Don't sweat the small stuff
Posted by Faith, 10 April 2010
It’s hard to focus on what’s really important when we let tiny details distract us.
Take the case of Celia, who met with me to discuss a proposed house purchase. She lived near the sea but without a sea view. She’d always hankered for ocean views and she’d spotted a house for sale with a perfect view in the next street.
I asked her what else she liked about the house. She deflected this by saying that she’d come to discuss her concerns over affordability.
“Tell me what’s on your mind”, I said.
Celia took a deep breath and leaned forward as she confided, “The view makes the property more expensive and I’m not sure if we can afford the rates.”
I waited, expecting her to also talk about the cost of the house, how much bigger the mortgage would be and whether the house had big maintenance issues, or would need renovating to suit her needs.
But she only heaved a long sigh and wearily sank back in her chair.
I asked, “How much more are the rates when compared with your current property?”
“Jack, my husband, says its $1,000.”
“A quarter? A year?”
“I don’t know. It could even be $1000 per week!”
“I’d be very surprised if it was that much. You could check with the council or the real estate agent. Information about rates is publicly available.”
“Jack does all that stuff.”
I asked, “Will the mortgage be substantially bigger than what you pay now?”
“Oh no, that won’t be a problem. You see we’ve just come into an inheritance. Jack says there’s enough to pay for all of the up front and moving costs, plus pay a huge chunk off the new house. Our mortgage won’t increase at all.”
“Sounds like the inheritance was quite big. Is this how you want to spend it all? I mean, apart from the view, is this house what you really want?”
Celia gave me an odd look. “This is what I’ve always wanted. I just don’t want the rates that go with it.”
I was puzzled. In terms of the money involved, the rates seemed a minor importance.
“What about your jobs? Are they safe in this economic environment?”
“Jack and I both have good jobs and they seem secure.”
“Have you found it hard to make ends meet?”
“Jack pays the bills, but he tells me we don’t have much left over each month. Oh Faith, I’ve always wanted a sea view. What do I do?”
I didn’t know what to suggest. I was ‘flying blind’, as Celia couldn’t give me the right information.
“Do you know how much you have left over each month?”
“No, but Jack says it is tight.”
I would like to meet this Jack, I thought.
Finally I asked, “Have you thought of asking Jack about all of this.”
“He’s so busy that I don’t want to bother him.”
“But, Celia you are entitled to know and I can’t really help you unless you can tell me more.”
She bit her lip and then repeated her statement that Jack was probably too busy. Sadly, I couldn’t assist her any further and she left my office.
However, she phoned me a few days later.
She said, “Faith, I feel such a fool.”
“What’s happened?”
“I got so stressed out over the size of the rates that couldn’t sleep and then I couldn’t think properly. I didn’t want to worry Jack with my silly thoughts and in the meantime the poor guy was worried sick that there was something-major wrong with me – like a terrible illness or that I was going to leave him. It turns out that the rates are only $1000 per year more, not per month. That’s only $20 per week extra. I don’t know why I simply didn’t ask him.”
“Well, they say that buying or selling a home is very stressful and it’s easy to become irrational in the process. Perhaps there were other things troubling you about the purchase of this house?”
“You’re right about that, Faith. In fact, Jack and I had a good talk once he’d learned of my worries about the rates. We’ve decided we need to think more clearly about this inheritance. Jack thought the only thing I really wanted was a sea view and therefore we should buy the house. But, remember when you asked me about whether I wanted to spend the entire inheritance on the house?”
I murmured an assent.
“Well, that got me thinking. I realise now that, while a view would be lovely to have, we were about to sink all of our money into just that one thing, without considering anything else. There are other things that are more important to us. We’d like to start a family and the inheritance money will help our finances so I could stay at home longer with the kids. We’re unlikely to get another inheritance and certainly not such a large one, so we need to stop and think about the best options.”
Especially if they were finding it hard to balance their bills each month, I thought.
Celia added, “I also want to learn more about how our finances work, but don’t want Jack to think I don’t trust him.”
Out loud, I said, “Why don’t you both come and see me together.”
I arranged a mutually convenient time and began my preparations for that appointment.
I thought about Celia’s stress over the rates. On the surface, her concerns appeared to be an over-reaction. However, they were masking the really big issue lurking underneath – whether they were using their inheritance wisely.
The brain is an amazing organ and it tries to help us in logical ways. But, thinking is coloured by our attitudes, experiences and conditioning from our childhood, such as how we resolve conflict in our relationships. Celia probably respects and loves her husband Jack, and in the past was happy to let him handle the household’s finances. However, the proposed house purchase made her realise she wanted more of a say, but she didn’t know how to address that in case Jack wrongly perceived her behaviour as lack of trust. Hence, her brain went into a sort of loop.
There is a lot of truth in popular saying: Don’t sweat the small stuff and, if you find that you’re fussing over little things then stop and rethink. Your stress could be masking reality. You need to find out what’s really bugging you and what the best solution is.
My discussion with Celia and Jack would start with what they each really wanted from life and then how to build those goals into a budget that they could work on together. Regular review sessions with me would keep them on track with these 6 steps to their financial freedom:
- Plan your life - Ready, Set, Goal!
- Make the most of what you've got - Make it, Save it, Spend it.
- Protect what you can’t afford to lose - Cover the “What ifs”.
- Manage your debt - Swim, Don't Sink.
- Grow your money - Make Dreams Real (including a house with sea views)
- Secure your retirement - Plan to Work Less (or not at all).
Find out more
-
What's holding you back?
http://www.keepingthefaith.co.nz/financial_planning_faith_blog_040210.cfm
-
Five questions to change your life
http://www.keepingthefaith.co.nz/financial_planning_faith_blog_111109.cfm -
The rule of happiness
http://www.keepingthefaith.co.nz/financial_planning_faith_blog_280809.cfm
Buy my new book Faith Speaks Money Talks to discover how to:
- Buy property with confidence and without going broke
- Handle the big money decisions with ease
- Decide what is important to you
- Get a better life with the 7-week money challenge
- Smash the spending habit so you have more money for what you really want
- Stop money pouring out of your life
- Make the most of KiwiSaver
See previous blogs:
Don't sweat the small stuff.
Can you grow a money tree?
What's holding you back?
Money or your life - which has more value?
The seven secret thieves
Five questions to change your life
Find that spark
Switching lives - what would you choose?
Who can I trust to help grow my money?
How to swim in a sea of money
Life can be unfair
The rule of happiness
No way to live
Anyone can be good with money
Best ways to warm up winter
Who wants to be a millionaire?
The secret of wealth
Keeping your money safe
Having it all
Win an all-expenses-paid trip for two to Europe (Part 3)
Win an all-expenses-paid trip for two to Europe (Part 2)
Win an all-expenses-paid trip for two to Europe (Part 1)
Make a change for good
A recipe for a happy Christmas
Nothing else matters
Rage, rage against the dying of the light
Make a wish come true
Buying or Selling a House – Those that care least, usually succeed
When is a good time to buy a house?
Sleepless Nights in a War Zone
Transitions - more life or more of the “same old, same old” boring stuff?