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Six great New Year’s Resolutions to improve your finances in 2021

Six great New Year’s Resolutions to improve your finances in 2021

Six great New Year’s Resolutions to improve your finances in 2021.

These days we know there is a correlation between our financial wellbeing and our general wellbeing. We know that toxic levels of financial stress impacts us in many different ways, it affects our relationships, our self-esteem, our social life, our productivity at work, even our physical health.

That’s why it’s appropriate to set New Year’s Resolutions for our finances — and also our related behaviours.

There’s every chance 2021 will be another tough year with COVID still a major problem, with businesses under pressure, unemployment a big worry and a wide range of ongoing social impacts.

Uncertainty and fear only add to the unavoidable problems presented by the pandemic: we still need to have positive goals and intentions for 2021, then deal with what happens as it happens.

Here are some suggestions to help you kick off 2021 in a positive way.

BECOME SELF-AWARE OF YOUR FINANCIAL POSITION

A great way to break through the murkiness of money problems is to answer some simple no-nonsense questions. Even if it’s a little scary, you should be clearer afterwards and probably more motivated too.

  1. Are your savings going up or down? What direction are your finances are headed in?
  2. Have you had trouble paying basic bills and/or making normal repayments?
  3. What are your financial goals?
  4. Do you fully understand your finances?
  5. Are you ok with being in the same position financially a year from now? Five years from now?
  6. Do you ever feel distracted because of your finances, including during work hours?
  7. How often do you spend money on things you don’t need and/or aren’t healthy for you? When did I last do this? How many times in the past month has this happened?
  8. Are you financially healthy but feel stressed and/or down about it anyway? Why is that?
  9. Do you ever experience conflict or feel anger because of your finances?
  10. What steps are you taking to address your financial issues? If none, what is holding you back?

Spend at least 30 minutes on this and try to share the answers with someone you trust, and also put your answers into a journal so you can refer to them later.

TRACK YOUR SPENDING

“Spend less, save more” is on just about everyone’s list of New Year’s Resolutions, ever year. It’s a great goal, but a more specific objective that will help you work towards that goal is to carefully track all your spending – on a daily basis. Use an app, or write it down on paper – whichever suits you best.

Do it for a week, then a month. Clear patterns will emerge which will help you to keep a realistic budget. Keep doing it – this is one of the best habits anyone who feels financial stress can build.

REDUCE THE NOISE

There are just too many distractions in the world today. To have any hope of living more mindfully, and sustaining financial resilience and overall wellbeing, we need to reduce the white noise in life. Here are some suggestions:

  • Reduce your social media use. Cut back and make the time you spend on social media more meaningful. For example, congratulate friends on life events and achievements instead of getting dragged into debates.Post pictures and stories of something you are proud of. If you really struggle with social media, turn off notifications and set digital wellbeing timers.
  • Be wary of online news. There’s an old saying that still holds true in the news business: if it bleeds, it leads. News organisations have a vested interest in bad news and scandals and that cannot be good for anyone’s state of mind.Be aware of that before you click: news sites count on a natural human curiosity to witness dramatic events.
  • Plan your distractions. It’s ok to switch off and escape mentally for a while, in fact it’s essential with the pressures in life. Plan ahead for how to ‘escape’ and make an agreement with yourself to eliminate or minimise unhealthy behaviours and stick to your limits.For example, watching a movie or two episodes of your favourite Netflix show is very different from bingeing until 2am. Try one glass of wine on a Friday instead of two each night. Listen to a podcast on a walk instead of snacking.
  • Monitor and reduce screen use. Are you seeing far more human faces on screens than in person? Does your screen use feel compulsive? Do you wish you could turn something off but can’t seem to?Do you have blurred vision, neck pain, headaches, irritability and trouble sleeping? These are all signs of excessive screen time.
  • Don’t reply to everyone. It was true of email 10 years ago and it’s true of all forms of digital communication today. We are not saying ignore people in need, but answer what you have to. You can’t always please everyone.
  • Aim for 5 minutes of complete silence each day. No screens, no music, no audio at all, no talking. Yes, it’s an old-fashioned idea but just try: it’s powerful. In that 5 minutes notice how your body feels.

UNDERSTAND WHAT YOU CANNOT CHANGE

Resisting or trying to control things that are not in our direct control is the cause of a lot of human misery. What does this have to do with financial resilience? A lot of people spend money to change the way they – or someone else – feels.

Understanding what you can’t change takes practice. Give this a try: can you actually change the fact that COVID is still in play and affecting your suburb and your company? Of course not.

Here are some other things you also cannot directly change:

  • Other people’s opinions and decisions;
  • Other people’s behaviours, including their flaws, habits and problems;
  • Final decisions and rulings made by companies, and governments;
  • The job market;
  • The housing or rental market;
  • The cost of buying anything;
  • Money that has already been spent; and
  • Debts that have been fairly accrued.

What do you think you have been trying to change that is actually beyond your direct control?

Here’s a list of things that we can change (even if it is difficult to do so):

  • Our own decisions and opinions;
  • Our own behaviours and how we react (including good and bad habits);
  • How we spend our time;
  • Our loneliness, including any tendency to repeat our mistakes (we can ask for help);
  • What we spend our money on;
  • Our level of savings and the direction of our finances;
  • Our financial literacy;
  • Debts that have been unfairly/illegally accrued

TAKE HAVING FUN MORE SERIOUSLY

True, it seems counter-intuitive to be “serious” about fun. What we really mean is to make having fun a priority. There is some science that shows how important fun is:

  • It improves relationships;
  • It relaxes and makes us more confident;
  • It is good for our health – reducing potentially harmful hormones like cortisol and noradrenalin and improving our immune system response;
  • Fun invariably leads to laughter, which also has a host of positive physiological affects including raising mood;
  • It improves satisfaction levels at home and in the workplace.

So how do we have more fun? Try thinking of fun as “play”.

Play isn’t just important for children, though it’s often best with children. Play with your kids, get down on the ground with them – inside or outside. In their fort, in the dirt. It’s good for everyone involved.

If you don’t have kids, play with your dog. If you don’t have a dog, sing bad 80s music at the top of your lungs, jump in the ocean regularly, rediscover things you loved doing as a teenager. Push yourself out of your comfort zone a little, perhaps with dancing, or taking up a craft or hobby that sounds enjoyable to you.

Gentle exercise, especially when shared with others, is often good fun. It doesn’t have to be competitive – that’s a personal decision: some people find competition fun, some don’t. Go with your gut.

Whatever you do for fun, make it regular – at least once a week.

MAKE SELF-CARE A DAILY HABIT

Self-care is being written about here, there and everywhere for a reason: it’s not just a cliché or a passing fad. It’s a very broad term to cover the actions that keep your mind and body healthy. Here are 12 suggestions for valuable self-care that anyone can do:

  1. Face up to basic responsibilities, like booking doctors and dentist appointments;
  2. Keep your receipts for tax time. Your self-esteem will grow, and you will feel more in control;
  3. Exercise at least 3 times a week, even if you can’t face high-intensity activity. Just go for long walks;
  4. Don’t eat mindlessly, think about your food. Avoid huge servings, especially late at night. Eat more vegetables than processed foods. Sugary snacks and drinks are not your friends! They are bad for your teeth and lead to weight gain;
  5. Go to bed on time and at the same time each night. 7-8 hours’ sleep is about right, less or more might affect your health;
  6. Do a quick mindfulness exercise each day. Guided meditations are easiest and often free on YouTube or apps;
  7. Get out of your own head by helping others;
  8. Always have something to look forward to a holiday, a dinner, a movie, a concert, especially something that ‘makes the heart sing’;
  9. Find a community you identify with – separate from work and family connect with them at least once a week;
  10. Reach out to trusted friends when you feel lonely. It’s never a burden to hear from a friend expressing their vulnerability, it actually builds trust;
  11. Set aside an hour each week for honest self-reflection: look at your progress with your finances and on your goals, assess your self-care and bad habits, estimate your screen time. Are you having enough fun? Or too much? Are you wrestling with things you can’t change? Record these facts, thoughts and feelings in the same place each week.
  12. Don’t forget to be positive, grateful and kind to yourself!

SET GOALS FOR 2021

Just setting a few modest goals can have positive impacts on our mental wellbeing, as well as the more obvious benefits that come from even partially achieving them.

It’s important to not overwhelm your list with a ‘to-do’ list aimed at transforming every area of your life. That is a recipe for beating yourself up. But you should put some thought and some detail into the few that you do come up with.

The SMART acronym – Specific, Measurable, Achievable (or Action-oriented), Realistic (or Relevant) and Timely – is a popular, effective and useful tool for goal setting.

Here are some steps for goal setting:

  1. Reflect on what you have learnt from 2020;
  2. Reflect on what worked well for you in 2020;
  3. Try to remember what your goals were this time last year – are they still relevant?;
  4. Think about what story you’d love to tell about your life at the end of 2021;
  5. Brainstorm 6-10 ideas for goals, some hard, some easy;
  6. Trim that list back to 3-4 that feel right and/or really important (don’t pick the 3-4 most difficult!);
  7. Apply the SMART acronym to each; and
  8. For long-term goals, make sure you break them down into smaller goals, e.g. “To save $20,000 and invest” can’t be achieved quickly for someone on an average income. For most people it would only be possible with a series of smaller goals, such as:
    1. Calculate how much you need to save each week to reach your savings goal;
    2. Make a realistic budget of all your expenses;
    3. Work out how much income you need each week to reach the savings goal;
    4. Adjust the savings target if necessary;
    5. Evaluate your progress after 1 week, 3 and 6 weeks. Make necessary adjustments; and
    6. Seek help and advice on investment options.

Some general tips on goal-setting:

  • Goals work best when they are clear and specific;
  • Having several highly ambitious goals is probably not realistic;
  • Having at least one challenging goal has positives and negatives, but produce better overall results than having only modest goals;
  • Goals need to be reviewed regularly and adjusted accordingly; and
  • When you evaluate your progress and find you are on track, give yourself a modest reward, but not one that undermines your efforts so far.
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How to stop spending too much at Christmas

How to stop spending too much at Christmas

How to stop spending too much at Christmas.

Christmas is by far the busiest time of the year for shopping and many of us deal with the pressure and financial stress of the annual retail frenzy with an increasingly popular new behaviour – self-gifting.

If you’re not familiar with the concept of self-gifting, you might be just a bit in denial. Think of it as December retail therapy: we all know that feeling – we are out shopping for Christmas gifts and we see a sexy new gadget, T-shirt with a funny slogan or a stylish home accessory in a store and realise the person it would be a perfect present for is actually ourselves. So, we buy it, you know, as a treat!

Retail therapy sounds nice – we fool ourselves it’s ok because it’s a type of therapy and we are told: “Therapy: Good!”

Retail therapy is of course popular all year round, especially after a shocking week at work, or an argument with our partner, or when we’re just feeling the blues.

But is it therapeutic if we buy non-essential to just manage predictable and recurring stress? Or is it really impulse spending?

Spending money impulsively can make us ‘feel better’ and ‘more alive’. But it can be a serious problem if this is something we begin to do regularly, especially with expensive items, as a way of coping. And let’s face it, jobs and relationships – and life in general – can be stressful for extended periods. New COVID-19 lockdowns are also very stressful especially on the eve of Christmas.

Data on impulse spending is contradictory – with one survey showing Aussies claim to have reduced our impulse buying while another shows that more than three quarters of us impulse buy when we shop via mobile. So it’s helpful to define it: when react to temptation by mindlessly spending money we haven’t budgeted on.

According to a poll of 1003 consumers by US website creditcards.com, five out of six Americans admit to impulse buying. One in five people had spent more than US$1000 on impulse, which rose to one in three for people earning over US$75,000.

Seven strategies to manage your impulse buying

  1. You are much less likely to buy on impulse if you plan your shopping trip therefore write a shopping list before you go.
  2. Avoid sales (or nominate an item you want and don’t break that agreement with yourself). A price discount is a real trigger for impulse spenders often buying things they don’t need.
  3. Don’t shop when you are emotional.
  4. Remind yourself of your longer-term financial goals before you spend.
  5. Wait a day before you purchase non-essential items.
  6. Make a budget for spending on ‘extras’ or treats and stick to it.
  7. Eat before you leave home to shop, this avoids spending extra money on food items as you will not be hungry during shopping time.

It’s not a huge leap to switch from a default state of mindless impulse spending to one of financial mindfulness– which means having awareness and paying attention to your finances and financial behaviours.

Working through complex and difficult problems that may trigger impulse buying is of course not easy. But let’s not forget what a hugely painful thing financial stress is. Ask yourself honestly, is your impulse buying adding to your financial stress? It’s a question worth pausing to consider honestly.

Financial worries are now accepted as a leading cause of stress in people’s lives throughout the western world.  Impulse spending therefore just compounds the problem.

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Happy holidays: stress less with mindfulness this Christmas

Happy holidays: stress less with mindfulness this Christmas

Happy holidays: stress less with mindfulness this Christmas.

Christmas and the holidays are mostly feelgood times. At least the ideas behind them are positive, but that doesn’t mean they aren’t stressful.

Clinical Neuropsychologist Dr Michael Takagi, says there’s plenty of evidence to show stress comes from happy occasions too: “Planning a wedding is a joyful, positive occasion, but very stressful. For many people it is overwhelming.

“Christmas is on a smaller scale, but it can be a bit like that. So, can holidays.”

A big issue with positive life events is they usually come with expectations, that’s just human nature, right? It’s normal to expect Christmas to feel familiar, even similar to previous years. It’s also pretty normal to expect gifts from people we are close to.

So, what if they forget, or buy something we don’t want? It’s usual too, to expect our holiday will feel relaxing in a way that we want. But what if the holiday cabins you usually book aren’t available, and the alternate choice doesn’t measure up? The family probably complains, that’s what.

It’s important to note that Christmas isn’t positive for everyone. Research done by the Salvation Army in 2018 found that 7.6 million think Christmas is the most stressful time of the year. One in four Aussies experience anxiety at this time, while the same proportion spend more than they can afford.

Could mindfulness help? It’s never been a magic cure for the kinds of issues noted above, but there’s plenty of evidence that shows mindfulness has a positive impact on our mindset and behaviour.

So as long as our expectations are modest, a few basic mindfulness techniques can take the edge off Christmas and holiday stress.

It’s a good idea to do a little unpacking to make your mindfulness techniques effective this Christmas and holiday season, Dr Takagi says anticipating potentially stressful events can improve our chances of reducing stress. So, let’s dig a little deeper. Christmas and the holidays have the capacity to stress us out in several ways:

  1. Financially
  2. At work
  3. The celebration/s
  4. Relationships
  5. Post-holiday blues

Below we’ll look briefly at how mindfulness works and then unpack each of those trigger points.to see how mindfulness can help.

HOW MINDFULNESS WORKS

In a nutshell, by reducing the stress hormones that course through our minds and deactivating the parasympathetic nervous system that sparks the flight, fight or freeze responses.

Our muscles relax and loosen, our breathing slows down and becomes deeper. We feel less agitation and can think clearer and make better decisions.

But those effects are the end result not the instructions for getting there.

It’s a misconception that mindfulness is clearing the mind and calming down, though we might get those benefits when we approach mindfulness with a good understanding of what it is.

“A big part of mindfulness is learning to be present in the moment, Dr Takagi says. That is easier said than done, it is normal for your thoughts to wander and go off on a tangent or focus on stressful things in your life. With practice, you learn to bring your thoughts back and stay in the moment.

“What we are trying to do is be aware of how we are feeling, the emotions, the sensations, how the moment is impacting you and acknowledging your reactions are normal.

“Accept your thoughts and feelings without judgement, so for example, if you’re anxious, acknowledge it and reassure yourself that feeling anxious is neither good nor bad. We try not to expect that we should be feeling this way or another way.”

Just accepting your feelings and thoughts and concentrating on your breathing, or relaxing the muscles in your body one at a time, or a very simple visualisation, and letting thoughts go, this can reduce stress. “Feelings and thoughts tend to pass and move on if you let them,” Takagi says.

Why do we need to reduce stress at all? Because continually operating with feelings of stress can interfere with good decision-making. It’s a theme we’ll come back to several times.

FINANCIAL STRESS AND SHOPPING

Situations like rushing to buy presents at the last minute on Christmas Eve, or in a 30-minute lunch break, or having to weave through big crowds to find items in short supply, or trying to tick off a long list of gifts on a budget.

These trigger a stress response, even though in evolutionary terms this was obviously not what our stress response was designed to handle.

We are similarly ill-equipped to cope with financial stress, which happens when we experience chronic worry about money.

There’s no doubt stress is a useful immediate reaction for humans in some situations, like, being faced with a life-threatening situation: we can decide under pressure to run, jump, hide, or even fight.  But operating for prolonged periods in a stressed state can lead humans to make bad decisions.

Perhaps nowhere is this more evident with spending money as an attempt to quell stress. Research done by Financial Mindfulness in 2017 found financial stress had damaging effects on relationships and our mental health.

Things only got worse during COVID-19, with big increases in level of aggression, isolation and distress due to financial stress.

How often do we make spending decisions we regret later? Most people would probably identify with this when they reflect on purchases made without planning – especially with Christmas gifts and Christmas shopping.

Overall, we spend far more at Christmas than any other time of the year and it’s growing every year. Roy Morgan Research predicts Christmas period spending in Australia for the six weeks leading up to Christmas Eve will be $54.3 billion, up 2.8 per cent from last Christmas.

‘Mindless’ shopping – where we are not fully aware of our financial position or what it is what really want to buy – can become a vicious cycle whether we are doing it online or at a real ‘bricks and mortar’ store. Spending too much quickly results in financial stress, which creates uncomfortable feelings that we paradoxically deal with by buying more for the quick feelgood hit of dopamine.

“Trying to relieve short term emotional discomfort around money by compulsively purchasing things will compound a difficult financial situation and produce even more stress.

Doing a few minutes of mindfulness can stop that cycle and having a mindfulness practice can turn that behaviour around.” Dr Takagi says spending is a behaviour positively impacted by mindfulness and mindful practices.

WORKPLACE STRESS

Everyone knows it: that special kind of pre-Christmas madness in the office. We feel pressured to finish up all projects before going on leave.

If you consider the alternative – leaving projects and tasks half done – the Christmas work rush actually makes a lot of sense. Who really wants work hanging over them while they’re on holiday? It’s as reasonable expectation from our partners and families that we will not be doing work, or obsessed with work, while we are with them on Christmas Day and on holiday.

Dr Takagi says the rush to clear the decks is a big cause of tension and stress at Christmas but it can be difficult to avoid. “Sometimes wrapping everything up before Christmas isn’t reasonable but other times that’s just how it is. It depends on the company, the project and the commitments made.”

Dr Takagi admits being one of the many trying to find extra time to finish work before Christmas. “I’m trying to find an extra half a day each week to finish five different jobs.

Yesterday I was writing an email which reminded me to make a phone call and that resulted in sending a different email, I was a bit all over the place and overwhelmed.

Then if I’m not mindful a five-minute break turns into half hour and I’m really behind. It’s a really common behaviour to have a ‘quick-fix’ behaviour to deal with uncomfortable feelings that seems to work at the time but has negative consequences later.

“I take short breaks and concentrate on my breathing for a few minutes and that helps me to focus and stick to my priorities. Mindfulness is very good at helping me to make better decisions.”

Here are some questions to ask yourself that might help you get that Christmas rush into perspective:

  • Who wants the project wrapped up, you or your boss?
  • Will the project fail if it isn’t finished before the break?
  • Is this part of a bigger piece of work that will continue well into 2021?
  • Is completion prior to Christmas realistic?
  • Will you be likely to obsess over work, or even dip into it, on holiday if you don’t finish it?
  • Will you be more productive if you go for a week or two without doing any work? Why?

CHRISTMAS CELEBRATIONS

The traditional nature of Christmas plans – whether we gather to celebrate on Christmas Eve, Christmas Day or Boxing Day – are enough to stress out most hosts.

All indications are that Aussies are that planning to splurge on Christmas gifts and food too this year, to make up for the social distancing and belt-tightening that happened earlier this year due to COVID.

Roy Morgan Research has forecast a massive 10 per cent increase in spending on food, which means crowds, long waits and products selling out across Australia from fish markets and department stores down to local shopping centres.

Heavy spending and a desire to provide guests with ‘the perfect Christmas” without doubt creates pressure which can lead to minor or major conflicts and tension.

Mindfulness can help us in several ways around the actual Christmas celebrations:

  • Planning accurately so we don’t buy too much food and serve so much that we end up throwing food away;
  • Catering to the tastes of all invited guests, not just expecting everyone to eat the same as us;
  • Having clear, simple boundaries around how much we consume so we avoid over-eating and drinking too much;
  • Being clear about the food and drinks we want and need to avoid, i.e. allergens, emotional eating, alcohol if we need to drive home;
  • Taking mindful time-outs if family gatherings are triggering instead of numbing emotions with alcohol and/or drugs; and
  • Sticking to pre-considered time limits at a gathering if we are likely to be triggered by the people present.

RELATIONSHIPS DURING THE HOLIDAYS

Isn’t it sad that one of the best things about Christmas and the holidays – spending time with loved ones – can actually be the first casualty of festive stress?

We all value family harmony highly for good reason. But under high stress we can become difficult to be around, either because we feel angry or because of another behaviour we use to cope – such as drinking alcohol, gambling or taking drugs.

Even without damaging coping strategies, innocuous and unexpected pressures and expectations can arise that can cause tension. “It happens with my sister and I. I love her dearly, but we really know how to push each other’s buttons too, better than anyone else. It’s always great to see each other but we can also drive each other crazy!”

Once upon a time, in decades past, we would have poured an extra drink or taken multiple cigarette breaks to get away from family for a few minutes. But today we have more awareness and better options. Again, Dr Takagi, suggests taking a breather in sustained close proximity to family, perhaps to do a 5-minute progressive muscle relaxation exercise.

It may seem obvious, but given the stresses of any year – especially one with a global pandemic – and the fast-paced closure of the calendar year, we do actually need to relax and recharge before going back to work.

“Stress and relaxation are mutually exclusive,” Dr Takagi says. “You can’t really relax while you are stressed.”

POST-HOLIDAY BLUES

What goes up must come down and we all know that is true of the relaxed sense of wellbeing and calm we get from a great holiday. But we have to come back to earth and face the prospect of returning to work, school and our normal lives.

A good holiday often brings introspection too: we can reflect on how to the good, the bad and the unhelpful behaviours and habits that might have stressed us throughout 2020. For many of us those included:

  • Unhealthy eating, drinking or substance use
  • Compulsive spending, overspending, gambling or shopping
  • Avoidance of our true financial position
  • Overworking or avoidance of work
  • Unresolved relationship issues
  • Thankfully, January always brings the opportunity to start the New Year in a positive way, which means a clear-headed assessment of what might have been holding us back in 2020.

Beginning a mindfulness practice can help us to see and accept reality, perhaps helping us to make form some new plans and take a few small steps towards the kind of 2021 we really want to live.

After all, we could probably all do with a better year after 2020!

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Want to avoid financial stress: ask yourself these questions

Want to avoid financial stress: ask yourself these questions

Want to avoid financial stress: ask yourself these questions.

There’s never been so many options for accessing cash quickly as there are today, and that’s very appealing around this time of year – especially this year, with many more people unemployed as a result of the ‘pandemic induced’ economic disruption.

Nobody wants to be in financial stress (or distress) or have money worries. But sometimes a quick fix becomes a long-term problem if we ‘go there’ over and over.

We all know the quick fixes to cashflow problems available today. On top of the huge success of ‘buy now, pay later’ products like Afterpay and ZipMoney, people are increasingly signing up to so-called ‘pay-on-demand’ services that – for a fee of around 5 per cent – will let you draw cash against your pay before it is deposited into your bank account.

New financial services arise (and succeed) because someone has identified a need and met that need. That’s fair enough. Financial products and services that give people flexibility and help them out of a squeeze are welcome. There are a lot of positives when one considers all the angles and different perspectives.

These new services, referred to above, are sign of the times. They also tell us some important things – that many people basically live paycheck to paycheck and that there is a groundswell of support for the idea that employers shouldn’t pay in arrears and instead should pay as people earn.

We need to be clear – and we urge mums, dads and singles to be clear about what these services really are: they are loans that have to be repaid.

As a rule, we cannot endorse the regular use of fee-based short-term loans to get by every week.

Here are at least four reasons:

  1. Paying regular fees for basically spending your own money is just adding another debit to your account, and it’s not insignificant (Think about it: how often would you pay $15 to withdraw $300 from an ATM?)
  2. The second reason is there’s a basic truth that these service providers (let’s call them small lenders, as that’s what they are) want you to ignore: spending more than you earn every week is a dangerous habit.
  3. Financial stress. See points 1 and 2.
  4. We believe that with ‘mindful spending’ – spending done with full awareness of your financial position and your needs and wants – you can reduce, and avoid, damaging financial stress.

The good news is that by using awareness and acceptance of your financial position, you can feel much more in control of your personal finances and your week-to-week expenses.

With a healthier financial mindset – where you aren’t experiencing the symptoms and impacts of financial stress – short-term loans become what they were designed for: a useful solution to an emergency cash flow problem.

Here are some questions to ask yourself if you regularly use ‘buy now, pay later’ services like Afterpay, and have used – or want to use – ‘pay on demand’ apps and services.

  1. When was the last time you looked at your credit card statement? If you are avoiding it, why is that?
  2. How many ‘buy now, pay later’ accounts do you have?
  3. Do you keep track of the total amounts owed? Are those totals increasing over time?
  4. How often do you use buy now pay later services?
  5. What do you buy using these products? To solve emergency money issues, or for normal living expenses? (Note: clothes and haircuts are rarely an emergency)
  6. How often would you use ‘pay on demand’ (getting an advance on your pay) apps and services?
  7. What would you buy with the money you receive from ‘pay on demand’ services?
  8. Is your overall financial position better or worse after using ‘buy now, pay later’ and/or ‘pay on demand’ services?
  9. What would it really take to improve your overall financial position?