Here is a statistic that really troubles me. 1 in 3 Aussies don’t have more than 1 month’s salary saved for emergencies. That means that a third of the population is at risk of something bad happening, and then being in major financial hardship.
Are you one of these 1 in 3? Do you worry how you will survive if you got hit with multiple and unexpected bills? The car breaking down? The washing machine blowing up? A medical emergency? If you answered YES, you are far from alone. And mentally, that reality can be extremely tough to cope with.
In fact, people in a recent research report from University of Melbourne said that outside of the struggle to buy food, coping with the mental health issues stemming from a lack of money was one of the hardest things to deal with.
It’s not a big leap to see how financial pressure can lead to anxiety and mental stress. I’ve been there myself and can still remember how debilitating it felt – and how getting to sleep at night became harder and harder.
With this in mind, I urge you to do these three things to change your situation. Warning – it won’t work overnight. I like to think it’s a five-year process to build your financial fitness on the road to financial freedom. Being financially fit means having a safety net, and avoiding multiple debts to live a less stressful life – and that has a huge impact and improvement on mental health.
1. Think long and hard about levers you have to pull to raise enough savings to give you a cushion. A soft place to land.
What would it take to save three months’ of your absolutely minimum living expenses? How can you go about raising this money to give you peace of mind? Can you sell something you no longer need? Can something of sentimental value be better put to giving you peace of mind? Think long and hard about levers you have to pull to raise enough savings to give you a cushion. A soft place to land. This is going to change your mindset and worry levels considerably, so it’s worth going the whole nine yards and exploring every option.
2. Consider a side-hustle for additional cash until you get 3 months of savings in the bag.
If you can save more from your existing salary, can you also side hustle? Babysit? Mow lawns? Work in a call centre after hours? While a second job might be a challenge to your already busy schedule, it only needs to be a short-term gig until you get 3 months of savings in the bag. If you can do longer, GREAT. The more you save, the better off you are. Three months is a fantastic start and should be your first focus.
3. Set yourself a date you want to achieve this goal by. Don’t let it drag on.
Give yourself a deadline and hold yourself accountable to it. You would be surprised how much more efficient you will be with your thinking and your time if you are working to a live deadline.
There’s an old saying in the sales world: Activity = Action = Results. You need to put in a concerted effort to solve this one for yourself. It is one of the most important steps to go through on your road to financial freedom. So go on, invest in yourself.
Until next time,