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Inflation, Your Business and How to Deal with the Upcoming Pressure4 July 2022
The national minimum wage is set to increase by 5.2%, and 4.6% for award minimums starting 1 July 2022. This increases the national minimum wage to $21.38/hour or $812.60/week.
The Fair Work Commission (FWC) has made this decision to support low-paid workers who are heavily burdened by the growing costs of living. The increase in the national minimum wage is sought to support 2.7 million workers amidst inflation, rising interest rates and petrol prices.
Can your cash flow keep up?
Whilst this decision is good news for workers, the burden is put upon employers, especially with the increase in input costs, as well as the rise in superannuation guarantee (SG) rates to 10.5%.
To ensure your cash flow is stable to support the minimum wage hike and the increasing input prices, here are some things you might want to consider.
Increase your prices
If you think it’s time to increase your prices (especially with the growing input costs), do it now. But ensure that you don’t surprise your clients with big price hikes, make sure you set a price you think your market can handle and communicate the increase to them clearly.
Reduce your expenses
Review your cash outflows and cut your expenses where you can. Tightening your expenses is helpful so you can allocate your cash to other things to run your business.
If you have questions or concerns about the new minimum wage, reach out to our team. We’re here to help.