Teaser: We’re back with Season 3!
February 8, 2022
A very quick episode to let you all know what's in store for this season!
Podcast Transcript Available Here
Duration: 27:15
Sarah Eifermann: Okay. Hello. Hello everyone. Welcome to 2022. This is season three of the Financial FOFU podcast and I'm Sarah Eifermann. Trudi Cowan: And I'm Trudi Cowan. Welcome back. Sarah Eifermann:Yeah. Wow. What a year? What a break? How are we doing? Going out there, Trudi. How are you doing after your break? Trudi Cowan: It doesn't feel like much of a break, but I'm doing good. I'm glad the kids are back at school. Sarah Eifermann: A lot of people have said to me, they've struggled this year to get back into work. Having maybe had two weeks off or three weeks off, or some people waited until like they had the whole month until like Australia day weekend. And now they're massively struggling for motivation to get to the gym or to eat healthily, or they're just exhausted still. Trudi Cowan: I think we had such a big year and so few breaks during that big year. Sarah Eifermann: Can we just put it out there and say 2021 was a hell of a year and it's taken its toll. And it might take all of us a little bit of time to get back into the swing of 2022. Trudi Cowan: Oh, I think so. Sarah Eifermann: What's been happening. What's happening for you this year, Trudi? Trudi Cowan: Few planning well you know, right now it's just around focusing on finishing off those tax returns of those people. I haven't quite got in for me yet, but just about ready to start launching into tax planning, if you can believe it for the current financial year, Sarah Eifermann: Pretty much March, isn't it? Trudi Cowan: Yeah, it is pretty much March. It'll be here before we know it. So, that's really what I'm focusing on right now. But for the year, a few big plans are sort of going to be the year of refining my business, I guess, looking at my procedures and my processes. And I'm going to go through a big process of reviewing my pricing this year, which is going to be interesting. Sarah Eifermann: Yes, It's on my list as well. Trudi Cowan: But after the couple of years that we've had, I am keen to actually get out and go see all my clients as well. Sarah Eifermann: Get off the internet Trudi Cowan: Get off the internet and go and see some people in person and sit down and see how everyone's doing, in their businesses after the last couple of years that we've had. Sarah Eifermann: Yeah. Spending some time, face to face where you can. Trudi Cowan: Yeah. That's going to be a focus this year. Sarah Eifermann: And I'm going to drop this one on you right now. What's your word of the year? Trudi Cowan: Fun. Sarah Eifermann: Ooh! She's already thought about it, she's on it. Trudi Cowan: I haven't thought about it. But you know, again after the couple of years that we've had. I just want to get out, see my friends, do things and enjoy the year. So this year it's about fun. Sarah Eifermann: Nice. My word of the year, this year is consistency. Little lesser fun or it's more formal than yours. But I think, you know we've had so many ups and downs, starts and stops. And in business and life, I just think consistency and committing to trying to be as consistent as you can for yourself and for those around you is important and valuable. And that consistency brings growth, it brings success and it brings great outcomes. So, Trudi Cowan: Yeah. And you had some big changes last year as well. So Sarah Eifermann: I did, I took a tree change yeah. And left Melbourne and moved to the Northern rivers. So I'm up near Yamba, in a cute little town called Maclean. So I moved regionally as well. So out of the city, so big changes. Yeah. Big changes. Life's good though. So if you are listening and you are in the region of the Northern rivers, please reach out. I'd love to catch up because we can catch up face to face. Trudi Cowan: Face to Face. Sarah Eifermann: Yeah. So, happy to meet and greet some new people up this way. And even if you've got friends up here and you think that we might connect well or get along, please do an introduction. Why not? Trudi Cowan: Yeah. So what are your plans for the year, do you got anything big happening? Sarah Eifermann: It's you know, a recovery for us in the finance industry and for businesses given that I work with B2B. Like a lot of businesses have had tough two years not knowing what's coming, what they can do, what they can invest in. Trudi Cowan: Yeah. Sarah Eifermann: Whether they can spend their money on expansion or whether they need to keep their money to pay their mortgage and keep their staff on. So for me, I reviewed my pricing already for the year. I thought that was important and put a value proposition on what I offer. So not easy. We'll talk about that in a later episode, but it was something that had to happen. In terms of business, I've got some contract work with some fintech. I'm still a small business incubator mentor for startup boot camp. So a bit of that and just working through with the clients we've got, to get them on track and plan out their 2022/2023 financial year. Because realistically as you said, tax planning is already happening. Trudi Cowan: Yeah, Sarah Eifermann: If you haven't done the work to build that basic foundation, then now's the time to be doing it to set yourself up for the 2023 financial year. Isn't that scary? Trudi Cowan: It is scary that we are motoring along so quickly. Sarah Eifermann: Yeah. Running away from us, isn't it? So Trudi Cowan: Yeah and I think this year's going to be an important year for a lot of businesses because hopefully, we are past the lockdowns and a lot of the restrictions. And hopefully, this is going to be that year when businesses can try and get back to a new normal. Sarah Eifermann: Stop. Trudi Cowan: I'm hopeful. Sarah Eifermann: None of those buzzwords are allowed on this podcast, Trudi. Trudi Cowan: I'm hopeful. Sarah Eifermann: Yes. But life has changed. I don't believe that it's going back to what it was. Trudi Cowan: No. Sarah Eifermann: We need to adjust and find our way for what works now and moving forward. And that I think comes back to that consistency. In the inconsistency is trying to, you know judge and move through all of that as best as we can. Yeah, Awesome [cross talk 06:23]. So what's on for FOFU this season? I know we gave a little bit of a spill in the teaser. Trudi Cowan: We did. This year, we really want to focus on a little bit of an education piece around people's books and how to understand their books and how to understand what a break-even point is and how to make money, how to price your products. So we are going to be focusing on all of those sorts of topics to start with. And then, later on in the season, we start looking at a few more topics around investing your money and superannuation and those sorts of areas. But today we're going to start up front with a money mindset. Sarah Eifermann: Yes. Because I think it is that benchmark or that foundational piece that sets you up for everything. Trudi Cowan: It does. And I guess to start with to talk about what is your money mindset and I see it as what is your attitude to your finances? Sarah Eifermann: I'm going to stop right there. Are you flicking an iPad? Trudi Cowan: Sorry. Sarah Eifermann: Talk now for a little bit. Trudi Cowan: Better, better. Sarah Eifermann: Hope it's better. Trudi Cowan: Sorry. Sarah Eifermann: No, that's fine. I was like, what is that noise? I was like maybe you had a widget that you were fidgeting with. I was like what is she doing. Okay. We also didn't explain any potential noise issues, but we can maybe go back. Trudi Cowan: You could probably just do a recorder, one-liner and slot it in and say, Sarah Eifermann: Yeah, Trudi Cowan: We are recording from separate rooms. And, Sarah Eifermann: Yeah Trudi Cowan: This, I guess is our test run. So please forgive us for any... Sarah Eifermann: Yeah. Okay, so sorry. What was the last thing you said about the money mindset? Trudi Cowan: Is your attitude that you have towards your finances. Sarah Eifermann: Yes. Okay. So we touched on this in our international women's day episode, last March about all the biases and our histories and our experiences and how they have impacted our money knowledge, but also our mindset. Trudi Cowan: Mindset. Trudi Cowan: Yeah. And it's really, do you have an abundance or a scarcity attitude to money and you know and that's not necessarily because you have lots of money, but just do you have that attitude that money might go, but it'll also come again. Sarah Eifermann: Yeah. I mean, I think if you unpack that money story and the values that you've developed, you better understand those past behaviors. And around money and choices that you've made. Trudi Cowan: Yeah. And it might be that you were brought up in a certain household that had a certain attitude. Sarah Eifermann: Yeah. Trudi Cowan: To money, whether that be because you didn't have a lot of it as a family, or just because you had parents that themselves had a very scarcity type attitude to money. Sarah Eifermann: Yeah. Sarah Eifermann: I do highly recommend that if you haven't listened to that episode or even if you have go back and re-listen to it because it plays into all of the things that we're talking about today. Trudi Cowan: Yeah. It does. But you know, rather than spending a lot of time talking about what is your mindset, we want to talk about what are some strategies to help you alter. Sarah Eifermann: Yeah. Trudi Cowan: Your mindset around money. And as listeners would know, we have a big belief in financial literacy. And so one of those strategies would be to go and develop your financial literacy. Sarah Eifermann: Yeah. And really what that means is learning what the basic information is as defined by financial literacy. I mean because financial literacy is kind of a loaded word. Trudi Cowan: Yeah. Sarah Eifermann: So it's just understanding the basics of finance, understanding what a cash flow is, understanding what a budget is, understanding what an interest rate is, understanding how to read your payslip, how to read your tax return and then how that knowledge then impacts your money choices. Trudi Cowan: Yes. It is. And there are lots of other aspects to it and there are lots of different ways to develop your financial literacy. Sarah Eifermann: Yeah. Trudi Cowan: It can be as simple as seeking out a friend who has better knowledge than you and having conversations around it. Sarah Eifermann: Yeah. Sarah Eifermann: Ask them to explain some basic concepts. Trudi Cowan: Yeah. We have a bit of a fear of talking to our friends about money, but there's no reason that we shouldn't. Sarah Eifermann: Completely, I know if anyone was to ring me up and ask me about the basic money concept, I would a hundred percent give them the time, to explain that concept to a way to a level that they had at least a basic grasp on it. Because there's the other thing with financial literacy you might not understand it first go, it might take you a couple of goes to get it into your head because you're effectively retraining your brain on this topic. And that can take time. Trudi Cowan: Yeah. I have my friends ask me questions from time to time. They jokingly, you know, say they need to engage me for some advice, but they're just wanting to have a conversation to, Sarah Eifermann: Yeah. Trudi Cowan: You know, learn a bit more about a certain topic or maybe understand how their loan or their offset account works. Sarah Eifermann: Yeah. Trudi Cowan: A bit better and just want to have a conversation so they can educate themselves a bit more. Sarah Eifermann: Yeah. Completely. And there are some courses that you can do. There's some stuff on the money, a smart website that the government has. I mean, Trudi Cowan: Yes. Sarah Eifermann: On our website is my financial literacy course. So you can just jump across to that. You know, there are lots of different ways that you can find information. It is a rising topic, especially for women. So you'll start to see more and more of this information be put out there into the marketplace for you to find relatively easily. There's a whole range of people offering this style of education now because it is that much of an issue. Trudi Cowan: Yeah. Sarah Eifermann: A lot of people don't have the basic financial literacy and when you're in business, that's problematic potentially because if your decisions are being made with no financial literacy, your money mindset will be skewed as a result. And that will have a direct impact on your business choices. Trudi Cowan: It's certainly will. You know, we've seen it with some of our mutual clients that, you know might have a certain client who is very strict with what they spend their money on and then that might limit them in their opportunities within their business. Because they're not willing to go and spend that money in an area that might help improve or grow their business. Sarah Eifermann: Yeah. Trudi Cowan: But then on the flip side, you can have a client who is so willing to spend money. They end up spending money on things that aren't helping their business. Sarah Eifermann: There's no value. Trudi Cowan: No value and ends up impacting their cash flow. Sarah Eifermann: Yeah. Or even their ability to pay themselves a wage. Trudi Cowan:Yeah. Sarah Eifermann: I mean, we did have a good giggle last season about the $22,000 stationery bill. Trudi Cowan: Yes. For a client that certainly should not have had anywhere near that amount on stationery, Sarah Eifermann: Like seriously, what are you buying from office work, stationery department? Trudi Cowan: Look, I do love a good office workshop but, Sarah Eifermann:Yes. Trudi Cowan: Not that much. Sarah Eifermann: Of course, you would you're an accountant. So I think it's really important to have a good understanding of that, that you know it's what we talked about just before is about where your money story comes from, how that impacts your decision, but what are you going to do to change it? Trudi Cowan: Yeah. Sarah Eifermann: If it needs to be changed, right. Because some people maybe don't need to change it. I mean because some people maybe grew up in a household where the money came easily to them. Trudi Cowan: But that could work on the flip side as well. Correct. If money is coming so easily to you, you may not understand how to properly manage that money to make sure that it sticks around and that you have it for your future and the long term. Sarah Eifermann: Yes. So if your abundance mindset is so far to the scale side of abundance, money comes in and out without you even really having to think about it, there could be a potential for a better improvement on how you handle your money to give you a better return without maybe having to work as hard as you currently do, even though you don't feel like you have to work that hard because money's coming in, you'd still be working. Trudi Cowan: And a perfect way to maybe demonstrate that is that there are some statistics around lottery winners. Sarah Eifermann: Yeah. Trudi Cowan: And how many of them still have their money, 10 years down the track. Sarah Eifermann:Yes. Correct. Trudi Cowan: They would probably very quickly go to an abundance attitude because they have this large sum of money, but because they don't know how to manage it. Sarah Eifermann: Yeah. Trudi Cowan: They could spend and lose it. Sarah Eifermann: Yeah. It's a great example. Exactly. Trudi Cowan: So I guess that also demonstrates that on this scarcity abundant scale, you can go too far on either side. Sarah Eifermann: Yes, absolutely. And you know, I often talk about this with business clients about where is their business going and that five-year plan and you don't drive from Melbourne to Sydney via Adelaide and yes, it's kind of the same thing in your personal life in terms of what do you want in life and what do you need to facilitate that? And I'm not saying lock in stone, the three-bedroom house with a white picket fence, but you know, some decent goals, especially with property prices going through the roof, rental prices going through the roof, it doesn't help. If you decide one day that you want to buy a house and you haven't done the background work that you need to do to save the money, to be set up for a loan to, you know, to even have the research done, to look in a particular area. So have some personal goals, but they don't necessarily need to be super specific, but you sort of need to go [inaudible 16:31] what you want from your life. Trudi Cowan: Yeah. Sarah Eifermann: When you want to buy. Trudi Cowan: If you just say, I just want to save money. Sarah Eifermann: Yeah. Trudi Cowan: It's very hard to achieve that goal of just saving money. It's a lot easier if I need to save a set amount of money because I want to buy a car or a holiday or a house or whatever it is. So too general, not helpful. But as you say too specific can also make it difficult. But yeah, you do need to have some sort of goal there, that you want to achieve to help you meet those savings goals. Sarah Eifermann: Yes, absolutely. And I think it also comes down to like once you have the financial literacy, you have a financial awareness or a money awareness with the choices that you make. And then that feeds into decisions that you make as well, like emotional shopping or spending. Trudi Cowan: Which we all do. Sarah Eifermann: Don't go to the supermarket when you're hungry is my best piece of advice for everybody because the shopping trolley ends up very full of stuff that you don't normally eat. Trudi Cowan: And don't browse the online sales when you are upset or not in the right frame of mind, Sarah Eifermann: Emotional shopper Trudi Cowan: Buy something to make yourself feel good. Because that handbag's cute. Sarah Eifermann: Okay. Clearly, a difference here is that Trudi buys handbags and shoes and I go straight for the food. Sarah Eifermann: But, yeah. Trudi Cowan:You've gotta be in the right frame of mind when you are doing your spending. Sarah Eifermann: Yes. Absolutely. Trudi Cowan: Because otherwise, you will end up spending on things that aren't helpful for you in meeting your goals. Sarah Eifermann: Yeah. And look, we did touch on this earlier as well is educating yourself obviously, but maybe it's time that you engage a professional, you understand your life a little bit better, how your loans are working, what your finances are doing, you know, even with your tax. Are you just trying to get the maximum tax refund or do you understand with your job role, what you can purchase during the year at certain times that gives you a better return than maybe one you've got or at least sets you up for better growth? Because a lot of people don't realize that when you write down your income, it can reduce your ability to borrow money, to do other things. So it's that planning aspect. Again, as we talk about tax planning in business, there's such a thing as tax planning in your personal life as well. Trudi Cowan: Make use of your advisors. But I also want to touch on the women who tend to let their husbands take care of the finances, make sure that you are going to see the accountant and you are going to see the financial advisor. And if you don't understand what they're saying, then ask the questions so that you can educate yourself as well. And don't just rely on the fact that your partner understands. Sarah Eifermann: Personal responsibility. And I mean, that works for the opposite where it's the men who may be listening. We're not excluding you. Trudi Cowan: True, sorry. Sarah Eifermann: Maybe handball the household management to their wives. And don't have a true understanding of where the household money is going and being spent. Again, personal responsibility, especially if you're in the family then translates into family responsibility or equal shares of the burden, because it can be a burden of the financial management of the home. So at the end of the day, get involved don't push it under a rug. Don't ignore it. Don't think I don't care about this. So I'm not even going to pay attention. If termites were eating your floors, you would be paying attention. Trudi Cowan: And it is exactly right. Sarah Eifermann: The same sort of thing with this stuff. Trudi Cowan: And am going to put a challenge out there. If you don't know what your spouse is earning, Sarah Eifermann: Ooh, Trudi Cowan: Then ask them, you're in a team. Sarah Eifermann: Wow Trudi Cowan: Personal opinion that you should know. Sarah Eifermann: Straight. Trudi Cowan:You should know what the household income is. Sarah Eifermann: Yeah. If you're living financially intertwined or dependent, not financially independent where you're still keeping everything separate as if you are flatmates living together, because some families behave like that, some people do, which is fine.[cross talk 20:56] Sarah Eifermann: But if you're at a stage in your relationship where everything is intertwined, then damn straight, you guys should have a really good understanding of who owns what and where that comes from. And I'm just going to jump in here and say with my tree change to the Northern rivers, came a lot of tropical storms. And if there's some noise in the background, it's the heavy rain that's currently belting on my roof in February, So Trudi Cowan: The joys of the tree change. Sarah Eifermann: Yes, you take what you can. Right? Trudi Cowan: Now, I guess the next strategy that I think is very important is to not compare your financial situation to that of the people around you. Sarah Eifermann:Yes. Yeah Trudi Cowan: Everybody, Sarah Eifermann: It's a trap Trudi Cowan: It is a trap. Everybody owns a different amount of money. Everybody chooses to spend their money in different ways. You need to take ownership of your finances and your own choices around your money. And just because you might prefer to spend the money on your house or your children doesn't mean that somebody else has that same opinion, they might prefer flashy cars and holidays. Sarah Eifermann: Yeah. Trudi Cowan: But live in a smaller or a less desirable suburb. It's your personal choice around money. Sarah Eifermann: Just, before you mentioned about in a relationship, this applies in relationships too often I have husband and wife, where the wife thinks one thing husband thinks another and it creates a huge amount of frictions because they're not on the same page and it's okay to not be on the same page. But, if one partner wants to spend a lot of money on alcohol and clothes and another partner prefers to spend their money on kids or experiences, set yourself a budget in your relationship and you both spend the same amount of money on that. If they spend all of their money, that's their choice. And if they spend none of their money, that's also their choice. That money is still theirs. And that's been one strategy that has massively changed relationships with the clients that I work with. Yeah. It's really interesting how that just removes that pressure of expectation immediately. Trudi Cowan: Yeah. Yeah. Trudi Cowan: And so it just forces you to look inwards again about your views and your preferences for money because you can't change anybody else. So there's no point trying or worrying about what other people are doing. Just focus on your own. Sarah Eifermann: Yes. I know it's hard. It's human nature to compare. Trudi Cowan: It is. I mean, it's difficult not to but it is a strategy that can help. Especially if you do feel you're on that scarcity mindset. Sarah Eifermann: Yeah. And I suppose scarcity mindset talking about that, maybe it's just you need to flip the money script. Trudi Cowan: Yes. Sarah Eifermann: A little bit of cognitive-behavioral therapy training there. If you don't know what it is, go look it up. It's great. It's life-changing. So rather than saying no, I can't afford that. Maybe you should be saying, if I save for X many weeks, I will be able to achieve buying that instead. Yeah. And it takes practice. Trust me.[cross talk 24:05]. Sarah Eifermann: Yeah. Trudi Cowan: Or instead of looking at your mortgage and saying, it's going to take me 30 years to pay this off. That is just forever. Then you can change that mindset in several different ways. One of them might be, I'll just pay this amount of money and eventually, I'll own the home and that's fine but for now, my family has a place to live. Sarah Eifermann: Exactly. Or and it might just be Trudi Cowan: If I pay a little bit more, then I can pay it off quicker. Sarah Eifermann: Yeah. If I pay an extra $20 a month or a fortnight, I'll shave two years off that loan term. Yeah. Trudi Cowan: So, you know there are several different ways that you could change that story, to make the mindset a more positive one. Sarah Eifermann: Moving from the negative. Trudi Cowan: The negative. Sarah Eifermann: Yes, absolutely. I mean again can be human nature depending on our life experiences that we focus more on the negative than the positive, but we will move to that gratitude position. You'll find your life changes and it takes 21 days to form a new habit. But if you start today, it won't be too far into March until you may have a new habit about how you view life and how you view your money. Trudi Cowan: A really common example that we would see is when we are talking to clients about changing their business structure and often all they can see is the cost of setting up the new structure. Sarah Eifermann: Yeah. Trudi Cowan: Whereas to us, we're saying no it's an investment in your business to help it grow and move forward. Sarah Eifermann: Yeah. You're right. Trudi Cowan: And you could apply that to many different expenses within your business. Yes. You could look at it as just a cost and it's money and I don't want to spend it or you could look at it, but if I spend this money, that's going to save me time or improve my processes or improve my client experience. Sarah Eifermann: Yeah. Trudi Cowan: And re-frame that cost more positively. Sarah Eifermann: Absolutely. And we did touch on this a little bit earlier with the direct impact on your business choices, that overspender versus the under-spender. I suppose the real thing that I want to drive home here is that this position that you have with your money mindset has a direct impact on your cash flow, your profit and your viability of the business. So by improving your mindset on money, you can change from working harder to working smarter and getting more, driven success out of your business without necessarily doing too much extra to change that. Trudi Cowan: Yeah, that's right. And we love working smarter. Sarah Eifermann: Absolutely. Who wants to work harder? Not me. So I'd be keen to hear if anyone else has any other suggestions regarding strategies to improve their money mindset or perhaps even like a story that worked for you. We'd love to hear, whether there's anything profound that has experienced happened for you, in the last 12 or 18 months, that's changed the way you view things. We know it's been a difficult time and I think it can help to hear other people's stories and share. Trudi Cowan: It really can be. It really can help to hear other people's stories. Sarah Eifermann: Yeah. Trudi Cowan: Especially those around how people have been able to improve their mindset and thus improve their attitude and their feelings towards money. Sarah Eifermann: Yeah. Absolutely. All right. Well, I think that's plenty for today. Lots to think about there. We will see you next week with another episode of Financial FOFU. Trudi Cowan: Bye.
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