Money – we all need it, want it and work for it, yet it is often a subject that is considered taboo to talk about with friends and family. With such negative connotations around the ‘money’ conversation, it is often hard to find someone to talk about your situation with.
This then also leads to the question, just how financially literate are you?
Here we take a look at Australia’s financial literacy and why it is so important to put money in the spotlight and create an open discussion about it.
A report published by the ANZ Bank on the financial literacy of Australian adults showed that people with the lowest rate of financial literacy were; under 25, had no formal post-secondary education, had a relatively low income or assets and worked in blue collar occupations.
Whether it is dealing with credit card repayments, investment options, or simply just creating a sustainable savings plan for yourself, there will be a point in time where you will need to be able to make key decisions regarding your financial situation.
Findings show that 67% of Australians live in a household where just one person is responsible for its financial management. Even though this is a common occurrence it is vital that both, or in some cases all, parties are kept up to date with the household finances incase something happens to that key decision maker.
Not being open about money matters can lead to both financial and emotional consequences within families. If a crisis occurs, not only will high stress situations put a strain on personal relationships, it also means that there are less options available for help.
On top of this, a report by the Commonwealth Bank found that Australians with a lower financial literacy were the worst affected during the GFC. Lack of knowledge meant they were not as adequately equipped to deal with financial crisis and stress.
First of all, be open about it. Talk about these matters with friends and family, and remember you are never too young or old to learn about money.
ASIC have created a free program, MoneySmart, for teachers and parents to help develop financial literacy and skills in young people.
For adults, having a trusted and experienced financial adviser on hand is beneficial.
Building a solid and lasting relationship with your adviser means that they can grow with you through your different life stages, know your financial goals and setbacks, and help create a plan for you to work towards your financial objectives.
Being transparent and having an open conversation with family members about money matters may be tough at first, but can prove helpful in the long run as you can correctly utilise your income and savings to create a sustainable future for you and your family.
If you need a professional opinion on your financial situation or help with your financial literacy, you should speak to one of our trusted financial advisers. Just click here to get obligation free quotes.