Let's (not) talk about money
January 24, 2023
Did you know there has been research undertaken which reveals that we are less willing to talk about money than we are about our weight or our sex life [1]?
Why is it that we are more inclined to talk about almost anything, other than money?
Australians have the second-highest median wealth per adult
International wealth reports from Credit Suisse consistently show that Australians have one of the largest middle classes and highest level of assets in the world. In fact in 2018 we had the second highest median wealth per adult [2].
Despite the fact that Australian’s are among the wealthiest people in the world, our unwillingness to talk about money means that we don’t always feel that way.
Australians also have the world's second-largest household debts
According to the Reserve Bank of Australia, we have nearly twice as much debt as income, with the level of household debt to income exceeding 190% for the first time in September 2019.
90% of the nearly 55,000 respondents to the ABC's 2019 Australia Talks National Survey [3], rated household debt as a problem for the nation. On an individual level, 39% of Australian households live beyond their means or barely break even, with almost half of millennials reporting that debt is a problem for them personally.
Despite our high disposable income, few were personally diverting this into savings or investment.
As a nation, we have not been well-equipped to make smart financial decisions
Pre COVID-19 research had shown that 1 in 5 were not able to access $2,000 in case of emergency [4]. The impact of the COVID-19 global pandemic has laid this bare.
The uptake of assistance in the form of early access to superannuation has brought to light the extent of Australian’s vulnerability and lack of financial resilience. Over 3 million Australian’s applied to access the scheme and by 2 August 2020, superannuation trustees had paid out over $30 billion [5], including around half a million who completely wiped out their super accounts. This not only exposed the extent of the problem, but also that many of these individuals may not understand the compounding impact this may have on their future wealth and wellbeing.
So, what can we do?
If we understand money, there is a much greater ability to engage in conversations around money, and to confidently engage professional financial advice.
Money may not buy happiness; but it does buy freedom. Freedom to make choices about the way we live. Financial wellbeing is all about our ability to make confident, well-informed money-related decisions resulting in financial security now and into the future.
Research shows that we feel less stressed about money if we have access to financial education [6]. Our ability to create wealth lies in our ability to understand money, and to make decisions to spend and invest mindfully. When we learn how to do more with our money, we will also be in a much better financial position to successfully navigate life’s hurdles.
It’s time to get the conversation started
If you don’t know where to start, reach out to people who deal with this stuff for a living. Speak with a financial adviser from Telstra Super Financial Planning. Talking to a professional about money – your income, your outgoings, your savings, your debt – could help you get a feel for whether you’re on the right track or unknowingly making big mistakes with your cash. Once you get started, you’ll realise it’s not as scary a subject as you thought.
General and simple personal advice about your TelstraSuper account is available over the phone. You can speak with a financial adviser at TelstraSuper Financial Planning about your TelstraSuper account at no additional cost - it’s part of your membership. You can start the money conversation by calling 1300 033 166 or request a call back online.
We also run regular webinars which you can enjoy from the comfort of your home.
1. https://www.moneymanagement.com.au/news/financial-planning/money-biggest-conversation-taboo
2. Credit Suisse Global Wealth Report 2018
3. https://www.abc.net.au/news/2019-10-06/australia-talks-explained/11570332
4. https://financialcapability.gov.au/files/Strategy-on-page-summary_2018.pdf
5. https://www.apra.gov.au/covid-19-early-release-scheme-issue-15
6. https://recruitmentbuzz.co.uk/uk-employers-falling-short-on-financial-education/