Close-up of an older man with glasses

Tips to overcome financial stress and improve our core skills

Published: 28 July 2022
  • national
  • 28 July 2022
  • National Seniors Australia

The new Financial Year is upon us, and it is always a great time reflect on the year that was but more importantly focus our intention on what next and the future. Most households are feeling the financial pinch of increases in costs of living (whether that be petrol, groceries, energy bills) and rising interest rates (for those who have loans). There is also more economic and global uncertainty around the world which is impacting those who hold investments.

For many people, facing up to the reality of their financial position can be confronting and stressful. The emotional roller coaster is not restricted to a particular demographic or age group, it can happen throughout our life journey and be shaped by experiences or events that may change our confidence levels or direction. The stress can come from a range of sources including pressures around paying the day-to-day bills or debts built up along the way. It can also be the feeling that we are not making progress towards important goals. 

I am always mindful of how I can proactively support others in their financial journeys and draw on real life experiences to inspire, educate or help people relate.

I was recently reflecting on the party activity of limbo where you get people trying to go under a stick without touching it. It starts off relatively easy but as you progress to the next round the bar keeps getting lower and lower. When the game first starts everyone is excited and you can normally observe all sorts of behaviours and attitudes. You can feel and see the tension and anxiety on some people’s faces or voices with just the thought of the exercise. For others you see the reality of it being more physically demanding than mentally for those who aren’t quite as flexible as they use to be. I certainly can relate. You can also spot those that are very confident with their own abilities, some a false sense of confidence.

The same mixture of emotions and apprehensions applies when we are confronting some of our financial speed bumps.

It is common knowledge, and we raise it in our financial wellness education sessions regularly that due to a lack of awareness, focus, or motivation many are leaving savings of thousands of dollars on the table per annum.

At a time when every dollar counts to meet rising costs, we need to help get more people confident in taking action to make savings, ask for a better deal and understand when they may not have the best deal. The reward is a much more fulfilling finance and importantly life journey. Each positive step forward gives the nudge to take the next step.

It does not mean they have to be financial limbo experts but we want to provide the feeling of relief and excitement as you get under the bar at least a couple of rounds into the activity. Being part of an inclusive community is important. The alternative of not being able to participate leaves people feeling isolated, frustrated, and vulnerable.

So with the financial limbo analogy I wanted to reflect on the core levels of either knowledge or action that we would like to get the majority of people comfortable with.

For me it would be enabling individuals to get more comfortable with the 10 areas below:

  1. Having basic financial confidence and literacy around principles, processes and activities that impact our daily lives and managing money.

  2. Having the skills to work through what our important goals are.

  3. Having a simple summary on a page of what we owe and what we own.

  4. Having a basic understanding of where we spend our money.

  5. Having a basic understanding of how credit works.

  6. Having a genuine understanding of how superannuation works.

  7. Having a genuine understanding of how investing works.

  8. Having a current will in place.

  9. Having a saving and investing plan in place.

  10. Having the confidence and experience to talk to, listen to loved ones about the above and know where to go for further assistance

These core skills put us in a much stronger position to get ahead financially, make informed choices and save for what is important. While there is lots of information available, we need to engage with others, get the conversation started and where possible inspire the next step in their own journey. Sharing experiences is a great way to help people connect.

The moral of this piece is that there a number of actions that individuals can take to improve not only their financial awareness but also their financial outcomes. With appropriate effort and motivation, it can make a world of difference. I am inspired and encouraged by the number of people who are reaching out for assistance to improving their position and seeking practical guidance on how to take steps that put them in a better position financially and emotionally.

Progressive employers are also understanding how important it is to be supporting their team members on this endeavour.

Just like the limbo exercise we need to limber up and have a positive and inquisitive mindset. With determination and focus we will achieve better outcomes.