How to Beat Financial Stress
The stress of financial commitment affects many, with the cost of housing, combined with the cost of essential services, food, utilities, insurance, transport, health, and education increasingly putting people under significant financial stress.
Combined with relentless marketing and the availability of credit, it is hardly surprising that, despite our position of wealth in the world, we are feeling the strain.
Buying into the consumer culture adds to the stress that runs through from individual, to family, through society and on to the environment. It worth taking a step back from it all and asking; is buying onto this culture making us healthier or happier? Is it sustainable? … and most importantly, is there a better way?
While Australia is one of the wealthiest countries in the world, with an average income that puts that person in the top 0.5 % of people in the world, Australians also have the highest household debt in the world, reaching 200% of their disposable income. 70% of renters and 50% of home owners are spending 30% or more of their disposable income on meeting just those commitments. This level of commitment is a common indicator of financial stress.
Increasingly we are relying on credit cards to maintain our lifestyle, with 80% relying on credit cards to pay bills, while 20 per cent of people using those cards are carrying long term debt of three years or more at interest rates of more than 20%!
During the last 40 years of a market driven economy, including unprecedented access to credit and over consumption individual health has suffered. Some of the biggest selling drugs today deal with the growing problems of depression and anxiety. Mental health, obesity and a long list of preventable diseases are increasingly affecting young and old alike. Environmental degradation of soil, land, air and oceans is another price we are paying for our consumer culture.
If the levels of consumption that people in the USA or Australia were replicated across even half of the 9 billion people projected to be on the planet in 2050, the impact on our water supply, air quality, forests, climate, biological diversity, and human health would be severe. As a sobering reminder of the waste involved in over consumption!
The Way Forward
Happiness comes down to three things: good personal relationships, financial security and a sense of life purpose.
Accordingly, people can have a sense of wellbeing, even on low income, provided they have a sense of control on how they spend their money.
Taking control of finances and managing expectations is the key. When we reflect on the personal and environmental costs of buying into the consumer society, with such a negative return on investment, in terms of personal and environmental health and wellbeing, it would seem that taking control of finances is an important step in managing the impact of financial stress on our health and the health of the planet.
As we have seen in past financial crises and more recent Royal Commission into Banking, where those institutions stand to benefit most, is a conflict of interest we need to be aware of. It may be why sensible, simple advice from well informed ordinary citizens, such as seeking appropriate personal advice from a financial adviser is the way forward.
This information is current as at 08/11/18. This article has been prepared by Heart1Stop, a social media brand owned by Heart Mortgage Services and Heart Financial Advisers. The information contained in this article is an overview or summary only and it should not be considered a comprehensive statement on any matter nor relied upon as such. The views expressed here are not those of Heart1stop, Heart Mortgage Services, Heart Financial Advisers, shareholders, directors or staff and associated contractors and business associates. This article has been prepared without taking into account any person’s objectives, financial situation or needs. Because of this, you should, before acting on any information contained in this article, consider its appropriateness, having regard to your objectives, financial situation or needs. Any taxation information contained in this article is a general statement and should only be used as a guide. It does not constitute taxation advice and is based on current laws and their interpretation. Each individual’s situation may differ, and you should seek independent professional taxation advice on any taxation matters. While the information contained in this article may contain or be based on information obtained from sources believed to be reliable, it may not have been independently verified. Where information contained in this publication contains material provided directly by third parties it is given in good faith and has been derived from sources believed to be accurate at its issue date. It is not the intention of Heart1Stop or Heart Mortgage Services and Heart Financial Advisers that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. To the maximum extent permitted by law: no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up to date or fit for any purpose; and no party of Heart1Stop or associated entities as mentioned is in any way liable to you (including for negligence) in respect of any reliance upon such information. This article may also contain links to websites operated by third parties ("Third Parties") who are not related to Heart1Stop. These links are provided for convenience only and do not represent any endorsement or approval by us.