Financial anxiety is genuine and can’t be ignored. The feeling that you are not investing enough with your money, the guilt of spending money on a particular luxury item or holiday, the feeling that you should be leaving some behind for your family, and a standard comparison many tend to do with their friends and family.
We forget that in the past three years alone, we have dealt with financial and economic uncertainty, worries about job prospects, retirement concerns, rising inflation, living costs and interest rates.
It is normal to feel stressed over your finances. In the current economic uncertainty, even high-net-worth individuals and family groups feel uncertain about their sense of financial security.
The AMP 2022 Financial Wellness Report shows that financial stress has doubled over the past two years alone. The financial pressure is affecting the already vulnerable group even more.
https://www.amp.com.au/content/dam/amp-au/documents/financial-hub/Financial-Wellness-2022.pdf
The data from the report shows that:
- In 2020, 19% of women were ‘severely or moderately financially stressed’. In 2022, it was 27%.
- In 2020, 18% of part-time workers were ‘severely or moderately financially stressed’. In 2022, it was 26% – a 33% increase.
- In 2020, 13% of single parents (aged 30-44) were ‘severely or moderately financially stressed’. Today that number has nearly doubled to 25%. `
Furthermore – 26% feel guilty about their finances, and 59% of older Australians (65+) are worried about their debt levels.
What is essential, though, is to learn and identify the key elements that are causing the stress and reach out for help. There are a few practical things anyone can do to start gaining control over their position to provide comfort.
First, it is crucial not to lose sight of your goals – it is still a very underrated powerful mechanism to help you crystalise your strategy. Sit down and plan your short (12 months), medium (1-3 years) and long-term (more than three years) goals.
Next, prioritise the goals according to your level of comfort. So, ask yourself – which one gives you the most anxiety, or will it help you sleep better at night once you achieve it? Focus on those goals first – get an action plan, seek advice and start implementing it. You are not too late to make a change – it is possible.
It is important to remember that the effect of your changes today will flow through over time – but it is essential to take the first step. Often the most challenging thing to do is to take the first step in seeking advice.
Once you have laid down your current situation, worries, goals and objectives, with good advice, you will have a few strategic options on how to improve your position. Take your time to analyse each and ask the critical questions to help you make an informed financial decision.
Always remember that there is a solution to every problem – it is a matter of discussing and analysing your options.
Karam Singh, Authorised Representative of Madison Financial Group Pty Ltd ABN 36 002 459 001 AFSL no. 246679.
He can be reached at ksingh@consciousmoney.com.au or 1300 193 136.
This information is of a general nature only and neither represents nor is intended to be specific advice on any particular matter. We strongly suggest that you seek professional financial advice before action. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc. as at the date of issue.