Taking stress out of money woes
OPINION: We live in worrying times but, then, we always have.
While there’s precious little we can do about warmongering superpowers, there are things we can do about our perennial sources of financial anxiety.
A survey released late last month by the Financial Services Council (a political lobbying body for KiwiSaver providers and insurers) found 17 in every 100 people worried about money daily.
A further 23 worried about money at least once a week, and 16 worried about their finances at least once a month.
While this sounds like an appalling slough of worry, it has to be kept in perspective.
First, worry has positive aspects.
Yes, it can be debilitating, and 34 to 53 in every 100 people admitted to the FSC that money issues had adversely affected things like their mental and physical health, and relationships.
Worry over not being able to pay for daily needs, can put
GOLDEN RULES
■ Worry is a signal to act
■ Almost everyone can reduce their money worries
■ Schooling yourself on money has never been easier
people into a state of perpetual mental turmoil making it harder to act rationally.
But worry helps people mentally and emotionally prepare for an uncertain future, and it can be a prompt to take action.
And survey data can be deceptive.
One person who answers ‘‘yes’’ to worrying about money every week might be struggling to put food on the table. Another might have a million-dollar investment portfolio, with worries of quite a different magnitude.
Most of us have some wriggle room in our lives to reduce our objective need to worry (if we can ditch the misleading belief we have no power to improve our lives).
FSC found financial literacy was weak over half of us. This is the easy one. There is no shortage of free money courses like Christians Against Poverty, budget mentors, and any money topic can be easily researched online.
Just over 40 in every 100 people didn’t have a sensible level of emergency savings, FSC found. Research shows people who save regularly, are happier, so I’m assuming the worry less. Go to a budget mentor. Get a budget. Get a savings habit. Get emergency savings. Stop making excuses.
Four hundred thousand people are behind on loan repayments. Life in the red is not normal, or healthy. Learn how to be debt-free for daily living expenses.
A lowish income can be easier to live on than a moderate income which fluctuates.
Achieving better job security is important, but it means developing skills, and requires effort and long-term planning.
About four in 10 of us feel unprepared for retirement.
Of course we do. Lots of us are young. Tackle worry by reading up on KiwiSaver, using free online tools to work out a saving plan. Seek advice.
Remember, it’s a case of save little, and often, if you start young.
Don’t listen to doom merchants. You may not need a $1 million nest egg.
Many also have house worries. The FSC found 68 in every 100 reported worry about house prices, and 65 in every 100 worry about interest rates.
First, people with houses should stop worrying about prices falling. They should worry about their repayments. If they are not ahead on their home loans, like many people are, they need to get a strategy to get ahead.
People who do not own homes. Get yourself a homeownership strategy. Keep doing the right things. Keep your eyes open for opportunities. And keep voting for a fairer deal. Even if you don’t get into a home, you will build wealth.
Younger worriers should take some heart. Older people tend to be more satisfied with life, and worry less. Many have fewer money worries, having amassed a bit of a financial buffer by doing at least semi-smart things with money.
All things being equal, getting older combined with sensible money decisions, will reduce your money worries.