Circumstances changed ………….Have your spending habits changed?

Most people experiencing difficulty balancing their household budget do so because they don’t adapt their spending habits as their level of financial commitment changes over time.

To explore this in further detail let’s look at a hypothetical example;
A couple meet in their early twenties, both working full time, both living at home with their respective parents, no financial commitments.
​
Initially this couple have complete freedom from a spending perspective. All the income they earn is theirs to spend as they choose – often, spending choices like overseas travel, retail purchases, or self-indulgent socialising can be made at the drop of a hat. It’s a great time of life, with many fantastic life experiences to be had – however it’s not necessarily a period where utilising the skills of sound financial management are often front of mind.

If we then look ten years forward for this same couple their financial life can look completely different.

If the couple have started a family, the two full time incomes will have reverted to one income (or maybe one and a half incomes). On top of the additional cost of raising children (food costs, healthcare, insurance costs, education etc.) the couple will also have the ongoing monthly obligation of either rent or a mortgage payment.

This is where the pain of financial mismanagement can really start to hurt.

Instead of the example couple having a plan that addresses and educates the changed set of financial circumstances often they will mismanage this increase in expense levels by carrying a credit card debt (or worse still juggling multiple credit card debts), and personal loan debt.  

It is simply a statement of fact to say that your financial circumstances will change many times over your working life.

If you don’t, (or don’t know how to) adapt your spending levels to your changing circumstances you need the assistance of an industry expert who can help you to learn and manage the skills to adapt your household budget to your current financial capacity.

​Take the anxiety out of managing your own money – Contact Leigh at Empower Money Management today.