‘Til Debt Do Us Part

Category: Financial Freedom

I heard a frightening statistic this week: that our national debt level is 130 per cent of our GDP (gross domestic product). Quite simply, as a nation, we are racking up debt faster than we are producing.

Or, in old fashioned terms, we are spending more than we earn.
Anyone knows in managing their own budgets, that spending more than you earn ends badly. Usually with a diminished lifestyle as you need to sacrifice in order to pay back what you are have already spent. If you can…

Another equally disturbing statistic is that 30 per cent of households are responsible for 85 per cent of household debt. Wow – this is a big spending 30 per cent of our population.

No doubt it’s what’s been driving property prices up in major cities like Sydney and Melbourne. Combined with the fact that 40% of bank loans have been interest only (although the government is now decreasing that to 30 per cent,) this means that only a few factors in the combination need to change for a series of cascading events to occur.

Reading big picture statistics like this can sometimes paralyse you with fear and a feeling of “what can I do?” It’s obvious we can’t change the habits of a whole nation, but what we can do is think about our own situation and make a checklist for the what if happening.

What if interest rates rise? What if house prices drop? What if another GFC came into play? What if you lost your health? What if you lost your ability to work? What if your business failed?

Bear with me; I am not trying to put you on a downer, what I am trying to do is give you a sleep-at-night feeling. Because if you have answers, plans and assurances around all these questions, then you won’t be caught out if circumstances change.

Chances are you do have a plan already. But the household debt tells me that many Australians are used to a good economy and prosperous times; which at times can mean that the worse is not planned for or taken into serious consideration as it has not been needed previously.

If you don’t have a plan, perhaps it’s time to see a financial adviser. If you don’t know one, start with a search on the FPA website and ask them these questions:

Are you a Certified Financial Planner (CFP)?
How do you charge?
What do you specialise in?
How will we work together?

If you find the answers are to your liking, it just may help you answer those what ifs, and sleep better at night. For if the whole nation is not covered, at least you and your family are.

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Natallia – you’ve said it so well. The message here I think is about consistency. Consistency in checking what’s going in and what’s creeping out. A review of finances to keep on track on interest rates, investment opportunities and Superannuation top ups. Many of us in our businesses self contribute to Super – we easily get behind. It’s part of our financial literacy homework. Get going ladies.
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The goal of the following article is to assist parents have meaningful conversations with their children about money and financial literacy by providing them with practical guidance and useful recommendations. The author discusses goal-setting, budgeting, saving, and investing, and offers advice on how to have these discussions with people of varying ages. The essay is informative and easy to read, making it a valuable tool for parents who want to teach their children about money.

For More Info:-https://busykid.com/kids-debit-card/

From admin on Changing Conversations You Need to Have with Your Kids

Thanks for your comments!

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So enjoyed this, I will share if that’s okay with you, many of my friends will benefit from your journey.
Many Blessings for 2023
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Hi all! This is a good site.
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They definitely have a place. People need advice and many are working on it to be more accessible. Watch this space!

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So true

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Authors

Vanessa Stoykov

Vanessa has been passionate about writing and storytelling since her days of hiding under the doona with her torch to read after bedtime.
Kathy Skantzos

Kathy is a yoga-loving world traveller who also happens to moonlight as a business journalist and writer. She was the finance editor of news.com.au and the Managing Editor of CEO Magazine (Asia) before joining Vanessa and the evo squad.
Shayne Sommer

Shayne is second dan black belt in karate, and a budding romance writer with a difference. Why? Because she writes romance stories that always have a money lesson.
Antoinette Colbran

Specialising in stories for 50+ women, Antoinette draws from her own experiences to help other women avoid the pitfalls and see the benefits of understanding their money situation.
Michael Crooks

Michael Crooks is a more than 20 year writer and documentary maker who has worked with Time Inc and the BBC, who wants to expose the truth from real victims of financial crime to help others avoid their mistakes.
Kim Payne

Kim Payne has spent the past three decades as a speaker, trainer, business coach, and consultant in financial services. She has worked with and transformed hundreds of brilliant, educated, high achievers who are chronically under-living.
Rebecca Pritchard

Rebecca Pritchard is on a mission to help men and women achieve equality when growing a family.
Antony Perring

Ant is a writer, designer and business builder with a love of food, design and good living. He writes on food and money in an easy to do way.
Julie Hyde

Julie Hyde is a leader of leaders. A disruptor and a powerful people enabler who empowers leaders to make big things happen.
Joshua Pennell

As a Dad to four kids and a business owner, Josh is passionate about family and finances and is known as The Family Finance Guy.
Sid Lal

Sid is a serial entrepreneur who set up his first business when he was still in University. Since 2009 he has been heading Bruce Clay, first in India & more recently in Australia.
Lou Johnson

Lou Johnson believes in the power of sharing stories to build empathy, understanding and connection. Growing up surrounded by books and storytelling, alongside her drive to make a difference led her to a highly successful career in book publishing.
David Rae

Dave is a CERTIFIED FINANCIAL PLANNER® professional and has been a financial adviser since 2003. He works with a range of clients and has a strong focus on ethical and sustainable investing.
Natallia Smith

Natallia specializes in assisting pre-retiree single women—whether they are never married, widowed, separated, or divorced—understanding deeply the importance of financial stability during life's pivotal moments such as separation, divorce, retirement, and the loss of a loved one.
Mark Hoy

With over 15 years of experience in financial services, Mark established Wollemi Wealth Management in 2013. His business is built almost entirely on referrals and word of mouth — a testament to the trust, integrity, and long-term relationships he forms with his clients.
Derek Gascoigne

Derek Gascoigne is the State Manager for UniSuper Advice in Victoria and Tasmania. Derek has been with UniSuper for over 15 years, and his career in superannuation and financial services spans 27 years and counting.
Annika Bradley

Annika Bradley is Head of Advice Strategy, Research & Technical at UniSuper. She brings over 20 years of experience across investments and wealth management in both the public and private sectors.
Wayne Leggett

Wayne has been a recipient of numerous industry awards and was one of the first to qualify as a Certified Financial Planner (CFP). He has been heavily involved in industry affairs at the highest level, including serving as national president of the Association of Financial Advisers (now FAAA).
Conrad Francis

Conrad Francis is the Founding Director of Inspired Money, a Perth-based financial coaching and financial planning, mortgage broking and money coaching firm he established in 2011.
Andrew Beks

Andrew Beks is a Chartered Accountant and the founder of Simplified Business and Accounting.