How Do They Afford That?If you're feeling overwhelmed by money, you're not alone. After work and family and general life admin, there's not a lot of time (or capacity!) to get your finances in order. Join Canna Campbell - a financial planner for 20 years - and Fear & Greed's Michael Thompson as they look at way to deal with the mental load of money, and to prioritise the things that'll actually make a difference to your finances.
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The information in this podcast is general in nature and does not take into account your personal circumstances, financial needs or objectives. Before acting on any information, you should consider the appropriateness of it and the relevant product having regard to your objectives, financial situation and needs. In particular, you should seek independent financial advice and read the relevant Product Disclosure Statement or other offer document prior to acquiring any financial product.
Canna Campbell is a Corporate Authorised Representative and Corporate Credit Representative of Wealthstream Financial Group Pty Ltd ABN 35 152 803 113 Australian Financial Services Licensee AFSL 412079.
Welcome to How Do They Afford That, The podcast that peaks into the financial lives of everyday Australians. I'm Michael Thompson. I'm an author and the co host of the podcast Fear and Greed business News. As always, I'm with Canna Campbell, financial planner and founder of Sugar Mama TV, the financial literacy platform covering YouTube and podcast, books, Instagram threads, TikTok and more. Hello, Hannah, good mind. I need some help.
You need a lot of help.
Yep, there we go, Thank you. I was waiting for that. Ask anyone right if you went out and if you walked outside today and just did a survey on the street, everyone will agree with me. I guarantee you that the mental load is just huge right now.
Yeah, I would agree.
Yeah, between work and family and just general life admin.
Responsibilities, all responsibilities, all of these things.
It is it feels like it is hard to focus on any one task right, let alone trying to over all your finances or make big changes to your money and trying to kind of reclaim your money and set yourself up for financial success. So the reason I need your help today. I would love to do it all right, but I just can't. So how do I decide the priority, what's going to have the biggest impact on my money? And how do I get it done? So really I'm just I'm speaking on behalf of everybody, but really this is about me today. Are you up for helping?
I am? Oh, that's good, Well, I am. I'm always up for helping.
Would have been very uncomfortable if you'd said no, I've got nothing else to talk to you about. Look, before we get into this, it is worth pointing out, of course, that as you're listening, everything that we talk about is always general in nature. It is never personal, investment, strategic or product advice. It is purely for financial education purposes only. And if you do hear something that might be relevant to you, then it is a good time to go and get some financial advice and talk to somebody about that is there and here I am looking for a quick fix kind of Is there a golden rule for what to prioritize first when it comes to managing your money?
So the classic order is debt first, then emergency savings, then you know, investing and planning for retirement and those big lifestyle purchases. However, personal circumstances do matter, so sometimes, like you're, the person's emotions take priority. So someone say, feeling really anxious about having no savings and they're sleeping out, like staying awake all night, and it's causing a lot of emotional distress, it might make sense of them to prioritize building up some emergency money is a buffer first before tackling the debt. For example, you know, might have like a thousand dollars in credit card debt, but then you've got no emergency savings to fall back off something happens out of the blue. In those situations, you need to listen to your gut, your intuition and go, all right, I'm aware of the debt, but quickly save up a thousand dollars for emergency money. Then us to tackle the debt.
Okay. Do you think then, if we agree that everyone is overwhelmed mostly, do you think that financial sense of financial overwhelm leads to avoidance? Do you think that we just get there's too much, and so you just got I can't, I can't tackle any of it.
Absolutely. Avoidance is a very common coping mechanism. So for example, someone might be you know, really diligent with their investments and even you know, checking in on their superannuation. But then they completely ignore their credit card debt, particularly if they had like a recent blowout or summer holiday. So you've got to try and break the cycle sooner rather than later.
How do you do that? So it's all right, I understand the importance of doing it. It feels like it is that that is the single biggest hurdle of trying to actually break that cycle, all right.
So just break it down into small, simple steps, you know, something as simple as just opening up a bank statement or opening up an email or checking one account. Take action on just one simple thing for each day or even each week, and then look at maybe even setting like a money date, so like scheduling you know, the month, each Monday evening or each Monday morning, to actually sit down and look at your finances on a regular basis and do it with no judgment. Everyone is overwhelmed, everyone is feeling anxious about their financial situation, and you know, doesn't know where to start. So no one is alone and no one's judging each other. But also learn to like reframe the narrative, the inner talk. Stop beating yourself up going I'm so bad with money, or I'm so irresponsible. Let drop the ball on this or let the wheels fall off on that. Say okay, all right, I'm doing my best. I'm going to have a go at looking at this one particular area in my life and say it out loud. Tell someone that can help you make it accountable. Even send me a DM. Say you know what, Canna, I'm going to have a go at looking at my budget this weekend. I'll make sure I reply to you and check in on you that weekend to make sure you've done your budgets and really, yes, why not, Like we all need to do this, We've got to help each other. And another great hack is and I do this for cleaning and tiding. I set a timer for ten minutes and I go. It almost gamifies it because I've got to beat the clock. So, you know, set a timer for ten minutes and sit down and go. Time is going. I'm going to check my credit card statement, or I'm going to check my bank transactions, or my savings accounts or my superannuation. So stop making it to be a bigger thing in your head that really needs to be. But do this by small little manageable tasks that you can actually see yourself doing without too much.
Stress, that all makes sense, like that actually feels like just and even just a little bit. The feeling of satisfaction that you get from that is huge, or the relief and suddenly you realize that it's not that big.
Exactly, and that then can drive you to do this again and you almost might even get a little bit of a dopamine hit from it.
Is there one financial task in that ten minutes or twenty minutes or half an hour or something that would give you the biggest return on your time and energy or is it just getting started? Or is it a budget? Is it doing a budget?
It's a budget and a goal. A budget without a goal, you can be in a little bits alls a bit lifeless and boring. But if you can, if you have like an exciting, empowering, sexy financial goal that you really want to achieve, that is the driving force to help you and make you do a budget. And the budget is what gives us the clarity to see, all right, how long is it going to take me to achieve that exciting sexy goal? You know, it's the motivation and what is it needed? For me to help prioritize this goal happens in time. So instead of saying, you know, with your goals, don't make them flaky, make them, make them detail. Money loves definition and clarity. So say things like I want to save five thousand dollars in my x y Z savings account by the first of December twenty twenty five because we are going on a holiday, a family trip to Disneyland, and we are all so excited we can't wait. Suddenly that goal isn't just like wafty like save more money. It's actually something that's got a deadline. You know exactly how much you want, so you'll know how you're progressing and when you've achieved it, and you've got some emotion behind it.
I'm not looking for a short cut here, but can we make like a minimum effective dose for financial admin like the bear assents that will still move the needle? Yes? And what would what would these be? An easy people? That's right? Like, I'm not trying to I'm trying to find a way that I can still get enough done to have an impact, acknowledging that Hey, at this particular time, I don't have the time to sit down and just spend hours working through everything, so I just need them what's going to still have a still make a difference, So make a huge investment of time.
So my first point of call would be debt, looking at debt, looking to minimize debt, particularly high end just debt like credit cards, so there would be that would be my first point of call. Then would be looking to automate savings and investing. Even you can set this up really is with most online training platforms and obviously with online savings accounts, so that really does help make things happen without having to think too hard.
Once You've only got to set that up once and then it just happens.
Sit and forget.
Yeah, I like that.
And then of course just doing a monthly check in. This is what I teach in my Budget and cash Flow Academy is checking your transactions to make sure you are sticking to your budget, because this will mean that you can put those you can automate all of those other financial goals back into your budget, which is one of the key principles behind making a huge difference in your financial future.
Okay, how do you then find this balance between essentially what is short term survival with long term financial goals. When life is busy, when life is chaotic, you know that you want to kind of achieve all these big things later. You want financial independence, you want a comfortable retirement, you want to travel overseas. Is it possible to do that without without putting in the work? I don't mean it like that, but can you How do you strike that balance trying to tick everything off you want in the future and acknowledging that just at the moment it might not be possible.
Rome wasn't built on a day. Yeah, okay, So it's about showing up consistently. You know, we've spoken about power of compounding interest and you obviously it takes time. You cannot you know, this isn't a get rich quick scheme here you do if you can just do little bits on a consistent basis over the long run, it is incredibly powerful what you can do over the course of a ten year period. It's that one percent shift. You know, every time you do one little thing, it really does help you take you into a very different, healthier and happier financial situation in the future. And this is why financial education is so important, because as you learn more about how important certain things are and paying attention and traps to avoid. You will want to invest time, you know, even it means having to get up twenty minutes earlier in the morning to look at your statements, to look at your debts, to check your superannuation. These things really do make a difference. And as you see the impact, the progress, the debts coming down faster, that fuels your motivation to actually go further and deeper with this. So you've got to I know it's cliche, but you got to almost lean in and trust the process. But as you educate yourself, you get it and go, actually, this is really important. I need to stop coming up with excuses and make this a priority in my life because I'm starting to see the progress I'm making and also realize that I'm worthy of having this in my life and I can actually do it because I'm doing the steps.
Okay, we're going to take a quick break. When we come back, I want to talk to you about kind of avoiding the guilt around kind of not managing to do everything that you want, but also kind of what you can outsource and whether you should be looking at outsourcing some elements of it, and also sharing the financial burden of the decision making and in the processing and within within the family unit, for instance, or within the household, so that it doesn't all fall on one person, and hope in doing so, whether you can actually ease the burden on yourself. We will come back in a moment. Can we are talking about financial overload today and this idea that life is busy, The mental load is huge for everyone between work and family and just all of the responsibilities that we have. How do we make the time to also keep on top of our money and how much do we need to be doing in order to be getting ahead and making some progress long term? Can we outsource parts of our financial life? And if we can, what is worth outsourcing because this is going to come at a cost. Are there particular parts that are going to deliver greater value by getting someone else to help you?
Yes? And it all boils down to what's important to you and what areas you can actually handle yourself and want to do yourself will actually properly get done. You know, you can actually dedicate that time versus what you just is too overwhelming, and you're happy to invest in that cost, So you know, going and finding a financial plan that can just purely do your superrednuation. If that's what you want, and you're going to do your investing separately, that is perfectly fine. You know, if you're a business owner having a bookkeeper, having an accountant to help you do your tax re trens, you know, it's the cost and benefit. You're going to get your time back and it's going to get done, and you're going to be able to progress on with your life and also emotionally feel like you're more in control than on top of things. So that is a wise investment.
Can I say that when we started working with our current financial planner and they said we will look at all of your insurances and help make sure that you are kind of correctly insured and getting the right policies and all of those things, I actually felt a physical weight lift off, because every time I say thinking about insurance and making sure I've got the right policies and all of these things, it is as though something just shuts down in my head and I just can't. That feels too big. So outsourcing, even in that kind of which is a more expensive way to outsource, having a financial plan of working with you on that still to me I consider that to be a worthwhile investment.
And the four or five hours you get back not having to figure it yourself, you can then use that time to earn more money elsewhere in doing what you do best.
Knowing then that you've got the peace of mind of being insured correctly. And because we have discussed.
About had some heated conversations with you, both online and.
Offline, where I have been frighteningly under insured and.
I have been horror equally horrified.
Indeed, is there value when we're talking about the financial overload and overwhelm is there value in kind of doing almost a brain dump style financial checklist to free up some mental space, just to go all right, I'm gonna put it all down on a list, from kind of a budget, through to insurances, through to mortgage through to superinuation. Just get it down on paper so it gets out of your head.
Absolutely. I call that a financial stock tech.
Oh I like that.
So you write everything down, you write down where you stand financially, you know, and you don't just condense it. You actually go, Okay, on this credit CARDIO, this much money, on that credit CARDO, this much money and this savings and I've got this much and then that savings and kind of got this much and this portfolio, don't like, just add it all together and give it yourself one concise number, detail where exactly they are, exactly how much, and also obviously write down your income as well. The more information you can put down, the better and you will. It's just like journaling, which is something I am doing at the moment each day. Getting it down is incredible what it does to your headspace and you just it compartmentalizes and it quarantines your stresses and problems because now you can see, Okay, that's what I'm worried about. What that's what needs my attention, and I will come to that when I next have time.
Yeah, and you don't necessarily have to act on it straight away, no, not at all. It does just kind of free up that space and it allows you to then come back to it knowing that you've already started the process, You've already done some of the homework.
Gives you awareness, clarity, and then gives you a purpose to go where you're going to go and focus your energy on.
Next. We talked about, or I mentioned before, this idea of sharing the financial load within say a household within a couple or a family, How do you do that? How can you do that to make sure that it is more evenly spread and one person isn't kind of carrying the full burden of making sure that the household's finances are in order.
I love this question, and so divide in conco So I'll use myself as an example. So Tom's responsibility is to do the mortgage. My responsibility is to do the super and the investing and the budget and cash flow. So the key to making this work, though, is continuous communication. So trusting each other is doing the work. They've got their responsibilities, they understand when things are due and what needs to be done, and making sure that you share any updates or any necessary changes or potential changes that are coming your way, and that you know, having that regular checking with each other to make each other accountable. But definitely, I mean, you know, I'm a financial planner and I even have my limits as to how much of the personal family finances I can take on, both mentally and physically and financially. So divide and conquer, I think is a very effective way. But communication is essential, and transparency and anything you see as a potential risk or expense. Communicate to each other, hey, that we might get you know, the car tires may need to be replaced. That's going to be an expensive we've got, so we need to make sure we keep that in mind.
But definitely it's just communication is key. And that goes right back to some of our earliest episodes we've done on this podcast when we were talking about I remember one in our very first month where we talked about how do you resolve this financial imbalance in a relationship where you have one partner as a spender and the other as a saverer, And funnily enough, the answer was communication. Yeah, And it all comes down to that within a household, within a couple, talk about your money.
And empower each other and educate each other. You know, sometimes you know someone might be spending because they don't understand what the benefit to putting that extra hundred dollars per month on the mortgage would be and actually say them seventy thousand dollars in interest for example. Suddenly when that spender understands that they don't want to spend as much anymore.
Are there any apps, any tools, anything that you would recommend to help kind of streamline their money.
Lots of different apps out there you can use, but you've obviously got to check the safety and security and the data. But at the end of the day, the most effective one, I think is your own. You know what works for you, stick to it, obviously, tweak and improve it where possible. But you know, I believe in having a cash flow system that matches your budget so that it's easy to stick to your budget and it's easy to put your financial goals into your budget so that they actually happen.
So that could be a spreadsheet, it could be on paper, it could be anything, as long as it actually works for you.
Yes, and it's written down and it's checked on a regular basis where you cross reference it against your transactions so you can see that you are sticking to your budget.
How do you this is the final question for you. How do you kind of avoid guilt or deal with guilt? You may not be able to avoid it, but how do you deal with the guilt around not being able to do everything when it comes to managing your money? And is it just a case of just do what you can, just get in, get started to do something, even if it is those little bits and just accept that we can't always do it all.
I think so acceptance is key, but also a bit of TLC. We are living in a very expensive world. The financial stress and pressure right now is horrific. What so many households are going through is so incredibly stressful, overwhelming and for some downright frightening. So we understand that you are doing your best, but I mean education here is key if we want to start making a shift. And also ask yourself this, how does this serve me? So does feeling guilt help you in any way whatsoever? No? But if you sit down and look at what you've got, what if you've got right now, what can you do that will help that situation? Where can you go? Free resources like a podcast, a book from the library, a conversation with someone who's been in a signal situation that's gotten through it. The best you can do for yourself to help improve your situation, even if it's only one small, simple thing once a day, once a week, or once a month. You've got to see light at the end of the tunnel. But understand that, yes, there is work involved. It is tough, but it won't always be like this as well.
It feels like a good place to finish up. I think that's it is a good message and to go back to where we started as well, that those priorities being the kind of debt, emergency savings, then investing in all of the other bits and pieces. But in the end, you just need to do what works for you that is going to get you going. Just something and whether it is even just a small little thing, and just sitting down and setting your goal. I loved that that you said that once you have your goal set, it just it helps to provide motivation for every other thing. Otherwise a budget can just feel like it is, did just say, a little bit empty, a little bit kind of soulless. Yeah, But if you're doing it with a goal in mind, that all of a sudden there is motivation to to try and kind of find those little bits of time and chip away at securing your financial freedom. Canna, If we want more information from you, where do we find you?
The best place to reach out for help is on Instagram at sugar Mama.
TV, and you can hear me every day on Fear and Greed with Sean Almer. That is the Fear and Greed Business News podcast. Thank you very much for listening to how Do They Afford That? Remember to hit follow on the podcast, and the best thing that you can do is tell somebody else or perhaps send them a link to this very episode and spread the word about how to they afford that? Thank you for your company. Join us again next week.
