Planning on a New Year’s revolution!

December 11, 2018

It happens every 31st of December. Millions of people all over the world promise themselves to improve at least one important aspect of their lives and make it their New Year’s resolution to do so. 

The most popular resolutions remain unchanged year after year, drawn from a list that includes getting fit, reducing stress and importantly, saving money so that you can reach your dreams sooner. Sound familiar? 

These are all important and worthwhile goals, but here’s the sad thing.Research indicates that by January 7th, 25 per cent of these resolutions will already be broken. And this attrition rate will continue, so that up to 80 per cent are likely to have been abandoned within two years.

So how can you make sure that you will be one of the minority who do not break their New Year’s promise to themselves? Perhaps the answer lies in our word choice. Rather than making a resolution which can be defined as ‘a firm decision to do or not do something’, why not aim for a revolution, ‘a sudden, complete or marked change in something’. The difference here is between thought and action. And actions when repeated become habits. Good habits achieve goals. 

Crucial steps

Your first step will be deciding how you will make the time to achieve the change you want, because if your life is already over committed you are more likely to fail than to succeed. If your day is already overcrowded, for example, it is unlikely that you will find the extra 30–60 minutes each day to jog, swim, ride a bike or go to the gym unless you drastically reorganise things. 

Secondly, you’ll need to research how you’ll reach your goal long before New Year’s Day. Don’t promise yourself to start spending less from the first of January and then do nothing about it until your credit card bounces at the Boxing Day sales. Investigate budget templates now, and review your past few month’s spending patterns (there are heaps of apps to help with this), this will put you in the best possible position to make sure your revolution sticks. 

Thirdly, use this research to create an informed plan with measurable outcomes. This way, you’ll be able to hit the ground running come January first. 

Revolutions take time

When you think of the great revolutions throughout history, they are often painted as sudden regime changes, overnight shifts in popular thinking. But remember the revolution itself is just the tipping point. Usually the ideas driving the change have been fermenting for a long time. And the hard work that comes with establishing a new system endures long after the revolt. 

Your New Year’s revolution will be the same. January first is the tipping point, but the momentum behind your revolution may have been a long time coming and the hard work will continue long into the New Year. So be patient and kind to yourself and forgive any lapses, stay focused on your goal and you will get there. 

Finally, tell all your friends about your revolution so you can earn their praise if you succeed and feel their scorn if you fail — peer pressure is a powerful incentive! And revolutions rarely work without the support of the people. This is particularly important if your goal is a budgetary one, as direct but sensitive communication around money is key to avoiding financial stress. 

As you can see, the difference between wishful thinking and real behavioural change is commitment and a plan, and this is never more important than when planning a brighter financial future. If you need help reaching your goals in the New Year, give us a call. We’re always here to help. 

Keys to an achievable revolution

1. Simple. You should be able to state your cause in one sentence.E.g. to save enough for a house deposit. 

2. Tangible. Make your goals quantifiable and specific. E.g. I will put away $500 a month towards my deposit. 

3. Shareable. Tell everyone about your goals, this will make you accountable to them. 

Budgeting on a fulfilling festive season

We’re at that time of the year again: the shopping centres are packed, you’re signing dozens of greeting cards, and your little ones have just handed you a ‘wish list’ longer than they are tall. At the back of your mind, you might even be hoping for a treat or two for yourself. 

It’s easy to get caught up in the consumer frenzy at this time of year. The media encourages us to equate spending with generosity, making buying a real emotional issue. From TV shows about the ‘best Christmas ever’ to department store ads encouraging us to give that special someone ‘what they really deserve’, there’s no wonder Australians spend billions every year over the holiday season– around $955 per person, according to ASIC’s MoneySmart. 

If that sounds like a lot, our Christmas debt hangover is even bigger, with the average Australian credit card holder spending $3342 on plastic in December last year. Worryingly, many were unable to pay it back for months, often accruing interest.

If this sounds like you, perhaps it’s time to put in place a plan for this festive season to make sure it’s a time not only of merriment and joy for all the family, but also one that doesn’t leave you too far in the red. 

Have a great holiday season – without overspending

  • Write a budget for your gift-giving, and stick to it. A thoughtful, well-chosen gift that reflects your relationship with the recipient often means a lot more than something flashy. 
  • If you’re hosting, plan the meal ahead of time to take advantage of savings and make sure you can get the ingredients you need without overspending. For example, you may need to order a ham or turkey up to a month in advance. 
  • Make your own decorations and crackers: this can be a fun activity to do with kids, or even by yourself. 
  • Speaking of DIY, Instagram and Pinterest have made homemade Christmas presents cool again. From personalised photo calendars to cookie mixes, there’s an idea for every person on your list. 
  • If you’re still tempted to spoil your kids, grand-kids or partner, consider giving one small meaningful present up front, and saving the rest of the spending until sales time when you’ll get better value for money. 
  • Reflect on last year’s Christmas spending. Think about everything you bought, what was really ‘worth it’ after all, and what you could do without. 
  • Rather than getting everyone in the family a separate gift, consider doing a Secret Santa of some sort to minimise everybody’s spending. Otherwise you can also make a rule that you just do gifts for the kids. 
  • Australian households throw away nearly 10 billion in food waste every year and the festive season is a major culprit. Reduce your Christmas spending by planning a meal in line with how much people actually eat rather than leaving weeks of leftovers that never get eaten. 
  • Consider whether, if you were to put holiday expenses on your credit card, you can still pay the balance in full ASAP. To put this another way, think about your total spend divided by 52 weeks (or 12 months – however you do your regular budget) – does the amount look reasonable and affordable now?

However you manage your holiday budget, we hope you have a wonderful time with friends and family, and a well-deserved break.

For more help with getting your spending and saving in order this festive season, make an appointment with us today. 

Ways to improve your work-life balance in 2019

In what has become an increasingly connected world, where we can be contacted at all times of the day and night, pretty much anywhere in the world, the pressure to be available at the drop of a hat can be considerable. 

But just because we have the means to always be available doesn’t mean that we always should be, far from it. 

In an increasingly competitive workplace, we can often feel obliged to go above and beyond what should reasonably be expected of us in order to advance our career, or simply even keep our job. But this approach does neither you nor your employer any favours, as there is a strong possibility that it will ultimately lead to burnout, or at the very least, low employee morale and personal difficulties. But by taking a few easy steps, you can achieve the optimum work-life balance that most of us crave. 

Establish boundaries (and stick to them!)

Chances are, the more available you make yourself, the more people will take advantage of that. If you get into the habit of responding to emails and phone calls in your personal time, it will quickly become an expectation that you do so. 

Avoid this by leaving your emails alone once you leave the office. They will still be there for you in the morning. Don’t be afraid to turn your phone off either, or at least stop answering work calls or calls from numbers you don’t recognise, and soon enough people will get the message that your out of office time is your time, and will stop impinging on it. 

Take advantage of flexible workplace options (or make a case for them if there are none)

While it is not possible for all professions to work remotely, it is eminently possible for most of us to have at least some degree of flexibility in how, where and when we work. 

For those of us with children, pets, or a long commute, working from home can be a great way of restoring some balance to your working week and getting more things done, both for yourself and your employer. 

If there are no flexible work options currently in place where you work, make the case for them with your boss. If you can demonstrate that it will be mutually beneficial to introduce flexible working practices, chances are they will be open to the idea. And if they are not, maybe it’s time to consider another employer that will respect your needs and be more flexible. 

Get organised!

A good way of getting your day off to a good start and improving your chances of getting home on time is to use any spare time you have during the day, or at the end of the day, to write a to-do list for the following morning. 

Another organisational trait to save time is to lose the clutter! If you have a tidy workstation with everything clearly marked and stored, you will save yourself lots of time hunting around for those bits of paperwork you can never find under a mountain of other stuff. 

Don’t lose sight of your priorities

Remember why the vast majority of us work in the first place – to keep a roof over our head, pay the bills, and generally provide for ourselves and our family. Family should always come first, and work second. If we lose focus of that, we could end up hurting our relationships with the ones we love the most, then what are we working for? 

A common fear is that if something happened to us, we wouldn’t be able to continue to provide for our family, but with Income Protection Insurance, you can rest assured that if you do happen to fall ill or suffer an injury, you will still receive a steady amount to help cover your ongoing expenses. 

Have some fun, and have it often

Lastly, never lose sight of the idea that life should be fun, so set aside plenty of time to see that show, go to that sporting event, read that book, take that holiday, meet with friends and have quality time with your family. Life is for living, so live it well.

Bank branches becoming ‘uneconomic’ says ANZ CEO

December 6, 2018

ANZ chief executive Shayne Elliott has conceded that branches are losing their lustre as cash becomes a niche payment solution and consumers opt to bank online.

Counsel assisting Rowena Orr asked why the major bank has been reducing its retail footprint during Mr Elliott’s time on the stand at the royal commission this week. 

Mr Elliott estimated 35 ANZ branches closed this year and up to 50 had ceased operating last year.

ANZ has closed around 110 branches in the past decade: 55 in inner regional Australia, 44 in outer regional areas, six in remote locations and four in very remote areas. 

Mr Elliott noted that some branches had also opened in that time, describing it as a redistribution of its network.

“Why so many branches this year, Mr Elliot?” Ms Orr asked. 

“Well, consumer behaviour is changing very quickly. And not that it has changed just this year but over the last few years we’re seeing a number of fundamental changes,” Mr Elliott said. 

“The Reserve Bank governor the other day referred to the fact that the usage of cash is almost becoming a niche payment solution.”

Mr Elliott added that most of what people are doing in branches is cash related, in deposits and withdrawals. He also noted a decrease in retail traffic of around 20 to 30 per cent over the last couple of years in areas where the bank had closed shops. 

However, small business usage was said to remain reasonably solid.

“So essentially, we are confronted with a dilemma where we have shops and a distribution network with less and less people in it, and therefore, at some point they become uneconomic,” he said.

“At the same time, what we have seen is a rapid increase in the use of technology for people who prefer to do their banking on their phone or at home, or even in some cases, on the phone.”

Ms Orr asked if people still go into branches to inquire about loans. 

“Yes, perhaps, although I would say for ANZ – and we may be different from our peer group – our home loan book only – less than a third of home loans are originated through a branch,” Mr Elliott said.

“Around 55 per cent come through brokers and another roughly 15 per cent come through our mobile banking network, ie, we send somebody to you. So the branch network is not a terribly efficient or well-used avenue for home loans.”

ANZ had considered two proposals with closing branches, one to sell and the other to continue with a branch by branch closure program. Mr Elliott said the organisation had chosen to continue with closures based on customer behaviour and impact data.

Mr Elliott was also asked about the considerations that ANZ takes into account during branch closures. He responded by saying the bank does not consider the financials of the branch, rather the transactions that are available in the area and local alternatives in close by branches and ATMs.

“There’s very little correlation between what happens in the branch and the economic outcome to the bank. What most people do in a branch drives very little value,” he said. 

“We don’t charge fees for most of what they do. It is a service that is not necessarily correlated to where we generate our profits or earnings.”

He added that delinkage is accelerating, with more people using brokers. 

ANZ’s attitude towards its retail banking division is in stark contrast to that of its largest competitor, CBA. 

When CBA boss Matt Comyn gave evidence before the Hayne inquiry last week he made clear the group’s preference for consumers to use its extensive branch network. 

Mr Comyn revealed that CBA had sought to introduce a “flat fee” commission-based model in January 2018, before choosing not to go ahead with the change in fear that the rest of the sector would not follow suit.

MFAA CEO Mike Felton said that CBA’s position was “not surprising”, but was “entirely self-serving” and was “designed to destroy competition and reduce the bank’s reliance on the broker channel”.

Commenting on CBA’s attempt to introduce a flat-fee remuneration model, Mr Felton said: “CBA’s model is anti-competitive and designed to drive consumers back into their branch network, which is the largest branch network of the major lenders.

“Mr Comyn’s solution for better customer outcomes is a new fee of several thousand dollars to be paid by consumers to CBA for the privilege of becoming a CBA customer.”

Mr Felton added: “Cutting what brokers earn by two-thirds would save CBA $197 million, which is good for CBA’s shareholders. However, it would destroy competition, leaving millions of customers without access to credit outside of major lenders.”