Season 1 Episode 5: Money personalities and how they influence our relationships
IN THIS EPISODE 5
Have you ever wondered why you make certain financial decisions, while others seem to have completely different approaches? Listen as Mel and Darlene unpack each unique money personality, looking at their inherent strengths and weaknesses and their hallmark traits. They discuss how being aware of your money personality and seeking support when needed can bring balance and confidence to your financial choices.
They discuss how the money personality quiz can be used to gain deeper insights into the "why" behind your impulsive responses when it comes to money, and can help you recognise opportunities for uplifting your financial wellbeing. They dive deep into relationships and discuss the need for understanding your partner on a financial level. At the beginning in ‘Our Truth’ the topic of parents giving pocket money is raised, and the episode ends with an in-depth talk about ‘mortgage prisoners’ being people stuck in certain home loan situations and what some possible options are to change their situation.
RESOURCES IN THIS EPISODE
Discover your money personality and have a chat about it with your partner or a friend. Take the quiz.
KEY QUESTION IN THIS EPISODE
What does the term ‘mortgage prisoner’ mean?
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0:00
Welcome to the Money Collective Podcast. We're here to uplift your financial wellbeing. Your hosts are me, Mel Pearce and Darlene Neu. We are the cofounders of The Money Collective and together we have over 50 years of finance and banking experience. We provide the tools, information and guidance to better understand your money and feel confident making money decisions.
0:22
Hi there. Hi there. Darlene and Mel from The Money Collective and Episode 5 Woo of our podcast Yeah,
0:33
Welcome back if you've listened to all of the others so far. Also imagine the celebrations will have when we get to like podcast 10! Episode 10! Exactly. And 50. And then a hundred and then season, I don't know, two. I know season two. Yeah, we've got so much to talk about. We do. We do. We've been holding back for years. We have. So watch out.
0:58
Also so we are going to start off every single episode with a bit of a truth from ourselves. I went first last time so, it's my turn. Yeah alright. What's happened? My truth today and I am open for any advice and any support. I certainly just because we do financial wellbeing coaching and know a lot about money we don't have all the answers. So mine this week is I've got a 12 year old daughter, Lily and it's what do you do at
1:28
home with pocket money? Oh, I know, right? So
1:35
a few, ah, not even a few months ago. A couple of months ago we agreed we would. She is quite driven by wanting things at the moment, she's a 12 year old girl, running hungry, yes because she wants stuff. And so I thought a good idea would be to map out, you know, what, what sort of chores she could do.
1:57
Love it. I struggle with all of this. And if you're part anyway, I'll get on to that. But if you're part of the household, shouldn't you just do some stuff anyways? You know? Right. So where we agreed where that line is in our house is that you have to clean your room and look after your own room. That's your own space anyway. Do what you want with it. That doesn't get, you know, any money. If you clean that up, that's just part of living. Yep. But the agreement was you unpack the dishwasher each day and set the table. That was it. And for that I said we would give. We worked it out,
2:30
very detailed. I'm analytical and she already had read into it. I don't think she's going to do it everyday. So she does that every day. It's $21.00 a week, so basically it's $2.00 to do the dishwasher and a dollar to do the setting of the table. Got it so week 1. So this started because she wanted something and I can't even remember what the thing was that she really wanted now. So anyway, so we she did it. She was great,
2:59
got a $21.00, fantastic. She went and bought that thing, you know, straight away and it was done and dusted. So then we were out. So worked for one week is what you're one week, one week, one week only, then what happens? So then we went shopping, just general shopping the following weekend and she saw something she wanted and got me in a weak moment. Ohe and I bought the thing and I had a conversation with her before I bought it and I said, look, if I buy it, it was $30.
3:31
Uh huh. And I said if I buy it, it means that you're in debt. Uh-huh. Right. So this is, you know, me coming out. This is you're in debt and you're in deficit. And it means you need to do, you know, the work jobs until it's paid back? Yes. And so there's no money coming your way until it's paid back. Yes, Mum. Yes, I will do that. How many times between that? We're now nearly two weeks gone. OK. Do you reckon she's
4:01
unpacked the dishwasher or set the table? Two times? Once. She's done the dishwasher once. So I came across this same problem. So there is no going into debt with me. There was no debt. That's my lesson. No, if you want it, then if you haven't got the money, I'm not paying for it. That is the answer. I love saying no, you can't have that piece of crap that you want. Yes, save up for that. And then I don't care where the money, you know how it comes from. So we do a similar thing with $20 a week as well
4:32
and we just have, you know, we participate in the family pull away type thing. Exactly. Oh cool. Yeah, I'm happy with that. And in my brain too, that 20 bucks a week is, hey, a bit of parental duty to make sure they've got food to eat and if they're somewhere they can get home, well that's where I was. So I was thinking the same thing, have the same mentality that
4:54
and because I'm not particularly reliable to make that food or for them to even do it themselves. So I do worry about that. It's always good to have that. And I was thinking the same have the availability of money and you know, have them manage it too. Like to have that responsibility of going well, hang on, how am I gonna manage this? And if I run out, then what resources do I have to pull on if I'm stuck somewhere? Cause calling mum and saying I don't have money for a train or a bus ride isn't going to make, it's not going to be great. Yeah.
5:24
I love this. Let's continue this journey. I will but I definitely hear you and I've you know I've done this in the past. You know in the past I've taken her to a shop and she’s had some money and she couldn't buy the things she want and I've walked out. I have been strong at times but this time I wasn't. So I'm. I love that advice. I'm getting back on the bandwagon there and but the thing is do I call it quits and draw the line and say we start again and take
5:55
your advice and then if you don't have the money to do it or do I still make her pay it back? Make her pay that back that was the rule. $28. Yes, you guys. And she agreed to it. We did. If there was a mutual agreement, you need to see out the contract should have gotten a sign. This is a hard life lesson. I know. That's what I would say. Anyway. See you through. See it through. OK. Anyway, pay back the 28. OK. Got it. I'll keep you posted. OK,
6:22
alright, so mine is more to do about me and not about my kids.
6:28
A few weeks back it might have even been in the very first episode I said that I would, so I went back and I had categorised all my spending and checked all my past spending and I did that. But the reason why I did that is because my accounts are not balancing and I am. You know what did I say robbing Peter to pay Paul? Yes, they do say that. I do not know the origin, but you're pulling money from different account.
6:58
I am. I'm money shuffling and I don't love it and I'm doing it regularly. So my accounts are not working for me and it is because of the cost of living. It is gone up. Yeah, extremely. And my old system has failed and I need to set up a new one. So I did that original task, you know, three or four weeks ago. And I now need to do the next step. So that is, I'm putting it out there, making a public declaration that I'm gonna look at my accounts on the weekend and sort that out
7:29
because I need to know the full reality of my situation. And what this means is that my I'm going to have to adjust some savings goals and other goals that I've got because my cost of living's gone up. Yeah. And I am not living in reality right now by money shuffling. Yeah. And just re-establish the new, the new buckets. That's right. Yep. It will feel better after you do it. It will. I know. Yeah. So I gotta do it. I don't know why I put it off and it's not even that hard, but I'm going to go in and do a fear of what it's doing to your goals maybe.
7:59
Totally. Yeah. That. Yeah. I'm living in denial.
8:05
That is. OK. Once you know the answer, you'll have to work through what's best. Yes. Yeah, very good. Well, very good. Well, alright. Topic of the day. We wanna talk about money personalities. Yeah, we love money personality much. So we've been working on our
8:22
financial wellbeing program that we've built and that we’ve delivered over the last four years. So Money Personalities was the very first thing and it was Mel’s, baby and Mel developed, we have developed, our own Money Personalities. And I'm so proud because they've stood the test of time. They are so good. You know when they're so relevant, when you make something up and it's brand new and you go, this could be a thing. I really believe in it and I remember writing out all the personalities
8:52
and the long form of this means this, if you have this and how they interact with each other. So because we all inhibit lots of personalities, we're not just one thing. And then we're interacting with our
9:06
immediate people around us, you know? Yeah. So how does that all come together? Is the point of understanding money personalities for us? Yeah. And why do we even care? Yeah, why do we care? Oh, my god, it's ground breaking. Just gonna say somebody should do university degree on this. No, absolutely could. Yeah, but we have named 4 money personalities, so we came up with them and we called them The Risk Taker, The Avoider, The Spender, and The Saver.
9:37
There are four in no particular order. That's right. And they're none is better than the other, which might be they are neither good nor bad. They are what they are some. But yeah, they. That's right. Everything has, you know, good bits about it. And some things you might like to change or be aware of or manage differently. And so in our podcast notes, you'll find the link to our money personality quiz. It's an online quiz and you can find out what your money personality is. Yeah. And today we're going to break down what each personality
10:08
vans and what that means in relationships as well. Yeah, good. Alright, where should we start now? Well, how about Mel? What personality? Sure. Right. Well,
10:21
I am coming up as a bit of a saver, but I do know that my inherent
10:29
money personality is, if I'm being completely honest, is a spender. Spender is not bad, so I could feel it in your vibe there Mel. No, no, no, no. I'm very proud of being a spender. Are you sad that you've moved to be a saver?
10:50
Yes, a little bit. A boring saver! Cause my results when I'm doing the quiz are coming out very saver oriented. Like it's like this balance between the two and savers coming out stronger for me because of my actual behaviours, because of all the money. And this is crap too, because like we don't wanna say that savers are the best. So if you change all your money habits and you're all great and most of your money, you're gonna be a saver. And that's the epitome of, exactly, I think. I think it will change depending on what your goals may be in life at the moment. So Mel,
11:21
is saving to go to Canada, which is really, really important to you, but also things are tough at the moment. Oh, the cost of living. So, like, we have to like rein it in and have more of those think before we buy moments. Yes. Yes. Which takes away from that bit of spontaneous. I wish that things were a little bit more free to get back into my normal realm of spending. Yeah. Yeah. So let's talk about spending then though. OK. What? What do spenders do? I would say inherently
11:52
suspender is somebody who is a bit doesn't think about the consequences so much of the spending and in the moment will decide and in their mind justify an expense or some spending. And that could be in a very daily sense of going, you know when you do your grocery shopping what type of items you're buying. I will want to buy good quality items, organic and good produce and I won't care so much
12:23
cause I'll justify as they go as I'm spending, right? And I will want to go out and have a good time. It's that continuous justification in my brain that oh, I value these things. I wanna have a good time. I love the people around me. Let's go celebrate, you know. So for me that's been a journey. Like I have even come to the point now where I say to my friends I've run out of money this week, I can't go out for dinner. Like that's a shock. Like for me to say things like that. Do you wanna come over and have a drink?
12:54
Yep. You still get to celebrate and hang around the people. So I just do it very differently, and not, but I would also probably
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yes, I like, have a bit of that mentality. I've worked hard. I can enjoy myself too. Yeah. So I would say that the there's good, you know, there's pros and cons to each money, personality and the pros of a spender. Are they good people? They're the fun time people and they're the ones who are gonna drag you out and make you have a good time, right. You're like, let's go do it. Hey, how fun is that? Or they might be gifters and I know Mel's not so much doesn't value that as much but you know
13:35
in this meeting on myself is that what you're saying. No. Celebrate and have lots of fun with people, definitely. I have been accused of being selfish. No, no. It's that you don't value material things as much that's just who it is so that cause you know you don't value getting a gift as much. No. You'd rather yes. I did enjoy my recent 40th birthday party, the celebration, and the gifts as well. Yeah. OK. So yeah. So you could do it, you know, for yourself or others.
14:06
Yeah. So there's those things. But then obviously the things that I need to be aware of is how much that cost and what impact that is having on the future because I'm living in the now and looking for that immediate.
14:25
Yeah, gratification. I suppose so. But I with little I'll sort it out later attitude like I'll work it out. There's plenty of time for that. There's cause you're really optimistic. Yeah. So,
14:39
and for me, having that away, that's what the awareness that I've needed to build for myself is to go or hang on. This is adding up and I have talked about it before, you know, like knowing where my money is going, categorising it because I know where the line items go which go crazy and it's usually around food eating out. And just do you know what's changed for me? You know how you said about I'm not as materialistic, I used to buy crap all the time. So I had this line item that I couldn't even
15:10
I didn't even know what the crap was that I was buying like it was. And I just called it miscellaneous shopping. OK. And I couldn't put a name. I had a huge number. I was like $13,000 a year of miscellaneous shopping that meant nothing to me. So I used to do it, and I then I couldn't. I'm like, I have no idea what this is. I cannot remember what. That doesn't make me feel good. Doesn't what? No. And so I cut that out. Yeah, because it meant nothing to me I didn't value it
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So I'm like and it actually made me feel like crap looking at that number.
15:45
So, um, yeah, that's where I've had to rein in and go, hey, look at my spending cause that's showed me because my brain isn't gonna tell me, Oh well, you've overspent my brain does not do that. It brings back the mindfulness totally. And not like, when I know that just that adds up to that much money. When I do that behaviour and knowing what it does to my future planning, it's so much easier for me to say no thank you. No, no, no, no, no, no, no.
16:16
I don't do that all the time. And I think I've come in and out of phases where it creeps back. I start doing it, then I go back and have a look and go nerd, you know, it's a really good tip, isn't it? So if you, you know, you really connect back to that thought of every time I start to do it, I look at the number and think, you know, at least you know the task that you can do to bring yourself back, you know, like, yeah. So because I'm not innately gonna do that. That's where I need the skills and the discipline,
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and this is why I call it out, so you guys can say, hey Mel, have you done it? How you going?
16:54
And then I, I feel much more empowered knowing what my numbers are. Yeah. And having support around me. Yeah. And learning from other people. And another good tip for spenders are people really worry. So when you set up bank accounts, you can set up as many bank accounts for different things as you want to make your system work. And people think, oh, that's cumbersome and that's really complicated it, but it actually makes it easier. And our advice to spenders is have as many accounts as you need. Yes.
17:26
So for me, that journey was when I started. I thought I'll have a variable expense account where I do my spending out of and then I'd be like oh hang on, I just ate all my clothes like
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or if I go clothes shopping I just, I'm wearing all my food! Like it just ran out. It was not. So I had to go have an account for clothes and account for eating out and account for groceries and I had to break it down like that minutely. And then that is a little bit annoying to operate like that to be honest. And so I get to stages where I put it back into one account, and I
18:10
just have much more awareness. But if I slip, I go back like I and I go I have to... And it's a bit about the truth that I had earlier up top. I'm like, hang on, yeah, I'm out of balance. Let's get it back in real it back in. What are these accounts doing? Because I need the structure to support me. And I think that's really important and not feeling like I'm bad, because in our society, we do lots of workshops in workplaces and you know, and the common quote thing is people think they're a saver. Oh, look at me.
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I’m great woohoo! But let's talk about Saver. Saver is not all great. Hang on. Are you a saver? What are you? I am. That's where we're going. I am. I am actually a risk taker, though. Risk Taker/Saver. OK. And I can move between the two. So let's talk about Saver. Saver first. Yep. So Saver I think that everyone knows the good side of a saver means you might have savings for a rainy day
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in in your quite disciplined about doing that - might have a budget and a spreadsheet set up. You might, you might spend a lot of your life doing that. Is that great? What are you why I don't know what are you trading off? You're getting control by doing that you're feeling like you're managing your money well which and I think that a savoury somebody who says that they're managing their money well. They do they like to think that they are doing that. I I as a saver. I think about constantly though what cause I
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the saviour? What are the bad bits of being a saver for me? Because a saver can mean and I remember when I was younger and again I've learned a lot obviously about doing this through our money lives. So I have shifted, but I'd say my revert back to personality is saver.
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And
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at my wedding, here go, here's the story. At my wedding somebody stood up and basically, you know, I was always I was known for, you know, being a, you know, saving every penny. And it was it that comment was in the MC speech. Right. So that was triggering for me. Yeah. So there is good. But basically the trade off. The trade off is that you can see on the comment was can I go back there? Oh, I wish. I need to get the video out. So long ago.
20:34
OK. I mean, I was married 30 something years ago, so I can't remember. Was it about being frugal about the wedding or is it more about just that's your personality? You. She's a saver. Isn't that funny? Yeah. Did you feel like you were being called stingy? Yes. Yeah. I felt like I was being called stingy and not generous. And. Yes, not generous. Yeah, not generous. And yeah, feeling stingy and selfish. It came across also, people always think I'll have it sorted, You know? So you just felt responsibility.
21:05
Yeah definitely responsibility as well like you know, she's got her first dollar, it was something along those lines She has the first dollar in the bank that that she made. Oh, right. Got it. It was the first time you've still got the 1st dollar you've ever made Yes. That was the comment yes. So but what the trade off can be, and then my husband and we'll talk about relationships as well, I remember he used to say to me, you know, it really early on he might wanna
21:36
go on a holiday or do something, and then I would always poo poo it because you know, I was always save for a rainy day. Save for the future, You know, save for 100 years save. Did you have a dollar amount on that? Like how much I did save? No, the more the better. I just wanted to see it grow, grow, grow, grow, grow. It was all about, and I would I would look at, I shall come back to that. You might look at your bank account,
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you know, three times a day, you know. So is that a behaviour that you could have as a saver? You know, like, you know that you're constantly looking at your bank account because you like to see the number or you want it to be more? I looked at mine three times a day, but just to see if I could spend it. No, this is just to see what the number was, more than it was yesterday. Yeah. So the downside is potential downside is you live too much for the future and are you really present and living life
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today? Like is that imbalance? I would. I would question some people. We were talking about this in a workshop yesterday and somebody said pretty much that there were about to retire. I've been a saver and I feel a bit bad about that. Like, my life's been a bit boring. Yeah, life.
22:55
That's right. It's alright to, you know, it's great. But you know, particularly as you get older, the rainy day or the worry of that thing may never have happened and then you can't go back. I mean, we, you know, you've lost all that time. So you really do need to just be aware of that. So this is too where that power play comes in because like people like me go, I'm bad with money. I'm so bad with money. I'll never get it right and I'll never have enough to retire on. I've got that mentality. And you were like, like, I'm not saying you are. Yeah. But more. I'm responsible for this.
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I've got this. I'm good with money is a common thing. Like, I've got this, you know. Yeah. No, I'm fine. Yeah. I mean, and then me having a relationship with you, let's say, like, you know, Yeah. Marital. Yeah. I'm not in the marital relationship with you, but it would be wonderful. Maybe one day. Yeah, that's right. Anyway, but those power plays within those relationships is hard. You know, where you've got an inferior. And it is all that, that perception of what's not even better, not true.
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It's not. And when we need each other too, to lift each other up and to somebody to keep people like me line a little bit, it's still coming out. They're all equal as far as what's important. Yeah. What? What's not exactly. It's just about understanding it and then work out in your money personality what's working for you and where you're really happy and comfortable or where are the things or you're spending energy that you might not want to. Yeah, that's all. And finding the places where they're not, but we might
24:28
to go to that a little bit later. Let's talk about the other two personalities. So you're also a risk taker – I am a risk taker. So what does that mean? A risk taker?
24:40
Yeah, basically means that I want to
24:45
try things. I'm happy to put money somewhere that has a bit of risk attached to it or just in life. You know that that really gets me excited if there's an opportunity that I can see, an opportunity for growth. But I know that I do. I know that it comes with risk. I mean, you know, anything that you do, you know has risk and reward attached to it and it might fail or it might succeed. But I am drawn to those opportunities. What are some opportunities that you've gone with?
25:16
yeah, well, I mean self-employed, right. So Mel and I started the Money Collective. Prior to that I had another business. So really driven to say see what if, what could I possibly do, what if? And the courage, you know, in the positive terms, the courage to take a risk to have a go to see what we can do. So definitely stepping in to be self-employed, yeah, is an example of being a risk taker and probably with the business I take risks,
25:48
yes, we certainly do.
25:51
So I've definitely got a bit more of a risk, I've got a little bit of a risk taking. We've all got a little bit of everything in it. But I would like, let's just go into risk taker a little bit more too, because
26:03
if you don't have a balance, particularly with your analysis, so you've got an analytical mind and it's balanced with saver. That's right. So your measured, you're taking measured risks. Yeah. So if you don't have the Saver component, hmm, let's say you're a spender/risk taker.
26:21
That's where the midlife crisis and the red Ferrari comes. Maybe the bank account balances are zero and you don't want to have a bit of a roulette casino life happening cause that's a definite personality too, where you just throw caution to the wind. I'm gonna have a go. That sounds great and it could, it may or may not pay off. So with risk comes reward but also potential loss as well, correct. So that is definitely interesting because sometimes that pays off and we look at high flyers
26:52
that cause high flyers, they're the people who are risk takers. They are business people, they're entrepreneurs. And you see some people who go through those like lots of different businesses and they, you know, they go well and then they fail the highs and the lows. It definitely. I studied entrepreneurs, actually, at uni, and it's a fascinating subject and fascinating and that, you know, the DNA of an entrepreneur, and it is, they are not, they don't care about whether I make money,
27:22
lose money, that that's irrelevant to them - it's completely the opportunity of what I can do or what I can create. And that's why if they fail, they don't care. Yeah, that's right. They don't care. It's not. It's irrelevant. But some people do, right. So that's like a breed of entrepreneurs. But then you've got in a bit of everyday people who are risk takers, who don't necessarily have skills but have made life choices. Yeah. And that have really impacted a lot of people around them. And then they become untrustworthy
27:54
within their units. Yes. So that could be a trade off to the people around you don't trust you. Yeah. And then and you might be put on like, you know, blocked out of managing accounts and things like that having to ask permission. What does that do psychologically? Not great. Yeah. So being a risk taker, you can, so you’re good cause you're able to self-manage your risk taking. But some people can't. So being able to get, this is where accountability is so important, and having support
28:25
around you, that can, to understand what the risks are for you, what your shortcomings are within your own money personality. Cause we all have them. What's what? You know we have strengths and we have things that aren't serving us well. That's right. And sometimes you can manage some counterbalance that within yourself. Sometimes you can do it within a relationship or close friendships. But sometimes we can't do it at all. Yep. That's right. Because we don't know how do we don't have the skills or we don't have the network. Yeah, exactly. And. And it comes back to why?
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Why do we need to know money personality? Because then we become more mindful. We can become more mindful. And yeah, that's all about what we do. Yeah, so it's all about our behaviour. So the last money personality that we have is called an avoider. Hmm. And they are people who are a lot paralysed, who will be quiet when it comes to this whole topic? Probably, yeah. It may not be listening to this podcast, for example, But you we all have elements of this where we don't wanna face
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something or want to avoid it. And there's many reasons why we do that
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today's hour in eight behaviours so things that we need to learn about ourselves and it also comes from our money stories which we're gonna talk about coming up yeah but I see avoiders can have money in the bank you know like you know definitely because they just they can't make a decision they're not comfortable to make a decision about actually what to do. So they may not make a decision at all. So you know, I definitely think avoiders can be
30:04
savers, totally, you know. But they're usually the harshest people on their situation. They go, I'm so terrible. I don't know how. I don't know anything about money. I'm bad with money. I just don't know. Right? Or I know I this is a good one. I knew I should have, you know, done something, but I just didn't. And then when you go in and have a look at how bad their situation is, it's never, it's never as bad as what I think. Avoiders feel they’re really bad with money. Yeah. Like spenders feel that. Why did this? Like,
30:35
this cataclysmic thing of like things are worse than what it's gonna be, or their tolerance to risk is much lower. It's like the opposite to a risk taker. It's like, ohhhhh, that really scares me. I don't wanna do it. They're definitely the people who are more prone to be thrift shopping. Op shopping. Yeah. Sales. Yeah. Not buying it all. Yeah. And have, you know keep their appliances for a million years type of people. So I'm sure we can
31:05
all think of people in our lives who are that. And if you are on this podcast and you're an avoider relating to this, then I'm so excited for you to be here as well. Like, that's right. Awesome. Yeah, Think about all the good things about it. You know, you might have money for a raining day. Yeah. So the advice for like an avoider would be to arm yourself with information. Like think about what you're scared about, think about your long term goals. And it really is planning out.
31:36
So prioritising things and taking really small baby steps. So some people might wanna plan the whole lot out and that may be what you wanna do. So and then just know what the next step is that you need to do to get there because the overwhelm for you is going to creep in much quicker than everyone else. And if you I think when you we don't know the next step then we don't do anything. And so you might not know cause you're bad with money for example, know what to do so you do nothing. It's about finding the right people
32:07
again around you. Yeah. That you feel safe with. And that also might be more hard for you to find those safe people. That you can have these conversations with. You could be a really good buddy though for a risk taker. Oh god yeah. You know, put the risk hat on and say, Oh yeah. I would say that's probably like the hardest relationship though because like, they're not linked to each other, but in relationship.
32:37
So what about, do you want to talk about your relationship, like yeah so relationships with money in your household then you know. So if we've just talked about, you know, the personality types and how does that play out for you, really think about the people in your life and what money personalities they might have and what you know, have you ever looked at it from their point of view? Because you know, they will bring something great to it as well. And it really is just about open communication conversation. But
33:08
yeah, it's not always a right or a wrong way. So yeah, think about how that's playing out in your household. So for my household, my partner is a saver,
33:24
predominantly, so yeah. I find because we've got those two saver innately and me a bit of a risk taker. So I, you know, do a bit more of the risk. But from a Saver perspective, it sort of seems to work. We've never, you know, because we, we both want to, you know save a bit more for that rainy day. But yeah, and we spend a bit, yeah, it's quite balanced. It's a bit boring. It sounds really boring. I would say though
33:54
knowing you for a long period of time though that you're definitely the person people come to like for advice around money. So I would say that that probably responsibility around that. How do you feel around that? I definitely so me yeah, me personally all this is could unpack my whole money story but I need like 3 hours right now. So yeah, definitely I have taken the role in the family, the broader family, in the work that I do, as being the responsible person with money. I actually think though I
34:26
it's helps and I'm backing away from this a bit at the moment. Like that's the bit of ego maybe, you know, that bit of - I feel where I add value to the world is, you know, being good with money. You know that feeling or thought that doesn't even is not true, you know, around money. So I've used that as the thing to make me feel good about myself. But I don't want the money to be the thing to make me feel good about myself in that responsibility.
34:56
And I want people to have their own responsibility and make their own decisions. So as I said, you know, I have really backed away. I don't tell people what to do with their money. I think that's the way for me to learn and evolve. And it's certainly good for people to learn and evolve. Yeah, Just make your own choices. Yeah, that's so interesting for me. My partner is I would say traditional saver but definitely not analytical in the way.
35:27
Well actually what I say I was gonna say that cause he doesn't engage in spreadsheets or doing all of this but saying that that's just reminded me he joins the dots and he absolutely loves to join the dots and he has a diary so he doesn't do computers and emails and technology the bare minimum. These diaries are detailed about where he spends his time. Yeah. So he could tell you what he's done everyday work day in his life for the last
35:58
15 years at least and exactly how many litres and how much it cost fuel wise. Sounds very analytical. Every single fill up that he's done and he has projections you wow what he's done year on year expenses versus income. He doesn't talk about it so we don't come in, but he definitely comes in with pride at the end of the year when the diary is filled up and we need to do a breakdown. I pretend to be more interested than I am. I am very proud of him. And I'm very grateful that he does these things too.
36:28
Because so I have to be much more measured and go out and I have to sit down and go right, Mel. Force myself, sit down, do the work. Yeah. But then when he comes to the table, and after I've done it, because that's how I get my understanding to see where our numbers, what's happening in our daily life, He just gets it like that. He'll walk in very quick and join all the dots like you were saying.
36:56
But he is, I wouldn't call him a risk taker, I should say, he's definitely a saver, which means that we,
37:07
and because with my mixed with my spender personality, we're still living in that everyday sense of our life and I worry about our future a lot. Like for what we're going, you know, working towards. Yeah. But
37:25
yeah, I don't know. Yeah. What the plans are. But it's really,
37:31
I don't know. So, you know, innately spender and humour saver. If you go back in time, what how would that relationship play out at home around money or where we spend it or? Yeah, well, I've always had, I haven't felt too controlled by him ever. Like he's always given me free range with and I think he's always valued my independence as well. Because you've always been independent. Yes. And he. Yeah. I don't know.
38:02
I think we've also had a different balance but a good balance. That supportive of us personally. In that. And I think the biggest skill that I've had to learn is how to communicate with him. Yes. Cause I feel like I load money with emotion. Yes. Yeah. And feel all that guilt and I should have done better. Well he would never think like that doesn't. I would never think like that. You know like that analytical side is just, it is what it is taken for me is move forward like what's happening happened like let's see what we can. What are we gonna do. Yeah. He's very. He's a realist.
38:33
Yeah, definitely a realist when it comes to money and things like that. So I am thankful for having that balance. Like I can see the benefits. Yeah, no, that's cool. Yeah. But yeah, what I do see in some spend
38:51
save our relationships. If there is that imbalance where the saver thinks that they're better, they're better at it. And you can see a subtly over time that where's the other person down feels less of a person you know, their self-esteem is lower. So it was definitely headed down that track top, until I met you.
39:16
We started doing all of this for sure. Yeah, like it. And then there's definitely other people too. So we had a business partner for a bit Ayal. Shout out to Ayal. Yeah, shout out. We'll have him on as an invite. Something. Yeah. Yeah. To having money conversations with different people and getting out there out of my comfort zone and being honest, has really uplifted me. Yeah. It's really, really important to have open and honest conversations with your partner at home about your money and actually reflect on how
39:47
those examples might be playing out. Because the more you can do that and look at it from each other's point of view and accept each other's traits, you know that it will be heaps, heaps better. And sometimes it's a long journey. I would say the turn around for me, like I've been doing this for about 8 years, 5678 years, I don't know how long, but to get to the point where I am now compare compared to the feeling that I used to have is so much different. Yeah, so it pays off, but it's not.
40:18
I think money is one of those things. It's not. You can't flick a switch on it, to change. It's constant. It's like your health. You have to work on it all the time. It makes me think we need to do a podcast on compound interest. Ah, yes. OK, we’ll, add it to our list. We are building our content list. Yeah, so cool. So good. Anyway, so is there anything else for money personalities? No. Just leave you with the thought. Find out what yours is. If you've got a partner, get them to do it. You know, just create the conversation
40:49
we do have on our, yeah, you know, a website through the quiz. You can look at the summary, you know, of what those traits could look like. Yeah, just have a chat. And so our question of the day and the question is: what is a mortgage prisoner? OK, a mortgage prisoner. What is a mortgage prisoner? Have you heard that word? It's new this year. It’s very similar to the mortgage cliff question we had last year,
41:19
last week, last episode.
41:21
So yeah, so if mortgage prisoner is when you maybe got a loan when interest rates were low and interest rates have gone up now and if you try to refinance, you can't. So you might wanna refinance and get a better deal, but you can't because if you're borrowing capacity, so basically your incomes, if you're applying for a loan today, you wouldn't have been able to borrow as much as you borrowed when you did a couple years ago. It means that you can't
41:52
get a better loan and refinance. Yeah, that's it. You are stuck. You got what you got. So what do you do, Mel? Well, you call your bank up. Our your broker. Well, yeah, that's right. Well, hang on. You need to find out what position you're in, right? So if you're in a crappy loan, so you took out a loan and it's not great. So you've got a higher interest rate on it and you just want to refinance for a better loan. You might go and see your broker and the broker might tell you, hey, I'm so sorry, but you can't apply for another loan
42:23
for those reasons that Darlene just said. You don't qualify, which in your brain might not make any sense because you're making your mortgage repayments and you're applied for it fine the first time and you're paying it back. That's right. So hey, why wouldn't somebody give me a better interest rate to make me in a better position? Doesn't make sense why you're improving my situation, Why you saying that I can't afford a better position? Yeah, so that reality doesn't make sense. SSo you're in that
42:53
situation. That's what we're calling a mortgage prisoner. You're stuck in that loan that you've got because no other bank will take you on. Yeah. And they do that because there's rules around how much money you can borrow. And because the rates have gone up, they put on higher buffers. So that's why you could afford it when rates were low, but not now. That's right. And that buffer generally is 3%. So, yeah, for rates today, 6%, they're estimating your repayments at 9% and whether you could make that loan
43:24
payment at that level. Yeah. Sorry. Can't afford it at 9%. That's right. So what would you do if you're in that situation and you've gone to see a broker and they can't refinance your loan? Then you've gotta call your bank and say give me a better rate. The words that you use are I've just gone to see my mortgage broker. She's looking to refinance my home loan and she's asked me to call you to ask for the best rate that you can possibly give me. That's right. Yeah.
43:54
And you call there if you want to know where to call, each bank has a department called a retention team. I know these are internal bank names, yes. But if you can remember that and you asked to speak to somebody in the customer retention team, they could give you a better rate and they will know if you just call up and say, I want a better interest rate, they'll send you through, they'll send you to the right team, Yeah. If you go to a branch though, they may not. So, yeah,
44:25
yeah, that's right.
44:28
Yeah. What else were you gonna say? I was also gonna say, though, so of late though, some of the banks are realising this problem with Mortgage Prisoner and if you just are wanting a better loan application, there's some products coming out where they are switching loans between. They're offering that and they're applying at a reduced criteria. Yeah, they're realising that this is not realistic. If you don't really want to increase your repayments, then hey, what? We shouldn't
44:58
stop you from refinancing. So it made it relaxed. Exactly. So definitely the second bit is engage a mortgage broker and to see what those current loan options are on the table. And just because even if the initial answer is no, you're stuck, then don't lose heart though, because those deals and products from banks are coming out all the time and I suspect over the next few months more of them will come. So definitely keep really close
45:29
with your mortgage broker and let them know to keep you informed if any new products come out would be another thing to do. And then the third thing to do is understand what it means for you. You really need to go through your numbers. You've got to know your number, your number is your income minus your expenses. Have you got anything left over? If not, can you get it back, you know, into positive? What can you change to do that? And
46:00
actually then look at your assets and you know what? Maybe you need to change your juggle. To get into that. Yeah. And seek the advice of a financial wellbeing coach. That's right. And be really clear on your values. Like, I've had customers who have actually downsized because they're like, well, we can't afford this. And this is not how we want to live our life. And I'm certainly not suggesting that's what you should do. But being creative around what your options are and how you want to live your life, it should all be on the table. Exactly. Maybe it's just
46:31
different work options, you know could be something to look at as well. But yeah, really understanding that and actually projecting it out because you might you might have some backup funds and how long are those backup funds going to carry you through. So this is where goal planning is critical and the work that you do because you might want some milestones before and at this milestone because we are going to be in these interest rates for the next couple of years. So
47:01
you can't hope that it's gonna change. You're gonna have to make the change that needs to happen to make your life work. Yeah, very good.
47:10
Alright, so we're wrapping it up now and we just before we leave you, we wanna leave you with a pondering question of what does financial wellbeing mean to you? So we've given you some definitions of what financial well eing is, but like just sit on that, do a little meditation on what you're yeah, what are you striving for and what does financial wellbeing mean for you? And yeah, what would be your happy place? Are you in it?
47:40
Yeah, Yeah, very good. Alright. Well, thanks for joining us today. Thank you. We'll catch you next time. See you next one.
47:49
At The Money Collective we provide financial wellbeing premium coaching, mortgage broking and workplace financial wellbeing programs which we couldn't do without the seamless support of our fabulous team. If you'd like to find out more, head to themoneycollective.com.au or our socials to take action and engage our services. In our Facebook group, join the conversation and help us break down the taboo around money. All content in this podcast is for educational purposes only and is general in nature. For tailored personal advice, please seek out a professional.
This podcast provides general advice only. It does not take into account your objectives, financial situation or needs. Before acting on any information provided, you should consider the appropriateness of the information and the nature of the financial product in regards to your objectives, financial situation and needs. We recommend discussing your personal situation with a financial professional.
Podcast by:
MEL PEARCE & DARLENE NEU
Co-Founders, Financial Wellbeing Coaches and Mortgage Brokers
The Money Collective
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