It was the week when the nation’s financial psyche was put on the couch.
Apparently, Australia has dropped five places in a global survey of the best places to live.
Australia’s education, medical care and nutrition levels have helped the country tie with New Zealand to reach ninth overall in the Social Progress Index. But low levels of tolerance and inclusiveness kept Australia’s overall ranking below Sweden, Canada and the Netherlands.
Australia has among the highest standards of living of any country with a diverse population, according to the survey.
Australia was pushed down to ninth from fourth position last year because its inclusion of immigrants was among the lowest in the top 10, according to Gallup World Poll data.
But not to worry. Australians remain pragmatic about the state of the world, according to the latest survey by the Lowy Institute, which surveyed 1,200 Australians.
Optimism about the Australian economy has lifted for the second year running after a low point in 2015, with 74 per cent of people positive about the performance of the economy over the next five years.
‘‘ The story there for me is that Australians feel insulated or inoculated to some extent from the meltdown elsewhere in the world about globalisation and trade,’’ Alex Oliver, the institute’s polling director, told The Sydney Morning Herald.
Now here’s something a little more depressing. When the ME bank (Ok – they’ve rebranded to ME) surveyed 1,500 people, only 13 per cent thought their financial literacy was below average.
But only 40 per cent got the answer to fairly simple questions right.
You want to try the questions? OK.
If a bank requires you to buy mortgage insurance with your home loan, who does it protect?
Is it cheaper to borrow $20,000 for a new car through a personal loan, or by adding it onto your mortgage?
Four out of five got the first question wrong (mortgage insurance only protects the bank). Three in four people also got the second one wrong (extending your mortgage will give you a lower rate, but it’s also about the length of your loan — if you pay it off over 25 years rather than five you’ll pay a lot more interest).
‘‘ The majority of people feel pretty confident about their finances and their financial knowledge, but that perceived knowledge is not actual knowledge,’’ ME’s head of deposits and transactional banking, Nic Emery, says.
You don’t know what you don’t know.
At last, a fund that really understands us. The F*ck You Fund (aka FU Fund) – For When Life Gives You Lemons
This fund is for those who want to have the financial security to be able to say ‘f*ck you’
We’re indebted to www.savingsguide.com.au for this idea.
It’s really about saving for independence from all those irksome problems – the landlord who raises your rent, the job you hate, the bank that charges you enormous interest.
To quote their website:
The FU fund lets you:
· Put yourself first when making decisions about money.
· Feel empowered to chase your passions, instead of a pay cheque.
· Feel confident that nothing can derail your personal life goals.
· Have a position of power when it comes to negotiating your true worth to a business.
· Sleep better at night knowing you can follow your moral compass without financial harm.
An FU fund essentially gives you the confidence to act on what you want to do in life. It enables decisions to be made that aren’t restricted by fear.
Ok, it’s about motivation to save. But I can’t think of a better reason than being able to say FU to all those institutions currently making your life miserable.
Enjoy the weekend!