DO NOT PANIC!
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: 1.
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.
2.
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.
3.
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.
THRIVE #2 | 27
MONEY
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.
