Is Financial Stress Affecting Your Health?

Is Financial Stress Affecting Your Health?

Is Financial Stress Affecting Your Health?

Improving your money management skills can help!

Nearly one in three Australians are financially stressed, with damaging effects on mental and physical health, together with social relationships. This information was found in the Financial Mindfulness Financial Stress Survey commissioned in July 2017. Lack of Financial Literacy skills played a major role.

 

Financial stress is felt across the community.  People with salaries of up to $150,000 and investments of up to $750,000 were only marginally less financially stressed than those who earn up to $90,000 and with investments of up to $350,000.

 

While over commitment to debt is a major cause, change in personal circumstances can also have an unexpected role.

 

Where the primary breadwinner, is unable to work through accident or illness, the family is usually unable to meet their loan repayments.  However, this type of financial stress is avoidable where adequate income protection has been put in place. People often don’t appreciate the consequences until it is too late.

 

The general consensus of research about financial stress is the lack of financial literacy skills is a major contributor to people making unwise financial decisions.

 

Australian Financial Literacy scores have been proven to be extremely low

 

More than 50% of Australians couldn’t answer a simple set of five questions asked by Melbourne of University researcher for the HILDA Report.

 

I have read the questions and believe me they were simple. 

 

If you want to take the test, you will find the questions at the end of the article “Financial understanding reaching ‘dangerous levels after embarrassing test results”.

 

It is not surprising the standards are so low when our education system does not include any curriculum for financial literacy at any level of education. Lack of this very basic financial knowledge may be leading people to make poor financial choices which result in poor financial outcomes.

 

ASIC’s MoneySmart – Financial Literacy Website

 

ASIC’s MoneySmart website has over the last couple of years developed an extremely good resource for all Australians.  I constantly recommend this site as the first reference point any consumer should go to when they want to get unbiased advice on any matters financial.

 

However, I think people tend to use this when they are looking for a specific piece of information, rather than using it to improve their general financial knowledge.

 

ASIC Moneysmart website

Google Quotes

 

As part of my research, I did a few Google searches for the topic of Financial Literacy.  Here are some of the answers to my Google questions. It makes compelling reading:

 

Who Needs Financial Literacy Skills

The lack of financial literacy can lead to owing large amounts of debt and making poor financial decisions. For example, the advantages or disadvantages of fixed and variable interest rates are concepts that are easier to understand and make informed decisions about if you possess financial literacy skills.

 

Why Financial Education is Important in Today’s World

Financial education is important in today’s world. Any improvement in financial education will have a profound impact on your ability to generate abundant wealth and create a sustainable future.  It is never too early or too late to improve your financial education.

 

Can Financial Issues Impact on a Person’s Well Being?

Money and Financial Issues. Money and financial issues can be significant sources of stress for people. A person’s problems with money may produce such overwhelming negative feelings and self-criticism that his or her mental and physical health can be adversely affected.

 

Financial Mappers launches a Free Financial Literacy Program

 

One of the reasons, I was first motivated to develop Financial Mappers was to give everyday people with average financial skills the ability to better understand their finances and try to figure out what their future financial situation could look like.

 

Of course, Financial Mappers has now developed into a substantial platform which can be used by either consumers or their advisers and share that information.

 

I spent quite some time trying to find a program I could recommend to my readers which I felt they could engage with.

 

In the end, I decided the best way was to do it myself. 

 

I felt that what people need is small “bit-size” pieces of information they can absorb and work out how that little part of the puzzle could be of value to their personal situation.  They need to take responsibility for managing their money.  Asking for 3-minutes a day of someone’s could save them hundreds of thousands of dollar.

 

It is getting the simple things right, but more importantly getting started is what will make a difference.

 

From my experience of talking with people, they don’t want to read lengthy books, they don’t want to get quizzed or have to attend webinars and seminars.  I think I have the solution.

 

I have called my financial literacy program Money Smart Tips in 3-Minutes a Day.

 

financial literacy program

 

You simply register your email and each day, you receive a link to a new 3-minute video clip.  The program has started and future sessions are under development.  In the end, there will be  seven series, each with 5 – 8 video clips of 3-minutes each.

 

The program will include these topics:

 

  1. Your Finances – The Basics
  2. Lifestyle Goals and Financial Targets
  3. Debt Management
  4. The HILDA Report – Financial Concepts
  5. Investments – The Three Major Types
  6. Superannuation

 

The aim is to introduce basic financial concepts, giving each person the opportunity to absorb that one concept and decide if that information is relevant to their current financial situation.  No specific advice is given, no financial products are recommended and you are not asked to purchase software or give personal information.  This program does use Financial Mappers to demonstrate concepts, but knowing how to use the software is not required to improve your financial literacy.

 

With no financial literacy programs in schools, this program is suitable for high school students.  The benefits to them it that time is on their side.  If they simply understand the concept of compound interest and using debit cards instead of credit cards, your child will be on the way to a great financial future.

 

If you would like to register, please click on the image.

 

Money Smart Tips Register Now

 

 

Disclaimer: Financial Mappers does not have an Australian Financial Services License, does not offer financial planning advice and does not recommend financial products.

I am a founding board member of Plencore Wealth Ltd and Plencore Online Pty Ltd. I am the designer of the product Financial Mappers and Financial Mappers PRO, cloud based modelling software for Personal Finance. This software is sold on the web site www.financialmappers.com.au.I am an educator, investor and expert in both personal finance and mathematical modelling and the author of 'Map Your Finances'.I have both a Graduate Diploma in Applied Finance and Investments and a Diploma in Financial Advising from the Securities Institute of Australia. I also have a Financial Analysis Certificate, by Distance Learning from University of Technology, Sydney. I am a Senior Fellow and Senior Mentor of FINSIA.

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  1. […] more than 30% of the population under financial stress to the point where their health, relationships and productivity at work are affected, knowing your […]

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