Homeless mums are the dark side of the housing crisis

A mum-to-be who needs to find $2200 in seven days to avoid eviction represents the dark side of the housing crisis but Barefoot says there are long-term solutions political leaders could explore.

Scott Pape is The Barefoot Investor. Supplied

Happy Mother’s Day!

Today is an opportunity to celebrate our wonderful mums.

So, here’s a message from a mum-to-be that came in via the National Debt Helpline:

“I have a baby due in roughly eight weeks and am a month-and-a-half behind on the rent. I just received an eviction notice and have to be out of the property by the 10th day of this month. I’ve explored every avenue but have no way to get the funds ($2200 in seven days). I get $900 a fortnight, of which $800 goes to rent, and if I get evicted I have no chance of getting any accommodation with my newborn. I really need some advice or help.”

Heavy, huh?

Welcome to the dark side of the housing crisis.

Right now the national rental vacancy rate is a shocking 1% – the tightest on record – and rent prices have increased by a staggering 9% year on year, according to CoreLogic.

This explains why Albo and ScoMo are bending over backwards to appear to be tackling housing affordability – often with shoddy-but-shiny short-term policies, like getting low-income single parents into houses with a 2% deposit (just as interest rates take off!).

However, a much larger solution – with a much larger long-term economic payoff – would come from providing safe social housing for mothers and mothers-to-be, who shockingly make up around half of our homeless population.

Homeless mums are the darkside of the housing crisis.

“If a community values its children it must cherish their parents,” said famous psychologist John Bowlby.

I’d go further.

As a society we protect our children … so it stands we must also protect their mothers.

Tread Your Own Path!

P.S. Financial counsellors are the people who are standing up for the mother-to-be above – and for free! That’s why I proudly donate 10% of my Barefoot Investor book royalties to the not-for-profit Financial Counselling Foundation. They need our help so they can keep helping others. You can donate here: www.financialcounsellingfoundation.org

It’s 3:38am and I’m Crazy Scared

Dear Barefoot,

It’s 3:38am and I’m wide awake and crazy scared. I either need a script for melatonin to help me sleep or some reassurance on rising interest rates. Last year we fixed our rate at 1.99% for three years, as we were two babies deep and trying to get on top of our ridiculous spending habits. What’s concerning me is that our fixed term will soon end, interest rates will be a bajillion per cent higher, and we won’t even get a look-in to refinance elsewhere due to said spending habits and excessive debt. This will leave us with no option but to stay on with a huge mortgage repayment which will ultimately leave our little family out on the street.

Nicole

Hi Nicole,

Philip Lowe (the bespectacled central banker) is giving you nightmares? He’s like the evil interest rate monster who has come out of the closet for the first time in 11 years. Wah-hah-ha!

Seriously, Nicole, you have a choice. You can stay up tossing and turning and dreaming of scary central bankers, or you can actually do something about it.

The fact is that you and your husband can choose to get on top of your ‘ridiculous spending habits’ and ‘excessive debts’ tomorrow. The clock is ticking, so book in a Date Night together this weekend and get going. To refinance and get a better rate you’ll need to have at least a 20% equity. Make that your two-year goal, and sleep soundly.

Help! My Teenager Refuses to Work

Hi Scott,

My 13-year-old daughter wants an increase in her allowance, which is $35 per week. Yet she refuses to do any chores. She currently spends the allowance frivolously on tokens in the online games she plays. I run my own business so this grates on my nerves. I’ve suggested she try investing or saving her funds, but she refuses to take this on board. Any suggestions?

Terry

Hi Terry,

How about ‘no’?

‘No’ can be a complete sentence!

In fact, I’d go further and cut her allowance down to … zero! (Which is super-easy for me to say, since I don’t have to live with her, or hear the slamming doors.)

Don’t give kids a warped understanding of how the world really works.

Look, it’s a kid’s job to push boundaries, and she’s walked straight into this one. So why not explain that you’re wanting to treat her like a grown-up … and that when you’re a grown-up you don’t get paid unless you work!

Terry, there are plenty of adults I know whose parents never had the backbone to stand up to them. They come to me in their 40s complaining how the world is against them and that it’s so unfair. You don’t want to enable this behaviour. If you give into it, you’ll do long-term damage by giving her a warped understanding of how the world really works.

Go on, Terry, slam the damn door!

The Bounty Hunter

Hi Scott,

My dad – who’s in his late 60s – recently received a letter from a group called Investafind. They say they have found an ‘unclaimed’ asset that my dad is potentially the rightful owner of. And they’ll tell him what it is, claim it on his behalf and pass on the asset to him. Apparently it’s worth $20,000, and they will pass on $16,000 to him for finding it (i.e. take a cheeky $4000 slice for themselves). Is this legal?

Dom

G’day Dom,

Yes it’s legal, but I’d still tell them to bugger off.

Instead, send your old man over to the Government’s MoneySmart website and have him do an ‘unclaimed money search’ for free. If it doesn’t pop up immediately, the website also has links to the ATO (for lost super via MyGov) and state government searches for deceased estates, lost share dividends, salaries, wages, cheques, overpayments, proceeds of sale and more. There’s also a link to Services Australia, where he can make sure he’s getting the Medicare benefits he’s entitled to.

Here’s the address: moneysmart.gov.au/find-unclaimed-money

It’s the easiest four grand he’ll ever make.

There’s a Community Behind You

Hello Scott,

I tried to convince my husband to read your book and for us to start your Date Nights, but to no avail. So I kind of gave up. And then two months ago he passed away, leaving me with a massive mortgage, not much Mojo, virtually no super, no life insurance, a massive tax issue – and a broken heart. Since then I have set up my buckets, and made my kids do it too. We now have Date Nights together. I go to bed crying while reading your book – simplifying my life is so very complex at the moment. I’ve just turned 50 and am feeling very deflated most days, but you and your column are helping keep my chin up.

Sandra

Hi Sandra

I’m really sorry for your loss.

Often I counsel widows not to make major financial decisions in the first 12 months … and give themselves time to grieve. Yet in your case I think you should start going through the Barefoot steps. It’ll build your confidence, day by day. And next Mother’s Day I want you to write back and let the entire Barefoot community know how you’re going. You Got This.

Information and opinions provided in this column are general in nature and have been prepared for educational purposes only. Always seek personal financial advice tailored to your specific needs before making financial and investment decisions

The Barefoot Investor for Families: The Only Kids’ Money Guide You’ll Ever Need

(HarperCollins) RRP $29.99

If you have a money question, email [e-mail].

Originally published as Homeless mums are the dark side of the housing crisis