Time to read : 3 Minutes
Why Is Talking About Money So Taboo
In my line of work, I hear the below all the time.
"We never expected this to happen, I don't know where the details are, I've never done any of the paperwork."
And, I want to say to everyone... it's okay to talk about your finances, especially with those you love and who love you.
Money talk: what you need to know
Financial literacy really matters. It helps us navigate big financial decisions like buying a home, taking out life insurance and planning for a comfortable retirement.
😓 The trouble is, we don't like to talk about our salaries, savings, investments or debt and all this does is leave us and everyone else in the dark.
Our financial literacy is tanking – falling 10% in the last year.
Newcastle University's Financial Wellbeing and General Life Satisfaction in Australia report found that:
44% of us are not financially literate and struggled to answer five basic money questions correctly.
A scary 43% of people aged 18-24 were unable to pay back their debts.
Though women were less financially literate, they were much better with their money planning.
Up to 70% of Australians do not have a legally binding will, leaving our families to figure out what our final wishes might be.
The money picture isn't very pretty right now either. According to The Australian Bureau of Statistics (ABS), our wealth as a nation in 2020-21 fell by 3.3% while our liabilities rose by 2.2%. This makes it even more important for us to understand our money and get our finances in order.
How do we get better at talking about money?
With the cost of almost all our essentials up and the Reserve Bank still lifting interest rates, there is no better time to lift the lid on your finances and get your budget in order.
Have the money talk with your partner and family. Yes, that one, so everyone knows how everything works.
Have an even more awkward talk about life insurance. What would happen if the main breadwinner suddenly wasn't around or couldn't work? Not your usual family dinner chat, but very essential.
Find your lost super accounts and consider combining them. This can help you reduce your fees and make your super easier to manage.
Check what your interest rate is for your loans and see if it is the best deal you can get. Never be afraid to switch. A lower interest rate could literally save you thousands over the life of a home loan.
Review your insurances, all of them, and see if they still serve your needs today.
Do your sums, is there more going out than is coming in right now? And if so, where can you trim your budget? If you can't then consider asking for a pay rise, or look for a job that pays more or consider a side hustle.
Prepare for the worst. If you own a home or have a family you should have a will.
The all important life file. Maintain and keep important information in one place, that your family knows about and can find. You can have this in an old-fashioned folder or just create an online system. This file should have all your insurances, super, bank and loan details.
The bottom line
Life admin sucks but it is an essential and important part of being an adult. Having a healthy and transparent relationship with your finances is a big part of that.
🙏 Don't leave your family in the lurch if things go wrong, organise your file and have the talk instead.
The information contained on this web page is of general nature only and has been prepared without taking into consideration your objectives, needs and financial situation. You should check with a financial professional before making any decisions. Any opinions expressed within an article are those of the author and do not specifically reflect the views of Compare Club Australia Pty Ltd.
