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You eat your greens, regularly reach 10,000 steps a day and visit your GP for all the right check-ups.
You could have biceps and a six-pack that would make Arnie jealous, but if your financial health isn’t up to par, your mental health could be suffering.
Did you know that the Australian Psychological Society found that financial issues are rated as the top cause of stress for Aussies? At nib, we know that there’s more to keeping healthy than just the physical, so we sat down for a chat with former scientist, head of Research and Analytics at the Workplace Gender Equality Agency, and finance writer, Dr Carla Harris. Here are her top five tips to help improve your financial situation.
Carla explains that acknowledging your financial situation is the first and arguably the most important step to improving your financial situation; although she stresses that it’s essential you don’t beat yourself up about it.
“Have you ever made yourself feel so guilty after eating a Tim Tam that you end up slamming the whole pack? Similarly, wallowing in your financial guilt can result in more unnecessary spending which creates a vicious cycle. Acknowledge the situation and the toll it’s playing on your mental health; understand that it feels scary and stressful and then find ways to move forward.”
“It’s vital that you start this process by getting a thorough (and honest) understanding of what money is coming in and what money is going out of your bank account,” Carla explains. “Tracking your spending can be a horrifying exercise, but it can throw some sunshine on areas that are tracking well, as well as show you areas that may need major attention.”
“Map out where your money goes and focus on your major spending areas (these will generally be transport, food, rent/mortgage etc). This will help you identify whether you’re on track to meet your goals. If you need more help with budgeting, it could be a good idea to consider seeing a financial adviser for personal advice. Alternatively, there are some great online resources including the Government’s Budget Planner."
When it comes to budgeting, some of us don’t have any left over at the end of the month to spend, but many of us have a little extra fat (or wastage) that we can pare back from our spending.
“When you tracked your spending in the above exercise, did it highlight how much you’re spending on Uber Eats and takeaway? If so, perhaps start taking lunches to work and consider cutting back on the lattes. Not only will this impact your spending, but eating homemade food and reducing your coffee intake is often healthier anyway,” Carla suggests.
“Do you pay for magazines that you don’t read? Are you forking out for a TV subscription that you don’t use? Are you a member of a club that you never visit? It might not be a huge amount of money you’ll save in the short-term by getting rid of the ‘extras’, but it’s a great way to save money over the coming months.”
We all know that time flies, so ensuring your future financial situation is under control is just as important as taking care of your immediate finances.
And Carla explains that this doesn’t have to be hard.
“This could be as easy as doing some simple housekeeping like combining all your superannuation accounts into the one account to avoid paying multiple sets of fees and insurance, or making additional contributions on top of what your employer already pays if you need to catch up.”
A US study found that people who looked after their future finances by putting extra money aside for their retirement were more likely to make better choices towards the future of their physical health. In other words, there’s a link between looking after yourself financially and your physical health.
The good news is that anyone can become money-smart.
The good news is that anyone can become money-smart - and you don’t need to go back to university or spend thousands to improve your financial literacy.
“Whether it’s gaining an understanding on how credit scores work or making sense of more complex investments, improving your level of financial knowledge is so important to being able to achieve a range of financial goals and improve your overall financial position,” Carla explains.
“There are many easy to understand materials that can get you started. Some of my favourite books are Effie Zahos’s A Real Girl's Guide to Money and the Barefoot Investor by Scott Pape.”
Both of Carla’s reading recommendations are available from Dymocks and if you’re an nib member, you can access 10% off using your nib Rewards.
For those of us who prefer podcasts? “There’re some excellent podcasts including She's on the Money and The Pineapple Project which can help bring you up to speed without spending a cent,” Carla says.
If your finances are causing your stress or you’re concerned about your mental health, it’s important to visit your GP to get professional advice. For ways to improve mental health, manage anxiety or reduce stress, check out the article, 6 ways to get help for mental health - and you won’t have to pay a thing!
DISCLAIMER: information provided in this article is for general information only and is not intended to act as specific financial advice. It has been prepared without taking into account your financial objectives, situation or needs.
Dr Carla Harris, CEO and Co-Founder of Longevity App is on a mission to change everyone’s financial futures one cent at a time. A former scientist, head of Research and Analytics at the Workplace Gender Equality Agency, and now entrepreneur, finance writer and Director at FinTech Australia, Carla is passionate about making money engaging and relevant no matter where you’re at in life.