Barefoot Investor’s surprising advice to stressed Australians dealing with the ‘shock’ of the cost of living crisis: ‘Have the latte, have the glass of wine’
- Scott Pape offered new financial advice
- He said cut things you don’t love, spend on what you do
Barefoot Investor Scott Pape has shared his surprising secret to surviving the cost of living crisis.
Pape, Australia’s best-known financial advisor of 20 years, recommended cutting things you no longer need so you can spend more on what you love.
‘I would much rather cut off my leg than not have a latte,’ Pape told the Courier Mail on Saturday.
‘I find those types of money-saving tips to be demeaning and stupid… When you’re stressed you want to be able to feel like you can treat yourself a little bit.
‘If you want to have a latte and you’re a single mum and you work two jobs, f***ing have the latte and have the glass of wine.’
He said one red flag he’s noticed when talking to Aussies is many expect current high interest rates will eventually fall.
Barefoot Investor Scott Pape (above) advised Aussies to spend on the things they enjoy but ‘viciously’ cut things they don’t from their budgets
‘People don’t realise that this is potentially the new normal, interest rates will stay at these levels, if not go higher, and I think we have to adjust to that,’ he said.
‘What I try and do is say you should spend generously on the things that you love but you should viciously cut the things you don’t love.
‘I’m looking at [finding] new household insurance, car insurance, all the bank fees that I’m paying.
‘I’d be looking at all the bills I do not care about.’
Pape advised Australians to avoid making two key mistakes when reviewing their finances: considering money a ‘taboo’ topic and under-preparing for the worst.
He said one group sure to be feeling the strain with the new interest rates, which have risen 12 times in just over a year, are young people who bought a home during record-low rates in the pandemic.
‘If you find yourself stressed about money, you’re worried about being able to make your repayments and worried about interest rates, it’s when you stop talking about it with your partner, stop communicating with your banks or your lenders, that’s when bad stuff happens,’ he said.
He recommended seeking help from a financial advisor as soon as you feel your finances are getting beyond your control.
Pape said: ‘If you want to have a latte, and you’re a single mum and you work two jobs, f***ing have the latte and have the glass of wine’
‘Financial counsellors are people who will stand beside you, negotiate with your banks and get you back on your feet,’ he said.
He added keeping people closest to you, like your partner, in the loop is essential.
‘I want to make sure you have got your bases covered, and if you don’t, the best thing you can do is either see a financial counsellor or go on a date night and start getting the plan in place,’ he said.
