Finder makes money from featured partners, but editorial opinions are our own.

From financial stress to success in 2 simple steps


These tips from finance expert and author Noel Whittaker could help keep your silly season spending under control.

Despite the record low interest rates and effective tax cuts in the form of tax offsets, almost 50% of Australians are living from payday to payday. When that is the case, there is a big risk that you won't be able to pay your bills as they come in or deal with unexpected costs.

The resulting financial stress can affect every aspect of your work and family life – and this will only get worse as we approach the Christmas period, when overspending becomes rife.

This will be followed by a host of new year's resolutions. But for most people, these will be just a dim memory by the end of January, due to credit card statements that contain the deadly combination of Christmas expenses and school fees.

These types of experiences have had an influence on my own work, particularly while updating the new edition of Making Money Made Simple. It's a book that has been a major seller for more than 30 years but, since writing the first edition in 1987, I have discovered the information is of little use without an action plan.

One of the key factors that makes the new edition of Making Money Made Simple different to the previous ones is my focus on two points that will almost guarantee financial success for anybody.

The first is to stop using credit cards and use debit cards instead. Credit cards are like warm salted cashews: once you get the taste you just keep on going. Let's face it, the main reason most people get into financial strife is living beyond their means – and for many people that means they use a credit card just to get by.

Think about it: if you cannot pay the full balance off your credit card each month, you are paying unnecessary interest, probably at around 20%, and are also not living within your means.

The problem with relying on credit cards is that even the minimum payment comes out of your future earnings, which makes living within your means even more difficult. You then rack up more debt on the credit card, and the situation gets worse and worse and quickly you find yourself on the debt treadmill. And once you're on that road it's hard to get off it.

Some people argue that they use credit cards to get points. I have no trouble with that if you are paying your card in full every month and living within your means – but you are a minority.

Also, the reality is that the value of points can be debased, and the only effective way to use them is for flights. But flights can be hard to get especially when the holiday season comes around.

I can guarantee you two things with credit cards. Unless you are extremely disciplined, which puts you in 5% of the population, the balance at the end of each month will be more than you thought it was going to be. Furthermore, spending money on a credit card feels different to spending real money.

It's the opposite with cash. Recently I withdrew some money from an ATM and happened to get a $100 bill in the cash out. It looked brand spanking new, but given that the signature on the note belonged to Ken Henry I reckon the note had been in circulation for a long time – it's been eight years since he left the role of Secretary to the Treasury. But can you believe I can't bear the thought of spending it?

This is in total contrast to using a credit card. I can swipe a credit card and spend $100 or more without blinking an eye. A debit card usually falls somewhere between credit and cash, because when you check your balance, you know it's your hard-earned money that has been spent.

So, the first essential is to get rid of the credit card. The other essential is to get some sort of financial buddy. This could be a partner, workmate, parent, child or anybody else with whom you relate well and who has a common goal with you to be financially successful.

Once you free yourself from the tyranny of the credit card and start having regular goal-setting meetings with a person who shares your values, you'll be amazed how quickly you will start to speed down the road to financial success. Remember, more than 50% of Australians suffer from financial problems and stress. You don't need to be among them.

Noel Whittaker AM is an author, finance and investment expert, radio broadcaster, newspaper columnist and public speaker on personal finance. He is currently an adjunct professor and executive-in-residence with the Queensland University of Technology, as well as a committee member advising the Australian Securities and Investment Commission. His best-selling book Making Money Made Simple is available at or your favourite bookstore.

Disclaimer: The views and opinions expressed in this article (which may be subject to change without notice) are solely those of the author and do not necessarily reflect those of Finder and its employees. The information contained in this article is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice or recommendation of any sort. Neither the author nor Finder have taken into account your personal circumstances. You should seek professional advice before making any further decisions based on this information.

Read more Finder X columns

Image credit: Getty Images, supplied

Ask a Question

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms Of Service and Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site