Here are money mistakes counsellors see couples make, to help ensure that money doesn’t sour the atmosphere. Discussing finances with your partner can often feel uncomfortable, awkward, and even scary, amplifying the vulnerability in such conversations. Being in a relationship inevitably involves making mistakes, but allowing financial matters to fall by the wayside shouldn’t be one of them. Lack of Money Communication When did you last broach the topic of finances with your partner? Amidst the hustle and bustle of daily life, couples might neglect these crucial discussions. However, it’s vital for both parties to synchronise their understanding of their financial situation, both joint and individual, to avoid surprises later on. Establishing a structured approach to these conversations can help. Set aside dedicated time and space for discussions and agree on the topics to cover regularly. The goal is to transform these conversations into constructive exchanges rather than burdensome tasks. Our counsellors recommend scheduling a “money date” to alleviate tension, foster mutual learning, and infuse enjoyment into managing finances once more. Failure to Collaborate as a Team In a committed relationship, it’s imperative to unite financially. This entails making joint decisions and ensuring both partners are fully involved in financial matters. No one should unilaterally make financial choices without consulting the other, nor should one person bear sole responsibility for managing finances. Both individuals should possess a comprehensive grasp of their financial inflows and outflows, bill due dates, passwords, organisational systems, and so forth. Consider the worst-case scenario: if something were to happen to one partner, the other must be informed and capable of managing the situation seamlessly. Overlooking Money Personalities Are you familiar with your and your partner’s money personalities? Various money personas exist, such as spenders, savers, risk-takers, security seekers, and more. Understanding these dynamics is pivotal for financial comprehension. Identify stress triggers and seek equilibrium. Each personality boasts strengths and weaknesses, presenting an opportunity for mutual growth within your partnership. Neglecting Budget Construction Prior to merging finances, crafting a collaborative budget is imperative. View each other as equals in this process, irrespective of individual incomes, ensuring both voices are heard. Utilise your next “money date” to assess income and expenses (maintaining a money diary aids in this), debt management, savings, and discretionary spending. Determine how to divvy up financial responsibilities—whether pooling funds, splitting 50/50, proportionate payments, etc.—and formulate a budget accordingly. Continuously seek opportunities to optimise and adjust the budget as circumstances evolve; budgets are dynamic and should reflect changes in income, lifestyle, or situations. Failing to Adapt to Single-Income Living Life’s unforeseen events can disrupt finances, such as job loss or illness impacting household income. Therefore, maintaining financial resilience is crucial. Avoid overextending finances to ensure the ability to sustain living expenses on a single income for an extended period. Make prudent financial decisions toward this objective — opting for more affordable housing, purchasing generic or bulk items, prioritising durability over trends, exploring thrift stores, and curbing recurring subscriptions, among other strategies. Failing to Establish Financial Boundaries in Dating How often have you and your partner indulged in extravagant date nights on a whim? How frequently have you exceeded your budget limits for the sake of trying a new restaurant or planning a weekend getaway? Once you’ve established a budget, ensure mutual agreement regarding date nights or shared experiences. It’s easy to surpass allotted funds when seeking to foster romance. Before scheduling a date or getaway, scrutinise your budget rigorously to verify affordability. Remember, maintaining the spark doesn’t necessitate monthly splurges; sometimes, the most cherished moments involve nature exploration, cosy evenings at home, or tapping into your creative side. Lack of Honesty Transparency is vital in every aspect of your relationship, including finances. Don’t hesitate to inquire about your partner’s financial background. Are there undisclosed debts? How’s their credit health? Do their habits—such as smoking, gambling, excessive shopping, drinking, or drug use—affect your financial well-being? Equally important is being honest with yourself. Address any concerns or red flags regarding your relationship and finances. Avoid secrecy from the outset; delaying honesty only complicates matters. If transparency is needed, schedule a “money date” for an open, non-judgmental discussion. Neglecting Shared Financial Objectives As a team, it’s imperative to establish common financial aspirations. Envision your future together and outline SMART (Specific, Measurable, Achievable, Relevant, Time-bound) short- and long-term goals. Hold each other accountable and celebrate milestones, fostering mutual encouragement even during challenging times. Pursuing shared objectives strengthens your relationship in the long run. Delaying Action on Your Finances Who hasn’t succumbed to procrastination at some point? Yet, when the persistent refrain of “Let’s start next month” impedes your financial progress, it’s time to discard those excuses and dive in wholeheartedly. Monthly distractions may always arise, tempting you to overspend or neglect your financial responsibilities. Consider this a cue to stand firm, reject costly temptations, and refocus on your financial objectives. Failing to Seek Assistance Have you ever deferred seeking help until it’s too late? Avoid repeating that error with your finances. If uncertainties about your budget, lack of trust, difficulty expressing concerns, or navigating joint finances leave you feeling overwhelmed, don’t hesitate to seek guidance. Even the most financially astute individuals require assistance occasionally. Schedule a free appointment with one of our accessible, impartial counsellors to guide you through this financial journey. It only takes one person to initiate action, so don’t hesitate to book an appointment independently and involve your partner when they’re ready. DISCLAIMER:  This article is for informational purposes only and not meant as official financial advice. 2 Ezi has no relationships with any organisation mentioned. Please consult a financial advisor and relationship counsellor.

After examining the correlation between wealth and happiness, Harvard Business School professor Jon Jachimowicz concludes that while affluent individuals do encounter challenges, possessing wealth enables them to address and resolve issues more expediently. Jachimowicz’s study involved 522 participants spanning income brackets from $10,000 to over $150,000, who were tasked with maintaining a 30-day emotional diary to document their reactions to various events. Increased financial means grant individuals greater command over their daily affairs, potentially enhancing overall happiness. Jachimowicz’s research yielded several key findings: In their influential 2011 paper, “If money doesn’t make you happy, then you probably aren’t spending it right,” American scholars Elizabeth Dunn, Daniel Gilbert, and Timothy Wilson outlined strategies to optimise spending habits, such as prioritising experiences over material possessions and cultivating anticipation prior to purchases. Moreover, there exist additional evidence-based methods to maximise the utility of existing expenditures. Invest your time and resources in others instead Research conducted by Dunn and her fellow happiness researchers, Lara Aknin and Michael Norton, indicates that allocating money to benefit others brings greater happiness compared to spending the same amount on oneself. In their study, participants were given a $20 note and instructed to either use it for personal expenses or to gift it to someone else before the day’s end. Those who chose to spend the money on others reported experiencing a more significant increase in happiness that day compared to those who kept the money for themselves. Fortunately, reaping the benefits of this phenomenon doesn’t require a substantial financial investment. Nurture your relationships If you’re on a tight budget, explore ways to show generosity and enhance your relationships without jeopardising your financial goals, such as getting out of debt or building your emergency fund. This could involve inviting friends over for coffee instead of going out or using your time to assist a family member in assembling furniture. Such actions also contribute to enhancing the quality of our relationships, which, according to the Harvard Study of Adult Development, is a major determinant of our happiness. Running for over 80 years and spanning four generations with more than 2000 participants, this study, overseen by director Robert Waldinger, challenges the notion that fame, wealth, and external markers of success lead to happiness. Instead, the accumulated data suggests that prioritising our most significant relationships is paramount. Reclaim your time Studies indicate that the more control we have over our time, the happier we tend to be. While we all have the same 24 hours each day, how we experience that time varies based on our circumstances, obligations, and values. Ashley Whillans, a researcher at the University of British Columbia, discovered that individuals who prioritise having more time over accumulating more money generally report higher levels of happiness. Taking her research further, Whillans examined the effects of using money to delegate undesirable (and time-consuming) tasks such as household chores or meal preparation. She provided 60 participants with $80 over two weekends, instructing them to spend half on a material purchase for themselves and the other half on a time-saving service. Interestingly, investing in a time-saving service resulted in a greater increase in participants’ happiness levels compared to spending on material goods. However, there’s a caveat to this trade-off. Whillans’ findings suggest that there’s a threshold beyond which outsourcing tasks can undermine our pursuit of happiness. Finding the right balance can be challenging. So, what are the key takeaways from research on using money to boost happiness? Spend your money intentionally on activities that resonate with you, bring joy to others, and create lasting positive memories, both in the present and the future. DISCLAIMER:  The content provided in this article is solely for informational purposes and does not constitute formal advice. It is recommended to seek guidance from a qualified financial advisor and mental health counsellor for personalised assistance.

What is Net Worth? Net worth is the value of assets owned by an individual or corporation after subtracting liabilities. It serves as a crucial indicator of financial health, offering an overview of the entity’s economic standing. Also referred to as net wealth, this metric plays a key role in financial assessments, determining eligibility for specific investment options such as hedge funds or structured products. It has permeated popular culture, with rankings showcasing people with the highest net worth alongside that of celebrities. Key Points: How is Net Worth Computed? Net worth is calculated by subtracting liabilities from assets. Assets include possessions with financial value, while liabilities comprise commitments that consume resources, like loans, accounts payable (AP), and mortgages. Net worth may be characterised as either positive or negative, where the former denotes assets surpassing liabilities, and the latter indicates liabilities exceeding assets. A positive and escalating net worth signifies sound financial well-being. Conversely, declining net worth warrants attention, potentially indicating a decrease in assets relative to liabilities. Enhancing net worth can be achieved by either diminishing liabilities while maintaining or increasing assets, or augmenting assets while liabilities remain constant or decrease. The concept of net worth is applicable to individuals, businesses, industries, and even nations. The Significance of Net Worth in Business In business, net worth goes by various terms, including book value or shareholders’ equity. The document that encapsulates this financial metric, the balance sheet, is also referred to as a net worth statement. Essentially, a company’s equity is determined by the disparity between its total assets and total liabilities. It’s important to note that the figures documented in a company’s balance sheet often reflect historical costs or book values rather than current market values. Lenders meticulously assess a business’s net worth to gauge its financial well-being. If total liabilities surpass total assets, a creditor might harbour doubts about the company’s capacity to repay its debts. A consistently profitable company should witness a steady increase in its net worth or book value, provided that these profits are not entirely distributed to shareholders as dividends. In the case of a publicly traded company, a rising book value often correlates with a rise in its stock price. Understanding Net Worth in Personal Finance An individual’s net worth is essentially the remainder obtained by subtracting liabilities from assets. Liabilities encompass several financial obligations, such as mortgages, credit card debts, student loans, and car loans, as well as recurring expenses like bills and taxes. Assets, on the other hand, encompass items such as balances in checking and savings accounts, the value of investments like stocks and bonds, real estate holdings, and the market worth of vehicles. The net worth is what remains after liquidating all assets and settling personal debts. Those with considerable net worth are often referred to as high net worth individuals (HNWIs) and represent a key demographic for wealth management services and investment advisors. Dealing with a Negative Net Worth Having a negative net worth occurs when an individual’s total liabilities exceed their total assets. For example, if someone’s cumulative credit card balances, utility bills, mortgage payments, auto loans, and student debts surpass the combined value of their cash and investments, they will have a negative net worth. A negative net worth serves as an indicator that an individual or household should prioritise reducing their debt. Implementing a stringent budget, employing debt reduction tactics like the debt snowball or debt avalanche, and potentially negotiating with creditors can assist people in escaping a negative net worth situation and initiating the process of wealth accumulation. In the early stages of life, it’s not uncommon to have a negative net worth, particularly due to student loans, which may lead even financially prudent young individuals to owe more than they possess. Also, familial obligations or unforeseen health issues can push individuals into debt. When other strategies have proven ineffective, declaring bankruptcy to discharge certain debts and halt creditor collection attempts may be necessary. However, it’s important to note that certain obligations, such as child support, alimony, taxes, and often student loans, cannot be absolved through bankruptcy. Furthermore, it’s important to recognise that bankruptcy will remain on an individual’s credit report for an extended period. FAQ What amount should be saved? How much you should aim to have saved varies based on factors such as your age, profession, lifestyle, and personal situation. For instance, a financial planning firm suggests targeting three times your annual salary in retirement accounts by age 40. Conclusion Examining net worth provides a clear insight into the true wealth of a person or enterprise. Solely focusing on assets may present a skewed picture, as it often involves balancing against liabilities, such as debts. Thus, increasing assets and minimising debts and other liabilities can increase one’s net worth. DISCLAIMER:  This article is for informational purposes only and is not meant to replace official financial advice. 2EZI has no affiliations with any company mentioned in this article. Please consult a financial advisor and wealth planner.

Achieving a zero-waste lifestyle on a limited budget is definitely possible with some strategic planning and creative thinking. Australian households generate approximately 12 million tonnes of waste annually, placing the sector nearly on par with manufacturing or construction activities. However, there is potential for change. With proper support, households can alter their consumption habits and adopt a zero-waste lifestyle. Our recent study delves into how Australians are embracing this concept. We conducted interviews with residents to understand their current waste management practices. Subsequently, we encouraged them to devise and implement their own six-week household experiments. Their initiatives varied from home gardening and DIY repairs to embracing zero-plastic cooking and patronising bulk stores. We then facilitated discussions with policymakers to exchange their insights. The findings indicate that while householders are enthusiastic about experimenting with change, transitioning to a zero-waste lifestyle poses challenges. Accountability for Recycling For years, Australia relied on shipping waste materials overseas for recycling. However, when China implemented a ban on these imports in 2018, Australian authorities were compelled to expedite the development of improved waste management strategies. In a genuine circular economy, every resource holds value and is consistently reused as it circulates within the system. Yet, during this transitional period, the emphasis has predominantly been on recycling as a means to decrease the volume of waste destined for landfills. Recycling bins placed at Kerbside often contain non-recyclable general waste, resulting in the accumulation of unsortable materials at waste management facilities. Soft plastics, predominantly packaging, have posed significant challenges. Recent efforts have urged households to return soft plastics to supermarkets. However, the REDcycle initiative faced overwhelming demand, prompting Coles and Woolworths to halt collection on November 9, 2022, due to its failure to meet recycling commitments for months. This setback followed the collapse of SKM, a recycling company in Victoria, in 2019. Warehouses became burdened with unprocessed waste, while some recyclables ended up in landfills. Various Australian states, most recently Victoria, have banned single-use plastics, yet the effectiveness of these measures hinges on the accessibility of viable alternatives. In 2018-19, households accounted for the majority of Australia’s plastic waste (47%) and food/organic waste (42%). Addressing these figures necessitates shifts in societal norms regarding lifestyles and consumption habits, alongside changes in retail practices, bolstered by regulatory measures and enhanced collection infrastructure. Past studies have underscored the intermediary role of households, positioned between individual and community levels. Nonetheless, there’s a notable lack of recognition regarding the potential contribution of households to sustainability transitions. Transformation through Experimentation Transitioning to a zero-waste lifestyle necessitates alterations in household consumption habits and waste management approaches. The lockdowns enforced during the Covid pandemic in Victoria offered both an opportunity and motivation for numerous individuals to adjust their consumption habits. Nevertheless, as life gradually returns to a semblance of normalcy, many encounter difficulties in sustaining a zero-waste lifestyle. A series of household trials were conducted involving participants from Melbourne. One mother of two aimed to achieve a 100% waste-free existence for six weeks, while another mother concentrated on eliminating plastic from her cooking. Some individuals opted to explore bulk stores, while a solo resident initiated a gardening project. Another woman living alone sought to acquire skills in clothes and bicycle repair, while a part-time sales associate, residing with his spouse, endeavoured to devise a three-week challenge promoting zero-waste practices among his peers. Insights Gained Participants expressed that they encountered considerable difficulty with household adjustments. They conveyed that the experiments demanded additional mental effort, time, financial resources, and determination. Moreover, they emphasised the necessity for increased guidance and assistance to accomplish and sustain desired behavioural changes. Some individuals found the process motivating, prompting them to explore alternatives like opting to walk further to a bulk food store instead of resorting to the convenience of a supermarket. Bulk food stores promote the use of customers’ reusable containers or environmentally-friendly packaging, such as paper bags, to eliminate the use of soft plastic packaging. Not all changes were enduring. Transitioning to shampoo and conditioner bars necessitated thorough research and proved too challenging for one individual: “Just that one switch was so intense … it was expensive as well.” Supermarkets caused significant frustration due to the prevalence of unwanted plastics. “The packaging is such a big problem. It’s just ridiculous. It should be stopped … There are very few items that you can buy that don’t have some sort of packaging.” Social connections played a significant role in adopting a zero-waste lifestyle. One individual mentioned that her family expressed reluctance to fully commit to the zero waste journey, while another shared how her husband and children offered unwavering support throughout the process. The issue of minimising food waste while having children at home was also raised. “It’s challenging to reduce how much food gets wasted with children. I have reduced how much I cook … I’ve tried to do stock takes of my freezer, my pantry, the fridge … to really focus on meal planning … But it’s really, really challenging … I think if it was just me, I would have a lot more success.” Facebook groups proved to be a valuable asset “because it does make you realise that there are other people who are trying to save every piece of plastic from going in the bin.” Homeowners expressed suggestions for facilitating easier adoption of zero-waste lifestyles, encompassing policy adjustments and systemic reforms. These suggestions involved enacting legislation targeting high waste producers, prohibiting polluting products, enhancing recycling infrastructure, fostering markets for recycled goods, promoting innovation, disseminating comprehensive information, and refining product labelling. Their awareness of zero-waste practices worldwide contrasted with their dissatisfaction with Australia’s systemic shortcomings. “We need support and systemic change from the government (policy) and businesses (innovation) to drive down the amount of plastics associated with our everyday products,” one participant remarked. The waste crisis escalated in 2019 when China decided to cease accepting Australia’s contaminated waste for recycling, leading to protests. Making Zero-Waste Living Accessible Significant changes are necessary to facilitate the zero-waste lifestyle. Conducting experiments

Avoid the money mistakes new parents commonly make by planning, communicating, and adapting to your family’s evolving financial needs. New parents often find themselves overwhelmed by a sense of falling short in different aspects of parenthood. As if their plate isn’t full enough, parents might also be committing significant financial blunders. Rafael Rubio, a partner at financial firm Oray King Wealth Advisors in Troy, Michigan, notes that there are mistakes commonly made by parents with children of varying ages. He emphasises that while the mistakes may be universal, the window for rectification dwindles as children grow older. Bearing this in mind, there are prevalent pitfalls to steer clear of, ranging from neglecting retirement savings to splurging excessively on holiday gifts. Being a Bad Influence One common mistake new parents commit is overlooking the potential impact of their present behaviours on their child’s future financial well-being by being a bad influence. Mark Henry, CEO of financial firm Alloy Wealth Management and host of Living Large Radio, remarks, “Children often emulate their parents’ actions.” If children observe their parents living from one paycheck to another and indulging in unchecked spending with credit cards, they might be on track to replicate these patterns throughout their lives. Instead, it’s necessary to allow youngsters to witness responsible financial habits, such as budgeting, saving for purchases, and waiting for opportune time to make purchases. Failing to Create a Budget Creating a financial plan is important for everyone, especially new parents who can leverage from having a budget. Without careful planning, expenses like new clothing, party gifts, and sports gear can quickly deplete a budget. Dan Routh, a certified financial planner, often observes parents wasting extra income simply because it wasn’t allocated in their budget. “It’s common to see bonuses being spent on gifts and trips, instead of being allocated towards retirement, emergency funds, or other significant financial objectives,” he says. Do Not Prioritise Saving Due to financial constraints and the constant stream of children’s wants, new parents often do not prioritise saving. Nevertheless, it is significant for parents to establish an emergency fund, given the unpredictable nature of children and their many requirements. Henry emphasises that unforeseen challenges can arise for everyone, making it a mistake for parents without a financial reserve to cover unexpected medical costs, school excursions, or repairs for the family car. Indulging the Kids John B. Burke, CEO of advisory firm Burke Financial Strategies understands the inclination of parents to shower their children with clothes, gadgets, and toys. “We all desire the best for our kids,” he observes. Burke rejects the notion that today’s parents are uniquely prone to spoiling their children, suggesting that previous generations would likely have done the same if they had the same level of wealth as many families today. While parents may wish to be generous, it’s unwise to fulfil every whim. Teaching children the value of delayed gratification is important for their future financial independence. Keeping Up With the Joneses Feeling pressured to match the lifestyles of others, new parents might believe they must sustain a particular standard to ensure their children fit in with their peers. “Their aim is to ensure their kids’ satisfaction,” Rubio says, which might prompt them to opt for extravagant vacations or enrol their children in pricey travelling sports teams instead of more affordable community leagues. Setting spending preferences according to others’ actions is likely to have negative consequences. It may lead to purchases of items a family doesn’t truly need and could strain the budget, potentially resulting in credit card debt or even bankruptcy. Favouring College Funds over Retirement Savings Opting to save for college funds instead of retirement savings is a prevalent financial oversight among new parents. It’s advisable for parents to allocate funds towards a 401(k) or IRA plan before focusing on a child’s college fund. Insufficient retirement savings could leave parents with no financial support for their retirement years, whereas, students have options like scholarships, loans, or employment to finance their education. Considering a 529 Plan as Optimal When thinking of college funds, a 529 plan often emerges as the favoured choice. Funds invested in these plans enjoy tax-free growth and can be withdrawn penalty-free for qualified educational expenses. Many states provide a deduction for state income tax on contributions. Nevertheless, there are alternative strategies for a college fund. Burke suggests diversifying investments across several accounts. Apart from a 529 plan, it might be better to allocate funds to a custodial account permitted by the Uniform Gifts to Minors Act. While parents may enjoy tax benefits with these accounts, there’s a potential downside. Burke says, “Once (children) reach the age of majority, they have unrestricted access to the funds, and you can’t intervene.” Consulting a financial expert can aid in determining the suitability of a custodial account for your situation. Misconceptions on Future Life Insurance Requirements With life insurance, new parents often commit two distinct mistakes. Firstly, they may underestimate their coverage needs. Many working parents rely solely on the life insurance provided by their employers, assuming it to be adequate. However, such coverage often amounts to only one to three times an individual’s salary. For many households, a policy with a death benefit equivalent to 10 times the annual income of a breadwinner might be necessary to adequately replace lost income, settle debts, and finance their children’s education. The second mistake involves misusing life insurance for purposes beyond its intended scope. Routh’s firm encounters many instances of parents purchasing life insurance for their children with the belief that it will accumulate cash value to cover college expenses. However, Routh emphasises that they have yet to come across a scenario where this strategy has proven effective. He notes, “The fees associated with these permanent insurance policies gradually erode any potential growth.” Providing Assistance to Children Endlessly One common mistake new parents often commit, according to Burke, is failing to establish a clear plan for when to stop providing assistance to their children. “It’s a frequent occurrence where