Frugal reader Jack reminded me about this story, which was front page news on today’s DomPost:
Families Commissioner Gregory Fortuin said the research, to be issued in full in September, indicated that household debt could be reduced by a fifth if three characteristics in the New Zealand psyche could be dealt with.
The main behaviours driving debt were the belief that life and financial management was out of your control; having aspirations based on comparisons with other people; and a tendency for impulsive buying.
The commission is now looking at what can be achieved by attending to those factors, which it identified last year.
The study also identified that a quarter of households were not keeping up with mortgage repayments and bills. More than one in five were selling possessions and turning to family for financial help, and a third were getting some form of community financial support.
– Regain control of your spending
– Don’t spend to keep up with others
– Don’t make impulse buys
On the one hand, the advice seems like common sense to me, but on the other, clearly it can’t be that common. And as we all know, these things are easy to say, but full of challenges if you want to practise them consistently.
Regaining control of your spending means that you have to start recording what you spend diligently, and using the results to construct a budget.
Not spending to keep up with others means developing a thick hide, learning to make the cheap look good, and resisting the pressures of your peers and a lot of clever marketing.
Avoiding impulse buys seems the simplest to me, but even then, there are days when it’s going to be difficult to get along without your wallet.
I think we might rustle up a post or several on these points in coming days.