The brain may be partly to blame for why two-thirds of Australians procrastinate in making their financial decisions, despite a massive 85% being concerned about their financial future, it has been suggested.
The
Suncorp Cost of Procrastination Report found that Australians most often take their time deciding on establishing a budget, savings plan, and prioritising expenses into needs and wants – a behaviour Suncorp's Phil Slade said can be partly due to how our brain works.
"Managing our finances is actually very emotional, even though we approach them with very rational thinking and use unemotional tools like spreadsheets," said Slade, a behavioural economist with the insurer. "The simple act of looking at our finances conjures a variety of feelings – confusion, disappointment, and even fear of the future. As our brains are hard-wired to avoid pain, we become naturally resistant to any money-related tasks. Our brain actually feels good when we procrastinate because we have successfully avoided something painful."
According to the report, seven in 10 people from aged 35 to 54 years admit to procrastinating regularly or always about their finances; closely followed by 69% of Australians aged 18 to 34 years. The age group that are least likely to procrastinate were retirees, aged 55 and up.
"The good news is this can be overcome,” Slade said. “Set your own deadlines; acknowledge the emotion behind financial decisions; and be aware of your spending patterns, not just how much you're spending.”
The study also revealed that different age groups varied in their top financial concerns, but that they all shared in their worries about being able to manage unplanned or sudden expenses; affording the ideal lifestyle retirement; and making mortgage repayments or getting into the property market.
Lynne Sutherland, Suncorp's EGM for stores and speciality banking, said the study findings reinforced the importance of dealing with finances proactively, and advised Australians to seek assistance should they need it.
"To feel financially confident, we need to be motivated about money, or at least the benefits of positive money management and put plans in place," Sutherland said. "In a lot of cases, procrastination can be linked to not knowing where to start or being ashamed to ask for help. Money can be confusing, but there are so many options available to help people regain control of their money. While the report found individual research was the most commonly used resource, financial planners, trusted friends, and families, and bank managers can also be really helpful."
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