Living Financial disarray is a risk and some simple tips can help you change your behavior
If you were asked about your monthly expenses, including bills and what you use for daily life and leisure, would you know the answer? It is not easy, because for this it is necessary to have organization and control. And more: Knowing exactly how much you’re spending not only means your financial situation is up to date, it definitely helps. And it seems that the Brazilian is not doing very well in that sense. A survey by the FSB Research Institute showed that three out of ten people in the country spend more than they earn. The same survey indicated that 47% of Brazilians consider personal finances to be their biggest concern at the moment and that almost half of the population struggle with monthly bills. Only 27% said they managed to organize themselves well and have extra money.
“We can think of 3 causes of financial difficulties. The first is a situation where a person receives his salary and is already immediately committed to expenses and debts. There may be a lack of budgeting, limit setting and planning. He has disorganization, impotence. Another possibility is that the lack of control is due to more impulsive behavior, where the importance of emotions acting on money is ignored and autopilot is triggered. Finally, the person may be exercising control, without However, the salary is not enough.” He does not have enough income. Then you have to look for ways to increase revenue. And more of that: it could be a combination of all of that,” explains economist Marilyn Karamau.
In fact, the third factor mentioned by Marillian, insufficient income, is a serious problem in the country. In 2021, the average income of the Brazilian population reached its lowest value, given a historical series started in 2012 by LCA Consultores, based on data from the IBGE National Quarterly Household Sample Survey (PNAD). According to the survey, we ended 2021 with more than 33 million workers with a monthly income of one minimum wage, which at that time was R$ 1,100. They represent 36% of the total number of workers in the country and the majority have a low educational level or work in the informal sector. Given this reality and also due to the lack of financial education, it is difficult to keep up with the bills, said Pia Santos, CEO and founder of Barkus Educacional, inclusion technology and financial education for startups invested by Google.
“Unfortunately, due to the lack of basic financial education, most Brazilians have difficulties managing their finances, regardless of their social class. The problem is that people with low incomes are less likely to face financial difficulties, have a fund emergency or receive financial assistance. support from Friends and family, they are also the ones who suffer the most from financial crises, like the one we are going through, therefore, the result of this is the greatest negative impact of the lack of control and financial knowledge on the lowest. lessons”.
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If low income is related to our social and economic structure, then the other aspects pointed out by the economist Marilian Karamau, such as chaos and impulsiveness, fall more under the responsibility of each person. For these cases, some tips can make a difference and we will tell you about them below.
Lose the fear of financial control
Many people can find it boring to think about controlling expenses, even if it means being busy at the end of the month. However, when it comes to money, being in control can prevent serious problems, be it debt, loss of assets or even emotional problems, because the interest in financial life is enough to keep anyone awake.
According to a survey by SPC-Brasil, 45% of Brazilians have no control over their finances and 31% of consumers feel insecure with their own money. This is reflected in the number of people who are in debt and in default. Knowing how much you earn and spend each month is very important to make purchasing decisions and, of course, to plan short, medium and long-term goals. Therefore, everything starts with the personal and family economic organization”, warns Pia Santos.
There is even an expression that defines the behavior of people who avoid doing simple things, like checking their bank statement or keeping track of their card bill: financial phobia. This term was coined in 2003 by the British psychologist Brendan Burchill. This intense fear of managing your money can trigger physical symptoms, such as rapid heartbeat, and help snowball financial problems.
“Control over one’s financial life is not attractive to the majority of the population. Financial regulation is not associated as a habit that promotes financial sustainability and quality of life. I feel there is cultural hostility. The claim is that money is the biggest concern of Brazilians. , which is confirmed by record levels of indebtedness and delinquency. On the one hand, on the other hand, there is the idea that it is difficult and tedious to control finances. You have to understand how boring it is to spend your life in financial problems. ”, explains the economist Marilian Karamau.
So, face the problem head on now, lest you create another future.
Every account matters!
If you entered the fixed bills for the month, but you left out that snack on the street, or that cheap blouse that was on sale, you are already breaking control. It is important to think about everything, because the sum of small expenses will be greater at the end of the month.
“I plan all my expenses, even if I have a coffee on the street, I write it down. I know the total cost of living thanks to the spreadsheet. When I need to increase expenses, I put them in the spreadsheet. Let’s see if I can pay them, even if it’s in installments, and I’ll analyze the amount. “Which will continue in the budgets of the coming months”, explains the designer Camilla Ayres.
For economist Marilyn Karamau, this is the best way to take control of the situation and avoid financial stress.
“Usually we take into account our big numbers, but the small numbers are not enough. At the time of this survey, it was already an exercise in self-awareness. It is common to find inexplicable and inconsistent expenses. helping a friend or family member or a professional is essential. Then there is the challenge of continuity, because someone can reserve 5 minutes a day, half an hour a week or a few hours a month. Get in the habit of evaluating what’s being controlled, says Marillian.
Reassessment of expenses
Is the electricity bill always high? Are you paying for the gym and I can’t go? Do you have cable TV but the package offers more channels than you see? So it’s time to reevaluate. How often do we accept a planned expense each month because it may fit into the budget, but we don’t realize it goes beyond what is necessary? Being aware of the cost of living and financial control also includes paying attention to detail. Do this exercise.
How do you organize?
If you’re going to use a notebook, an Excel spreadsheet, or a financial tracking app, for example, the choice is yours. The important thing is that you can imagine what money comes in and what goes out each month. Just remember: the method must be gentle. You cannot leave the notebook at the bottom of the drawer and remember to enter the information after two months. Discipline is needed and therefore a system at hand. The important thing is not to delay in your control.
The CEO and founder of Barkus Educacional, Bia Santos, explains that they work in edtech with their own methodology called ÉRICA, which stands for Assessment, Scoring, Classification and Assessment.
These are the four steps to complete a financial regulation. This cycle occurs during the month itself: First, we estimate how much money comes in and goes out in that period. Then we record every gain or expense we have. From there, we classify these expenses to understand in which area of our lives we spend the most. Finally, we compare the estimate with what has already happened, and we evaluate what we can improve for the next month. It is a simple and intuitive method for anyone. who wants to take the first steps in financial control of his personal life”, details Pia.
Economist Marilyn Karamau also tipped. She suggests the expense matrix, which can be done on a piece of paper—just fold it into four equal parts. From now on, each piece will be a quarter of this arrangement.
“First, do a scan of all receipts. The amount actually going into the account after legal deductions, or, in the case of the self-employed, the seasonal average. Reserve quartiles 1 and 2 for fixed expenses , such as rent, condominium , health plan, education, financing and contributions typically General Divide it into mandatory and non-mandatory expenses, that is, expenses that you can live without, but that bring you well-being Leave the 3rd and 4th quarter for variable expenses , such as water, energy, market, fair, clothing and entertainment. They are also divided into mandatory and non-mandatory. In this chapter, it is already possible to Determine the proportions of income that provide for each need of life. When expenses are higher Rather than income, it’s common for people to exclude a field like entertainment, for example. But it seems that this doesn’t hold for long. By doing this separation by quarters , I can also calculate the Percentage of income committed expenses ratio, for those who have children, for example, school is a fixed and mandatory expense, I cannot eliminate it, but it does affect a large part of the income, if it really takes up space for With it free time, I need to think about alternatives”, teaches Marillian.
Am I finally in control?
Financial control not only covers all expenses without going into debt. It also says a lot about being on top of these expenses and understanding every decision you make, making it easier to plan and save. But even if you have reservations, commitment and control are essential, as the architect Camila Ayres does.
“Today I can save a little money for the reserve. It’s even values that appear in my spreadsheet. I’m currently paying myself, because I ended up using part of that reserve on a trip,” she explains.
For Bia Santos, you gain financial control when you are fully aware of how much you earn on average each month and how much you consume and spend in the same period. It is also helpful to have an idea of the categories of expenses.
According to research by Itaú Unibanco and DataFolha, half of Brazilians avoid even thinking about money so as not to feel sad. Analyzing your financial life can often be difficult, especially when we know we have significant debt or are in arrears. Therefore, it is important to get financial education at an early age, while she is still in school, before her first job. Pia concludes that developing healthy money habits, like taking control, is critical to life.