How many of us live out our day to day lives compromised by what we can afford to do, as opposed to doing what we really want to? 

How many times have you heard a friend (or even yourself) dream out aloud how they would live if they won tattslotto? – Dreaming about a tattslotto win is NOT an effective strategy.  

I’ve spent over thirty years working in the finance industry, and in my experience what most frequently compromises a person’s capacity to live the lifestyle they really want comes down to an inability to budget well, and an over reliance on debt.

The ability to craft a sustainable budget, along with the ability to understand and control the effective use of debt will go a very long way to creating a lifestyle that allows you to do more of the things you really want to.

To illustrate my point, think of it like this;

Let’s imagine Mr & Mrs Bloggs

• Home mortgage $250,000 owing – approximate payment $1460 per month
• Credit card 1 $10,000 owing – approximate payment $300 per month
  
• Credit card 2 $5000 owing – approximate payment $150 per month
  
• Car loan $25,000 owing – approximate payment $515 per month

 
In the fictional example above Mr & Mrs Bloggs need to pay out a minimum of $2425 per month just to keep up with the minimum payments on their existing financial commitments.

In addition to debt servicing costs, Mr & Mrs Bloggs also need to make allowances for ongoing cost of living expenses such as education costs, groceries costs, insurance costs and utilities costs.

This is BEFORE they can commit to spending any money on lifestyle wants. The level and structure of their existing debt is then compromising how they may really want to spend their lives, and potentially adding a source of anxiety to their day to day lives.

At Empower Money Management I specialise in assisting people to craft sustainable monthly budgets, and I coach people to understand and control their effective use of loan facilities.

In my experience people who are in control of and understand their own financial affairs will generally lead a less stressed quality of life.

I would love to help more people gain a greater understanding and control of their own financial affairs – to learn more or to make an appointment contact leigh@empowermm.com.au or see www.empowermm.com.au
  

The biggest challenge for any new business is in “getting the word out” as to what it actually is that you do, and why people should buy your goods and/or services.

Getting the word out there is an even bigger challenge when the service you are offering is a new one, and furthermore it deals with something as personal as your own financial wellbeing.

Many studies have shown that consumers look for the WIIFM (What’s In It For Me) when they make a decision to buy goods or services.

I have established my service because the WIIFM I am offering people is a greater level of financial peace of mind and control that can be obtained from a better understanding and management of your day to day finances.    

Since launching Empower Money Management in late 2016 I’ve had plenty of positive feedback (and Facebook likes), and I am beginning to build a base of satisfied and empowered clients. Each of these clients now has a much greater understanding of their financial affairs, and significantly improved financial peace of mind.

I would love to continue to build my base of satisfied clients. Thank you to everyone who has taken the time to read and like my posts – To help me to further build my business please also take the time to share my posts with your own Facebook friends.

See more at www.empowermm.com.au 
                            

According to a Finder.com.au survey conducted in June 2016 more than 70% of Australian adults own credit cards, with more than 16 million credit cards in circulation and a national debt of over $32 billion accruing interest.

Furthermore, according to ASIC statistics the average debt per credit cardholder currently stands at around $4300, which will cost $2139 in interest over 5 years at 18% p.a. The statistics also reveal that the average credit cardholder has 2.19 cards. Do the maths yourself to see what that reveals!

With the plethora of card types on offer (e.g. reward cards, free balance transfer, low rate cards etc., etc.), who is really winning out of the broad range of cards on offer? I would argue that it is not the consumer!

When you really think about it, unless you are using your credit card as a traditional charge card - that is, using it as an expense account and then clearing the balance in full before the due payment date each month you are losing and your bank is winning.

As per the statistics quoted above, if you operate multiple credit cards that have a balance carried forward each month, you are just increasing the magnitude of your losses, thus increasing your bank (or banks) winnings.

The stark reality with regard to credit card use is that unless you can clear your credit card balance in full each month you are living beyond your means and you need to make changes to the way you manage your money.

To illustrate my point, as an example if you have a credit card with a $10,000 credit limit and the current balance owing is $5,000, you need to have $5,000 available in salary and/or your savings account at the end of the month to repay the credit card debt in full to then be breaking even from a zero interest charge perspective.

Too often over the years I have seen people who would view the scenario above as still having the capacity to spend a further $5,000 (as the card limit is $10,000). In this example if the cardholder increases the balance owing to the $10,000 limit they are actually deepening a financial hole for themselves and increasing the level of their bank’s interest windfall.

To improve your budgeting direction, and break yourself out of the cycle of credit card overuse and interest expense contact Leigh at Empower Money Management  on 0407 439 827 or leigh@empowermm.com.au       

I’m certain that most of us have made well intentioned New Year’s resolutions in the past , only for all that good intention to come grinding to a halt within the first week or two of the new year.

Amongst the most common resolutions, I fancy that we would find those listed below;

This year I resolve to get fitter
This year I resolve to give up smoking
This year I resolve to lose weight
This year I resolve to return to study
This year I resolve to drink less alcohol
 
In the finance industry the most frequent resolution I hear is -This year I resolve to get my finances in better order.

So why is it that most of these well intentioned resolutions fail?

I believe that more often than not we fail with our resolutions, because we don’t follow up the “thought bubble” behind the intention with a defined action plan.

I think that most of us would agree that the popular resolutions listed above are all great ideas, however if there is no “how” behind the intention, then more often than not the idea never progresses past first base.

Think of it like this;

How do I get to where I want to go if I have no set of directions as to how to get there?
How do I build a workable monthly budget?
How do I get my finances in better order if I never honestly assess my own position?
How do I improve my capacity to make sound borrowing choices if I don’t really understand loan contracts?
Most importantly, how do I do any of this if I’m not really sure what I’m doing in the first place?
 
At Empower Money Management I can help guide you to a better understanding of your own financial capacity through coaching you in the skill of managing your own money.

I have thirty years finance industry experience and a broad base of contacts I can share with you.

By investing some time and structure into your own financial affairs you can escape the treadmill of broken New Year’s resolutions.

For your appointment call 0407 439 827 or contact leigh@empowermm.com.au to make your New Year’s resolution mean something.     

My working life (30 years) has been spent in the finance industry. During that time I’ve often had cause to wonder why people seem to accept that “getting by” is the best they should hope for from a financial point of view.

Think of it like this;

If you are feeling consistently physically unwell do you just put up with it, or do you go to the doctor to seek a diagnosis and treatment for your ailment?

If the plumbing is blocked at home, do you put up with not being able to use the toilet or do you call the plumber ASAP to get it fixed?

If the car is broken down, do you just leave it permanently at the side of the road and put up with catching the bus, or do you call the mechanic and get the car fixed?

I could go on with the examples but I’m sure you are getting the message…….therefore why do we tolerate just “getting by” from a financial perspective.

I would argue that good ongoing financial health is at least as important to the quality of life you are able to lead as any of the examples above.  

If at times you feel overwhelmed by managing your day to day finances, think about what benefits you could derive from seeking the coaching and assistance of someone who can demonstrate in simple terms the value of good money management.   

At Empower Money Management I have a working lifetime of finance industry experience and connections I can share with you.

Be prepared to do better than just “get by”.
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Make an appointment today by contacting Leigh Cassidy on 0407 439 827 or leigh@empowermm.com.au
 
 

How often have you been asked this question over the years?

Meeting new people at the school pick-up, or at kids sport etc., etc. I’m sure this is a question we have all been asked plenty of times over the years.

So, what is the answer?

To me there is a significant difference between who you are employed by and who you work for.

Your employer is who you receive your pay packet from each week.

To my mind where you pay packet goes each week determines who you work for.

Let’s take a minute to think about that…….
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According to the ABS (Australian Bureau of Statistics) as at May 2016 the all employees average weekly total earnings was $1160.20. This equates to a gross annual salary of $60330.40.Based on current tax rates this means a net weekly figure of $922.20, or if you prefer, a net monthly figure of $3996.20. 

From the $3996.20 you then need to deduct the ongoing fixed costs you have each month.

Obviously everyone will have a different level of fixed costs depending on individual circumstances; however I would define fixed costs as those commitments you must make each month to sustain your household.

Typically (but not exhaustively) these costs will include housing (either mortgage or rent), utilities, groceries, fuel, schooling costs and insurance costs.

Furthermore, if you have made the choice to borrow money via personal loans, car loans or credit cards you must also add the monthly cost of servicing these commitments to the fixed costs listed above.

………Now before you spend any money on actually doing something for yourself how much of the month’s income of $3996.20 is left?

So let me pose my original question to you once again.
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Who do you really work for? 
 
Don’t you think it’s time to take back control of your own financial affairs!
 
Do you feel like you could use some assistance crafting a monthly budget for yourself that is sustainable?
Would it help you to have someone who understands the broad range of products available in today’s financial marketplace provide you with some direction?
 
Contact Leigh at Empower Money Management on 0407 439 827 or leigh@empowermm.com.au

There have been many studies done over the years that show that anxiety about money is one of the leading causes of stress in contemporary society.

A recent (2014) survey performed by the Australian Psychological Society revealed that for 49% of survey participants financial concerns remain the leading cause of stress.  

Why is this so?

Let’s look at some current facts.

With the Reserve Bank of Australia currently setting the cash rate at 1.50%, most of us with an owner occupied mortgage are likely to currently be paying a variable rate loan somewhere around the 3.50% to 4.50% mark.

The current annual rate of inflation, (Inflation can be loosely described as the increase in the cost of living), is 1.3%. The Reserve Bank of Australia targets an annual rate between 2.0% to 3.0% on average.

With home loan interest rates at such historic lows and the rate of inflation low why are so many of us stressed about money?  
 
I believe the answer lies at least partly in FOMO (Fear Of Missing Out).

As an example, how many of us have fallen victim to having to buy the latest gadgets as soon as they are released (thus paying full retail price for something you didn’t actually need in the first place).

As a further example, how many of us have purchased something that is price advertised as save 50% (again, for something that you didn’t actually need in the first place). This form of advertising is my personal bugbear. You haven’t saved anything at all. You have actually spent 50% of what the item was originally advertised at. Real saving is putting money in the bank – not spending it.

I could go on and on with the examples, however I believe the point is clear.

Of course for everybody there will be times where you do NEED to spend money unexpectedly (e.g. your fridge has broken down, car needs repairs, vet bills etc., etc.), so I’m not for a moment suggesting that these expenses can be avoided.

What I am suggesting is that by controlling the WANT spending the vast majority of us can retake control of the household budget.

Most modern marketing techniques are designed to have you spend money that you don’t need to spend (generally with a FOMO type advertising campaign), and this type of spending is usually what causes the feeling of financial stress and unease referred to at the beginning of my article.

Crafting a monthly budget for your household and through coaching learning the skills to better manage your level of exposure to WANT spending will go a very long way to easing the level of financial anxiety in your household.

To learn more about the benefits that can be obtained from having a monthly budget for your household, and the benefits that can be derived from financial coaching contact Leigh at Empower Money Management on 0407 439 827 or www.empowermm.com.au
   

The relentless call to consume which seems to be the nature of most contemporary advertising and marketing has led me to pose the question at the head of today’s article.

I was watching the TV last night, and the ad of a well-known retailer came on. Word for word the script of the ad was as follows; “Buy now, pay later, have the goods when you want them”.

Whatever way you choose to spin that, it still means you have to pay! Choosing the pay later option generally means that you don’t have the capacity to pay now. I would argue that if you can’t “pay now” you shouldn’t be buying whatever the item is.

Paying later generally means that you are using money provided by a financier to fund your purchase. The financier does not lend you their money for free. Paying later will almost always mean you are paying more for goods or services than if you are using your own money.

Furthermore, if you fall into the trap of utilising buy now, pay later options for multiple purchases (e.g. fitting out and furnishing your new home) you run the risk of having entered into multiple consumer credit contracts that you have no hope of completing when they fall due.  

………….In essence what I am saying here is that you need to be able to distinguish how to live within your means.
Naturally every household has different means (i.e. different levels of monthly income), however we all need to be able to live within the financial means of our own house.

As my headline asks, “Who pays the bills at your house”?  

Of course the answer is you. Therefore it makes common sense that the spending commitments you make are based on the income you earn and have a comfortable ongoing capacity to fulfil.

Using credit to “Keep up with the Joneses” is not a sustainable spending strategy.
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Falling victim to advertising and marketing that attempts to convince you that you “need” things is not a sustainable spending strategy.
 
If you feel like you could use some coaching that can assist you to learn how to better manage the monthly budget, live within your means, & help you resist the “spin” involved in modern marketing contact me today on 0407 439 827.

You can also visit www.empowermm.com.au or my Facebook page.   

Having worked in the finance industry all my life, I’ve often witnessed people looking to find the next “big thing” to invest in, with a view to making a quick buck.

That type of thinking has always made me wonder whether those who look externally for the miracle pot of gold ever take the time to pause and critically self- analyse their current financial position.

As an example, how many of us take the time each month to critique their own credit card statement when it arrives in the mail, comparing what they “wanted” to spend against what they “needed” to spend.

• Do you leave the credit card statement envelope sitting unopened on the kitchen bench or the study desk?
•  Has your bank signed you up for electronic statements, & you now don’t bother to look at them online?
•  Do you wait for the late payment reminder notice before you make the minimum monthly payment?   
• Have you ever received a threat of disconnection notice from one of your utilities providers?

Clearly I could go on and on with examples, but I think the list above is enough for now for the point to be clear - Burying your head in the sand is NOT an effective strategy.  

If you continue to struggle with effectively managing your finances, doing the same thing over and over is not the way forward.
 
……Let me use the analogy of a child’s sporting team with my explanation here. We don’t expect that the first time our daughters run onto the netball court, or our sons take to the football field that they will have an innate understanding of the game.

We expect that they will be led on the journey of learning the game by someone who has an understanding and passion for the game, and who has the will and the skills to effectively pass their knowledge on to our children.

Why should it be different when it comes to effectively managing your finances? Why be looking externally for the next “big thing” to invest in?

Invest in yourself! Invest in some coaching that will assist you to better understand the effective day to day use of your own money.
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To learn more visit www.empowermm.com.au or contact leigh@empowermm.com.au.

It’s only 9 weeks until Christmas.

Traditionally Christmas is a time of year when we love to catch up with family and friends and reflect on what those close connections mean to us.

Unfortunately it seems more and more prevalent in the world of rampant commercialism that we now live in, contemporary society measures Christmas in terms of the level of retail spending at the pre and post-Christmas sales.
I have absolutely no wish to be seen as the Christmas Grinch, and as with most of us I get great pleasure out of witnessing the joy some presents under the tree brings to my own kids on Christmas morning.

However, what I think has been lost in the relentless nature of modern marketing is the capacity for people to recognise their spending limits, and then feeling ok (not pressured by society) about choosing to spend within their means.

Buying something at the post-Christmas sales because it was 50% off is not a reason in itself to buy something that you don’t really need. I would argue that if you didn’t need a certain item the week before Christmas than you probably don’t need it the week after Christmas.

Furthermore, no matter the price paid an item isn’t cheap if you are still paying for it 6,12,24 or 36 months after you first bought it. Unfortunately too many of us fall in to the trap of using credit for Christmas shopping. The residual debt of a Christmas and post-Christmas shopping binge is often one of the key factors in people experiencing cash flow and budgeting issues into the New Year.

Using credit for Christmas shopping, combined with the expense of a summer holiday, followed up by back to school expenses in January/February, followed by rates bills in February is often the catalyst for people getting the feeling of being overburdened by their financial load.

As with most things in life the key is planning.

I mentioned earlier in the article I have no wish to be seen as the Christmas Grinch. Creating a manageable budget, and understanding the difference between a need and a want is the key not only to a happy Christmas, but the key to financial peace of mind throughout the rest of each year.   

Empower Money Management can help with creating a manageable budget, and provide you with ongoing coaching to assist achieving financial peace of mind.
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Contact Leigh today www.empowermm.com.au; leigh@empowermm.com.au