17% of people don't have $500 saved

[lizzie]

Talking to a young 20's lady I know today - she's on a disability pension due to family circumstances but is capable of working full time if she wanted but she won't work more than 16 hours a week or she will lose her pension.

To me, I just don't get it. I know many people pensioners who think like this - sole parent, disability, unemployed etc - but surely it's better to earn more money and get off the pension than be caught in the cycle of poverty?

This particular girl can't afford a car because of her financial circumstances, so is reliant on others to drive/bus, which means massive amounts of wasted time waiting around for people.

We talked about her situation and, without being critical, did ask where she saw herself in 20 years time? And suggest she not hold herself back for the sake of hanging on to this pension.

I know one of hubby's older daughters found it really hard to make the mental adjustment to working as it would mean her boyfriend (who she lived with) would lose his housing commission house ... but she's not earning $70k+ a year with many promotion prospects. Where would she be if she hadn't made that attempt to break the cycle?

It often comes back to a fear of losing a little of what you know, in exchange for "potentially" gaining something huge. Many would rather stick with the little than risk it for the huge.

 

[Peter 14.7]

Middle Class and even Lower Class Welfare is joke.

The ALP move to remove tax on income up to $15k and to move Single Mums to Unemployment Benefits at age 8 are a good start to rewarding work over benefit. Yes, I praised the ALP.

Regards Peter 14.7

 

[Spectre]

referring back to the original article..

If they dont have $500-1000 today when they get made redundant at @ what - 58 I think is the average age now - and another 30 years to live, and they havent made preparations for this time as they cant access their super funds... They suddenly find that they're not as valuable as they thought they were in that organisation and replaced.

Saying is people dont plan to fail, they fail to plan, or they think they know it all only to get blown out of the water with taxes because they wouldnt get professional advice.

Near 80% of aussies reliant on some sort of govt handout at retirement. Lucky country isnt really that lucky. Thats 8 out of 10 of you reading this will be in this spot.

And you wonder why the banks do some well, they get you from your youthsaver to your reverse mortgage.

Interesting app is the smartmoney app... plug in your current super value then see how far it gets you in retirement when you divide it up.

 

[C-mac]

I read a great objective piece about why Superannuation should be disregarded by anyone under the age of say 50, living today.

My opinion on it? I see both sides. I believe in creating one's own wealth path. Since the introduction of super, there have already been changes to it. This means it is likely to change again (and again, and again), making it unreliable. Build your own wealth pool that you have the freedom to 'fiddle' with, whenever you like, I say

Super is a great little helper but not the be all and sole reliance of a happy retirement.

 

[Peter 14.7]

Yes but super is paid by your employer at 9%. So really most people don't actively work on this. Whilst it can give false sense of security it is better than nothing as was the case 30 years ago.

Regards Peter

 

[eXc]

One of my mates cannot save. He is late 20s but still in teenager mode. I have tried to help him with budgets etc. But he does not succeed as he see's a 'bargain' he must have (eg. A car that was $5000 at the yard, dropped to $4200, so he had to buy it - couldnt pass up the $800 saving, even though I had pointed out there were same cars, same condition etc for $2000 on car sales)


Can anyone recommend some links that I can show him on taking control of his finances.

He is in no position to invest, he struggles to pay registration for his car. He won't listen to me anymore (I've been trying to 7 years now) but he may listen to tips on the net. I can't seem to find the right terminolgy to search google for "finance help" "finance advice" etc, ends up with lenders or brokers.

 

[nhg]

One of my mates cannot save. He is late 20s but still in teenager mode. I have tried to help him with budgets etc. But he does not succeed as he see's a 'bargain' he must have (eg. A car that was $5000 at the yard, dropped to $4200, so he had to buy it - couldnt pass up the $800 saving, even though I had pointed out there were same cars, same condition etc for $2000 on car sales)


Can anyone recommend some links that I can show him on taking control of his finances.

He is in no position to invest, he struggles to pay registration for his car. He won't listen to me anymore (I've been trying to 7 years now) but he may listen to tips on the net. I can't seem to find the right terminolgy to search google for "finance help" "finance advice" etc, ends up with lenders or brokers.

From experience... walk away.

You end up frustrated and they will be resentful you keep hassling them.

You can only help those who want to help themselves.

 

[Crabnet]

He is in no position to invest, he struggles to pay registration for his car. He won't listen to me anymore (I've been trying to 7 years now) but he may listen to tips on the net. I can't seem to find the right terminolgy to search google for "finance help" "finance advice" etc, ends up with lenders or brokers.

The Salvos do some work in this area.
http://salvos.org.au/need-help/financial-troubles/

 

[Peter 14.7]

From experience... walk away.

You end up frustrated and they will be resentful you keep hassling them.

You can only help those who want to help themselves.

+1 same experience here.

This is true story.

My sister was 2 weeks away from foreclosure on loan bank, owed $1000's to services like gas, etc.. had debt collectors chasing $5k for a car accident she caused : uninsured. Owed $2500 at 27% on a stupid roof restoration. Had one almost dead car. Then her husband died.

I stepped in at the family begging. 3 kids involved.

I stopped the collector with $1K take or leave it or we go to court offer. Personally paid off stupid roof loan immediately. Got her Union to help with direct payments on the services bills due to hardship, chased every super scheme he had for death benefit. Went guarantee for solicitor to chase his rights in his death. Put her on saving plan with bank re home loan. I paid half the funeral costs on family loan. All up she owed me over $10k and agreed would pay me after home was paid off. I charged no interest and no charge for my time in all this.

After 1 year through my perseverance she got a super death payout which I put 100% in the home loan, thereby halving it. She complained, she wanted a new car. I said wait! and used Power of Attorney to just do it.

Each I said, have you paid loan out, you own me $10k remember? No she said.
7 years passed then she begrudgingly said OK sell these shares: just enough. I said OK but only when GFC (1st is over) as they were low.

Another year passed and she found new man and spending $$$$$ on flash new wedding. I said how did you pay for that? She sold half the shares under me!

I said that was MY money waiting for it to rise to help you! Ok , take small loan on home, it must be repaid by now. Yes it was (2 years ago) but I took another loan LOC for $$$$$ to pay for wedding and gifts for new boyfriend.

I lost it. I had literally taken her from homeless with kids and bankrupt to 100% owning home worth $300k and payouts worth another $300k and she could not and refused pay me $10k!!!!!! after 10 years!!!!! and now she had new dumb debt.

I used power of attorney to get my $10k and walked away. She said I had robbed her.

Year later. She is almost back to the start of this story. She is spending to much money and will go under in 5 year again. New Husband refuses to work.

At one point in time she was positioned to put a deposit for new home as IP for each kid they could have at 18. They will be lucky to see a party. She things she has done nothing wrong!

FYI, Peter

 

[HotRod]

Lucky you got the 10K out.

Similar story with my brother.

His wife and him have been in Darwin and then the UK for 5 odd years to supposedly make more money and save for a house. They travelled all over Europe and the top end of Oz having the time of their lives.

Come back home and have saved nothing and even spent $10K we told them to invest and put away so it was there when they came back.

They rented for about two years and things were getting better.

Then decided to buy a house and then the requests for money came pouring in (didn't think about maintenance, rates, insurance, etc). Gave them $1000 to pay a mortgage payment. Then found out they went and bought a KitchenAid mixer and other stuff, then sold that and bought that you-beaut mixer thing (name escapes me ATM), $5000 on couches etc on GE money and are planning to go OS in a month or two "because we need a break"!

Asked and finally got our money back after much grumbling and have found out my father has given them money (not sure exactly how much) and the same as her parents.

So angry.

People's priorities are just so out of whack sometimes.

Lending that $1000 went against everything in my being. We have tried helping them by telling them what they should do, but they keep on digging a hole for themselves and then expect help.

Oh, and they have a 3yo daughter and will soon have another child soon.

He's no thinking about going to work on the mines and making more money.

As night follows day, they will up themselves and move to where the money is to try and make more. Tried explaining that you will get paid more but it will cost more to live there.

it just goes round and round.

 

[cimbom]

Sometimes you just have to let people learn the hard way I think, especially when there is such a long pattern of the same behaviour.

 

[Luv2Travel]

Sometimes you just have to let people learn the hard way I think, especially when there is such a long pattern of the same behaviour.

And some will never learn, they will always have something else to blame which isn't their fault. I'm all for helping people, but some people just aren't worth the effort as they don't want to hear about hard work and sacrifices they'll have to make. Their life, let them live how they want to, provided they don't expect you to pick up the pieces when they're in trouble.

 

[Peter 14.7]

I hear ya.

Sister said I want to pay you back when we have the money but then she keep spending. She is incapable of realising if you KEEP spending you willnever save.

My mum also use to loan her money, which really upsets me because mum was and is pensioner. Parents love too much.

Peter

 

[VYBerlinaV8]

My sister is similar. Left her first husband (a nice guy and well paid professional) to set up with a guy who refuses to work. She busts her a**, but there's never enough money. My mother helps them out. They wouldn't dare ask me.

 

[nhg]

I personally have needed $500 to help me get through the month a number of times, poor cash flow predictions on my part, it happens. Yet I learnt very early on however it wasn’t going to come from my parents; it is less of a hassle to sell a kidney than to borrow money for a week from them (no-strings attached).

My best friend, so close I consider him family, earns $30k/year. He racks up a $10k credit card debt on a bi-monthly basis which is mum pays off (the banker who approved that card should be arrested for slavery, that’s what it has turned him into). At one point I think there was a significant inheritance coming his way, though from a chat with his mum, I do believe it is now spent.

Sometimes the best help you can give a loved one is to let them sink so deep into a hole, they wake up. ‘Helping’ them with cash-outs or other types of hand-outs is counter-productive (read the millionaire next door). His mum just doesn’t have the strength to let him learn the hard way.

 

[eXc]

Thanks for all the replies

From experience... walk away.


You end up frustrated and they will be resentful you keep hassling them.

You can only help those who want to help themselves.

This will be my last "try this" attempt, after that, I'll only help if he asks for help - he often talks about it, but then doesn't want my advice.

The Salvos do some work in this area.
http://salvos.org.au/need-help/financial-troubles/

Thanks, will take a look

 

[kingchevy]

Funny it takes more balls to say no than lend someone money.

 

[nhg]

This will be my last "try this" attempt, after that, I'll only help if he asks for help - he often talks about it, but then doesn't want my advice.

Interesting observation. Of the few people who know I dabble in property/shares, a lot ask how to do it. Ive stopped explaining now and simply say, "sure, would love to talk about it, give me a call and we can chat over coffee". Of the dozen or so only 2 ever called.

The realization some people are all talk. It took me a long time to get my head around it.

 

[JessP]

^^^ What nhg said. I find so many people asking about what we do then the eyes glaze over when I start talking about it in depth. I might start doing what your doing and tell them to call me lol.

 

[Spectre]

For help - I think the moneysmart website may have some info on it.
Or the mybudget people.

What some might try is setting up two bank accounts

One for your spending and one for your big bills (ie. rents, mortgages to come from). All income goes to the big bills account and then an allowance is paid to the spending account once a fortnight/week/month. All things going well the bills account balance should grow.

or call it having a business and personal account