Financial Planning - Seek professional advice from a financial planner
Financial Planner - Let's Talk Money
By Venn Williams
We know the recent financial crisis has caused a lot of stress at the big end: corporations have collapsed, central governments have injected billions of dollars into their economies, and there have been major growth down-grades across the globe.
But what about the stress closer to home? What effect is the downturn having behind closed doors?
Money is one of the most emotive issues there is. It can be a point of tension in any relationship at the best of times but when finances are tight this tension can reach breaking point.
Research has shown that there's a link between relationship breakdowns and the All Ordinaries index: when markets are up divorces are down and when markets are down, relationships crack. Divorces last peaked during the tech wreck in 2001, then fell to just 6.6% at the height of the boom last year (the lowest divorce rate in 20 years). Researchers expect to see this number rise again with this recent financial down-turn.
Relationships Australia recently conducted a survey and found that the number of people concerned that financial stress may break down their relationships has more than doubled in two years. Two years ago, at the height of the boom, only 18% of people felt money could end their relationship; this number now stands at 40%.
Over the years we've found that while people have strong goals for many areas of their lives, they often don't have clear financial goals. The Relationships Australia survey found that 55% of people felt that 'different goals or expectations' from their partner was a negative factor on their relationship.
With this in mind, try some of these strategies to help ease the strain:
1. Develop a financial plan together. Put in writing what you and your partner want to achieve financially and list the ways to make it reality. It is important to keep in mind your earning potential and not over commit.
2. Set an accurate budget. Sure budgeting is boring but it is the key to making sure you have money available to cover the necessities.
3. Review your financial goals with your partner every few months. Discuss your expectations.
4. Talk talk talk. Talking about the issues as they arise and being realistic about the solution is important to help avoid financial stress affecting your relationship.
5. Seek professional advice. See your financial planner; while they might not be able to help you on the love front, they can give you an objective point of view on your financial situation and help you find the best strategy for moving forward. And if the strain on your relationship gets too much, see a relationship counselor.
Also keep in mind that you and your partner may have different risk profiles - you need to find out what these are and work within them. In our experience when partners have different risk profiles towards investing the result does not favour the most aggressive profile. The result is most often no action at all, and hence nothing is ever done toward creating wealth (except paying off the home). This is not a result for either partner.
Remember you and your partner are on the same team when it comes to your finances so work out a plan together.
We know the recent financial crisis has caused a lot of stress at the big end: corporations have collapsed, central governments have injected billions of dollars into their economies, and there have been major growth down-grades across the globe.
But what about the stress closer to home? What effect is the downturn having behind closed doors?
Money is one of the most emotive issues there is. It can be a point of tension in any relationship at the best of times but when finances are tight this tension can reach breaking point.
Research has shown that there's a link between relationship breakdowns and the All Ordinaries index: when markets are up divorces are down and when markets are down, relationships crack. Divorces last peaked during the tech wreck in 2001, then fell to just 6.6% at the height of the boom last year (the lowest divorce rate in 20 years). Researchers expect to see this number rise again with this recent financial down-turn.
Relationships Australia recently conducted a survey and found that the number of people concerned that financial stress may break down their relationships has more than doubled in two years. Two years ago, at the height of the boom, only 18% of people felt money could end their relationship; this number now stands at 40%.
Over the years we've found that while people have strong goals for many areas of their lives, they often don't have clear financial goals. The Relationships Australia survey found that 55% of people felt that 'different goals or expectations' from their partner was a negative factor on their relationship.
With this in mind, try some of these strategies to help ease the strain:
1. Develop a financial plan together. Put in writing what you and your partner want to achieve financially and list the ways to make it reality. It is important to keep in mind your earning potential and not over commit.
2. Set an accurate budget. Sure budgeting is boring but it is the key to making sure you have money available to cover the necessities.
3. Review your financial goals with your partner every few months. Discuss your expectations.
4. Talk talk talk. Talking about the issues as they arise and being realistic about the solution is important to help avoid financial stress affecting your relationship.
5. Seek professional advice. See your financial planner; while they might not be able to help you on the love front, they can give you an objective point of view on your financial situation and help you find the best strategy for moving forward. And if the strain on your relationship gets too much, see a relationship counselor.
Also keep in mind that you and your partner may have different risk profiles - you need to find out what these are and work within them. In our experience when partners have different risk profiles towards investing the result does not favour the most aggressive profile. The result is most often no action at all, and hence nothing is ever done toward creating wealth (except paying off the home). This is not a result for either partner.
Remember you and your partner are on the same team when it comes to your finances so work out a plan together.
©2024 All rights reserved | Email:
info@financialadviceaustralia.com.au
Home | Superannuation Funds | Property Investment | Income Tax | Income Protection Insurance | Fund Managers
Margin Lending | Stock Trading | Stock Market Crash | Tips | Quotes | Property Boom | Baby Boomers | Mortgage Trust
Reduce Tax | Buying Shares | How To Invest | Investment Scams | End Of Financial Year | Building Wealth
Oulook 2006 | Investment Types | Property Trust | Market Investment
Home | Superannuation Funds | Property Investment | Income Tax | Income Protection Insurance | Fund Managers
Margin Lending | Stock Trading | Stock Market Crash | Tips | Quotes | Property Boom | Baby Boomers | Mortgage Trust
Reduce Tax | Buying Shares | How To Invest | Investment Scams | End Of Financial Year | Building Wealth
Oulook 2006 | Investment Types | Property Trust | Market Investment