Money money money

I saw an ad yesterday on one of the channels I never normally watch. It was about money. Having money seems to affect love, freedom, security and power. Funny, that. This ad was from Suncorp. Their “Money profile” includes:

• Love - retail therapy, generous gift giving and gestures of love and affection
• Freedom - long to be free from the routine and restrictions of a paid job so they can pursue their whims and interests 
• Security - impressively organised money habits and serious attitude toward finances
• Power - confidence and strong drive to succeed 

How does this happen? Do you have to work to get to any of these? What about if you're in poverty? Don't laugh at me.... too many people in this country are there.

The trouble I saw with this ad is that it's never intended for people in poverty. It's intended for those who work and earn a lot and can spend wherever they want to. Retail, whims. Those words are in their explanation.

How I dream about it! I would love to spend. I would love to shout myself a brand new expensive white shirt with a lovely collar – rather than inexpensive second hand. I would love to have my hair cut every 4 or 6 weeks - rather than every 3 months. I would love to go for a holiday every year, out of this country – rather than staying home, shut in my unit. I would love to eat out at a nice restaurant – rather than buying an unfilled breadroll on my fortnightly payday. But I can't change. I lost my employment income four years ago. I had brain aneurysm surgery, my heart stopped and the stroke happened when they got it going again. I didn't ask for any of that!

So how do any banks (with very well paid employees) help anyone on DSP, Newstart, single parents benefit, pension or any of the other incomes through Centrelink? What happens if a person is made redundant and can't find another job so ends up on Newstart – a lot less than they had ever earned? Do they still use a bank account? Oh yes, I know they do – because that's how Centrelink would pay them. But on payday most of their Centrelink income is spent on what they can't control: rent or mortgage, food and personal accessories, car petrol or train tickets. Many people cancel insurance because they can no longer afford it, unless they get help to pay it. Some will lose their home, because the Centrelink income will never meet the mortgage payments they met when they were actually employed. Really employed.

Sometimes, now, I'm really glad that I no longer have young kids. I was a single parent through most of their lives. I worked, and all my income went onto setting them up for their future. That was back in the 1980s and 1990s – not as bad as nowadays.

An article in the UK Telegraph in 2009, titled “Does banking contribute to the good of society?”, said “This distinction between creative and distributive goes some way to explaining why the financial sector has become so large in relation to GDP – and why those working in it get paid so much.” This is UK, yes, but it's very similar to Australia. And this government allows banks to not pay tax. 

I looked through Aussie pages for how a beneficiary could get funds to buy a house. Home Loan Experts said “Not all lenders will accept government benefits as supplementary income when assessing your home loan application.” How does that work for those who had a mortgage and have been made redundant? And if you're FTB, maybe you qualify for a loan... just maybe.

In May 2017 Finder presented an article titled “Don't let the pension get in the way of getting a loan” and yet their first paragraph said: “When you receive Centrelink payments, whether it's a carer's allowance, the disability pension or another type, you might find it difficult to access credit.” That's not a “pension” - it's Centrelink benefits. Another page (October 2016) was titled “Business loans for Centrelink recipients” and “Don't let Centrelink stand in the way of a business idea.” It seems that there are many ideas – Centrelink ideas – on this website.

I found a page which looked at disabled pension benefits, and asked “Am I eligible for a home loan if I'm on a disability pension?” It seems that lenders probably won't consider you unless the “amount of income support you receive is sufficient for you to comfortably repay the loan.” What purchase price? What deposit? About the deposit, they said: “Generally, a person on a disability pension will need to come up with a 20% deposit. This is because there is no other salary or other source of income that can be used to service the loan- there is little security should you default on your loan.” 20% deposit on property of, say $350,000, would be $70,000. I can't find that.

I went into the contact page and found the following info about Finder: “Hive Empire Pty Ltd (trading as finder.com.au, ABN: 18 118 785 121) provides factual information, general advice and services on financial products as a Corporate Authorised Representative (432664) of Advice Evolution Pty Ltd AFSL 342880.” Their website has a few pics which show pretty much all the staff are young. As a pensioner I don't think they would really help me, but maybe I should “find out”.

Google “government home loans for pensioners” - there are a lot of pages that you might have to look through if you think you're eligible. Me? I'm not eligible unless I could buy a first home – a cheap one – and maybe get in someone to share with me. Perhaps rental is better for me.

Onwards... Wikipaedia says that microfinance is “a source of financial services for entrepreneurs and small businesses lacking access to banking and related services”.

Good Shepherd Finance was the first website I came on. I had already had contact with them before I went into hospital. I had supported a couple of projects through them, and the people had some wins. Well done to them! These days I can't afford to support anyone, but I'd love it if there were any people on here to support me! I have three books waiting to be printed. I'd need someone to help pay for the printing, market them and share with me. Anyone?

Good Shepherd provides NILS funds from $300 to $1200 and say that to be eligible “you must have a healthcare or pension card, earn under $45,000, have lived in your current residence for three months, and have a willingness and capacity to repay the loan. There are no credit checks.” There is a related NILS page – read it.

Thrive supports refugees to work towards becoming new Australians by settling into their communities. Thrive CEO Mahir Momand says microfinance is helping: good on them. I've only been a citizen for 16 months but I doubt if I could get any help from them. 

I looked through an RBA report from 2006 titled “The Structure of the Australian Financial System” and another from University of WA from 2010 titled “Reserve Bank Of Australia, The Role Of Finance”. The first report said that Australia went away from owning any banks in 2001 and looks at how it's now set up. The graph show the difference between 1980s and 2005.

Glenn Stevens, who introduced his paper as a discussion for the Shann Memorial Lecture, said “We tend to think of financial activity and innovation as very recent, but in fact the history is a long one... almost as old as civilisation itself.” 

He looked through the history, and spoke about how Australia had changed in the 1980s and 1990s, “allowing banks to compete vigorously for all lines of business and allowing pricing to be driven by market forces.” He said that “Total assets of financial institutions relative to the size of the economy have increased from the equivalent of around 100 per cent of annual GDP in the early 1980s to almost 350 per cent in recent years.” His graph shows very similar features. These are necessary reads. Please do so if you have a bit of time!

So, where have I gone? I started talking about the ad I'd seen from Suncorp, went through some home funding websites and microfinance websites, and on to RBA reports comparing our banking between the 1980s and 2000s. Perhaps this doesn't answer any question I had in my head, but I still think of them.

Many people on benefits didn't choose to be there, but now in poverty and with no funds to move up they can't choose what they would prefer.

Who will loan funds to beneficiaries? Who will help beneficiaries get off poverty? Who will support you if you want to advance?

I'm still waiting for answers.