Welcome to my newsletter “Behind the Numbers”.

A fortnightly newsletter where I share tips for Budget Owners on how to run your budget more effectively. I may also share an interesting sporting stat along the way.

For those of you who know my story you’ll get why numbers and sport are so much part of who I am.

Own Your Budget – What’s really going on here?

“Our costs are out of control”

This is how a coaching client of mine started a conversation recently. They had just received their budget report for the month. And their department was spending a lot more than what was in their budget.

As a budget owner, you might think that things are out of control. But it’s never as simple as that.

Let me explain using an example.

“Interest rates are the killer for household budgets at the moment”

This was a claim recently made by the Australian Treasurer, Jim Chalmers. But, is it as simple as that? How much impact is the cost of living (inflation) having on the household budget?

Prices have gone up more than average incomes over the last year. As a result, household spending power was reduced by 4.5%

That’s nearly three times the impact of interest rates.

What’s really going on here, is that inflation has been the killer for household budgets over the past year. Not interest rates.

The next time you are asked to explain your budget numbers, use the “What’s really going on here approach”.

Here are a couple of questions to ask:

Compared to what?

What time frame are we looking at? (Monthly? Quarterly? Yearly?)

These questions will help you focus on the real challenge.

Own your budget so it doesn’t own you.

PS: Would you like to see more WRGOH (What’s really going on here?) in future newsletters? Let me know here.

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