‘Financial stress’ is costing the economy $31 billion every year, says AMP – The New Daily

‘Financial stress’ is costing the economy $31 billion every year, says AMP – The New Daily

Hugh recently chatted with Matt Johnson of The New Daily to discuss where we’re going wrong with finances.

Excerpt below

Centaur Financial Services managing director Hugh Robertson says a lack of awareness and understanding is a key driver of financial stress, because it means people are unable to recognise whether they’re in a good financial position, which leads to poor choices.

Many Australians also “bury their head in the sand” when it comes to dealing with their finances, he said.

And even people earning above $100,000 a year are stressed – AMP puts the figure at one in 10 – because they compare themselves to others and often spend no time working out their goals and how best to achieve them.

“And there’s an information overload from social media, friends, family, Google, where people are really just uncertain,” Mr Robertson said.

“So you’re combining low levels of financial literacy with the fact that it goes into the ‘too-hard basket’. And when people do want to [deal with it], there’s an information overload.”

On top of this, Mr Robertson said popular culture fails to reward financial discipline. People want things today and are less willing to wait, he said.

And this spending can then develop into a self-fulfilling prophecy.

People stray from their plan and make an impulse purchase, then feel guilty about it, and then spend again to make themselves feel better.

“It’s kinda like when you’re trying to lose weight,” Mr Robertson said.

Read the full article

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