Managing Your Finances on FIFO Income

FIFO wages can be life-changing — or they can disappear faster than you'd think. We've seen workers earn $200K+ per year and have nothing to show for it, while others on $120K have paid off houses and built serious wealth.

The difference isn't the salary. It's what you do with it.

The FIFO Money Trap

High income creates its own problems. Common traps that catch FIFO workers:

• Lifestyle inflation — Upgrading everything because "you can afford it"
• Boredom spending on R&R — Blowing cash during time off
• Keeping up with workmates — Boats, jet skis, side-by-sides
• Guilt spending — Buying things for family to compensate for absence
• No budget — Money comes in, money goes out, where did it go?

Building a FIFO Budget

FIFO income is different from regular employment. You need a budget that accounts for:

The Basics

• Fixed expenses at home — Mortgage/rent, utilities, insurance (these continue whether you're home or not)
• Variable expenses on R&R — Food, entertainment, activities with family
• Minimal expenses on site — Most is covered, but gym memberships, streaming, phone plans continue

Sample Budget Framework (on $150K)

Adjust these based on your actual salary, family situation, and goals. The point is to be intentional about where every dollar goes.

The First Paycheque Rule

Before you spend a cent of your FIFO income:

1. Set up separate accounts — Bills, savings, spending
2. Automate transfers on payday — Savings and bills come out first
3. What's left is spending money — Not the other way around

If you wait to "save what's left," there won't be anything left.

Smart FIFO Money Moves

1. Pay Down Debt Fast

High income + low living expenses on site = perfect debt-killing conditions.

• Priority order — Credit cards first, then car loans, then mortgage
• Extra repayments — Put every spare dollar into highest-interest debt
• Goal — Be debt-free (except mortgage) within 2-3 years of starting FIFO

2. Build Emergency Fund

Mining is cyclical. Downturns happen. Injuries happen. Have 3-6 months of expenses saved.

3. Max Superannuation

• Salary sacrifice — Additional super contributions reduce taxable income
• Concessional cap — $30,000/year total (including employer contributions)
• Tax benefit — Super is taxed at 15% vs your marginal rate (often 37%+)

4. Invest Outside Super

Super is locked until 60. Consider building wealth you can access earlier:

• Property — Many FIFO workers invest in rental properties
• Shares/ETFs — Low-cost index funds for long-term growth
• Business — Some build businesses to exit mining into

5. Get Proper Insurance

Your income is your biggest asset. Protect it:

• Income protection — Replaces income if injured or sick
• Life insurance — Essential if you have dependents
• TPD (Total Permanent Disability) — Lump sum if you can't work again

Tax Strategies for FIFO Workers

Common Deductions

• Travel to/from airport — If not reimbursed
• Protective equipment — Boots, safety glasses, sunscreen
• Tools — If you supply your own
• Union fees — Fully deductible
• Self-education — Courses related to your work
• Income protection premiums — If paid personally

What You Can't Claim

• Travel from home to your usual airport (that's commuting)
• Clothing that's not protective (regular work clothes)
• Meals on site (they're provided)
• General fitness expenses (unless specifically required)

R&R Week Money Management

Time off is when most FIFO money disappears. Smart approaches:

Budget Your Break

• Set a weekly R&R spending limit before you start
• Use a separate "fun money" account with that limit
• When it's gone, it's gone

Free/Low-Cost Activities

• Beach days, bush walks, fishing (if you already have gear)
• Quality time with family doesn't require spending
• Home projects and hobbies

Avoid Boredom Spending

• Plan your R&R in advance — what will you actually do?
• Stay busy with activities, not just shopping
• Limit pub/club visits (where money evaporates fastest)

Big Purchases: Think First

Before buying that boat, caravan, or new car:

The 48-Hour Rule

For any purchase over $500, wait 48 hours before buying. Impulse fades, rational thought returns.

Questions to Ask

• Will I use this enough to justify the cost?
• What's the ongoing cost? (Storage, maintenance, insurance)
• Am I buying this for me, or to impress others?
• What else could this money do? (Pay off mortgage 2 years early?)

Planning Your Exit

FIFO isn't forever. Build toward an exit strategy:

• Define your "enough" number — What do you need to stop FIFO?
• Track progress — Are you getting closer each year?
• Build alternatives — Skills, investments, or business to transition into
• Don't golden handcuff yourself — A lifestyle requiring $200K/year keeps you trapped