Tired of money worries? Here are 5 tips to improve your financial wellbeing

12 April 2023

If you are keeping up with your daily living expenses but still feel your finances are controlling you (instead of the other way around), you’re not alone. Research is showing that many Australians are struggling with money management even if they’re getting by day-to-day .* †

Allan Ward, Head of Advice at Super SA, shares some simple actions you can take to gain control and improve your financial wellbeing.

 

What is financial wellbeing?

Essentially, it’s your ability to meet expenses and also have money left over. It means being in control of your finances and feeling secure, now and in the future.†

Financial wellbeing is a strong predictor of overall wellbeing‡ so it’s worth pinpointing the root causes of your money worries. A few changes could make a big difference, helping you enjoy your money today and in the future.

 

Allan’s five tips to guide you in reducing your money worries.

1. Set goals for the future

Ask any motivational or life coach and they’ll agree that setting goals is essential in reaching your potential and living the life you dream of.

Whether it’s an annual trip to the Sunshine Coast; buying a brand new car; investing in further education or living mortgage-free, setting targets for achieving your goals could be the difference between dreaming them and realising them.

Creating SMART goals could help. These goals should be Specific, Measurable, Achievable, Relevant, and Time-bound. They can be really helpful for short-term goals (eg. paying off your credit card), medium-term goals (eg. saving for a house deposit), and long-term goals (eg. paying off your mortgage).

A financial planner can also help you with setting financial goals while taking into account your current financial position, needs, and objectives.

2. Create a budget (that works for you!)

Are you spending more than you earn? It’s easy to do if you’re not tracking your income and expenses. But without knowing where your money goes, it’s hard to gain control of your finances.

That’s where a budget can help. If your income fluctuates and you haven’t tracked your spending before, start simple: collect bank statements, receipts, pay slips, and loan statements for a couple of months. This may help you to see if there’s a pattern and determine if you’re living within your means. If you’re not, where can you cut back? If you are, have you set savings goals?

Budgeting isn’t about being tight with your money or missing out, but spending consciously on what truly matters to you. 

The saving-on-takeaway-coffee example

A commonly used example that paints a really good picture of how tiny savings here or there can really add up:

Assuming you pay $4.50 for your daily coffee, cutting back to three cups a week saves $936 a year. That could go towards paying off debt, or you could invest it.

Maybe you’re not a coffee drinker. You can apply the same principle to eating out, streaming services, car parking, and even subscriptions (think gym, online fitness, and weight-loss programs).    

To see the difference a little extra in your super can make to your balance, try our contributions calculator. For information and tools on setting a budget you can stick with, you can visit Moneysmart.gov.au.

3. Save for those rainy days

If you’re spending beyond your means, you have nothing left over to save which could be devastating if things around you start to crumble (like the plaster wall in the study caused by an undetected leak in the roof!). Whatever the crisis, being unprepared can lead to financial shock and a lot of stress.

A common rule of thumb is to save enough for three months of expenses. If that’s not do-able right now, start with any amount – just $25 a week will add up to $1,300 in one year. This can help pay for car repairs, the replacement of white goods, and unexpected out-of-pocket medical costs.

Moneysmart has a savings goal calculator you can try for free.

4. Stay on top of your debt

Missing loan repayments and maxing out your credit can add to your stress and potentially hurt your credit score. It could help to have a plan to pay off any ‘bad’ debt that’s not adding to your wealth or wellbeing.

Bad debt funds your lifestyle. Think personal loans, car loans, and credit card debt. This type of debt can have a positive effect on your lifestyle and wellbeing if handled correctly, but it can have the opposite effect if you struggle to make repayments.  Stay disciplined by tracking due dates and payment amounts. If you’re falling behind, look for ways to cut back on other expenses to make up for the short-fall.

If you’re worried about your debt,  seek help quickly. Learn more about free financial counselling service on the MoneySmart website.

5. Make sense of money

By the time we reach adulthood, most of us know (or at least think we know) enough about money. We’re earning, we’re spending and we may be applying for loans and credit. But to build the life you really want, it’s worth exploring your relationship with money.

What money choices are you making? Are you proactive or reactive when managing your money? Do big purchases leave you feeling guilty or nervous? Are you comfortable with investing, or is something holding you back?

A better understanding of money can give you more control, and it doesn’t have to be an all-consuming task. There are plenty of resources out there to help you, including the MoneySmart website. Some of my favourite books on this topic are Dollars and Sense by Dan Ariely and Jeff Keisler, and The Richest Man in Babylon by George S Clason.

Check with your financial institution also. Many banks and credit unions have online tools and resources you can access for free.

If you’d like to learn more about managing your super, consider joining a Super SA online or in-person seminar. We also have a range of tools and calculators to help you plan for the future. 

About the Author

allan square image.jpg

Allan Ward, Head of Advice at Super SA

Allan is passionate about helping everyday Australians improve their financial wellbeing. With over 20 years in the financial planning industry, he’s seen first-hand the benefits of good financial advice and believes that anyone is able to create good financial habits. His biggest financial regret was not buying a 1960’s Fender Stratocaster guitar in the early 90’s (before they became ridiculously expensive).


* Source: Improving the Financial Wellbeing of Australians. Sited 14 November 2022; available from: https://www.commbank.com.au/
† Source: Exploring Financial Wellbeing in the Australian Context. Sited 14 November 2022; available from: https://assets.csi.edu.au/

Super SA is not required to hold an Australian Financial Services License to provide general advice about its products. The information in this document is of a general nature only and has been prepared without taking into account your objectives, financial situation or needs. Before making any decisions about the schemes administered by Super SA, you should consider the appropriateness of this information in the context of your own objectives, financial situation and needs, read the relevant Product Disclosure Statement (PDS) available and seek financial advice from a licensed financial adviser in relation to your own circumstances. Super SA and the State Government disclaim all liability for all claims, losses, damages, costs or expenses whatsoever (including consequential or incidental loss or damage), which arise as a result of or in connection with any use of, or reliance upon, any information in this document.

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