Stubbornness

I love my kids. They’re awesome. While I’m sure your kids are great an’ all, mine are way cooler. The best toys in the solar system.

They’re a million times sweeter than my Swans beating my editor’s Eagles in 2005. Filled with even more love than my wedding day (sorry, Mrs DebtMan). A bigger adrenaline rush than bidding on my first home. More satisfying than making my first BILLION (waiting, waiting, waiting …)

However, as much as I love them, there is something about DebtBoy,  and DebtGirl, that I definitely do not love. Meal times.

Stubborn little buggers! Every night they compete to be the first to pop a vein in Daddy’s head with the worst behavior. Occasionally, both of them claim dibs.

Stubbornness, belligerence, obstinence, call it what you like, is a disease that kicks in around age 2, says the child-raising pyscho-babble. In kids, the symptoms include foot stamping, eye frowning, screaming and general carrying on like a pork chop.

Worst possible outcome? A smack. Maybe two. Pain for a minute.

But the stubborn gene mutates over the years. And like chicken pox, the symptoms are far worse in adulthood.

In adults, the symptoms include refusal to change opinion no matter the evidence against you, pointless screaming matches with colleagues or lovers, nights sleeping on the couch and general carrying on like a pork chop.

However, the outcomes have near unlimited downside. Loss of relationship. Loss of money. Loss of job. Loss of business. Possibly pain for a lifetime.

Financially, stubbornness is steadfastly continuing to do something that isn’t working. It’s hearing a solution to your problem, but not acting. It’s doing something “the way it’s always been done”, even if technology means that you can do it eight times faster for a poofteenth of the cost.

It’s refusing to part with $100 that will make you $1000 (and I’m not talking about 10/1 odds at the track). It’s insisting on doing something that you clearly don’t have the skill set to do competently.

It’s amazing how obstinate people can be with their money. Some reckon they know better. Others arrogantly don’t care.

Here are my top seven financial mistakes that keep people poor and how much it costs them.

Cars: Buying expensive wheels as a status symbol puts you at the top of the class in stubbornness. Cars depreciate. Rapidly – about 30 per cent when you drive it off the lot. The average extra cost of buying a $60,000 car over a $30,000 car is about $15,000 a year. For most, cars aren’t tax deductible either.

Affluenza: Living big. Spending more than you earn. If there’s no money spare each week/month and your debts growing, you have to start a budget. (For a useful free budgeting calculator, download the budget planner top right at www.debtman.com.au.)

Credit cards: They only make sense if you pay them off in full each month. If you only pay the minimum, make purchases just to get points, pay high interest, then you’re doing a Michael Jackson moonwalk. Your lifestyle looks impressive, but you’re going backwards.

Tax: Accounting fees are tax deductible. Most accountants will do your tax return in an hour. You will do it badly in 10 hours. Would you seriously not spend $200 to make $2000? Maybe a bit pig-headed?

Investing badly: Dud stocks recommended by mates. Property that will never grow in value. One bad investment could not only cost you tens of thousands, but can scare you off investing for life. Keep it simple – quality shares and property. Stop guessing. Get professional help.

Super: If you don’t care enough about your super to have it working for you, have never consolidated your many accounts, then I advise you and your stubbornness to enjoy living on the government age pension of $255 a week.

Insurance: If you hate paying for insurance, you’re not Robinson Crusoe. But if you don’t have insurance, then I hope you have faith in a god and that your god is fond of you. Lives that aren’t struck, at some stage, by accident, robbery or long-term illness are rare. The consequences can be financial devastation.

Don’t be stubborn. When a child gets a smack, the pain lasts a minute. But your financial stubbornness will last the rest of your POOR, miserable, life.

Bruce Brammall is the author of Debt Man Walking (www.debtman.com.au) and a licensed financial adviser. bruce@debtman.com.au .