It’s always tricky giving advice, but when it comes to loved ones and their financial well being, sometimes you’ve got to say what the heck ( you may choose other words!)

Tell ‘em you’ve been on Dads’ Club.com.au  and found this piece of sound advice and much more….

Take a financial health check

If you were to ask a group of your friends whether they thought that healthy eating and regular exercise was good for their physical wellbeing, there’s a good chance that the majority will recognise the benefits of these lifestyle choices. If you asked the same group about their financial wellbeing, the majority would probably understand the fundamental benefits of budgeting, managing their debts and making provision for the future.

Unfortunately, there can be a significant disconnect between knowing what is good for you and choosing to make the required changes to your lifestyle.

Understanding vs. attitude

A much publicised piece of research by ANZ Bank* highlighted the fact that basic financial knowledge is just one factor influencing the financial behaviour of individuals and their subsequent financial health. The findings suggest that to a large degree an individual’s attitude to their financial position can overwhelm their underlying understanding of the best course of action for them to take.

The ‘unhealthy’ attitudes

• ‘living for today’ – focusing on the present, not taking into account the future consequences of today’s spending;
• ‘financial disengagement’ – no interest in managing finances (either current or future), no monitoring or responsibility taken for spending;
• ‘aspirational’ – spending to ‘keep up with the Joneses’;
• ‘emotional enhancement’ – spending to feel better;
• ‘ownership of credit’ – over time developing an attitude of ‘it’s my money’ as opposed to credit that needs to be repaid; and
• ‘credit as supplementary income’ – ‘I need more to live’: to supplement a low income, to replace a loss in income or for those with higher incomes to support a ‘lifestyle’.

It can however, be difficult to recognise when unhealthy attitudes to money begin to creep into the psyche, particularly as the pressures of everyday life mean that our attention is spread ever more thinly over a growing diversity of issues. And, of course, no-one is immune from the occasional bombshells that fate can drop in our paths, as even those with the most positive attitude to their finances can fall foul of circumstances outside of their control.

Peculiarly, a financial misfortune (such as job loss, divorce or ill-health) can sometimes act as a positive tipping point for some individuals, cutting through their unhealthy attitudes and revealing their underlying knowledge and skills.

See a specialist

When we are ill, we entrust our physical wellbeing to a range of experts such as doctors, or even personal trainers and dieticians. These professionals perform two vital functions: to manage our overall health in order to prevent future difficulties and to restore our wellbeing following an unforseen problem.

Financial ‘health’ professionals can help us better mange our ongoing financial fitness, plus provide us with safety nets such as risk management strategies and insurance for those unpredictable but potential pitfalls.

If you’re unsure of your financial fitness, perhaps the most positive step that can be taken towards improving financial wellbeing is to contact your financial ‘health’ adviser for a thorough examination.

* Source ANZ’s Adult Financial Literacy Survey 2005

Brett Abikhair has over 20 years experience in the finance industry. He has an Advanced Diploma of Financial Services (Financial Planning), Diploma of Mortgage Lending and specialist certification in Self Managed Superannuation Funds. Brett Abikhair and ABS Capital Pty Ltd trading as Real People Financial Services are Authorised Representatives of Consultum Financial Advisers Pty Ltd AFS Licence No 230323 ABN 65 006 373 995.

Disclaimer and General Advice Warning

This information has been issued by Consultum Financial Advisers Pty Ltd (Consultum), ABN 65 006 373 995, Australian Financial Services Licence No. 230323. The information in this article is general in nature and has been prepared without taking into account any person’s individual investment objectives, financial situation or particular needs. A person should not act on this information without first talking to a financial adviser