot offset ordinary income, only capital gains. Selling underperforming positions strategically before 30 June to offset profitable sales in the same year — tax-loss harvesting — is a legitimate and widely used approach. Grove tracks unrealised gains and losses across your portfolio so you can see your net CGT position at any point during the year.

Question 10

How does CGT work when I sell an investment property in Australia?

Accepted Answer

The capital gain is the sale price minus your cost base — which includes the original purchase price, stamp duty, legal fees, and capital improvements. The gain is taxed at your marginal rate, but with the 50% CGT discount if held 12+ months. Note: Division 43 capital works deductions you've claimed during ownership reduce your cost base dollar-for-dollar, increasing the eventual taxable gain. Timing a sale to a lower-income year can significantly reduce your CGT liability.

Question 11

What is the 6-year CGT exemption rule for property in Australia?

Accepted Answer

If you move out of your principal place of residence and rent it out, you can continue treating it as your main residence for CGT purposes for up to six years — meaning no CGT if you sell within that window, as long as you don't declare another property as your main residence. The six-year clock resets each time you move back in. If the property sits vacant (not rented), the absence can be indefinite — the six-year limit only applies when the property produces income. This rule can save tens of thousands in CGT on an appreciated property.

Question 12

What is negative gearing and does it actually save money?

Accepted Answer

Negative gearing is when your rental income is less than your deductible property expenses — mortgage interest, rates, management fees, depreciation — creating a net rental loss that reduces your total taxable income. At a 37% marginal rate, a $12,000 annual loss saves $4,440 in tax, but you're still out of pocket $7,560 in cash. The strategy only makes sense if capital growth more than compensates for the cash shortfall. Negative gearing remains fully available in FY 2025-26 with no legislative changes.

Question 13

What are the superannuation contribution caps for FY 2025-26?

Accepted Answer

Concessional (before-tax) cap: $30,000 — includes your employer's SG contributions (now 12% from 1 July 2025) plus salary sacrifice and personal deductible contributions. Non-concessional (after-tax) cap: $120,000. The bring-forward rule allows up to $360,000 in non-concessional contributions over three years if your Total Super Balance is below $1.76 million. The Transfer Balance Cap — the limit on moving funds into tax-free pension phase — increased to $2 million on 1 July 2025.

Question 14

What is the difference between concessional and non-concessional super contributions?

Accepted Answer

Concessional contributions come from pre-tax income — employer SG, salary sacrifice, or personal deductible contributions — and are taxed at 15% inside super, a significant discount for most working Australians. Non-concessional contributions are made from after-tax money and attract no additional tax inside the fund. The right balance depends on your marginal rate, proximity to the caps, and your long-term strategy. Grove tracks your super balance as part of your net worth so you can see how it's growing relative to your other assets.

Question 15

What are catch-up concessional super contributions and who can use them?

Accepted Answer

If your Total Super Balance was below $500,000 on 30 June of the previous financial year, you can use unused concessional cap amounts carried forward from the prior five years. For FY 2025-26, unused cap from FY 2020-21 onwards is available. This is especially valuable after a career break, variable-income years, or years you didn't maximise contributions. The maximum theoretical catch-up is approximately $167,500. Check your balance via myGov → ATO online services → Super → Carry-forward concessional contributions.

Question 16

How does HECS/HELP repayment work in FY 2025-26?

Accepted Answer

FY 2025-26 restructured the system significantly. The minimum threshold increased to $67,000 (up from $54,435). Repayments now work incrementally: 15 cents per dollar on income between $67,001–$125,000; $8,700 plus 17 cents per dollar on $125,001–$179,285; 10% of total income above $179,286. All outstanding balances received a one-off 20% reduction on 1 June 2025. Repayments reduce your debt balance but are not tax-deductible. Multiple income sources can push your repayment income higher than your salary alone.

Question 17

Should I include my HECS debt in my net worth calculation?

Accepted Answer

Technically yes — HECS/HELP is a real liability and including it gives a more accurate financial picture. That said, HECS behaves differently from commercial debt: it's indexed to CPI/WPI (not a commercial rate), is unenforceable below the income threshold, doesn't appear on credit checks, and is extinguished at death. For FIRE planning, include it as a liability — the compulsory repayment obligation reduces annual cash flow until the debt is cleared. Grove lets you add HECS as a liability so your net worth reflects the full picture.

Question 18

How do I calculate my FIRE number in Australia?

Accepted Answer

Your FIRE number is your estimated annual living expenses multiplied by 25 — derived from the 4% safe withdrawal rate. $80,000 in annual expenses gives a $2,000,000 FIRE number. Many Australian FIRE practitioners use 3.5% (a 28.5x multiplier) as a more conservative rate, given longer retirement horizons and sequence-of-returns risk. Super complicates this: it compounds tax-advantaged but is inaccessible until preservation age (currently 60). Grove's FIRE calculator separates inside-super and outside-super wealth so your projected retirement date reflects what you can actually access and when.

Question 19

What is Coast FIRE and how does it work?

Accepted Answer

Coast FIRE is the point at which you have enough invested that, even without any further contributions, compound growth will carry your portfolio to your full FIRE number by a target retirement age. You only need to earn enough to cover current living expenses — not accumulate aggressively. For Australians, employer SG contributions (12%) continue regardless, giving your super component a Coast trajectory almost automatically. Grove models Coast FIRE using your actual portfolio balances rather than a generic assumption.

Question 20

Is the 4% rule still valid for Australians planning early retirement?

Accepted Answer

The 4% rule was derived from US market data over a 30-year retirement horizon. For Australians potentially facing 40+ year retirements, 3.5% is generally the more prudent withdrawal rate. Super changes the equation meaningfully — drawdowns from super in pension phase are tax-free from age 60, improving spending power compared to drawing from a taxable brokerage portfolio. The appropriate rate depends on your asset allocation, tax treatment of each account type, and how flexible your spending can be through a market downturn.

Question 21

How do franking credits work on Australian shares and ETFs?

Accepted Answer

Franking credits represent the 30% corporate tax already paid before dividends are distributed. Shareholders include both the dividend and the grossed-up franking credit in taxable income, then receive a tax offset equal to the credit. If your marginal rate is below 30%, the excess is refunded as cash — making fully franked dividends especially valuable for retirees and lower-income investors. For investors in the 30%+ brackets, franking credits simply offset tax otherwise owed on the dividend income. Grove tracks dividend and franking credit totals across your holdings.

Question 22

What is dollar-cost averaging and does it work for Australian investors?

Accepted Answer

Dollar-cost averaging (DCA) means investing a fixed amount at regular intervals — fortnightly or monthly — rather than timing the market with a lump sum. You buy more units when prices are low and fewer when prices are high, keeping your average cost per unit below the simple average price. While lump-sum investing outperforms DCA on average in trending markets, DCA's real value is behavioural: it removes the paralysis of picking an entry point and builds consistent investing as a habit. For Australians buying ASX ETFs, automating a monthly purchase is one of the highest-impact financial habits to build.

Question 23

Does the 50/30/20 budget rule work for Australians?

Accepted Answer

The 50/30/20 rule — 50% on needs, 30% on wants, 20% on savings — is a useful starting framework, but it was designed with US cost structures in mind. In Sydney or Melbourne, housing alone can consume 35–45% of take-home pay, making a 60/20/20 or 70/15/15 split more realistic. The specific percentages matter less than the underlying principle: your savings rate is the most important lever for long-term wealth. Grove's budgeting module lets you set custom category targets that reflect your actual cost of living.

Question 24

How much should I have in an emergency fund in Australia?

Accepted Answer

Three to six months of essential living expenses in a liquid, accessible account — enough to cover job loss, a major medical expense, or unexpected repairs without touching your investments. For Australians with a mortgage, a well-funded offset account works as an excellent emergency buffer: it reduces interest while remaining fully accessible, unlike a redraw facility which lenders can restrict or freeze. Building a three-month buffer before investing aggressively is one of the most universally applicable pieces of personal finance advice.

Question 25

Why does tracking my spending actually improve my finances?

Accepted Answer

Consistently recording where money goes creates awareness that changes behaviour — behavioural economists call this the observation effect. Most people underestimate discretionary spending by 20–40%, particularly dining, subscriptions, and convenience purchases. Tracking surfaces actionable patterns: seasonal spikes in energy costs, forgotten subscriptions, or gradual spend creep. Grove connects actual spending to your net worth trajectory, so you can see how reducing discretionary spend by $500/month accelerates your FIRE date or savings milestone.

Your questions, plain answers.

Net Worth & Tracking

Income Tax

Capital Gains Tax

Property

Superannuation

HECS / HELP

FIRE & Financial Independence

Wealth Building

Budgeting

Ready to see your real financial picture?

Your questions, plain answers.

📊Net Worth & Tracking

💰Income Tax

📈Capital Gains Tax

🏠Property

🏦Superannuation

🎓HECS / HELP

🔥FIRE & Financial Independence

🌱Wealth Building

💳Budgeting