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Battling to make ends meet? Financial planning expert offers 5 tips on how to build your budget

<p><em><a href="https://theconversation.com/profiles/bomikazi-zeka-680577">Bomikazi Zeka</a>, <a href="https://theconversation.com/institutions/university-of-canberra-865">University of Canberra</a></em></p> <p>Every day seems to bring new headlines about rising costs. <a href="https://www.news24.com/news24/africa/news/nigerias-big-unions-call-indefinite-strike-over-fuel-prices-and-the-cost-of-living-20230926">In Nigeria</a>, unions are threatening to strike amid soaring fuel prices; the country’s inflation rate <a href="https://www.cbn.gov.ng/rates/inflrates.asp">hit 25%</a> in August. The amount it costs to fill a food basket in South Africa <a href="https://pmbejd.org.za/wp-content/uploads/2023/09/PMBEJD_Key-Data_September-2023_27092023.pdf">keeps climbing</a>. Ghanaians <a href="https://www.reuters.com/world/africa/multi-day-protests-over-economic-crisis-grip-ghanas-capital-2023-09-23/">took to the streets</a> of Accra in late September to protest about the cost of living.</p> <p>A <a href="https://www2.deloitte.com/us/en/insights/industry/retail-distribution/consumer-behavior-trends-state-of-the-consumer-tracker.html">recent study by the audit and consulting firm Deloitte</a> found that 75% of South Africans were concerned that the prices for everyday purchases would continue to increase, while 80% of consumers across all income groups expected the prices of groceries, household utilities and fuel to rise.</p> <p>This stark reality means budgeting may be more necessary than ever.</p> <p>If you don’t know how to create a budget, then you shouldn’t feel bad – most adults aren’t taught how to create one. And most people don’t budget, because they see it as restrictive or unsustainable. But it need not be: once you appreciate that a budget can work for you, it can be a financially empowering exercise. It’s a cornerstone of financial planning because it ensures you are living within your means and helps you remain in financial control.</p> <p>As a financial planning academic, I focus in <a href="https://researchprofiles.canberra.edu.au/en/persons/bomikazi-zeka/publications/">my research</a> on improving financial wellbeing and promoting savings behaviours through interventions such as budgeting. Here are five guidelines for creating a budget.</p> <h2>1. Apps vs spreadsheet</h2> <p>A good place to start is to choose the format of how you’re going to budget. There are several <a href="https://www.sanlamreality.co.za/wealth-sense/setting-up-a-family-budget-that-works/">online templates</a> and apps you can use for budgeting. For instance, <a href="https://www.22seven.com/">22Seven</a> has gained popularity in South Africa due to its compatibility with several financial institutions, including the country’s big five banks. Similarly, <a href="https://www.the-star.co.ke/business/kenya/2021-01-25-budgeting-using-mint-app/">Mint</a> is a popular budgeting tool that is used in Kenya and Nigeria.</p> <p>If you prefer to put pen to paper, some online templates come with <a href="https://www.wonga.co.za/blog/free-budget-template">free printable budgets</a>. Creating your own <a href="https://create.microsoft.com/en-us/learn/articles/how-to-make-excel-budget">Excel spreadsheet</a> is an equally good approach.</p> <p>What matters most is using a tool that you can commit to.</p> <h2>2. Itemising your income and expenses</h2> <p>A budget essentially shows how much you’re spending in relation to how much you’re earning. So once you have selected your budgeting tool, you need to fill in your income and itemise how much you’re spending on each expense in a month. A budget can be considered a cashflow statement because it allows you to track money coming in (income) and money going out (expenses).</p> <p>If you are living within your means, your budget should indicate a surplus – more cash inflows than cash outflows. So budgeting provides an accurate account of your short-term financial position.</p> <h2>3. A realistic account of expenses</h2> <p>When you look at your financial statements, fill your expenses into your budget honestly and accurately. Don’t cheat! Since everyone’s financial situation is different, your budget will also be unique.</p> <p>Even though there is no one-size-fits-all approach to budgeting, it should still consider all of your expenses (both regular and intermittent). A general rule of thumb is that if it’s deducted from your account then you should treat it as an expense. This includes payments for housing, medical insurance, fuel, dining out, credit card repayments and even bank fees.</p> <h2>4. Save first, spend later</h2> <p>Now you’ve seen how much you’re spending. Either it’s too much – and you can plan where to cut back – or you have savings at the end of the month.</p> <p>When compiling your budget it’s important to demarcate how much will be in the form of savings. What’s more important is getting into the habit of saving before you spend instead of saving after spending. If you spend first then you’ve deprived yourself of the opportunity to save for a rainy day.</p> <p>Furthermore, <a href="https://eprints.hud.ac.uk/id/eprint/10231/1/Microsoft_Word_-_submitted_version_3rd_June_201.pdf">research</a> has shown that getting into the habit of saving has a transgenerational effect: it can be considered a cultural value that is passed on from one generation to another. So think of saving as paying yourself first. Once you have done so, you won’t feel guilty for treating yourself because you’ve already done the financially responsible thing by putting your savings aside.</p> <h2>5. Considering assets and liabilities</h2> <p>Once you’ve become comfortable with consistently budgeting, you can take it up a notch by including your assets (everything you own with an economic value) and liabilities (everything you owe) to determine your overall financial position.</p> <p>You can get a clearer picture of your overall financial wellbeing by compiling a list of all your assets, for example your savings and <a href="https://www.investopedia.com/terms/h/home_equity.asp">home equity</a>, in relation to liabilities (such as bank loans). Knowing your long-term financial position can indicate how financially resilient or vulnerable you are. In the event of a financial emergency, you will know which resources you can draw upon to meet an unexpected expense.</p> <p>By creating a budget (and sticking to it), you can protect yourself and your household from financial shocks. Consider the alternative. Imagine you haven’t budgeted and set savings aside. If a financial emergency were to arise, your next best bet would be to borrow the funds you need. You’d have to come up with a plan to repay what you’d borrowed while also building your savings.</p> <h2>A healthy habit</h2> <p>Getting into the habit of budgeting isn’t easy, especially if you haven’t done it before or you’re intimidated by the process. But, as the expression goes, “a journey of a thousand miles begins with a single step”. Think of budgeting as taking a small but important step towards reclaiming control over your finances and improving your financial well-being.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/214861/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /></p> <p><em><a href="https://theconversation.com/profiles/bomikazi-zeka-680577">Bomikazi Zeka</a>, Assistant Professor in Finance and Financial Planning, <a href="https://theconversation.com/institutions/university-of-canberra-865">University of Canberra</a></em></p> <p><em>Image credits: Getty Images </em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/battling-to-make-ends-meet-financial-planning-expert-offers-5-tips-on-how-to-build-your-budget-214861">original article</a>.</em></p>

Money & Banking

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If you have money anxiety, knowing your financial attachment style can help

<p><em><a href="https://theconversation.com/profiles/ylva-baeckstrom-1463175">Ylva Baeckstrom</a>, <a href="https://theconversation.com/institutions/kings-college-london-1196">King's College London</a></em></p> <p>The number of people struggling with money in Britain is at a <a href="https://www.theguardian.com/money/2024/mar/18/record-numbers-of-uk-people-in-debt-warns-charity">record high</a>. Financial charities say that people are contacting them for help with debt, paying bills and insolvency. The campaign group Debt Justice found in a <a href="https://debtjustice.org.uk/wp-content/uploads/2024/03/WalnutOmnibus-Debt-Justice-Policy-Development-Weighted.xlsx">survey</a> that 29% of 18- to 24-year-olds and 25% of 25- to 34-year-olds had missed three or more bill payments in the last six months.</p> <p>A majority (65%) of people don’t think they can survive on their savings for three months without <a href="https://www.money.co.uk/savings-accounts/savings-statistics">borrowing money</a>. Statistics from the UK’s financial markets regulator show that more than one-third of UK adults have less than £1,000 in savings. And a survey by Money.co.uk found that 30% of Brits aged 25-64 do not save at all <a href="https://www.pensionsage.com/pa/Nearly-one-third-of-Brits-are-not-saving-for-retirement.php">for retirement</a>.</p> <p>With figures like that, is it any wonder that 75% of people in the UK feel <a href="https://www.mentalhealth.org.uk/about-us/news/financial-strain-driving-uks-anxiety#:%7E:text=Almost%20three%2Dquarters%20of%20the,cited%20job%20insecurity%20or%20unemployment">anxious about money</a>?</p> <p>The current state of the economy is particularly scary for young people. Unless you were born with a trust fund (not most people), you are likely part of the first generation to be financially worse off than <a href="https://edition.cnn.com/2020/01/11/politics/millennials-income-stalled-upward-mobility-us/index.html">your parents</a>. Retirement seems like an impossibility, and you’re unlikely to own your own home. Eighty percent of people in their early 20s worry about <a href="https://www.youngminds.org.uk/parent/parents-a-z-mental-health-guide/money-and-mental-health/#Thelinksbetweenmoneyandmentalhealth">not earning enough</a>.</p> <p>It is important to start planning for your financial future early in your career, but you may find it overwhelming. The good news is, there are ways to overcome this.</p> <h2>Finding your financial attachment style</h2> <p>As a psychotherapist and finance researcher, I work with people to help them to increase their financial confidence and find the motivation to start planning. This often starts with understanding what influences their relationship with money.</p> <p><a href="https://www.cambridge.org/core/journals/behavioral-and-brain-sciences/article/bowlbyainsworth-attachment-theory/6D35C7A344107195D97FD7ADAE06C807">Attachment theory</a> is a psychological concept introduced in the late 1950s. Your attachment style – which can be, for example, secure, anxious or avoidant – explains how you approach creating emotionally intimate relationships with other people. Some people feel secure building relationships, while others are extremely anxious. Some avoid close relationships altogether.</p> <p>Attachment style can also apply to your finances. If you feel confident and safe when it comes to money, you are secure in your relationship to saving and spending. But if the thought of opening an ISA or filling out a tax return, let alone planning for retirement, fills you with dread and panic, you may be anxiously attached. And if you if you push money worries to the back of your mind, you are likely avoidant.</p> <p>Attachment theorists and psychotherapists like me think that attachment styles are shaped by childhood experiences – for example, how well you were looked after by your parents or carers, and how safe and loved you felt.</p> <p>The way money was handled in your family growing up is likely to have set the blueprint for your <a href="https://www.sciencedaily.com/releases/2020/02/200225114410.htm">financial attachment style</a>. Outside influences like education or work experiences may shape this too.</p> <p>Although financial education is part of the <a href="https://maps.org.uk/en/work-with-us/financial-education-in-schools">school curriculum</a> in the UK, 76% of children leave school without sufficient <a href="https://maps.org.uk/en/media-centre/press-releases/2024/hundreds-of-thousands-leaving-school-without-money-skills#:%7E:text=In%20its%20poll%20of%201%2C012,knowledge%20they%20need%20for%20adulthood">financial knowledge</a> to manage their lives. Similarly, financial services like banks have done a poor job helping people establish secure financial relationships. Complex and <a href="https://www.pwmnet.com/private-view-blog-time-for-the-financial-industry-to-jettison-the-jargon">off-putting language</a> has placed a barrier between those who know about money and those who need to learn.</p> <p>If you feel unable to keep up with financial terms, or that you don’t understand money, this is likely to hurt your confidence in your financial planning abilities and fuel a more avoidant attachment style.</p> <p>Identifying your attachment style can help you nurture a better relationship with money. You will be able to understand and predict how and why you react to finances in certain ways. And, it can provide confidence by reminding you that money struggles are not necessarily your fault.</p> <h2>Getting over financial anxiety</h2> <p>Some of the recent financial trends spreading on social media may give an insight into your attachment style. Are you <a href="https://www.cnbc.com/select/what-is-loud-budgeting-trend-can-it-work/">“loud budgeting”</a> (being vocal about why you aren’t spending money)? This could be a sign of financial confidence and that you have secure financial attachment. Or are you “doom spending” (spending money you don’t have instead of creating a <a href="https://www.theguardian.com/lifeandstyle/2024/jan/31/are-you-loud-budgeting-or-doom-spending-finance-according-to-gen-z">nest egg</a> for the future)? You may be avoidant.</p> <p>Healthy relationships with <a href="https://www.nhs.uk/every-mind-matters/lifes-challenges/maintaining-healthy-relationships-and-mental-wellbeing/#:%7E:text=People%20with%20healthy%2C%20positive%20and,such%20as%20stress%20and%20anxiety">people</a> and <a href="https://www.nhs.uk/every-mind-matters/lifes-challenges/money-worries-mental-health/#:%7E:text=Our%20mental%20health%20might%20be,earning%20enough%20or%20currently%20unemployed">money</a> are both critical for our survival and mental health. As an adult, you have the power to improve these relationships. But because attachment patterns were formed early on, they are difficult to change. Therapy and other support can help you adopt healthier habits, as can increasing your financial knowledge.</p> <p>If you want to change your relationship with money, you should try to be mindful of what may be influencing you. While financial advice on social media may be useful and help young people feel more empowered to <a href="https://www.forbes.com/advisor/investing/financial-advisor/adults-financial-advice-social-media/">talk about money</a>, it can also <a href="https://www.mcleanhospital.org/essential/it-or-not-social-medias-affecting-your-mental-health">increase anxiety further</a> and be <a href="https://theconversation.com/if-you-get-your-financial-advice-on-social-media-watch-out-for-misinformation-222196">full of misinformation</a>. A good place to start for accurate and helpful information is the government’s <a href="https://www.moneyhelper.org.uk/en">Money Helper website</a>.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/225243/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /></p> <p><em><a href="https://theconversation.com/profiles/ylva-baeckstrom-1463175">Ylva Baeckstrom</a>, Senior Lecturer in Finance, <a href="https://theconversation.com/institutions/kings-college-london-1196">King's College London</a></em></p> <p><em>Image credits: Getty Images </em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/if-you-have-money-anxiety-knowing-your-financial-attachment-style-can-help-225243">original article</a>.</em></p>

Money & Banking

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‘Girl math’ may not be smart financial advice, but it could help women feel more empowered with money

<div class="theconversation-article-body"><em><a href="https://theconversation.com/profiles/ylva-baeckstrom-1463175">Ylva Baeckstrom</a>, <a href="https://theconversation.com/institutions/kings-college-london-1196">King's College London</a></em></p> <p>If you’ve ever calculated cost per wear to justify the price of an expensive dress, or felt like you’ve made a profit after returning an ill-fitting pair of jeans, you might be an expert in <a href="https://www.standard.co.uk/news/world/girl-maths-tiktok-trend-its-basically-free-b1100504.html">“girl math”</a>. With videos about the topic going viral on social media, girl math might seem like a silly (<a href="https://www.glamourmagazine.co.uk/article/girl-math-womens-spending-taken-seriously">or even sexist</a>) trend, but it actually tells us a lot about the relationship between gender, money and emotions.</p> <p>Girl math introduces a spend classification system: purchases below a certain value, or made in cash, don’t “count”. Psychologically, this makes low-value spending feel safe and emphasises the importance of the long-term value derived from more expensive items. For example, girl math tells us that buying an expensive dress is only “worth it” if you can wear it to multiple events.</p> <p>This approach has similarities to <a href="https://www.investopedia.com/terms/m/modernportfoliotheory.asp">portfolio theory</a> – a method of choosing investments to maximise expected returns and minimise risk. By evaluating how each purchase contributes to the shopping portfolio, girl math shoppers essentially become shopping portfolio managers.</p> <h2>Money and emotions</h2> <p>People of all genders, rich or poor, feel anxious when dealing with their personal finances. Many people in the UK do not understand pensions or saving enough to <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/workplacepensions/articles/pensionparticipationatrecordhighbutcontributionsclusteratminimumlevels/2018-05-04">afford their retirement</a>. Without motivation to learn, people avoid dealing with money altogether. One way to find this motivation, as girl math shows, is by having an emotional and tangible connection to our finances.</p> <p>On the surface, it may seem that women are being ridiculed and encouraged to overspend by using girl math. From a different perspective, it hints at something critical: for a person to really care about something as seemingly abstract as personal finance, they need to feel that they can relate to it.</p> <p>Thinking about money in terms of the value of purchases can help create an <a href="https://www.thetimes.co.uk/article/every-time-i-use-my-card-my-phone-buzzes-and-that-stops-me-shopping-ps0fjx6nj">emotional relationship</a> to finance, making it something people want to look after.</p> <figure><iframe src="https://www.youtube.com/embed/GPzA7B6dcxc?wmode=transparent&amp;start=0" width="440" height="260" frameborder="0" allowfullscreen="allowfullscreen"></iframe></figure> <h2>The girl math we need</h2> <p>Women are a consumer force to be reckoned with, controlling <a href="https://www.forbes.com/sites/bridgetbrennan/2015/01/21/top-10-things-everyone-should-know-about-women-consumers/#7679f9d6a8b4">up to 80%</a> of consumer spending globally. The girl math trend is a demonstration of women’s mastery at applying portfolio theory to their shopping, making them investment powerhouses whose potential is overlooked by the financial services industry.</p> <p><a href="https://www.theguardian.com/world/2019/oct/28/women-paid-less-than-men-over-careers-gender-pay-gap-report">Women are disadvantaged</a> when it comes to money and finance. Women in the UK earn on average £260,000 less than men during their careers and the retirement income of men is twice as high as women’s.</p> <p>As I’ve found in <a href="https://www.routledge.com/Gender-and-Finance-Addressing-Inequality-in-the-Financial-Services-Industry/Baeckstrom/p/book/9781032055572">my research</a> on gender and finance, women have lower financial self-efficacy (belief in their own abilities) compared to men. This is not helped by women feeling patronised when seeking financial advice.</p> <p>Because the world of finance was created by men for men, its language and culture are <a href="https://www.routledge.com/Gender-and-Finance-Addressing-Inequality-in-the-Financial-Services-Industry/Baeckstrom/p/book/9781032055572">intrinsically male</a>. Only in the mid-1970s did women in the UK gain the legal right to open a bank account without a male signature and it was not until 1980 that they could apply for credit independently. With the law now more (<a href="https://www.worldbank.org/en/news/press-release/2023/03/02/pace-of-reform-toward-equal-rights-for-women-falls-to-20-year-low">but not fully</a>) gender equal, the financial services industry has failed to connect with women.</p> <p>Studies show that 49% of women are <a href="https://www.ellevest.com/magazine/disrupt-money/ellevest-financial-wellness-survey">anxious about their finances</a>. However they have not bought into patronising offers and <a href="https://www.fa-mag.com/news/gender-roles-block-female-financial-experience--ubs-says-73531.html">mansplaining by financial advisers</a>. This outdated approach suggests that it is women, rather than the malfunctioning financial system, <a href="https://www.theguardian.com/commentisfree/2020/sep/16/women-are-not-financially-illiterate-they-need-more-than-condescending-advice">who need fixing</a>.</p> <p>Women continue to feel that they do not belong to or are able to trust the world of finance. And why would women trust an industry with a <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/genderpaygapintheuk/2019">gender pay gap</a> of up to 59% and a severe lack of women in senior positions?</p> <p>Girl math on its own isn’t necessarily good financial advice, but if it helps even a handful of women feel more empowered to manage and understand their finances, it should not be dismissed.</p> <p><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: https://theconversation.com/republishing-guidelines --></p> <p><em><a href="https://theconversation.com/profiles/ylva-baeckstrom-1463175">Ylva Baeckstrom</a>, Senior Lecturer in Finance, <a href="https://theconversation.com/institutions/kings-college-london-1196">King's College London</a></em></p> <p><em>Image credits: Getty Images </em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/girl-math-may-not-be-smart-financial-advice-but-it-could-help-women-feel-more-empowered-with-money-211780">original article</a>.</em></p> </div>

Money & Banking

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What ‘psychological warfare’ tactics do scammers use, and how can you protect yourself?

<p><em><a href="https://theconversation.com/profiles/mike-johnstone-106590">Mike Johnstone</a>, <a href="https://theconversation.com/institutions/edith-cowan-university-720">Edith Cowan University</a> and <a href="https://theconversation.com/profiles/georgia-psaroulis-1513050">Georgia Psaroulis</a>, <a href="https://theconversation.com/institutions/edith-cowan-university-720">Edith Cowan University</a></em></p> <p>Not a day goes by without a headline <a href="https://www.vice.com/en/article/qjvaym/people-share-worst-scam-stories">about a victim being scammed</a> and losing money. We are constantly warned about new scams and staying safe from cybercriminals. Scamwatch has <a href="https://www.scamwatch.gov.au/research-and-resources/tools-resources/online-resources/spot-the-scam-signs">no shortage of resources</a>, too.</p> <p>So why are people still getting scammed, and sometimes spectacularly so?</p> <p>Scammers use sophisticated psychological techniques. They exploit our deepest human vulnerabilities and bypass rational thought to tap into our emotional responses.</p> <p>This “<a href="https://www.thecut.com/article/amazon-scam-call-ftc-arrest-warrants.html">psychological warfare</a>” coerces victims into making impulsive decisions. Sometimes scammers spread their methods around many potential victims to see who is vulnerable. Other times, criminals focus on a specific person.</p> <p>Let’s unpack some of these psychological techniques, and how you can defend against them.</p> <h2>1. Random phone calls</h2> <p>Scammers start with small requests to establish a sense of commitment. After agreeing to these minor requests, we are more likely to comply with larger demands, driven by a desire to act consistently.</p> <p>The call won’t come from a number in your contacts or one you recognise, but the scammer may pretend to be someone you’ve engaged to work on your house, or perhaps one of your children using a friend’s phone to call you.</p> <p>If it is a scammer, maybe keeping you on the phone for a long time gives them an opportunity to find out things about you or people you know. They can use this info either immediately or at a later date.</p> <h2>2. Creating a sense of urgency</h2> <p>Scammers fabricate scenarios that require immediate action, like claiming a bank account is at risk of closure or an offer is about to expire. This tactic aims to prevent victims from assessing the situation logically or seeking advice, pressuring them into rushed decisions.</p> <p>The scammer creates an artificial situation in which you are frightened into doing something you wouldn’t ordinarily do. Scam calls <a href="https://theconversation.com/we-have-filed-a-case-under-your-name-beware-of-tax-scams-theyll-be-everywhere-this-eofy-162171">alleging to be from the Australian Tax Office</a> (ATO) are a great example. You have a debt to pay (apparently) and things will go badly if you don’t pay <em>right now</em>.</p> <p>Scammers play on your emotions to provoke reactions that cloud judgement. They may threaten legal trouble to instil fear, promise high investment returns to exploit greed, or share fabricated distressing stories to elicit sympathy and financial assistance.</p> <h2>3. Building rapport with casual talk</h2> <p>Through extended conversation, scammers build a psychological commitment to their scheme. No one gets very far by just demanding your password, but it’s natural to be friendly with people who are friendly towards us.</p> <p>After staying on the line for long periods of time, the victim also becomes cognitively fatigued. This not only makes the victim more open to suggestions, but also isolates them from friends or family who might recognise and counteract the scam.</p> <h2>4. Help me to help you</h2> <p>In this case, the scammer creates a situation where they help you to solve a real or imaginary problem (that they actually created). They work their “IT magic” and the problem goes away.</p> <p>Later, they ask you for something you wouldn’t normally do, and you do it because of the “social debt”: they helped you first.</p> <p>For example, a hacker might attack a corporate network, causing it to slow down. Then they call you, pretending to be from your organisation, perhaps as a recent hire not yet on the company’s contact list. They “help” you by turning off the attack, leaving you suitably grateful.</p> <p>Perhaps a week later, they call again and ask for sensitive information, such as the CEO’s password. You <em>know</em> company policy is to not divulge it, but the scammer will ask if you remember them (of course you do) and come up with an excuse for why they really need this password.</p> <p>The balance of the social debt says you will help them.</p> <h2>5. Appealing to authority</h2> <p>By posing as line managers, officials from government agencies, banks, or other authoritative bodies, scammers exploit our natural tendency to obey authority.</p> <p>Such scams operate at varying levels of sophistication. The simple version: your manager messages you with an <em>urgent</em> request to purchase some gift cards and send through their numbers.</p> <p>The complex version: your manager calls and asks to urgently transfer a large sum of money to an account you don’t recognise. You do this because <a href="https://www.wsj.com/articles/fraudsters-use-ai-to-mimic-ceos-voice-in-unusual-cybercrime-case-11567157402">it sounds exactly</a> like your manager on the phone – but the scammer <a href="https://www.forbes.com/sites/thomasbrewster/2021/10/14/huge-bank-fraud-uses-deep-fake-voice-tech-to-steal-millions/?sh=1329b80e7559">is using a voice deepfake</a>. In a recent major case in Hong Kong, such a scam even involved a <a href="https://edition.cnn.com/2024/02/04/asia/deepfake-cfo-scam-hong-kong-intl-hnk/index.html">deepfake video call</a>.</p> <p>This is deeply challenging because artificial intelligence tools, such as Microsoft’s VALL-E, can create <a href="https://arstechnica.com/information-technology/2023/01/microsofts-new-ai-can-simulate-anyones-voice-with-3-seconds-of-audio/">a voice deepfake</a> using just three seconds of sampled audio from a real person.</p> <h2>How can you defend against a scam?</h2> <p>First and foremost, <strong>verify identity</strong>. Find another way to contact the person to verify who they are. For example, you can call a generic number for the business and ask to be connected.</p> <p>In the face of rampant voice deepfakes, it can be helpful to <strong>agree on a “safe word” with your family members</strong>. If they call from an unrecognised number and you don’t hear the safe word just hang up.</p> <p>Watch out for <strong>pressure tactics</strong>. If the conversation is moving too fast, remember that someone else’s problem is not yours to solve. Stop and run the problem past a colleague or family member for a sanity check. A legitimate business will have no problem with you doing this.</p> <p>Lastly, if you are not sure about even the slightest detail, the simplest thing is to hang up or not respond. If you really owe a tax debt, the ATO will write to you.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/223959/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: https://theconversation.com/republishing-guidelines --></p> <p><a href="https://theconversation.com/profiles/mike-johnstone-106590"><em>Mike Johnstone</em></a><em>, Security Researcher, Associate Professor in Resilient Systems, <a href="https://theconversation.com/institutions/edith-cowan-university-720">Edith Cowan University</a> and <a href="https://theconversation.com/profiles/georgia-psaroulis-1513050">Georgia Psaroulis</a>, Postdoctoral research fellow, <a href="https://theconversation.com/institutions/edith-cowan-university-720">Edith Cowan University</a></em></p> <p><em>Image credits: Shutterstock</em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/what-psychological-warfare-tactics-do-scammers-use-and-how-can-you-protect-yourself-223959">original article</a>.</em></p>

Money & Banking

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Monty Python star's candid financial admission

<p>Monty Python star Eric Idle has made a candid admission about the state of his finances, revealing why he still has to work at the age of 80. </p> <p>The comic legend admitted he receives only a fraction of the millions the Python team have made in the past because the finances are a “disaster”.</p> <p>In messages on X, formerly Twitter, Idle wrote: “I don’t know why people always assume we’re loaded”.</p> <p>“I have to work for my living. I never dreamed that at this age the income streams would tail off so disastrously."</p> <p>“I have been working and earning for Pythons since 1995. And now no more.”</p> <p>Idle also took aim at TV lawyer Holly Gilliam, the daughter of fellow Python member Terry Gilliam, who took over the Python brand in 2013 as part of HDG Projects Ltd. </p> <p>He said, “I guess if you put a Gilliam child in as your manager you should not be so surprised”.</p> <p>“One Gilliam is bad enough. Two can take out any company.”</p> <p>Daughter Lily Idle backed him, writing online, “I’m so proud of my dad for finally finally finally starting to share the truth.”</p> <p>The Pythons, who also included John Cleese, 84, Michael Palin, 80, and the late Terry Jones — made a fortune thanks to their iconic cult films, including <em>Life of Brian</em>, hit stage show <em>Spamalot</em>, which Idle co-wrote, and the original <em>Flying Circus</em> BBC TV series.</p> <p>They were back in the limelight in 2014 with <em>Monty Python Live (Mostly) — One Down, Five to Go</em>: a reference to former member Graham Chapman who died in 1989 aged just 48.</p> <p>It featured interpretations of some of their famous sketches, and reportedly earned the surviving members at least £2 million ($3.87m AUD) each.</p> <p><em>Image credits: Getty Images </em></p>

Retirement Income

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Could you cope with a shock to your bank balance? 5 ways to check you are financially resilient

<p><em><a href="https://theconversation.com/profiles/bomikazi-zeka-680577">Bomikazi Zeka</a>, <a href="https://theconversation.com/institutions/university-of-canberra-865"><em>University of Canberra</em></a></em></p> <p>Imagine the dentist has just said you urgently need a A$2,000 dental crown. A week later, a pipe in your bathroom bursts, causing $8,000 worth of damage. Suddenly, you’ve been hit with a $10,000 financial shock.</p> <p>As the cost-of-living crisis plunges more households into financial uncertainty and at least <a href="https://melbourneinstitute.unimelb.edu.au/data/taking-the-pulse-of-the-nation-2022/2023/australians-face-challenging-budgetary-constraints#:%7E:text=Over%20the%20past%20six%20months,has%20increased%20to%2060%20percent.">one-third</a> of Australians struggle to make ends meet, it’s more important than ever to ask yourself: how financially resilient am I?</p> <p>Being financially resilient means you aren’t left financially devastated when an expensive emergency creeps up on you. Here are five key signs of financial resilience.</p> <h2>1. You have a plan for what you’d do if you suddenly lost your salary</h2> <p>Financial resilience means having a plan to fall back on during tough times. This extends to how you’d make money if you lost your job.</p> <p>In practice, that means things like making sure your skills and contacts are kept up to date so you can more easily find a new job. You might also consider whether a “side hustle” job such as tutoring could work for you in the short term, and how you’d put that plan into practice if needed. Perhaps you have a spare room in your home you could rent out for a period of time if you lost your salary.</p> <p>Those examples won’t work for everyone, of course, but it’s still worth asking yourself the question: what would I do if I lost my salary tomorrow?</p> <h2>2. You have enough liquid assets to meet an unexpected financial expense</h2> <p>Liquid assets means money that can be accessed quickly and easily to overcome an unplanned financial expense. Savings are a good example. They provide a buffer so you can cope in the short term if a financial shock strikes. The federal government’s Moneysmart website suggests you aim to have enough in your emergency savings fund to cover <a href="https://moneysmart.gov.au/saving/save-for-an-emergency-fund">three months of expenses</a>.</p> <p>Having an <a href="https://moneysmart.gov.au/glossary/offset-account">offset account</a> as part of a mortgage is another option that provides a buffer. Putting money in an offset account helps you save while reducing the amount of interest on a home loan. You can still access the money in an offset account at any time.</p> <h2>3. You have bought the right financial products, such as insurance</h2> <p>Financial products, such as insurance, hedge against potential losses.</p> <p>Personal insurance is important because it provides income in the event of death, illness or injury. Examples include:</p> <ul> <li> <p>life insurance (which pays out to your beneficiaries, such as your partner or children, when you die)</p> </li> <li> <p>total and permanent disability insurance (which means you may get some money if you acquire a disability that prevents you from working)</p> </li> <li> <p>income protection (which provides you with an income if you can no longer work)</p> </li> <li> <p>trauma cover (which covers a life-changing illness or injury, such as cancer or a stroke).</p> </li> </ul> <p>Check if your superannuation has any of these insurances included in it. <a href="https://www.griffith.edu.au/__data/assets/pdf_file/0030/295770/FPRJ-V4-ISS1-pp-53-75-insurance-literacy-in-australia.pdf">Research</a> has found that many Australians are underinsured.</p> <h2>4. You can still pay your debts when times are tough</h2> <p>Being able to borrow money can help when you’re in a tight spot. But knowing where to borrow from, how much to borrow and how to manage debt repayments is crucial.</p> <p>Financially resilient people use debt responsibly. That means:</p> <ul> <li> <p>not using debt for frivolous expenses like after-work drinks</p> </li> <li> <p>staying away from private money lenders</p> </li> <li> <p>being cautious about buy-now-pay-later services</p> </li> <li> <p>watching out for debts with high interest rates, such as payday loans and credit card debt</p> </li> <li> <p>maintaining debt repayments consistently.</p> </li> </ul> <p>If you’re having debt problems, talk to your lender about renegotiating your repayment arrangements, or contact the <a href="https://ndh.org.au/">National Debt Helpline</a> on 1800 007 007.</p> <h2>5. You are financially literate</h2> <p>Being financially literate means you can assess the benefits and risks of using savings or taking out debt to meet an unplanned financial need.</p> <p>As I have <a href="https://theconversation.com/are-you-financially-literate-here-are-7-signs-youre-on-the-right-track-202331">written</a> before on The Conversation, key signs of financial literacy include tracking your cashflow, building a budget, as well as understanding what debts you have and which to pay first.</p> <p>It also means storing your money across different places (such as superannuation, savings accounts, property and the share market) and understanding how financial assets like cash, shares and bonds work.</p> <p>Being aware of your financial strengths and weaknesses, and having financial goals is also important.</p> <p>Nobody is born knowing how to make sound financial decisions; it’s a skill that must be learned.</p> <p>It’s good to think about the resources you would draw upon to help get yourself out of a difficult financial situation – well before disaster strikes.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/218126/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /></p> <p><a href="https://theconversation.com/profiles/bomikazi-zeka-680577"><em>Bomikazi Zeka</em></a><em>, Assistant Professor in Finance and Financial Planning, <a href="https://theconversation.com/institutions/university-of-canberra-865">University of Canberra</a></em></p> <p><em>Image credits: Getty Images</em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/could-you-cope-with-a-shock-to-your-bank-balance-5-ways-to-check-you-are-financially-resilient-218126">original article</a>.</em></p>

Money & Banking

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5 financial lessons you should impart to your adult children

<p>Ultimately, we want our kids to live long, happy, healthy lives. </p> <p>Financial security is central to achieving this dream. So it may be time to have a chat about matters of money and ensure they are well set up for a prosperous future!</p> <p>While there are many important things to instil in future generations, the five below are perhaps the most crucial current-day issues for your adult children to master.</p> <ol> <li><strong>Avoid BNPL</strong></li> </ol> <p>Buy now, pay later (BNPL) schemes have taken off in popularity in recent years, allowing shoppers to purchase and use goods straight away yet pay for them over time in instalments. Sound too good to be true? Indeed.</p> <p>Most schemes attach hefty penalties and interest for missed or late repayments – much the same as credit cards. The debt quickly balloons, and can become unsustainable.</p> <p>The best approach to instil in your children is to always live within their means.</p> <ol start="2"> <li><strong>Avoid sexually transmitted debt</strong></li> </ol> <p>Joint finances, loans, credit cards, utilities, subscriptions, vehicles, businesses, property… all of these and more are shared liabilities. </p> <p>Even if a partner is the one who racks up the debts, your child is equally responsible for repaying them. This is what I call sexually transmitted debt.</p> <p>It could be inadvertent (such as having a partner who, despite their best intentions, is simply bad with money); hidden (like gambling addiction), deliberate (financial abuse), lose their job, have an accident, get seriously unwell.</p> <p>Either way, sexually transmitted debts can create long-term and even life-long problems, regardless of whether the relationship that created those debts survives: repayment struggles, credit constraints, bankruptcy, legal woes.</p> <p>When it comes to money, your children (and yourself) need to think with their head, not their heart.</p> <ol start="3"> <li><strong>Start investing </strong></li> </ol> <p>The number one thing financial advisers hear most is “I wish I started years ago”.</p> <p>Investments typically grow over time. The more time you allow, the bigger their value.</p> <p>Younger adults have big demands on their hip pocket. However, even starting with small investments allows compound growth to work its magic.</p> <p>Plus, given the housing affordability constraints facing younger generations, investments that can be sold or leveraged could better help them onto the housing ladder in future.</p> <p>Superannuation is another investment to pay attention to from a young age: managing investments, ensuring they are in a cost-effective fund, and avoiding mistakes – like consolidating funds without getting advice, which can inadvertently see them consolidate into a poorer performing fund or cancel attached insurances that had preferential terms.</p> <ol start="4"> <li><strong>Get a will</strong></li> </ol> <p>While young people may feel invincible, untimely deaths or disablement claims sadly can and do happen. And often unexpectedly: land transport accidents and accidental poisoning, together with suicide, make up <a href="https://www.aihw.gov.au/reports/life-expectancy-deaths/deaths-in-australia/contents/leading-causes-of-death">the biggest causes of death for under 44s</a> in Australia.</p> <p>Not having a will and a nominated executor complicates matters for grieving family and can delay all-important access to finances. How would your child’s partner and kids (if they have them) survive if their super, insurances and other payouts are delayed through probate? </p> <p>Remember to point out that superannuation (and other structures like companies and trusts) are treated separately from a will, and so need beneficiaries nominated within them.</p> <p>Younger people are also less likely to have discussed their final wishes with loved ones – funeral arrangements, burial vs cremation, organ donation, inheritances etc. This is where a separate statement of wishes can be useful.</p> <ol start="5"> <li><strong>Get insured</strong></li> </ol> <p>Insurances – save perhaps vehicle and house/contents – are rarely on the minds of younger people. But they should be.</p> <p>That is because many insurances are cheaper and offer better coverage when people are younger and free of any health complications. That includes private health, life and permanent disability, and income protection cover. </p> <p>Other insurances, like asset protection, can also be more lucrative to lock-in early. Just think about how the Ts and Cs on insurances have changed (become more restrictive) since you were their age!</p> <p>So encourage your adult children to scrutinise their insurance coverage. (And keep them away from drugs and smoking to stay healthier for longer!)</p> <p><em><strong>Helen Baker is a licensed Australian financial adviser and author of the new book, On Your Own Two Feet: The Essential Guide to Financial Independence for all Women (Ventura Press, $32.99). Helen is among the 1% of financial planners who hold a master’s degree in the field. Proceeds from book sales are donated to charities supporting disadvantaged women and children. Find out more at <a href="http://www.onyourowntwofeet.com.au">www.onyourowntwofeet.com.au</a> </strong></em></p> <p><em>Image credits: Getty Images</em></p>

Money & Banking

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How to protect yourself from cyber-scammers over the festive period

<p><em><a href="https://theconversation.com/profiles/rachael-medhurst-1408437">Rachael Medhurst</a>, <a href="https://theconversation.com/institutions/university-of-south-wales-1586">University of South Wales</a></em></p> <p>The festive season is a time for joy, family and festive cheer. However, it’s also a prime target for cybercriminals. As online shopping ramps up, so does the risk of falling prey to cyber-attacks. That’s why it’s crucial to be extra vigilant about your <a href="https://blog.tctg.co.uk/12-cyber-security-tips-of-christmas">cybersecurity</a> during this time.</p> <p>Here are some essential tips to safeguard yourself and your data during the festive period:</p> <h2>Phishing</h2> <p>Phishing is when criminals use scam emails, text messages or phone calls to trick their victims. Their <a href="https://www.ncsc.gov.uk/collection/phishing-scams">goal</a> is often to make you visit a certain website, which may download a virus on to your computer, or steal bank details or other personal data.</p> <p>This type of scam tends to <a href="https://www.egress.com/blog/phishing/holiday-phishing-scam-guide">increase</a> at this time due to the amount of people having bought or received new gadgets and technology.</p> <p>Look out for there being no direct reference to your name in any communications, with wording such as “Dear Sir/Madam” or other terms such as “valued customer” being used instead. Grammar and spelling mistakes are also often present.</p> <p>Be wary of any suspicious links or attachments within emails too, and don’t click them. It’s better to contact the company directly to check if the message is genuine. You can also <a href="https://www.ncsc.gov.uk/collection/phishing-scams">report</a> suspicious messages and phishing scams to the government’s National Cyber Security Centre.</p> <h2>Shopping safely online</h2> <p>The convenience of online shopping is undeniable, especially during the festive season. However, it’s crucial to prioritise your security when buying online.</p> <p>Before entering your personal and financial information on any website, ensure it’s legitimate and secure. Look for the “https” in the address bar and a <a href="https://theconversation.com/the-vast-majority-of-us-have-no-idea-what-the-padlock-icon-on-our-internet-browser-is-and-its-putting-us-at-risk-216581">padlock</a> icon, which indicates a secure and encrypted connection.</p> <p>When creating passwords for online shopping accounts, use strong, unique combinations of letters, numbers and symbols. Avoid using the same password for multiple accounts, as a breach on one site could compromise all your others.</p> <p>As with shopping in the real world, be cautious when encountering offers that are significantly below usual prices or which make extravagant promises. Always conduct thorough research on the seller and product before making a purchase. If a deal seems too good to be true, it probably is.</p> <p>And if you are out shopping in towns or city centres, there will often be a large number of public wifi options available to you. However, criminals can intercept the data that is transferred across such open and unsecured wifi. So, avoid using public wifi where possible, especially when conducting any financial transactions.</p> <h2>Social media</h2> <p>While social media platforms provide people with a means to keep in touch with family and friends over the festive period, they are often a goldmine for <a href="https://www.which.co.uk/consumer-rights/advice/how-to-spot-a-social-media-scam-aMtwF3u1XKGt">scams</a> and malware (software designed to disrupt, damage or gain unauthorised access to a computer). In the spirit of the festive season, people often share an abundance of personal information on social media, often without considering the potential consequences.</p> <p>This trove of data can make people vulnerable to cyber-attacks. Scammers can exploit this information to gain unauthorised access to social media accounts, steal personal information, or even commit identity theft. To protect yourself, be mindful of what you share.</p> <p>Be wary when interacting with posts and direct messages, especially if they contain suspicious links or attachments. Before clicking on anything, hover over the link to verify its destination. If it shows a website you don’t recognise or seems unrelated to the message, do not click on it. If you receive a message from someone you know but the content seems strange or out of character, contact them directly through a trusted channel to verify its authenticity.</p> <p>Likewise, be wary of messages containing urgent requests for money or personal information from businesses. Genuine organisations will never solicit sensitive details through social media.</p> <p>There are many buy and sell platforms available on social media. But while such platforms can be a great place to find a unique gift, it is also important to remember that not all sellers may be legitimate. So, it’s vital that you don’t share your bank details. If the seller sends a link to purchase the item, do not use it. When meeting to collect an item, it’s generally safer to use cash rather than transferring funds electronically.</p> <figure><iframe src="https://www.youtube.com/embed/aO858HyFbKI?wmode=transparent&amp;start=0" width="440" height="260" frameborder="0" allowfullscreen="allowfullscreen"></iframe><figcaption><span class="caption">Advice for staying safe online.</span></figcaption></figure> <h2>Package delivery scams</h2> <p>As well as being a time for giving and receiving gifts, the festive season is also ripe for cybercriminals to exploit the excitement surrounding <a href="https://www.citizensadvice.org.uk/about-us/about-us1/media/press-releases/scams-linked-to-parcel-deliveries-come-top-in-2023/">package deliveries</a>.</p> <p>Scammers often pose as legitimate delivery companies, sending emails or text messages claiming that a delivery attempt was unsuccessful or requiring additional fees for processing, or even customs clearance. Typically, these messages contain links or phone numbers that, when clicked or called, lead to fake websites or automated phone systems designed to collect personal information or payments.</p> <p>To protect yourself, always verify the legitimacy of any delivery notifications you receive. Check the sender’s email address or phone number against the official contact information for the delivery company. If the information doesn’t match or seems suspicious, don’t click any links or provide personal details.</p> <p>Legitimate delivery companies will never ask for upfront payment or sensitive information through unsolicited messages or calls.</p> <p>Remember, cybercriminals are skilled at manipulating the festive spirit to their advantage. Stay vigilant, exercise caution, and don’t let your excitement for gifts and deliveries compromise your cybersecurity.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/218294/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: https://theconversation.com/republishing-guidelines --></p> <p><a href="https://theconversation.com/profiles/rachael-medhurst-1408437"><em>Rachael Medhurst</em></a><em>, Course Leader and Senior Lecturer in Cyber Security NCSA, <a href="https://theconversation.com/institutions/university-of-south-wales-1586">University of South Wales</a></em></p> <p><em>Image credits: Getty Images </em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/how-to-protect-yourself-from-cyber-scammers-over-the-festive-period-218294">original article</a>.</em></p>

Money & Banking

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1 in 6 older adults fall victim to impersonation scams

<p>More older adults are likely to fall victim to scams than are currently recognised according to new US research. The problems are global. </p> <div class="copy"> <p>A research team from Rush University Medical Center in Chicago, US, says older Americans who aren’t cognitively impeded, are also at risk.  </p> <p>In their study <a href="https://10.1001/jamanetworkopen.2023.35319" target="_blank" rel="noreferrer noopener">published</a> today in <em>JAMA Network Open</em>, the group reports on a behavioural experiment where they targeted 644 adults aged 64-104 in Rush’s Memory and Aging Project – a local scheme that draws on participants from metropolitan Chicago to participate in research – with a pitch mimicking a real-world impersonation scam. </p> <p>The study’s fictitious ‘US Retirement Protection Task Force’ pitched itself to participants as a government social security initiative.  </p> <p>This USRPTF told participants via either post, email or a telephone call there’d been irregular activity on their Medicare or social security file and the inquiry was a routine account security check. As part of this, the fake agency asked participants to call a telephone hotline or login to a provided website to provide their details.  </p> <p>Over two-thirds of the study failed to respond to any attempts to obtain information by the phoney scheme.  </p> <p>The remainder were evenly split by either responding to requests for contact, but expressing scepticism at the authenticity of the USRPTF, or by responding and engaging with the request for information.  </p> <p>Those who were engaged with the request for information, but expressed doubts, were also those with the highest cognitive performance, and lowest proportion of dementia. They were also the most financially literate participants, while those who provided their details had the lowest literacy. </p> <p>Those who provided details were also found to have the lowest scam awareness of all participants.  </p> <p>Among this group, 1 in 10 willingly provided personal information and 1 in 5 provided details of their social security number.  </p> <p>“If extrapolated to a population level, these numbers are astounding and suggest that a very large number of older adults are at risk of victimisation,” the authors say. </p> <p>They also note that, given the use of a fictitious US government organisation name, the number of people vulnerable to well-organised scams is likely much higher.  </p> <p>Last year, the US National Council on Aging reported 92,371 older Americans were defrauded of a total of US$1.7 billion. Most were victims of government department impersonation, sweepstakes and robocall scams. Often such scams will simply demand payment while ‘spoofing’ the phone number of a government agency to add the veil of legitimacy. </p> <p>It’s a similar story around the world. This year, the Australian Competition and Consumer Commission found Australians lost a record $3.1 billion last year, mostly via phone scams. Australians over 65 years of age accounted for a quarter of losses and reports.  </p> <p>The UK’s Action Fraud initiative found Britons lost about ₤2.35 billion in the 2020/21 financial year, with those aged 50-69 most susceptible to falling victim.  </p> <div> <p align="center"> </p> <p><em>Image credits: Getty Images</em></p> <p><em><a href="https://cosmosmagazine.com/people/society/1-in-6-older-adults-fall-victim-to-impersonation-scams/">This article</a> was originally published on <a href="https://cosmosmagazine.com">Cosmos Magazine</a> and was written by <a href="null">Cosmos</a>. </em></p> </div> </div>

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Hilarious reason dad couldn't be fooled by online scam

<p>One savvy dad has outwitted a scammer who posed as his daughter, after the scammer made one hilarious error. </p> <p>Ian Whitworth, a dad from Sydney, took to his LinkedIn page to share the message a scammer texted him in a classic phishing scam that targets parents. </p> <p>He shared the photo of what he thought was the "funniest phishing text any parent has ever received".</p> <p>The text read, "Hey dad, dropped my phone in the sink while doing the dishes. Its unresponsive this is my new number for now just text me here x."</p> <p>Despite the terrible grammar and punctuation that would immediately alert anyone to the possibility of a scam, it was something else that caught the dad's attention. </p> <p>Instead, Whitworth said it was the fact his daughter would never do the chore mentioned by the scammers.</p> <p>Still, he thought it was worth sharing a photo of the text in a bid to warn others, which he uploaded along with the comment, "Cybersecurity update. I just got this."</p> <p>"Perhaps the funniest phishing txt any parent has ever received. 'Doing the dishes', yeah, for sure."</p> <p>In a reply to one of the people who commented on his post, Whitworth joked that his daughter "at age four emerged from my parents' kitchen with a shocked look on her face. 'What's pop doing?'. He was washing up in the sink."</p> <p>Another commenter wrote, "Haha! There is NO WAY this is from my son or daughter, that's for sure."</p> <p>Another commenter said the giveaway that it wasn't from his own child was that they didn't immediately ask for money, to which Whitworth replied, "Ha, yeah, the phishers are like the seven step ladder of confidence before the money issue gets raised. Actual kids: MONEY NOW."</p> <p>According to the federal government's Scamwatch website run by the Australian Competition and Consumer Commission (ACCC), the "Friends/Family Hi Mum" impersonation scam was common.</p> <p>"Scammers send messages pretending to be a family member or a friend desperate for money," it said.</p> <p>"They say they have a new phone and they need you to pay money to help them out of a crisis."</p> <p>Scamwatch warns: "Don't assume a person you are dealing with is who they say they are" and offers the following advice.</p> <p>"If someone you know sends a message to say they have a new phone number, try to call them on the existing number you have for them, or message them on the new number with a question only they would know the answer to," it said.</p> <p>"That way you will know if they are who they say they are."</p> <p><em>Image credits: Getty Images / LinkedIn</em></p>

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7 ways to create realistic financial goals that you'll actually stick to

<p>Establishing robust financial habits not only fosters comfort but also alleviates anxieties about the road ahead. A positive change in our financial circumstances commences with a shift in our money mindset. When you shift to creating lasting change, you can achieve more than you believe is possible.  </p> <p>When creating financial goals that you’ll actually stick to, parallels can be drawn between achieving physical and financial fitness. Let’s take a look.</p> <ol> <li><strong>Precision in Goal Setting</strong></li> </ol> <p>Just like any other endeavour, the path to financial well-being requires setting clear objectives that are both quantifiable and feasible. Whether it's building an emergency fund or saving for a major purchase, your goals need to be well-defined and measurable. </p> <p>Just as a fitness regimen consists of various exercises targeting different muscle groups, your financial goals should cover different aspects of your financial life.</p> <ol start="2"> <li><strong>The Inaugural Step</strong></li> </ol> <p>The hardest part is starting – there will always be competing priorities.   Think of it as taking one step at a time.  Starting your financial goals might feel overwhelming due to competing priorities and uncertainties. </p> <p>Start small and build momentum gradually. Establish a budget, track your expenses, and save a modest amount regularly. </p> <ol start="3"> <li><strong>Avoiding Extreme Measures</strong></li> </ol> <p>Remember, lasting change comes from sustainable actions. Financial quick fixes like waiting for bonuses or tax returns won't foster healthy habits and can lead to financial fatigue. Instead, embrace gradual progress; small efforts compound over time. </p> <p>The allure of crash diets can be tempting, but they rarely yield lasting results. Instead, opt for consistent, manageable actions. Focus on building sustainable habits, like making regular contributions to savings or investments.</p> <ol start="4"> <li><strong>The Power of Knowledge</strong></li> </ol> <p>Equip yourself with information. Education is a powerful tool in achieving financial well-being.  Understanding the options available is pivotal to making informed financial decisions. Gain a comprehensive understanding of your financial options. </p> <p>Research investment opportunities and strategies that align with your goals. Knowledge empowers you to navigate the complex landscape of personal finance confidently.</p> <ol start="5"> <li><strong>Exploration of Strategies</strong></li> </ol> <p>Just as someone might prefer running over cycling, finding financial strategies that resonate with you enhances your chances of long-term success. Experiment with diverse approaches to identify what resonates best, reducing stress and enhancing commitment. </p> <p>Opt for strategies that resonate with your values, minimise stress and amplifying commitment.</p> <ol start="6"> <li><strong>Consistency </strong></li> </ol> <p>Success lies in cultivating steady habits over time, ensuring enduring benefits. Just as regular workouts lead to improved physical health, cultivating small, consistent financial habits over time leads to enhanced financial well-being. </p> <p>Set up automated transfers to savings accounts, make incremental increases in contributions, and avoid overspending.</p> <ol start="7"> <li><strong>Intermittent Rewards</strong></li> </ol> <p>Occasionally treat yourself.  Sporadic indulgences can enhance well-being and acknowledge hard-earned victories. Rewarding yourself for achieving financial milestones enhances your commitment and prevents financial fatigue. It's essential to strike a balance between frugality and enjoyment.</p> <p>By embracing these principles, we not only engineer realistic financial objectives but also cement a commitment to achieving them. That’s the key to lasting financial prosperity.</p> <p><strong><em>Amanda Thompson, author of Financially Fit Women, is a sought-after speaker and qualified financial adviser.  As the founder of Endurance Financial, Amanda is driven to support women to have a great relationship with money and own their own financial success. For more information visit <a href="http://www.endurancefinancial.com.au">www.endurancefinancial.com.au</a></em></strong></p> <p><em>Image credits: Getty Images</em></p>

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What does financial abuse really look like?

<p>Sally is in her 20s, lives in a dilapidated rental home and works three jobs. Fifty-something Sarah owns a large home, drives a Mercedes and is a corporate executive. Pensioner Scott, in his mid-70s, still lives in the home in which he and his late wife raised their children. Who would you say is more vulnerable to financial abuse?</p> <p>The answer, you may be surprised to learn, is all three. Financial abuse, according to the government’s <a href="https://moneysmart.gov.au/living-in-retirement/financial-abuse">MoneySmart</a>, is a type of family and domestic violence:</p> <p>“It often happens alongside other types of violence, such as physical or emotional abuse. It can leave you feeling vulnerable, isolated, depressed and anxious. It can also take away your independence.”</p> <p>Commonly a spouse or partner is the perpetrator, but it can come from any relative or friend. A <a href="https://www.commbank.com.au/content/dam/caas/newsroom/docs/Cost%2520of%2520financial%2520abuse%2520in%2520Australia.pdf">2022 Commonwealth Bank report</a> suggests over 623,000 Australians experienced financial abuse in 2020 alone – roughly one in 30 women and one in 50 men. Anyone – regardless of age, wealth etc. – can be a victim. </p> <p><strong>Financial abuse has many faces</strong></p> <p>Just as finances are complex, so too is financial abuse, which can be viewed from many angles:</p> <ul> <li>Couples: One partner controls everything money related. I know of one instance where a woman’s partner went so far as counting coffee pods; another checked car mileage to stop his partner driving further than school drop-offs.</li> <li>Exes: Not working specifically to avoid paying child support; withholding information to delay settlement; bullying into a menial settlement.</li> <li>Multi-generations: Children or grandchildren milking elderly relatives; seizing control over their finances and living arrangements.</li> <li>Non-relatives: Such as friends buying property together without properly documenting everything, then fighting come sale time.</li> <li>Business relationships: Duped signatures on trust and business documents; hiding debts; impeding or undervaluing someone’s exit.</li> </ul> <p><strong>Warning signs </strong></p> <p>There are common warning signs that you, or someone you know, is suffering financial abuse:</p> <ul> <li>Pressure to make decisions: to invest your money or superannuation in crazy things that go bust, or to do nothing and not keep up with inflation (let alone grow your wealth), go guarantor on a loan, or sign power of attorney.</li> <li>Draining money: using your money to fund their business or investment on the promise a return is coming that never does (which could be poor management or deliberate deceit). This could continue for years until you’re left homeless and bankrupt.</li> <li>Unfair claims: your partner came into the relationship with nothing and stays just long enough to make a claim on your home.</li> <li>Controlled spending: this may start small (‘Don’t spend so much on clothes!’) but can become extreme. </li> <li>Blackmail: I’ve heard of people denied access to their grandkids unless they gave their son/daughter money or amended their will.</li> <li>Restricted access: you’re denied access to your own or joint finances, from having your own accounts, or are banned from working to earn your own income and superannuation.</li> <li>Tracking: sharing your location by smartphone may sound practical or safe but is open to abuse.</li> <li>Social isolation: cutting you off from friends and family; pressing for an interstate move.</li> <li>Reckless spending: your money is spent haphazardly – you may be kept in the dark or pressured not to ask questions.</li> <li>Tying down: trapping you into a big mortgage to crimp your freedom.</li> <li>Guilting: I have seen wealthy adults guilt their less fortunate parents into paying their bills, and gambling addicts guilt partners into paying their debts (with no intention to address their addiction or plan to pay it back).</li> </ul> <p><strong>Protecting yourself</strong></p> <p>The best prevention of all is to avoid thinking ‘it won’t happen to me’. So many victims of financial abuse once thought exactly the same.</p> <p>Other tips include:</p> <ul> <li>Speak up: Sometimes, starting a conversation can be enough to deliver positive change and even save a relationship (avoiding divorce is cheaper for everyone!)</li> <li>Have an emergency fund – cash only you can access, easily, in a crisis.</li> <li>Keep separate bank accounts – deposit your income here, then transfer money for joint bills into a joint account. </li> <li>Make decisions together – don’t leave money matters to your partner/children. It’s your money too.</li> <li>Get outside perspective: financial advisers are accountable to you as their client and help provide visibility over your assets, liabilities and risks. Ensure they are qualified and currently practicing.</li> </ul> <p>If you think you may be a victim of financial abuse, I beg you – seek help immediately. Suffering in silence and letting the situation snowball is the costliest thing you can do. Both financially and emotionally!</p> <p><a href="http://www.lifeline.org.au/">Lifeline - </a>13 11 14</p> <p><a href="https://www.1800respect.org.au/">1800RESPECT - </a>1800 737 732</p> <p><a href="https://www.familyrelationships.gov.au/talk-someone/advice-line">Family Relationship Advice Line - </a>1800 050 32</p> <p><a href="https://goodshep.org.au/">Good Shepherd Australia Financial Independence Hub  - </a>1300 050 150</p> <p><a href="http://www.ndh.org.au/">National Debt Helpline - </a>1800 007 007</p> <p><strong><em>Helen Baker is a licensed Australian financial adviser and author of the new book, On Your Own Two Feet: The Essential Guide to Financial Independence for all Women (Ventura Press, $32.99). Helen is among the 1% of financial planners who hold a master’s degree in the field. Proceeds from book sales are donated to charities supporting disadvantaged women and children. Find out more at <a href="http://www.onyourowntwofeet.com.au">www.onyourowntwofeet.com.au</a></em></strong></p> <p><em>Image credits: Getty Images </em></p>

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#GirlMaths: a seemingly innocent and fun way to justify expenses that can have serious financial consequences

<p><em><a href="https://theconversation.com/profiles/janneke-blijlevens-150258">Janneke Blijlevens</a>, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a>; <a href="https://theconversation.com/profiles/angel-zhong-1204643">Angel Zhong</a>, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a>, and <a href="https://theconversation.com/profiles/lauren-gurrieri-5402">Lauren Gurrieri</a>, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a></em></p> <p>These shoes are perfect, made for me! I have to get them! But really, I should be paying off my car loan instead. I can’t justify this purchase. Or can I …?</p> <p>We all know this feeling, this tension between what you really want to do and what you really should, or shouldn’t, do. What you are experiencing is <a href="https://www.britannica.com/biography/Leon-Festinger/Cognitive-dissonance">cognitive dissonance</a>.</p> <p>It’s a psychological discomfort we feel when our behaviours and our values or beliefs do not match. Not to worry, we can make that discomfort simply disappear with a good dose of #GirlMaths!</p> <h2>So what is #GirlMaths?</h2> <p>GirlMaths recently became a viral phenomenon on TikTok after New Zealand FVHZM radio hosts Fletch, Vaughan and Hayley used #GirlMaths to justify one host’s mother’s expensive dress purchase as basically free because the dress was going to be worn at least four times.</p> <p><iframe id="tc-infographic-904" class="tc-infographic" style="border: none;" src="https://cdn.theconversation.com/infographics/904/f0b5e215a804bb450e609c397b96c7fcbf46172f/site/index.html" width="100%" height="400px" frameborder="0"></iframe></p> <p>Since then, influencers have added to the #GirlMaths trend with gems such as “If I buy it for $100, wear it, and then resell it for $80 then I basically wore it for free”, “If I pay with cash, it means it’s free”, and “If I just returned something, then purchase something new for the same amount of money, then it’s free”.</p> <p>The reason #GirlMaths resonates so well with everyone and allows it to go viral is that we are very familiar with this type of thinking. The mental gymnastics of #GirlMaths needed to justify cost-per-wear or cash-is-free is a perfect display of behavioural biases and heuristics, such as confirmation bias and denomination bias, being applied to everyday consumption decisions.</p> <h2>The psychology of decision-making</h2> <p>Behavioural biases and heuristics are shortcuts in our thinking that help us make decisions quicker and easier, and are great for reducing the cognitive dissonance we sometimes experience.</p> <p>Our brain has a lot of decisions to make in a day and simply doesn’t have the power to scrutinise every little detail of every <a href="https://theconversation.com/what-shall-we-have-for-dinner-choice-overload-is-a-real-problem-but-these-tips-will-make-your-life-easier-193317">decision</a>. These shortcuts in our thinking may facilitate the decision making process, but they don’t always mean we make the most optimal decisions.</p> <p>Confirmation bias is a bias where you justify your decisions by considering only the evidence that supports what you want and ignore the evidence that would mean you’d have to make a different decision. Cost-per-wear does sound quite financially savvy. It is just like bulk-buying pantry essentials, right?</p> <p>The issue is you are ignoring the facts such as: 1) your disposable income does not match this expense in light of your utility bills, 2) you could rewear a cheaper dress all the same, and 3) by spending money on a fancy dress, you lose the opportunity to spend the money on other better investments for wealth accumulation, or to pay off your car loan.</p> <h2>The financial and social costs</h2> <p>But it’s all a bit of innocent fun, right? Surely people won’t take #GirlMaths that seriously? We beg to differ.</p> <p>First, the term is unnecessarily gendered. Gendered language operates to reinforce societal expectations with a particular gender and can promote stereotypes, biases and binary categories.</p> <p>In this case, the term “girl maths” reinforces problematic stereotypes that equate women with consumption, frivolity and extravagant spending. When stereotypes are reinforced within our own social circles, we are more likely to <a href="https://journals.sagepub.com/doi/abs/10.1177/0146167299025007004?casa_token=dOhnQVtFwPsAAAAA:XSBdix5AB6bDfGjNgfbX9OIjstw4KE071GP0l60mAxvHJMaEwkyPERqHXf3z9PhctWJUl6h7TgTHg_U">internalise these as part of our identity</a>.</p> <p>By representing women in a less favourable way, the term operates to both demean and discriminate on a gendered basis. This is heightened by the use of “girl” as opposed to “woman”, which implies someone is childlike or lacking in knowledge or experience. It also begs the question what “boy maths” - set up as something opposing and different - might connote.</p> <p>Second, the #GirlMaths trend reminds us of the power of “<a href="https://theconversation.com/fintok-and-finfluencers-are-on-the-rise-3-tips-to-assess-if-their-advice-has-value-161406">finfluencers</a>” – social media content creators amassing huge online followings by sharing advice on anything from budgeting to buying a house, to investing.</p> <p>These online gurus appeal to Gen Z and millennials, simplifying complex financial concepts into digestible nuggets, much like #GirlMaths simplifies purchases based on cost-per-wear or cash-as-free.</p> <p>Just as regulators such as <a href="https://moneysmart.gov.au/other-ways-to-borrow/buy-now-pay-later-services">ASIC</a> repeatedly warn us of the dangers of buy-now-pay-later services, we must caution the #GirlMaths trend as a dangerous cocktail for young women who are susceptible to the “advice” of finfluencers.</p> <p>The trend resembles BNPL by breaking down expenses into smaller, more palatable portions, making purchases seem justifiable and affordable at the moment.</p> <p>Denomination bias describes this tendency to spend more money when it is denominated in small amounts rather than large amounts. We find it much easier to spend $50 four times than $200 all at once.</p> <p>However, the convenience of these shortcuts in our thinking can obscure the hidden financial risks. You may overlook the bigger picture of your financial health, and spend more than what you can afford. That’s why a large number of BNPL users find themselves ending up in a <a href="https://www.choice.com.au/money/credit-cards-and-loans/personal-loans/articles/bnpl-submission-to-treasury">modern debt trap</a>.</p> <h2>The perils of #GirlMaths</h2> <p>The danger of #GirlMaths to young women lies in the cocktail of feeling oddly familiar and reinforced in this biased thinking, the problematic stereotypes that shape identities, and the power of finfluencers, who wield increasing influence over the financial choices and decision-making of young women.</p> <p>While the term may initially come across as innocent fun, it’s crucial not to underestimate its potential harms. Instead, let’s champion the use of inclusive language in finance that doesn’t perpetuate gender biases.</p> <p>And if you’re a staunch supporter of #GirlMaths, we strongly urge you to take into account the possible adverse financial consequences of these quick-fix spending habits.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/211903/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: https://theconversation.com/republishing-guidelines --></p> <p><em><a href="https://theconversation.com/profiles/janneke-blijlevens-150258">Janneke Blijlevens</a>, Senior Lecturer in Marketing, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a>; <a href="https://theconversation.com/profiles/angel-zhong-1204643">Angel Zhong</a>, Associate Professor of Finance, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a>, and <a href="https://theconversation.com/profiles/lauren-gurrieri-5402">Lauren Gurrieri</a>, Associate Professor in Marketing, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a></em></p> <p><em>Image credits: Getty Images</em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/girlmaths-a-seemingly-innocent-and-fun-way-to-justify-expenses-that-can-have-serious-financial-consequences-211903">original article</a>.</em></p>

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Four myths about the financial side of divorce

<p><em><a href="https://theconversation.com/profiles/emma-hitchings-388514">Emma Hitchings</a>, <a href="https://theconversation.com/institutions/university-of-bristol-1211">University of Bristol</a> and <a href="https://theconversation.com/profiles/gillian-douglas-1428314">Gillian Douglas</a>, <a href="https://theconversation.com/institutions/kings-college-london-1196">King's College London</a></em></p> <p>It’s no wonder many people think divorce involves going to court, huge legal fees and decades of spousal payments, considering these are the cases that dominate our headlines. However, the kinds of divorce cases reported in the news involve the very rich, and are far removed from the reality for most couples.</p> <p>The Law Commission of England and Wales, the body responsible for law reform, <a href="https://www.lawcom.gov.uk/project/financial-remedies-on-divorce/">recently announced a review</a> of the law of finances on divorce, with a scoping report due in September 2024. Review of this law is much needed, given the legislation governing how couples in England and Wales sort out their financial affairs upon marriage breakdown mainly dates back to the 1970s (the <a href="https://www.legislation.gov.uk/ukpga/1973/18">Matrimonial Causes Act 1973</a>).</p> <p>The problem is that key politicians <a href="https://hansard.parliament.uk/lords/2023-03-08/debates/3AB3D708-24E5-4FF2-8481-05EFA27E2593/DivorceFinancialProvision">who have been calling for change</a> still rely on the issues raised in these <a href="https://hansard.parliament.uk/lords/2018-05-11/debates/89A33706-7DCD-4FA0-AE0D-B06E11FAF264/Divorce(FinancialProvision)Bill(HL)">exceptional, “big money” divorce cases</a>.</p> <p>We need to correct the misleading narrative about divorce if reform is to address the needs of the 110,000 couples <a href="https://www.gov.uk/government/statistics/family-court-statistics-quarterly-july-to-september-2022">who get divorced in England and Wales each year</a>. Although there is limited research about this issue, we do know enough to challenge the following myths.</p> <h2>1. Spouses are often forced to fund costly legal battles</h2> <p>Family courts grant divorces and the fee is currently £593. However, it is not mandatory for a divorcing couple to get an additional order regarding their finances, and there is no need for expensive court hearings.</p> <p>In fact, <a href="https://www.gov.uk/government/statistics/family-court-statistics-quarterly-july-to-september-2022">fewer than 40%</a> of those divorcing each year do so. While there is no authoritative data on average legal costs incurred in these cases, it seems that, for many couples, the costs of sorting out their financial arrangements need not be high because the courts are not involved.</p> <p>And even those couples who do use the courts for their financial matters overwhelmingly settle rather than fight their case, which limits their legal costs. Only <a href="https://www.gov.uk/government/statistics/family-court-statistics-quarterly-july-to-september-2022">13% of financial orders</a> made in a divorce are actually decided by a judge after contested litigation. The rest are consent orders: orders finalised by the judge on terms that have already been agreed by the divorcing couple.</p> <h2>2. Everything is split 50/50</h2> <p>The law does not lay down a principle of equal sharing of the marital assets on divorce. However, the courts <a href="https://www.lawteacher.net/cases/miller-v-miller-mcfarlane-v-mcfarlane.php">do accept this is a desirable goal</a> if this can be done while meeting both parties’ needs – and those of their children.</p> <p>Research suggests that, rather than rigidly applying a 50/50 split, couples focus on their needs first and <a href="https://research-information.bris.ac.uk/en/publications/financial-remedies-on-divorce-the-need-for-evidence-based-reform">particularly those of their children</a>. This can result in an unequal split of the value of the main asset most couples have – the former marital home.</p> <h2>3. Men have to pay lifelong maintenance</h2> <p>Some news media object to the current law as they claim it allows an ex-wife to be supported <a href="https://www.dailymail.co.uk/news/article-5965629/Surveyor-marriage-ended-16-years-ago-WINS-Supreme-Court-battle.html">for the rest of her life</a> by her former husband (or vice versa). The argument is that this casts ex-wives as dependants who cannot look after themselves, and prevents husbands from moving on after their divorce.</p> <p>In reality, lifelong maintenance is rare, and even limited ongoing financial support is uncommon. The most recent data found that only 16% of court orders involved any kind of ongoing spousal support – of which, two-thirds were for a fixed term. Nearly all such orders involved <a href="http://www.nuffieldfoundation.org/sites/default/files/files/briefing%20paper%20Jun%202018%20FINAL.pdf">dependant children</a>, with the order terminating when the youngest child reaches a certain age or stage of education.</p> <h2>4. London is the divorce capital of the world</h2> <p>Some news media <a href="https://www.theguardian.com/lifeandstyle/shortcuts/2015/feb/24/divorce-rich-husband-london-english-law">report</a> that the courts’ endorsement of the principle of equal sharing has led to some wives, married to oligarchs, sheikhs and tycoons, seeking divorce through an English court due to its “generous” treatment of them. For example in 2021, a High Court judge ordered Sheikh Mohammed bin Rashid al-Maktoum, the emir of Dubai, to pay a <a href="https://www.businessinsider.com/why-london-divorce-capital-world-for-mega-rich-2019-7?r=US&amp;IR=T">£554 million divorce settlement</a> to his former wife, Princess Haya.</p> <p>By their nature, these cases are atypical – that’s why they make headlines. But why should the fact that English law takes spousal equality seriously be a matter for regret? The 1970s legislation aimed to ensure the non-financial contributions of spouses, such as home-making and caring, should be recognised. Judges have been clear <a href="https://uk.practicallaw.thomsonreuters.com/3-503-7596?transitionType=Default&amp;contextData=(sc.Default)&amp;firstPage=true">it is discriminatory to assume</a> the breadwinner spouse is making a greater contribution to the relationship and should keep a larger part of the wealth than the other who takes on the role of carer. Surely this is an enlightened position.</p> <p>That doesn’t mean we shouldn’t update the law, though. Working patterns have changed but women still earn, on average, <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/genderpaygapintheuk/2022#:%7E:text=Image%20.csv%20.xls-,The%20gender%20pay%20gap%20has%20been%20declining%20slowly%20over%20time,up%20from%207.7%25%20in%202021.">less than men</a>. They are still more likely to assume the bulk of <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/articles/familiesandthelabourmarketengland/2021">child care</a>, <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/articles/familiesandthelabourmarketengland/2021">work part-time </a>, and, in consequence, have <a href="https://adviser.scottishwidows.co.uk/assets/literature/docs/women-retirement-report-2022-press-release.pdf">smaller pensions compared with men</a>.</p> <p>The result is that, far from being treated generously, women still come out of divorce <a href="https://ses.library.usyd.edu.au/bitstream/handle/2123/26207/Fisher_2018_AJFL_Final.pdf?sequence=1">financially worse off than men</a>.</p> <p>But there is still so much we don’t know about how divorced couples divide their assets. Since the norm is for couples to stay out of the courts, there is no official record of how the majority of the divorcing population arranges their finances. That’s why <a href="https://research-information.bris.ac.uk/en/persons/emma-hitchings">one of us</a> (Emma) is leading the Fair Shares Study, expected to publish in autumn 2023. This will provide the <a href="https://www.bristol.ac.uk/law/fair-shares-project/">first nationally representative picture</a> of couples’ finances on divorce.</p> <p>We need a law that meets the needs of all divorcing couples rather than the few wealthy exceptions, and a major corrective to the myths that abound in this area of family law.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/202975/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /></p> <p><em><a href="https://theconversation.com/profiles/emma-hitchings-388514">Emma Hitchings</a>, Professor of Family Law, <a href="https://theconversation.com/institutions/university-of-bristol-1211">University of Bristol</a> and <a href="https://theconversation.com/profiles/gillian-douglas-1428314">Gillian Douglas</a>, Professor Emerita of Law, <a href="https://theconversation.com/institutions/kings-college-london-1196">King's College London</a></em></p> <p><em>Image credits: Getty Images</em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/four-myths-about-the-financial-side-of-divorce-202975">original article</a>.</em></p>

Money & Banking

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Facebook Messenger scams are on the rise – here’s how to protect yourself

<p><strong>Facebook Messenger scams prey on our vulnerabilities</strong></p> <p>Scams through Facebook’s Messenger platform are being reported at higher rates than ever before, according to AARP, citing its own data as well as that of the government. Since Facebook’s early days, cybercriminals have been mining Facebook’s direct-messaging capabilities to scam unsuspecting victims out of money. One of the earliest Facebook Messenger scams involved a message, purportedly from a friend, claiming they were stuck in a foreign country and in desperate need of immediate financial assistance to get out. It wasn’t really the friend, however, but rather a scammer who had hacked into the friend’s account. </p> <p>Imposter scams such as “the friend in a foreign country” have evolved and proliferated over the years. The common thread is the scammer either creates an account impersonating an actual Facebook account or hacks into an existing Facebook account. In either case, the scammer then uses the fake/hacked account to send private messages to the account holder’s friends that elicit either money or personal information. The messages vary, but all are designed to prey on our human vulnerabilities, including:</p> <ul> <li>the desire to be a “hero”</li> <li>the desire to appear “generous”</li> <li>the desire to win “free money”</li> <li>the desire to be loved and admired</li> <li>the desire to avoid shame or punishment</li> </ul> <p>If a scammer tries to message you, report them, Facebook advises, but that begs the larger question of how does one recognise a Facebook Messenger scam?</p> <p><strong>Current Messenger Facebook scams</strong></p> <p>According to Facebook and our cybersecurity experts, here are the most common Facebook Messenger scams today:</p> <p><span style="text-decoration: underline;"><em>Romance scams</em></span>. Preying on our desire to be loved and admired, romance scammers appear as attractive strangers with sad stories and a desire to love and be loved. The most effective romance scammers will friend a number of mutual friends before reaching out to any of them, in an attempt to make themselves seem less like strangers and more like people in the same social network. Many use photos they’ve stolen off the Internet and many pose as members of the military or as doctors, in an attempt to inspire trust, admiration, and even authority. What they all have in common is they can’t meet you just yet because they’re somewhere far away, and although it may take a bit of time, even as much as several weeks, they will eventually ask you to send money so that they can come to see you.</p> <p><span style="text-decoration: underline;"><em>Lottery scams</em></span>. Preying on our desire for “free money,” lottery scammers appear as friends or organisations who are thrilled to tell you you’ve won money in some lottery or contest. The common thread? It’s a contest you have no recollection of having entered and to get the prize, you’ll have to either pay a fee or “refundable” advance or provide personal information.</p> <p><span style="text-decoration: underline;"><em>Inheritance scams</em></span>. Also preying on our desire for free money, inheritance scammers claim to be lawyers or others who represent someone who has died and supposedly left you their estate or some portion of it – but first, you’ll have to fork over some money or personal information.</p> <p><span style="text-decoration: underline;"><em>Loan scams</em></span>. Another variation on the “free money” theme is the loan scam, whereby the scammer promises low-interest loans with no money down – except for a “refundable” application fee. Facebook points out that loan scammers may send messages via Messenger and also leave posts and comments on Pages and in Groups to legitimise themselves. However, legitimate lenders wouldn’t offer loans via Facebook Messenger, nor would they ask you for money to proceed with a loan application.</p> <p><span style="text-decoration: underline;"><em>Donation scams</em></span>. Facebook specifically warns users to watch out for “famous people” or people claiming to represent a charity hitting them up for a donation. Donation scams, which are easy money for a scammer because they are a direct request for payment, prey on our desire to be perceived, or to perceive ourselves, as generous.</p> <p><span style="text-decoration: underline;"><em>“Hey, is this you?” scams</em></span>. Consumer Affairs warns of this “phishing scam” that uses the threat of shame to goad you into giving up personal information. The scammer hacks into one of your Facebook friend’s Messenger accounts and sends you a video, asking if it’s really you in the video, and implying there’s something in the video that could embarrass you. If you ever get a message like this, Consumer Affairs urges you to ignore and delete it to avoid giving away personal information or introducing a virus onto your computer.</p> <p><strong>Red flags to watch out for</strong></p> <p>Unfortunately, Facebook Messenger scams evolve rapidly (as soon as we suss them out, there are several more to replace them). So, it’s a good idea to be aware of these warning signs that we culled from our experts:</p> <p><span style="text-decoration: underline;"><em>Someone is asking you for money</em></span>. While Facebook warns specifically against strangers asking for money, Rachel Wilson, investigative coordinator for The Smith Investigation Agency, points out to Reader’s Digest that any time anyone asks you for money over Messenger, it’s immediately suspect. “If friends or family ask you to help them in an emergency, always call to speak with them personally to confirm that the message originated with them.”</p> <p><span style="text-decoration: underline;"><em>Someone is getting a little too personal</em></span>. When someone sends you a message requesting personal information, especially financial information, it should be considered suspicious, advises Sean Messier, credit industry analyst for Credit Card Insider. Messier suggests not revealing any such information until you’re certain the message-sender is who they claim to be, but it’s probably also a good idea to never reveal any such information over Messenger at all.</p> <p><span style="text-decoration: underline;"><em>Someone is offering something for free</em></span>. You know how they say there’s no such thing as a free lunch? Well, there’s no such thing as free money on Facebook, points out Robert Siciliano, security expert. This is true for any kind of “free money” Messenger message, including those involving lotteries, loans, contest winnings, inheritances, lost bank accounts, and reimbursements of money owed.</p> <p><span style="text-decoration: underline;"><em>Someone who wants to take the conversation off Facebook (to text or email, etc)</em></span>. Facebook warns against taking conversations off Facebook unless you’re absolutely certain, beyond a shadow of a doubt, the message sender is who they say they are.</p> <p><span style="text-decoration: underline;"><em>Messages that seem out of character for the sender</em></span>. If a message seems “out of the norm” for the sender, trust your instincts and ignore it. This is doubly true if the message includes an attachment. Be very wary of opening attachments in general, and particularly if something seems “off” about the message or the sender.</p> <p><span style="text-decoration: underline;"><em>Messages rife with spelling and grammatical errors</em></span>. Facebook points out that when a message is filled with typos and grammatical errors, you should have your guard up. A single typo is one thing, but things like the misspelling of names and places are a big red flag.</p> <p><span style="text-decoration: underline;"><em>Messages from new accounts with few friends</em></span>. Roger Thompson, CEO of Thompson Cybersecurity Labs, points out that new accounts with few friends should always be considered suspicious until confirmed otherwise. Friend requests from such accounts and from duplicate friend accounts should be considered suspect as well.</p> <p>To avoid getting hacked (and used by a cybercriminal in an imposter scam), Wilson recommends updating your social media passwords regularly and always use two-factor authentication. She also notes that with Facebook use increasing among seniors, it would be a good deed to speak to older family members about Messenger scams and how to avoid them.</p> <p><em>Image credits: Getty Images </em></p> <p><em>This article originally appeared on <a href="https://www.readersdigest.co.nz/true-stories-lifestyle/science-technology/facebook-messenger-scams-are-on-the-rise-heres-how-to-protect-yourself" target="_blank" rel="noopener">Reader's Digest</a>.</em></p>

Technology

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How your favourite things can boost your financial wellbeing

<p><em><a href="https://theconversation.com/profiles/jingshi-joyce-liu-1424398">Jingshi (Joyce) Liu</a>, <a href="https://theconversation.com/institutions/city-university-of-london-1047">City, University of London</a>; <a href="https://theconversation.com/profiles/amy-dalton-1425283">Amy Dalton</a>, <a href="https://theconversation.com/institutions/hong-kong-university-of-science-and-technology-1153">Hong Kong University of Science and Technology</a>, and <a href="https://theconversation.com/profiles/anirban-mukhopadhyay-1425284">Anirban Mukhopadhyay</a>, <a href="https://theconversation.com/institutions/hong-kong-university-of-science-and-technology-1153">Hong Kong University of Science and Technology</a></em></p> <p>The cost of living crisis has left many people struggling to afford basic necessities such as food and heating for their homes. On the other hand, the top ten richest men in the world <a href="https://www.weforum.org/agenda/2022/04/economic-inequality-wealth-gap-pandemic/">doubled their wealth</a> during the COVID pandemic while 99% of people became worse off.</p> <p>While this is a comparison of two extremes, many people attempt to “keep up with the Joneses” – looking at what the people around them own and striving to afford the same things. Comparing material wealth and resources to those around you is even more common when others are better off. It’s hard not to wonder why someone else has a nicer car or better clothes.</p> <p>Lots of <a href="https://onlinelibrary.wiley.com/doi/full/10.1111/jasp.12631">research supports</a> this tendency, <a href="https://journals.sagepub.com/doi/full/10.1177/00222437221141053">including our own</a>. For example, when we asked American people to watch a video about research on income inequality in their own country, unsurprisingly, it made them think about their own wealth and how it compares to those around them.</p> <p>And we found that it doesn’t matter how wealthy a person is. Relatively well-off people still tend to look upwards in this way. There is nearly always someone who has more money or owns a better car, a bigger house or the latest gadgets.</p> <p>But while money may not buy you happiness, <a href="https://journals.sagepub.com/doi/full/10.1177/00222437221141053">our research shows</a> that a favourite possession can actually help to make you feel happier when facing income inequality. Thinking about a single treasured possession – even something small like a favourite book gifted by a friend or a keepsake from a trip – can help prevent these feelings of deprivation and actually boost your wellbeing.</p> <p>We used the <a href="https://www.investopedia.com/terms/g/gini-index.asp">Gini coefficient</a> – a common measure of income inequality – to analyse more than 31,000 Instagram posts from 138 countries. We found that posts tend to convey less happiness in places with more income inequality (i.e., when the Gini coefficient of the location of the post increases).</p> <p>We focused on posts that were about favourite possessions (that used hashtags such as #favouritething, #favthing), comparing these with posts about favourite things in general, that is things that aren’t “owned”. The latter posts used hashtags such as #fashion or #favoritepeople.</p> <p>Posts that used hashtags about general consumption and favourite things that aren’t “owned”, such as music or friends, were typically less happy and posted in areas with more income inequality. But when we looked at posts that used hashtags about favourite possessions, such as #favouritething or #favthing, we found there was a weaker relationship with income inequality.</p> <p>So whether a post was happy or not wasn’t linked to the equality of the area it was posted in. These posts about favourite possessions were therefore less affected by income inequality.</p> <p>This means that encouraging people to think differently about things they already own could help some cope better with inequality. Rather than focusing on how much you own, which tends to exacerbate social comparison and undermine happiness, focus instead on your favourite possessions. Our research indicates that people who do this tend to make fewer material comparisons, and are happier as a result.</p> <h2>Simply remember your favourite things</h2> <p>A treasured possession doesn’t even have to be particularly expensive. From a memento purchased on a trip abroad, to your grandmother’s embroidered cushion, a football jersey that reminds you of your old school teammates, or even that tattered t-shirt of your favourite band, such items can feel priceless to their owners because they are unique and their value transcends any kind of price.</p> <p>In a separate multi-country study using an online questionnaire, we asked 1,370 participants from China, India, Pakistan, the UK, Spain, Russia, Chile and Mexico to describe either every item of clothing they had recently purchased, or a single favourite item of clothing. After participants described these things, we asked them about their wellbeing, as well as their perception of income inequality in their country.</p> <p>Those who thought about recent clothing purchases reported lower wellbeing when thinking about income inequality in their country. In comparison, those who talked about a single favourite piece of clothing were not as affected by the income inequality they perceived around them.</p> <p>Three more online experiments with over 2,000 participants <a href="https://journals.sagepub.com/doi/full/10.1177/00222437221141053">revealed that</a> when people are reminded of their favourite possessions they feel less affected by income inequality because they are making fewer material comparisons.</p> <p>In one of these studies, we found that merely describing a favourite possession made people less likely to compare their wealth to that of others. When people stopped making these comparisons they were happier – even those living in places with more income inequality.</p> <h2>#FavouriteThing</h2> <p>Our research shows the benefits of focusing on a few favourite things that we own, rather than thinking about the amount of possessions we have and what else we need to “keep up with the Joneses”.</p> <p>Hashtag trends like #ThrowbackThursday encourage people to post photos on certain themes. In a similar vein, encouraging more people to post photos of their favourite possessions using hashtags like #FavouriteThing could do a lot to help boost happiness during the cost of living crisis.</p> <p>Income inequality is rampant and the cost of living crisis has only made its effects worse. But we all possess something dear to us that can keep us from comparing ourselves to others and help protect our wellbeing in this difficult economic environment.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/201997/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /></p> <p><em><a href="https://theconversation.com/profiles/jingshi-joyce-liu-1424398">Jingshi (Joyce) Liu</a>, Lecturer in Marketing, <a href="https://theconversation.com/institutions/city-university-of-london-1047">City, University of London</a>; <a href="https://theconversation.com/profiles/amy-dalton-1425283">Amy Dalton</a>, Associate Professor of Marketing, <a href="https://theconversation.com/institutions/hong-kong-university-of-science-and-technology-1153">Hong Kong University of Science and Technology</a>, and <a href="https://theconversation.com/profiles/anirban-mukhopadhyay-1425284">Anirban Mukhopadhyay</a>, Lifestyle International Professor of Business and Chair Professor of Marketing, <a href="https://theconversation.com/institutions/hong-kong-university-of-science-and-technology-1153">Hong Kong University of Science and Technology</a></em></p> <p><em>Image credits: Getty </em><em>Images </em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/how-your-favourite-things-can-boost-your-financial-wellbeing-201997">original article</a>.</em></p>

Money & Banking

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Don't get caught out: 6 holiday scams ripping off travellers

<p>If you’re planning to take a trip across the world soon, then be warned, as there is an influx of new holiday scams affecting tourists as they travel to their dream break.</p> <p>Holiday-makers have money to spend and relaxation on their minds, which is why they are seen as easy targets for con artists.</p> <p>UK-based consumer group <a href="https://www.which.co.uk/" target="_blank" rel="noopener">Which?</a> has listed the six most common frauds travellers need to be aware of, along with tips on how to avoid getting scammed, <em><a href="https://www.thesun.co.uk/" target="_blank" rel="noopener">The Sun</a></em> reported.</p> <p>So, if you’re planning a trip abroad, here are the things you need to watch out for:</p> <p><strong>1. Accommodation booking scams</strong></p> <p>While the introduction of the internet has been a blessing in terms of ease, it’s also made it easier for scammers to lure you into their traps. With the growth of online holiday bookings, fraudsters often need nothing more than a few fake pictures to lure their victims.</p> <p>A common scam is one that includes picturesque photographs of holiday rentals that don’t seem to exist, advertised at affordable price points. The deals were often advertised on mainstream websites but asked those who were interested in booking to contact them via email, rather than use the site’s own booking system.</p> <p>Bookers were then sent a link to a convincing payment page, which suggested the payment hadn’t cleared. They then ask for a bank transfer instead.</p> <p><strong>How to protect yourself: </strong>Do your research. Google the property to see if it shows up on other reputable websites to check its authenticity. You could use Google Maps and Street View to see if the accommodation actually exists. Also, never pay by bank transfer.</p> <p><strong>2. Dodgy flight deals</strong></p> <p>Con artists have created fake airline websites that advertise budget deals on long haul flights that leave their victims high and dry.</p> <p>The UK government’s fraud agency has reported a recent surge of scams targeting those who are travelling to Asia, Africa and the Middle East.</p> <p>In many instances, tickets were purchased with stolen credit cards and then sold to unsuspecting victims, complete with a reference number.</p> <p>But tickets were then cancelled after the credit card was reported as stolen, leaving the victims out of pocket and nothing to show for it.</p> <p><strong>How to protect yourself:</strong> Book tickets through trusted agencies.</p> <p><strong>3. Wi-Fi hacks</strong></p> <p>It’s become human instinct to try and find Wi-Fi wherever you go, and the same applies when travellers land at airports.</p> <p>While it’s important to stay connected in order to get in touch with friends and family, there is a risk involved. Fraudsters have set up their own free networks in airports and use them to gain free information about anyone that logs on.</p> <p>Many passengers have been tricked into entering their credit card details before logging on.</p> <p><strong>How to protect yourself:</strong> Ask airport staff about the real Wi-Fi connection to make sure it’s the real deal and be on the lookout for connections that don’t ask for passwords straight away. Also, if you are asked for confidential information then provide fake details where possible.</p> <p><strong>4. “Free” holidays</strong></p> <p>This decade-long scam has been one that con artists have perfected throughout the years. Back in the day, people would be pressured into buying timeshares after accepting a complimentary break.</p> <p>Now, the con is conducted through scratch cards and other fake competitions.</p> <p>In one example of the scam, around 500 British travellers in Spain’s Costa del Sol have been scammed of around $27.5 million in the last year alone.</p> <p><strong>How to protect yourself:</strong> Refuse all offers of free holidays because if it’s too good to be true, then it probably is.</p> <p>Do you know of any other travel scams? Let us know in the comments below.</p> <p><strong>5. Document fraud</strong></p> <p>Over the years, the internet has seen a growth in websites selling fake travel visas and other important documents needed to visit foreign countries.</p> <p>A few cases were found to not be conducting illegal activity but were responsible for reselling documents at a huge premium compared to official channels.</p> <p>Some common examples included websites selling the European Health Insurance Card and US visa (Electronic System for Travel Authorisation, or ESTA) documents.</p> <p>While the sites looked extremely convincing, they had nothing to do with the governments of the countries they claimed to represent.</p> <p>According to Which?, out of the top 20 search results for “ESTA visa” over half were unofficial.</p> <p><strong>How to protect yourself:</strong> Follow links to official government websites through the Department of Foreign Affairs website.</p> <p><strong>6. Fake tickets</strong></p> <p>It’s no secret that music concerts and major sporting events are on top of the list of potential scams, but travellers are now falling victim to fake packages to international events and are only finding out the true worth of their ticket once they arrive in the country.</p> <p>The FIFA World Cup in Russia was one example where countless websites offered travel packages including tickets when the only tickets that were considered valid and authentic were the ones purchased directly from FIFA themselves.</p> <p>Scammers love to lure desperate fans with fake tickets, as they know the demand is high and it’s easy to trap people who are willing to go the extra mile for a ticket to their chosen event.</p> <p><strong>How to protect yourself:</strong> Make sure the tickets you are purchasing are from legitimate websites and web pages that start with “https” and have the padlock symbol in the URL bar. And if you’re on the hunt for second-hand tickets, then do a quick check if whether or not resale is allowed, as some tickets are only valid for the original buyer.</p> <p>“Criminals are finding ever more sophisticated ways to dupe holiday-makers, both in the booking process and when they’re on the holiday itself,” Which? Travel editor Rory Boland said.</p> <p>“If something seems too good to be true, it almost certainly is. Don’t hand your money over until you can be sure it’s the real deal.”</p> <p><em>Images: Getty</em></p>

Travel Trouble

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Get-rich-quick schemes, pyramids and ponzis: five signs you’re being scammed

<p><a href="https://theconversation.com/profiles/bomikazi-zeka-680577">Bomikazi Ze<em>ka</em></a><em>, <a href="https://theconversation.com/institutions/university-of-canberra-865">University of Canberra</a> and <a href="https://theconversation.com/profiles/abdul-latif-alhassan-1390159">Abdul Latif Alhassan</a>, <a href="https://theconversation.com/institutions/university-of-cape-town-691">University of Cape Town</a></em></p> <p>Consumers are under a lot of financial strain. The <a href="https://www.weforum.org/agenda/2022/09/cost-of-living-crisis-global-impact/">World Economic Forum</a> reports that the cost-of-living crisis is affecting people across the globe. With food and fuel prices rising, it’s becoming increasingly difficult to keep financially afloat. On top of that, salaries <a href="https://www.wsj.com/articles/workers-pay-globally-hasnt-kept-up-with-inflation-e6df92d">aren’t keeping up with inflation</a>, making it more difficult to save and build wealth.</p> <p>It’s during such times of economic difficulty and uncertainty that fraudsters lure unsuspecting consumers into “<a href="https://www.sabric.co.za/">get-rich-quick</a>” schemes, offering <a href="https://www.sabric.co.za/stay-safe/ponzi-pyramid-schemes/">an avenue to make easy money</a> by investing in a “lucrative” financial opportunity.</p> <p>Nothing beats the prospect of making easy money, and every now and again there seems to be a “get-rich-quick” scheme circulating on WhatsApp or on social media that seems legitimate. But it’s not.</p> <p>Our research interests centre on financial systems in emerging economies, and we advocate for financial inclusion and empowering marginalised communities through financial literacy and financial planning. We use our academic platform to share our expertise on finance, including common financial traps people should steer clear of.</p> <p>“Get-rich-quick” schemes are one such trap. They’re also sometimes called ponzi or pyramid schemes. The schemes are a form of <a href="https://www.lawinsider.com/dictionary/financial-fraud">financial fraud</a>. The people running them take money through deception: the misrepresentation of information and identity. They promise financial benefits that don’t exist.</p> <p>You should avoid them because, more often than not, they are bogus and fraudulent business ventures.</p> <p>There have been some massive fraud schemes over the past 30 years. In the early 1990s, <a href="https://www.independent.co.uk/news/world/africa/mmm-global-russian-ponzi-scheme-from-1990s-reborn-and-now-spreading-like-wildfire-in-africa-a7333366.html">MMM Global</a> - one of the world’s largest and most notorious ponzi schemes - defrauded up to 40 million people, who lost an estimated $10 billion. Ponzi schemes have since resurfaced in different forms in <a href="https://www.iol.co.za/weekend-argus/news/ponzi-scheme-investigated-as-some-victims-lost-as-much-as-r200-000-c3c3633c-2abb-4dd4-b668-a5ea608deb41">South Africa</a>, <a href="https://guardian.ng/business-services/nigerians-lose-over-n911b-to-ponzi-schemes-related-fraud-in-23-years/">Nigeria</a>, <a href="https://www.voazimbabwe.com/a/zimbabwe-money-pyramids-ponzi-schemes/6305100.html">Zimbabwe</a>, <a href="https://allafrica.com/stories/202105170964.html">Kenya</a>, <a href="https://doi.org/10.1108/JFC-09-2020-0177">Ghana</a> and several other African countries.</p> <p>There are five tell-tale signs of a “get-rich-quick” scheme. Watch out for them.</p> <h2>The five tell-tale signs</h2> <p><strong>Firstly</strong>, they offer exaggerated and above-market returns within a short period of time, with the promise of little to no risk.</p> <p>There are two golden rules when it comes to investing. The first is that it takes time to make money. Amassing a small fortune within a short space of time should raise questions about the scheme.</p> <p>The second rule is: the higher the risk, the higher the return. In other words, no investment is risk free or can guarantee significant returns. There is always some risk involved. An investment that promises substantial returns tends to be quite risky, which repels most people with a low appetite for risk.</p> <p><strong>Secondly</strong>, new members are constantly recruited to join the scheme.</p> <p>Typically, such schemes are sustained by relying on the investments of new members to pay existing members. Once the number of existing members exceeds new members, the scheme goes “belly-up”. At best you lose out on the returns you were promised. At worst you lose all the money you’ve invested.</p> <p>When the scheme collapses, it is almost impossible to recover the money you’ve lost because you’ve technically given it to a stranger (remember, the definition of financial fraud encompasses the misrepresentation of identity).</p> <p><strong>Thirdly</strong>, there is urgency to join the scheme and no clarity on how the scheme works.</p> <p>This is a classic characteristic of a “get-rich-quick” scheme. There is usually no clear answer about the nature of the scheme, what it invests in, how it generates its returns or the credentials of the organisation.</p> <p>Legitimate investments are transparent and can provide investors with all the information they need to help them decide whether to invest. Unsurprisingly, a proper check of “get-rich-quick” schemes will unmask their fraudulent nature. This is why there’s always the urgency and coercion to make an immediate financial commitment under the guise of missing a once-in-a-lifetime opportunity to get rich.</p> <p><strong>Fourthly</strong>, the scheme is not registered with or regulated by any recognised authority.</p> <p>Regulatory authorities are important because they monitor the conduct of financial service providers and protect consumers by keeping their best interests in mind. The protection provided by financial regulators also instils confidence in financial systems.</p> <p>“Get-rich-quick” schemes are not registered and operate outside the framework of regulatory bodies. This makes investors more vulnerable to loss and makes it more difficult to seek legal recourse when the loss occurs.</p> <p>Legitimate investments in South Africa are offered by authorised financial service providers and regulated by the <a href="https://www.fsca.co.za/Pages/Default.aspx">Financial Sector Conduct Authority</a>. You can search for any authorised financial service provider on the authority’s <a href="https://www.fsca.co.za/Fais/Search_FSP.htm">website</a>.</p> <p><strong>Fifthly</strong>, they use the testimonies from existing members who’ve earned big bucks to promote the scheme.</p> <p>At the initial stages, the scheme tends to pay out to those who have invested early, and these members are encouraged to share the news of their wealth (which travels fast and far) to promote the scheme.</p> <p>But this is a tactic used to create the impression that you too can earn returns in the double digits. These schemes are both unsustainable and unethical as one person gets wealthy through someone else being deceived.</p> <h2>Too good to be true</h2> <p>It’s worth repeating that if it sounds too good to be true, then it probably is.</p> <p>Wealth comes from a sound investment strategy and decisions made over time. Any promise to “get rich quick” should be treated with the cynicism it deserves. It will ultimately reveal its fraudulent nature. Recognising the signs of “get-rich-quick” schemes can save you from unnecessary financial distress.</p> <p>It’s always a good idea to do your own investigation before committing your finances into any investment. You can find more information on the various types of scams through the <a href="https://www.sabric.co.za/">South African Banking Risk Information Centre</a>’s website and report them to the <a href="https://www.safps.org.za/Home/Contact">South African Fraud Prevention Service</a>.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/205798/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /></p> <p><em><a href="https://theconversation.com/profiles/bomikazi-zeka-680577">Bomikazi Zeka</a>, Assistant Professor in Finance and Financial Planning, <a href="https://theconversation.com/institutions/university-of-canberra-865">University of Canberra</a> and <a href="https://theconversation.com/profiles/abdul-latif-alhassan-1390159">Abdul Latif Alhassan</a>, Associate Professor in Development Finance & Insurance, <a href="https://theconversation.com/institutions/university-of-cape-town-691">University of Cape Town</a></em></p> <p><em>Image credits: Getty Images</em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/get-rich-quick-schemes-pyramids-and-ponzis-five-signs-youre-being-scammed-205798">original article</a></em>.</p>

Money & Banking

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How to tell if your partner is stealing from you

<p>Financial infidelity can take many forms and it can be devastating to a relationship. From secretive purchases to hiding debts, dishonesty about income to secret investments, it can cause significant harm to both partners. If you want to avoid becoming victims of financial infidelity, it is important to communicate openly and honestly about your finances. </p> <p>Taking responsibility for your financial health is good for your wellbeing. Whether it’s being pro-active in the face of financial infidelity or recovering the damages, being aware of the common forms and red flags can help you build strategies to move forward. Here is what you need to know.</p> <p><strong>Common financial ‘secrets’ </strong></p> <p>Money lies take several forms and they all involve secrecy, for example, buying items without informing your partner, gambling or other expenses that are unaccounted for, frivolous spending on unnecessary items, not disclosing debts or loans, and lying about how much money you make or your financial situation. </p> <p>Then there are the secret bank accounts and investing money without your partner's knowledge. Your partner may be harbouring one or many of these common financial secrets, so knowing the red flags will help you bring the dishonesty to the surface.</p> <p><strong>Signs of financial infidelity</strong></p> <p>It is important to keep an eye out for signs of financial infidelity. The red flags that will call out secretive behaviour include new credit card statements or bank accounts that you know nothing about, new items appearing in your house that you didn't buy, packages not addressed to you, new passwords on financial accounts and an unwillingness to discuss money matters. </p> <p>Your partner's behaviour is also a warning. Pay close attention to reactions that don’t seem authentic and displays of paranoia about you opening the mail – especially the bank and credit card statements.</p> <p><strong>Moving beyond financial infidelity</strong></p> <p>If you suspect your partner is guilty of financial infidelity, there are simple steps to help you both move forward. First, you will need your partner to come clean. Ask, listen, and be supportive. They may be feeling embarrassed or ashamed, and fearing judgement. </p> <p>Next, get help. Consider a professional. This could be both financial and personal – by planning a way forward together, you can re-affirm your views about money and trust in your relationship. Financial infidelity can destroy trust in your partner, so you both must be willing to work towards healing the hurt and reducing the risk of future money sins.</p> <p><strong>Make money a talking point</strong></p> <p>When it comes to financial matters, maintaining honesty and trust in your relationship can be challenging. To be on the front foot, try talking about money regularly. Normalise it. For example, talk about your bank balance, who is paying what bills, what you’d like to buy and how you plan to buy it, your savings plans, how your superfund is performing. </p> <p>Set up these conversations in advance and use them as a time to check in on your money goals. You must both feel empowered to ask money questions, so the more you make money conversations the norm, the better.</p> <p><strong>Create a personal finance village </strong></p> <p>Try adding someone to your personal finance village. Consider working with an accountant or financial advisor who can independently help you and your partner to plan open discussions in a safe manner to address your financial issues. Ask their advice on enabling ‘safe’ confessions like having a no-judgement rule for raising money sins. </p> <p>Allow yourselves the opportunity to come clean on spending and work out how best to address this going forward. This offers you the freedom of being on the same page financially and working towards the same financial goals.</p> <p>Finding yourself in a situation involving financial infidelity can be utterly devastating. Of course, the best way of addressing any kind of money cheating is to know the red flags and avoid it altogether. </p> <p>However, as this is not always the case, consider getting professional advice on working towards common financial goals so you can move forward in a positive way. Remember, communication and honesty are key to a healthy and successful financial relationship. </p> <p><strong><em>Jacqui Clarke FCA, FTI, GAICD, JP, author of Stop Worrying About Money (Wiley, $29.95), is a trusted advisor, board member, executor and veteran business executive. As a personal wealth and money management expert and over three decades of experience , 25 years at Deloitte and PWC helping high-net-worth families, individuals and business owners to build, manage and preserve their wealth. Her message is simple: with careful planning and effort, you can manage your money, so it doesn’t manage you. <a href="https://www.jacquiclarke.me/">https://www.jacquiclarke.me/</a></em></strong></p> <p><em><span style="background-color: #ffffff;">Image credits: Getty </span>Images </em></p>

Money & Banking

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Don’t let financial shame be your ruin: open conversations can help ease the burden of personal deb

<p>Nearly <a href="https://www.ipsos.com/en-nz/19th-ipsos-new-zealand-issues-monitor">two-thirds of New Zealanders</a> are worried about the cost of living, and a quarter are worried about <a href="https://www.canstar.co.nz/wp-content/uploads/2023/03/Consumer-Pulse-Report-NZ-2023-Final-4.pdf">putting food on the table</a>. But the <a href="https://visionwest.org.nz/food-hardship-part-one/">shame</a> that can come with financial stress is preventing some people from seeking help. </p> <p>According to a recent survey, a third of New Zealanders were not completely truthful with their family or partners about the state of their finances, and 12% <a href="https://www.stuff.co.nz/business/money/129477493/financial-infidelity-research-finds-kiwis-hiding-debts-from-their-partners">actively hid their debt</a>. This shame and worry about money can spill over into <a href="https://www.nzherald.co.nz/bay-of-plenty-times/news/concerns-buy-now-pay-later-schemes-could-fuel-addiction-as-kiwis-spend-17b-last-year/VOV3VIDIG2MZBGJEGPMLGWDMJI/">addiction</a>, <a href="https://www.newsroom.co.nz/i-had-serious-concussion-bad-credit-and-15000-debt-abuse-survivor">violence</a> and <a href="https://corporate.dukehealth.org/news/financial-strains-significantly-raise-risk-suicide-attempts">suicide</a>. </p> <p>Considering the effect of financial stress on our wellbeing, it is clear we need to overcome the financial stigma that prevents us from getting help. We also <a href="https://www.apa.org/topics/money/family-financial-strain">owe it to our kids</a> to break the taboo around money by communicating our worries and educating them on how to manage finances better. </p> <h2>The burden of growing debt</h2> <p><a href="https://www.stuff.co.nz/business/money/300817697/mortgage-pain-homeowners-facing-repayment-hikes-of-up-to-900-a-fortnight">Ballooning mortgage repayments</a> are compounding the financial distress of many New Zealanders. At the beginning of 2023, an estimated 11.9% of home owners were behind on loan payments, with more than <a href="https://www.rnz.co.nz/news/business/485045/data-shows-430-000-new-zealanders-behind-in-credit-repayments-in-january">18,400 mortgagees in arrears</a>. </p> <div data-id="17"> </div> <p>Given the <a href="https://www.treasury.govt.nz/publications/an/an-21-01-html">majority of household wealth</a> in New Zealand is in property, our financial vulnerability is closely linked to the ebbs and flows of the <a href="https://content.knightfrank.com/research/84/documents/en/global-house-price-index-q2-2021-8422.pdf">second most overinflated property market</a> in the world. </p> <p>There are also cultural reasons for growing financial distress. Many households have taken on significant debt to “<a href="https://www.stuff.co.nz/business/7616361/Keeping-up-with-the-Joneses">keep up with the Joneses</a>” and to pursue the quintessential <a href="https://www.interest.co.nz/property/99890/westpac-commissioned-survey-suggests-many-new-zealanders-still-pine-quarter-acre">quarter-acre dream</a>. Social comparison and peer pressure act as powerful levers contributing to problem debt and over-indebtedness. </p> <p>The average household debt in New Zealand is more than <a href="https://tradingeconomics.com/new-zealand/households-debt-to-income">170% of gross household income</a>. That is higher than the United Kingdom (133%), Australia (113%) or Ireland (96%).</p> <h2>The rise of problem debt</h2> <p>And we are digging a deeper hole. Over the past year, <a href="https://www.rnz.co.nz/news/business/485045/data-shows-430-000-new-zealanders-behind-in-credit-repayments-in-january">demand for credit cards increased by 21.7%</a>. The use of personal debt such as personal loans and deferred payment schemes <a href="https://www.nzherald.co.nz/business/demand-for-personal-credit-rises-arrears-also-up-as-cost-of-living-bites/YCEM74CII5FQBPJXO3UOG4Y3GY/">is also climbing</a>. There is a real risk this debt could become problem debt. </p> <p>Problem debt can have severe and wide-reaching consequences, including <a href="https://theconversation.com/over-300-000-new-zealanders-owe-more-than-they-own-is-this-a-problem-173497">housing insecurity</a>, <a href="http://www.socialinclusion.ie/publications/documents/2011_03_07_FinancialExclusionPublication.pdf">financial exclusion</a> (the inability to access debt at affordable interest rates), <a href="https://www.tandfonline.com/doi/full/10.1080/07409710.2012.652016?journalCode=gfof20">poor food choices</a> and a plethora of <a href="https://bmcpublichealth.biomedcentral.com/articles/10.1186/1471-2458-14-489">health problems</a>. </p> <p>Yet, the hidden <a href="https://spssi.onlinelibrary.wiley.com/doi/10.1111/sipr.12074">psychological</a> and <a href="https://link.springer.com/article/10.1007/s11205-008-9286-8">social cost of financial distress</a>remains often unspoken, overlooked and underestimated.</p> <p>Even before the pandemic, <a href="https://www.scoop.co.nz/stories/BU1909/S00616/research-shows-financial-stress-impacts-mental-wellbeing.htm">69% of New Zealanders were worried</a>about money. The share of people worrying about their financial situation was higher for women (74%), and particularly women aged 18-34 (82%). It is no coincidence that the latter are particularly at risk of problem debt through so-called <a href="https://acfr.aut.ac.nz/__data/assets/pdf_file/0008/691577/Gilbert-and-Scott-Study-2-Draft-v10Sept2022.pdf">“buy now, pay later” schemes</a>. </p> <p>The stigma of financial distress extends beyond the vulnerable and the marginalised in our society. A growing number of <a href="https://www.rnz.co.nz/news/political/467417/middle-income-families-hoping-for-help-in-budget-as-rising-costs-sting">middle-class New Zealanders </a> are quietly suffering financial distress, isolated by financial stigma and the taboos around discussing money. When pressed, one in two New Zealanders would rather <a href="https://www.scoop.co.nz/stories/BU2203/S00384/research-shows-wed-rather-talk-about-politics-than-our-finances.htm">talk politics over money</a>. </p> <h2>Time to talk about money</h2> <p>Navigating financial distress and <a href="https://digitalcommons.law.seattleu.edu/cgi/viewcontent.cgi?article=2526&context=sulr">stigma</a> can feel overwhelming. Where money is a taboo subject, it may feel safer to withdraw, maintain false appearances, be secretive or shun social support. </p> <p>This tendency to avoid open discussions and suffer in silence can lead to <a href="https://loneliness.org.nz/lonely/at-home/financially-struggling/">feelings of isolation</a> and contribute to <a href="https://theconversation.com/how-financial-stress-can-affect-your-mental-health-and-5-things-that-can-help-201557">poor mental health</a>, such as depression, anxiety and emotional distress. </p> <p>Sadly, the trauma of living in financial distress can also <a href="http://irep.ntu.ac.uk/id/eprint/39442/1/1307565_Wakefield.pdf">break up families</a>. Losing the symbols of hard-gained success and facing the prospect of a reduced lifestyle can be tough. It often triggers feelings of personal failure and self doubt that deter us from taking proactive steps to talk openly and seek help. </p> <p>But what can families do to alleviate some of this distress?</p> <h2>Seek help</h2> <p>First, understand that <a href="https://www.ft.com/content/86767aac-98e0-4dae-8c5a-d3301b030703">you are not alone</a>. Over 300,000 New Zealanders <a href="https://theconversation.com/over-300-000-new-zealanders-owe-more-than-they-own-is-this-a-problem-173497">owe more than they earn</a>.</p> <p>Second, seek help. There are many services that help people work through their financial situation and formulate a plan. In the case of excessive debts, debt consolidation or <a href="https://goodshepherd.org.nz/debtsolve/">debt solution loans</a> may help reduce the overall burden and simplify your financial situation. </p> <p>For those struggling with increasing interest on their mortgages, reaching out to your bank early is critical. During the 2008 recession, banks in New Zealand <a href="https://www.beehive.govt.nz/release/banks-exchange-letters-crown-support-distressed-mortgage-borrowers">worked with customers</a> to avoid defaulting on mortgages, including reducing servicing costs, capitalising interest and moving households to interest-only loans. It is essential to understand that the <a href="https://www.stuff.co.nz/life-style/homed/real-estate/130677426/are-we-on-the-brink-of-a-wave-of-mortgagee-sales">banks do not want mortgagees to fail</a>, and that options exist.</p> <p>To help future generations avoid debt traps, we need open communication about money – also known as “<a href="https://link.springer.com/article/10.1007/s10834-020-09736-2">financial socialisation</a>”. This includes developing values, sharing knowledge and promoting behaviours that help build <a href="https://files.eric.ed.gov/fulltext/EJ1241099.pdf">financial viability and contribute to financial wellbeing</a>. </p> <p>The lessons about handling money from family and friends are crucial for <a href="https://www.frontiersin.org/articles/10.3389/fpsyg.2020.02162/full">improving our children’s financial capability</a>, helping them be <a href="https://www.fsc.org.nz/it-starts-with-action-theme/growing-financially-resilient-kids">more financially resilient</a> and better able to survive the stresses we are experiencing now – and those <a href="https://www.stuff.co.nz/business/money/300836616/heres-how-much-household-costs-are-expected-to-increase">yet to come</a>.</p> <p><em>Image credits: Getty Images</em></p> <p><em>This article originally appeared on <a href="https://theconversation.com/dont-let-financial-shame-be-your-ruin-open-conversations-can-help-ease-the-burden-of-personal-debt-202496" target="_blank" rel="noopener">The Conversation</a>. </em></p>

Retirement Income

Over 60

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