In my March vlog, buy generic viagra I talk about the connection between money management, happiness and well-being.
Nearly 40 per cent of Australian workers are now non-permanent employees. Half of them are casuals and the remainder is made up of self-employed business owners, contractors, and fixed-term employees.
The Sydney Morning Herald reports that Australia leads the world in developing a casualised workforce. Spain is the only country to have more casual workers than us.
Experts have even developed a name for this new class of citizen—the “precariat.” The title reflects the precarious nature of casual and contract employment.
Casual work can make budgeting and money management difficult because of widely fluctuating income from one pay to the next. Contractors and fixed-term employees can earn great money while they have work, but feast can quickly turn into famine.
These factors mean that personal budgeting and good money management is more important than ever for non-permanent workers.
Here are five budgeting and money management rules for the 40 per cent of Aussie workers who don’t have secure jobs:
- Live the lifestyle you can afford in your leanest month, not your richest one.
- Create your budget based on your minimum likely pay cheque. In rich months, commit most of your surplus to savings.
- Don’t take on any debt (that includes a home loan) that would be unaffordable or uncomfortable in lean times.
- Organise your income into “buckets” for future expenses and bills. Some banks will let you set up sub-accounts for this purpose.
- Save, save, save like there’s no tomorrow (or at least no work tomorrow.) Have your savings disbursed into a separate bank account which is difficult to access on a whim.
On our Facebook page last week we shared an ABC News story about new data which show that Australians prefer using cards over cash. We commented that cards make personal budgeting more difficult because it’s easy to lose track of spending. Our suggestion is to withdraw your living expenses in cash so you can closely watch where your money goes.
Let’s take the discussion a step further…
Imagine ordering your usual mocha-chocka-frappuccino and instead of reaching for your wallet to pay, you swipe your mobile phone instead.
Of course, what I’m describing isn’t imagination. It’s a product from Google that already exists. Google Wallet plans to turn our cashless society into a walletless one.
How does it work?
Google Wallet stores your credit card details or allows you to deposit credit into a Google Wallet account. To pay, you enter a security code into your phone and wave it over a Paypass or payWave terminal. These terminals are already in use in some retail outlets in Australia.
When it comes to security, Google’s answer is that their virtual wallet is safer than your real one. They argue that if you lose your phone, your Google Wallet is still password protected. Plus, you can cancel your telephone SIM card without cancelling any of your banking cards.
But what does it mean for personal budgeting?
I appreciate that the mobile phone has replaced everything from our wrist watches to our street directories. To some extent, online stores are even replacing our shops. But I’m worried that Google Wallet is yet another way to make spending way too easy. And spending without thinking is a dangerous financial habit.
What are your thoughts? I’d love to hear from you. Please post your comments on the MyBudget Facebook page!
Wow. It’s such a simple, but powerful concept: the idea of stopping to think before spending money.
It sounds like common sense, doesn’t it? I mean, who would spend their money without thinking first?
The answer, unfortunately, is most of us. It’s hard not to. We live in an impulsive, fast-paced culture that’s all about ease and convenience. “Buy now, pay (think) later”.
We’ve all had that experience where we look in our wallets or at our bank account statement and expect to see more. “I thought I had $50 in my purse. I can’t believe I spent $40 yesterday.” Does that sound familiar? Lots of MyBudget clients are surprised by how much money they used to spend on stuff or how easy it used to be to buy new clothes or eat out and then not have enough money to pay bills.
But how do we swim against the cultural current and always think before we spend?
It’s all about creating new money management behaviours — and when we repeat behaviours often enough, they become habits.
As with learning any new skill, sometimes we have to challenge ourselves. So here is a 30-day money management challenge which is designed to result in thinking before spending. By the end of the month, the idea is to have established new money management habits that stick.
For 30 days:
1. Use only cash
No cards at all. Cash is an excellent visual reminder of your financial position. It’s way too easy to spend thoughtlessly with a credit or debit card.
2. Sleep on it
Delay all impulse purchases for 24 hours. This applies to anything from a bag of chips to a cute-as-a-button puppy. If it still seems like a good idea in the morning, go back and make the purchase. (If it’s gone when you get there, assume it wasn’t meant to be.)
3. Do your research
For any product or service that costs $100 or more, compare at least three prices through different suppliers. The internet makes this pretty easy to do. Also read consumer reviews when available.
4. Stick to your list
Never hit the shops without a pre-written list in hand and do not buy anything that’s not on that list. That rules out impulse purchases (see point 2 above.)
5. Meditate on your goals
Carry a reminder of your financial goals in your wallet or purse where you will see it every time you go to spend. You can type or write your goals on a piece of paper or you can use a visual symbol or representation that has meaning for you. For instance, if your goal is to save for a new car, you might carry a small photo of the car in the plastic window of your wallet. You don’t have to fixate on the image every time you open your purse. It’s enough for your brain to register it subconsciously.
Remember, the aim of this money management challenge is not necessarily to save money — it’s to train your mind to think before you spend. The upside, however, is that the more you manage your money consciously, the wiser your spending habits will become.