Supporting the Local Economy
Spending your government stimulous to make a difference in your communityOpinion is still divided on whether Kevin Rudd's $42 Billion dollar stimulus package achieved its objective of jump boosting the economy.

Although tempting (and perhaps wiser) to put the money in savings or pay off debts, the government is hoping that Australians will spend the money with the prevailing logic being that - spending creates income and jobs, encourages business investment and, in the long run, creates additional tax revenue for governments.

One of the aims of the package is to increase the cash spent on Australian products, Australian businesses and in Australian communities. "Buy Local" is the catch cry.

Small businesses are particularly vulnerable to the impacts of the economic downturn. As the backbone of the Australian economy - contributing 30% to the wealth of the nation it is important that we keep supporting local business which in turn supports the community. With that in mind, here are some ways that you can spend (if you haven't already!) your stimulus money while supporting the local economy:

1. Book a holiday within Australia - This is one of the best ways to support the Australian economy. You will be supporting a number of businesses, for example, for car trips this will include supporting petrol stations, pubs/restaurants, hotel/motel s etc. Taking a holiday is also being encouraged by many workplaces to assist with managing staff costs during the economic slow down.

2. Dining out at local restaurants/pubs. If you want to do something simple to help the economy, go to a restaurant / pub and have a local meal knowing that the money will send ripples through the economy from the owner/manager to the staff to the farmer/s that produced the food. Going out is also a good excuse to let your hair down and have some fun during the recession.

3. Home renovations. By undertaking something as simple as some basic redecoration work at home you help create work for local tradespeople and businesses plus increase the intrinsic value of what is a capital gains tax-free asset. Making the work a family project is also a good way to get everyone feeling involved at home.

4. Shopping at markets. Shopping at markets is a great way not only to find a bargain and support the local community and local businesses, but it is also a great opportunity to see first hand the range of local produce/products that you can use to replace the generic items you have been used to buying. Visiting your local grocer for example will mean you're reducing transport costs and supporting Australian farmers.

5. Donate to a Non-profit organisation. When the economy is hurting, non-profit charities lose donations and are therefore unable to offer the breadth of usual services to the disadvantaged. If you really don't need the windfall, a donation can make sense - you'll be entitled to a tax deduction and the charity and the community will benefit from your kindness.

6. Superannuation co-contribution. If you are still working, have qualifying income and are under the age of 71 at the end of June 2009, then the Government Co-Contribution Scheme may provide the opportunity to turn your $900 into a savings benefit of up to $2,250, completely tax-free. The only catch of course, is that the money has to pass through the superannuation system - meaning it generally cannot be accessed until investors' preservation age or after retirement. However, taking advantage of the Government Co-Contribution Scheme and the super vehicle will help you to accelerate your savings and mean you have more to spend at a later date.

7. Children's education. If you have primary school aged kids you should take advantage of the 50% rebate available for up to $750 spent on textbooks, computers and the like.

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Contributing Writer Alex Brown

Contributing Writer Alex Brown

Alex is a holiday writer, with a love of languages and a background in economics. Interests in travel, linguistics, fashion news and celebrity trivia.

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