Budgeting

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

In this blog, we’ll explore the ways you can travel for free in Australia and make the most of your domestic and overseas adventures. Australia, with its vast landscapes and diverse attractions, has long been a dream destination for travellers. However, the cost of travelling within and outside the country can be a major deterrent. But what if you were told that it’s possible to travel for free or at a significantly reduced cost? The Allure of Free Travel The desire to explore new places and experience different cultures is a universal one. In Australia, where the distances are vast and the allure of international travel is strong, the idea of free travel is particularly enticing. Many Australians are driven to find ways to spend less on travel without compromising the quality of their adventures. Travel Australia with Rewards Points One of the most popular ways to achieve free or heavily discounted travel in Australia is through rewards points and frequent flyer miles. Several major airlines in Australia offer loyalty programmes that reward frequent travellers with points for every flight they take. These points can then be redeemed for future travel, effectively reducing the cost of your trips. If you’re not already a member of a frequent flyer programme, it’s time to sign up. You can start accruing points on both domestic and overseas flights. The more you fly, the more points you accumulate, which can later be used for free or discounted tickets. The drive for landing travel opportunity via reward point scores may have been underlined further in American Express’ latest AMEX Trendex report. Its evaluation of 1,000 Australians found that 66 per cent of them often booked their flights by credit card, and their card provider had a rewards programme where certain amounts or distance corresponded to points redeemable in the future. Another 89 per cent confirmed they keep track of the points they got with every charge. Domestic Travel Australia: Make the Most of It Exploring your own backyard can be a delightful and cost-effective way to quench your travel thirst. Australia is renowned for its natural beauty, stunning coastlines, and unique wildlife. So why not make the most of domestic travel opportunities? Overseas Travel AU: Dream Destinations at Your Fingertips While domestic travel in Australia is fantastic, the allure of overseas adventures is undeniable. Here’s how you can reduce the cost of international travel and make your dream destinations a reality: Tips to Prepare for Your (Almost) Free Trip While the idea of travelling for free is tantalising, there are some practical aspects to consider: Travel by points Travelling for free in Australia and abroad is not a mere dream; it’s a tangible possibility. By accumulating rewards points, making the most of domestic travel opportunities, and being savvy about your overseas adventures, you can significantly reduce your travel expenses. Remember, even if the opportunity for free travel arises, meticulous planning and preparation are essential to make the most of your unforgettable journeys. DISCLAIMER:  This article is for informational purposes only and does not constitute official travel advice. 2 Ezi is not affiliated with any travel industry rewards service.

What is Financial Literacy? Financial literacy is the ability to understand and proficiently apply diverse financial skills, including personal financial administration, budgeting, and investment strategies. Being financially literate provides a fundamental basis for a savvy interaction with money, establishing a launching pad for a continuous exploration into more sophisticated financial topics. Initiating this educational journey sooner rather than later proves advantageous, as knowledge serves as the cornerstone of financial success. Between 2000 and 2022, financial products and services have become increasingly prevalent in society. While previous generations predominantly used cash for purchases, contemporary preferences lean towards various credit options, including credit and debit cards, as well as electronic transfers. Given the significance of finance in today’s world, a lack of financial literacy is widespread and can significantly hinder long-term financial success for anyone. Being financially illiterate can result in several pitfalls, such as a higher risk of accumulating debt due to poor spending decisions or a lack of long-term preparation. This, in turn, may lead to adverse consequences such as poor credit, bankruptcy, housing foreclosure, and other negative outcomes. Fortunately, there are now more resources available than ever for those seeking to educate themselves about the intricacies of finance. Scope of Financial Literacy While financial literacy involves varying skills, some commonly cited examples include managing household budgets, understanding debt management, and evaluating the pros and cons of different credit and investment products. These skills often demand a basic understanding of financial concepts, including compound interest and the time value of money. In addition to the traditional aspects of financial literacy, the significance of products such as mortgages, student loans, health insurance, and self-directed investment accounts has increased. This underscores the growing necessity for people to grasp how to use these financial tools responsibly. Financial literacy extends to both short-term and long-term financial strategies, with the chosen approach influenced by factors like age, time horizon, and risk tolerance. It involves an awareness of how current investment decisions can impact future tax liabilities. Furthermore, it entails knowing the most suitable investment vehicles for saving, whether for specific goals like home purchase or retirement. Also, emerging financial trends such as e-wallets, digital currency, buy now/pay later options, P2P lending, and other innovative products, though convenient and cost-effective, require consumers to be educated in order to assess their benefits accurately. Why Financial Literacy Matters From day-to-day expenses to long-term budgeting, financial literacy is key for effective management. It is important to plan and save adequately to ensure a stable income during retirement, steering clear of excessive debt that could lead to bankruptcy, defaults, and foreclosures. Lack of financial literacy has left millennials ill-equipped for severe financial crises. Even those claiming high personal finance knowledge had less accuracy in answering fundamental financial concept questions. Some don’t even have an emergency fund and are unable to come up with $2,000 within a month in emergencies. Millennials also grapple with substantial student loan and mortgage debt, ending up burdened by these excesses. Financial literacy even extends beyond personal concerns, having broad implications for economic health. Benefits of Financial Literacy Understanding financial matters empowers people, enabling them to make logical and wiser decisions. More specifically, financial literacy holds significance for different reasons. It serves as a safeguard against potentially disastrous mistakes. For instance, loans with fluctuating interest rates and the limitations on withdrawing from your retirement account before your actual retirement carry long-term consequences. Financial literacy equips individuals to navigate their personal finances wisely, preventing costly errors. Financial literacy also equips people to handle emergencies. Topics such as saving and emergency preparedness help people anticipate and be prepared for unforeseen events. Whether facing job loss or unexpected expenses, having financial literacy enables individuals to proactively mitigate the financial impact of such situations. Moreover, financial literacy plays a key role in helping individuals achieve their goals. A deeper understanding of budgeting and saving empowers individuals to formulate plans that establish expectations, enforce financial accountability, and chart a course toward realising seemingly unattainable aspirations. Even if someone cannot afford their dream today, financial literacy enables them to strategise and improve their chances of making it a reality. Also, financial literacy instils confidence. Imagine making life-altering decisions without possessing all the necessary financial information. Armed with knowledge about finances, individuals can approach significant life choices with greater assurance, knowing they are less likely to be caught off guard or adversely affected by unforeseen outcomes. How to Improve Financial Literacy Skills Developing financial literacy to enhance personal finances involves acquiring and applying various skills related to budgeting, debt management, and understanding credit and investment products. Regardless of your financial situation, it’s never too late to initiate positive financial habits. Create a budget Create a budget by tracking your monthly income and expenses using tools like an Excel sheet, paper, or a budgeting app. Categorise your budget into income sources, fixed expenses (rent, utilities, loans), discretionary spending (nonessentials like dining out, shopping, and travel), and savings. Pay yourself first Adopt the “pay yourself first” strategy by setting aside a predetermined amount for savings before allocating funds to other expenses. Identify a savings goal, determine a monthly contribution, and prioritise it over other expenses. Pay bills on time Stay organised with your monthly bills by ensuring timely payments. Explore options like automatic debits or bill-pay apps, and sign up for payment reminders through email, phone, or text. Review your credit report Request a free annual credit report from major bureaus. Check the reports for inaccuracies and dispute any errors with the credit bureau. Consider spreading out your requests throughout the year for regular monitoring. Monitor your credit score Keep tabs on your credit score using free credit monitoring services or premium options for added protection. Be mindful of financial decisions that impact your score, such as credit enquiries and credit utilisation ratios. Debt management Utilise your budget to manage debt effectively by cutting spending and increasing repayments. Develop a plan, prioritising repayment of high-interest loans. If needed, explore options like negotiating with lenders, consolidating

Without a basic understanding of personal finance management, you may be exposed to costly financial missteps early in life. Recognising that each financial situation is unique, there is no one-size-fits-all formula for money management. Nevertheless, there are important steps that can set anyone on the path toward financial well-being. It’s necessary to note that while the following financial tips are beneficial, they should not replace guidance from a licensed financial advisor. Instead, consider them as a starting point to pave the way for financial success. What is Personal Finance Management (PFM)? Personal Finance Management (PFM) includes various strategies for handling personal finances. Numerous apps have been developed to cater to diverse personal finance and budgeting needs. PFM apps play a significant role in managing different aspects of personal finances, such as: Selecting the most suitable app hinges on aligning its features with your short- and long-term financial objectives. Take, for instance, 2 Ezi, which specialises in budgeting, expense tracking, and facilitating savings for unforeseen circumstances. How Does Personal Finance Management Work? While each Personal Finance Management software may vary in its specific features, the general process involves gathering user’s personal information and linking their accounts to provide a comprehensive overview of their finances. It is important to review the software’s terms and conditions as well as its data policy to understand the storage and usage of your information. PFM programs leverage the collected data to track and monitor spending, offer valuable insights, and perform various tasks that would often require manual effort. Some programs may go a step further by providing tips to enhance your credit score. Financial tools available through PFM software PFM apps usually offer a range of tools and features for monitoring different aspects of personal finances, such as bill payments, overall spending patterns, credit score changes, and investment portfolios. For instance, the 2 Ezi app includes features like subscription management, spending insights, and autopilot savings, aiming to simplify users’ financial management. Is PFM the same as budgeting? PFM is not synonymous with budgeting, although budgeting is just one of the many strategies encompassed by PFM. PFM serves as an umbrella term, which includes various money management approaches, with budgeting being just one component. Budgeting methods vary widely among individuals, ranging from manual entry into Excel documents or handwritten notes. In contrast, PFM apps and tools often offer a more comprehensive solution. These applications often update automatically on a monthly basis, streamlining the budgeting process and saving users time and energy. PFM Apps: A Step-by-Step Guide Embark on your Personal Finance Management (PFM) journey by adhering to the following steps. 1. Download the app and set up your account Upon downloading the PFM app, take a moment to initiate your account setup. This usually involves entering standard information such as your full name, email address, phone number, and creating a robust, unique password. Depending on the app’s features, you may also input additional details like your home address, bank information, and Social Security number. Exercise caution during this step, and thoroughly read the app’s terms and conditions before providing personal information. 2. Connect all your financial accounts After setting up your account, the next step is linking all your financial accounts. These are debit and credit cards, investments, mortgage loans, student loans, auto loans, and other accounts. Many PFM apps come with tools and features to facilitate a seamless, secure, and reliable connection between your financial data and the app. 3. Customise your spending and saving categories With your account ready, customise the app to suit your preferences. 2 Ezi, for instance, lets you establish personalised spending and saving categories, such as “Groceries,” “Student Loan Payments,” or “Vacation Savings.” Budgeting apps often allow you to invest spare change from your daily purchases. Set thresholds for each category and automate savings transfers within the app for a hassle-free savings experience. 4. Use the PFM tools and features Once your PFM app reflects your desired settings, let it work for you. Sit back and monitor as it tracks and manages your financial activities. Should you need adjustments, you can easily access the app and modify Settings to align with your financial requirements. With these steps, you can maximise the potential of PFM apps to efficiently manage and enhance your financial well-being. FAQs Still have questions about Personal Finance Management softwares? Here are some frequently asked questions with informative answers. Are PFM apps safe and user-friendly? Yes, most PFM apps are both safe and user-friendly. While it’s advisable to review the privacy policy for assurance, most financial software prioritises the security of your data and does not store or sell it. Why should I use a PFM app? PFM apps simplify money management and aim to reduce stress associated with financial tracking. Instead of manually calculating your finances, these apps allow you to input basic information, and the app takes care of the rest, making the process more efficient and less time-consuming. Conclusion While recognising the uniqueness of individual financial situations, it is imperative for everyone to possess a basic understanding of personal finance management. Through this journey, there are numerous PFM apps tailored to assist in effectively handling your finances, setting you on the path to wealth creation. Whether your goal is budgeting, saving, investing, or enhancing your credit score, these apps are available to cater to your specific needs. One notable example is the 2 Ezi app, a comprehensive tool designed to not only streamline personal financial management but also facilitate wealth accumulation and future financial planning. For those eager to initiate the journey towards a more secure financial future, consider downloading and creating an account on the 2 Ezi app today. Your proactive steps now can pave the way for a secure financial future. DISCLAIMER:  This article is for informational purposes only and does not constitute official financial advice. Please consult a financial advisor.