DESTRESS YOU MONEY LIFE

CORONAVIRUS HAS HIT TOO MANY OF US WITH A FINANCIAL CURVEBALL

BUT BY GETTING REAL WITH YOUR MONEY NOW IT COULD BE THE OPPORTUNITY TO SET YOURSELF UP FOR THE FUTURE

By PETE LORD & CAROLINA FLORES

Tens of thousands have lost their jobs, others their work hours reduced. And, by the looks of it, the worst is yet to come. The pandemic has affected Australian households in numerous ways but one of the biggest effects has been to personal and family finances. If you are finding yourself in a tight money spot, know that there are things you can do to pull yourself out of it. The crisis shall pass, but how you treat your money from here on will really shape your future.

Here at Best Financial Friend, these are rules of thumb we share with clients who are stressing out over their money situation:

DO NOT PANIC! Nothing positive ever came out of a rushed decision. Understandably, when our income seems threatened or the economic outlook feels very uncertain, we might feel tempted to kneejerk and do things like to sell valuable belongings to bring in some cash, to pull savings out of the bank or shares out of the stock market. Our advice here is to take a deep breath and reassess when you are calmer. Think, what advice would you give to a friend if they were in this situation? Trying to approach things as rationally as possible is your best answer to crisis management.

PULL YOUR HEAD OUT OF THE SAND At BFF we believe that the first step to getting a grip on your finances is to get real, but also be kind to yourself. We know that sometimes looking at our bank statements can get emotional, especially if you are stressed about your current circumstances. But starting your journey towards a healthier financial position is to understand where you are now. If you are not able to cover some of your major financial commitments you can absolutely call your providers and work with them on a payment plan. Alternatively, there are financial counsellors – such as at The National Debt Helpline, ndh.org.au - you could go to for help. They are free and their advice can be life (and money) saving!

You’d be surprised to find how empowering it is to get real with yourself; it’s like all of a sudden you get control of your life back! One thing we can assure you, doing something about it is better than sticking your head in the sand and hoping your bills disappear.

X-RAY YOUR FINANCES De-stressing your money life is about understanding your money personality, values and spending habits. Taking an X-ray of your finances means grabbing three months of your bank statements and going through each line and highlighting those that didn’t bring as much value into your life. The disconnect between our values and our spending habits shine a light on some areas where we might be spending some money without any real purpose. THESE QUICK STEPS WILL HELP YOU START YOUR X-RAY:

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3. Go through each line of your last bank statement and highlight with one colour the charges that are vital (and non-negotiable) for you to live, like rent and bills.

Highlight with a different colour those charges that brought you the most joy, like that dinner out with your friends or that much-needed bag you had your eye on for a long time.

Highlight with a different colour those charges you could have gone without, like that online purchase that you never returned because you felt too lazy to do it.

AVOID THE CREDIT CARD TRAP One big trap many of us have fallen into is the credit card carousel. It is so easy to “treat ourselves” because we are going through an emotionally tough time and well, some online shopping might just help a little. Unfortunately, the psychology behind a credit card (or the cashless payments, tap tap tap) is that the emotional reward is disconnected from the emotional “pain of payment”. In the moment it feels like free money but down the track can be a real lifestyle creeper. Don’t get us wrong, we are not against credit cards. In fact, if you are in a really tough spot and need to use your credit card to buy the basics like your groceries, it’s common sense. But if you fall into the “I’ll just pay the minimum this month and buy myself a cute top because I’m feeling sad today” zone you might want to reconsider. Credit cards still need to be paid off, and if you don’t pay them in full by the end of the month you’ll be paying extra in interest and fees.

It’s been said that in times of crisis lies so Worth $299 each, three Thrive readers have the • Complete personal budget

much opportunity for those who look for it. Try reframing your situation and look for places to bring in alternative income.

Start by thinking about current expenses where you could be saving some money: for instance, refinancing your mortgage, renegotiating your rent, renegotiating your phone plan … you get it.

Then look for other places where you can utilise your extra-curricular abilities. Could you be selling any crafts online? Or are their services you could hire out? Think of areas in high demand now, especially in your local community. Email your entry to bff@bestfinancialfriend.co

Remember, times like this affect everyone in one way or another, positively or negatively. We are all in this together and the crisis will pass.

The question is: how will you want to come out of it? If you’ve ever had the intention to get on top of your cash flow, this is it. If it feels too daunting to do it by yourself, why not see a financial planner. They will help you get your money and spending habits in order so that next time a crisis strikes you can buy yourself some certainty with savings

Give Away THRIVE HAS 3 BFF PERSONAL MONEY-TRAINING SESSIONS TO GIVE AWAY opportunity to get a grip on their finances with a complimentary Design Your Own Money System consultation. What they’ll get: • A 2-hour intensive meeting with a BFF • Interactive Zoom call • Their buffers and customised Money Map • Their ideal account structure • Their transactions automated • Dollarbird bills calendar • A system built they can stick to

in the bank.

Pete Lord and Carolina Flores are co-founders of Best Financial Friend, an affordable digital financial coaching start-up, with a mission to build financial security by connecting users with personalised support from a qualified “personal money-trainer”, to help them take control of their finances and enjoy a less stressful, debt-free life.

bestfinancialfriend.co