Time to cut up that card and live below your means

How to survive the corona crisis

Editor’s note: this article is long term advice, so does not take into account the sudden loss of income for freelancers,  day labour earners of this stood down. As of March 22 the government has expanded the job seeker allowance (the doubled newstart) to include sole traders and self-employed people, as well as people caring for someone who is infected with coronavirus, or in isolation, (there is a means test). But there will be a gap before the payments flow, so these people might need to live on credit for a time. As with all financial advice for publication, this article is general advice and won’t reflect everybody’s circumstances. John Sandeman

I am a planner. That’s why I keep a diary. A diary gives me an idea of what to expect, a sense of control. Of course, I didn’t have coronavirus in my diary, I didn’t expect it and there is very little I can do to control it.

You might not keep a diary, but you probably like to know what’s around the corner so you can be prepared. As humans we thrive off consistency, routine and the feeling of control. If we don’t feel in control, we panic — and buy boat loads of toilet paper.

Resilience is about being flexible, durable and able to last when the unexpected happens.

I especially like to feel a sense of control over my personal finances, that’s why I have a budget. Coronavirus didn’t feature in my budget either.

This uncertain season has reminded me of the difference between being in control and being resilient. The truth is I don’t have total control over the state of my finances or market forces that affect them – only God is in control.

But if I am not in control, then why budget? Because I can wisely cultivate resilience using the resources given to me.

Resilience is about being flexible, durable and able to last when the unexpected happens.

The financial resilience of many in our nation is about to face a great challenge. We will probably all feel the effects in some way or another, so it’s wise to take time to consider how things are right now. Here are some things I’m doing to build financial resilience, which you can do too:

Talk about your budget. My wife and I usually sit down together once a month to talk about our budget. It’s a good chance to take stock and consider what is coming up and make adjustments. Given what is happening in the world right now – bring that date forward for your budget chat. Set aside some time in the next few days to talk about money with your spouse, family members or trusted friends. If you have never written a budget or talked much about money now is a good time to find your next Christians Against Poverty ‘Money’ course and get started.

Consider your current priorities. I know we all like to consider ourselves ‘Aussie battlers’, but the truth is most of us have more than we need, and our money is mostly spent on wants. Now is a good time to consider where to cut costs, cut back or cut out, in line with new and changing priorities. Some things may have to change for a while.

Cut up the card. Living on credit does nothing to build our financial resilience. If things start getting tight, the last thing I need is a debt I can’t afford to pay. Please stop using your credit card – your frequent flyer points are no good when airlines are grounded – and debit cards can do everything a credit card can.

Live below your means. When we spend every dollar we earn, it is impossible to build any financial resilience. The only way to put money aside for the unexpected is by spending less than you earn.

Reach out. You may feel okay with where you are at financially. If that’s you – great! It’s incumbent on you to check in with others. You don’t have to be a financial adviser or counsellor to ask how someone is going.

Ask for help. You might be starting to really worry about what is to come. Maybe all this talk of financial resilience is making you worry that you won’t be able to weather the storm. Ask for help – people can’t help you if they think everything is fine. If you don’t know anyone, call Christians Against Poverty on 1300 227 000 and a debt counsellor will talk to you.

Pray. Matthew chapter 6 teaches us not to be anxious. Not because there is nothing to worry about, but because God knows and loves us and has promised to take care of us. By taking things one day at a time (remember that he asks us to pray for our daily bread, not our monthly bread), we can rest knowing God is in control and knows our needs.

This last one is the most important. All the money in the world can’t protect us from the unknown of tomorrow and the anxiety brought about by knowing we are not really in control. But a trust that is built on the promises of God is a safety that cannot be shaken.

Financial resilience might start with a budget, something material. In time however these habits form a strength of character that has deep roots that can’t be shaken. My prayer is not just that you may be financially resilient in this moment, but that the discipline of budgeting would prepare in your heart a resilience that is literally unmovable thanks to the confidence found in Christ.

Stuart Sampson is Head of CAP Money for Christians Against Poverty Australia. CAP is passionate about working with local churches to release people across Australia from the weight of debt, poverty and its causes, and into a life filled with hope and freedom. Find out more about what you and your church can do to help here.

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