Donate
Articles & Tools

Expenses and income: What is your real situation?

The amount of information stored by our brains is staggering. Names, prices, to-dos, and countless other pieces of information. Therefore, it is very surprising to discover that most Israelis do not know what their average monthly income is and how much they spend per month. Many explanations have been given for the phenomenon, from information overload in modern society, through the complexity of the numbers to the sum, to the common “ostrich method” for ignoring uncomfortable tasks.

Ignorance of the situation does not exempt from punishment

In our experience, there are considerable gaps between what families and individuals think they are putting in and spending and what is happening in reality. Many families are aware that they do not know their actual financial situation, but even among families who believe they do know their financial situation, there are considerable gaps between the family’s assessment and actual situation.

For example, among the families we accompanied in 2013, the gap in average monthly expenses between what the families estimated as their expenses and actual expenses was about NIS 3,400 on average.

It is clear to all that making economic decisions based on misinformation can lead to disastrous consequences. Understanding the real situation in depth is critical for those interested in controlling their financial situation and making the right decisions.

“Will it be okay”? Not if you don’t cause it

True, the economic situation in the country is not always easy, prices are high, the regulator does not regulate what it needs to regulate, the banks encourage the consumption of more and more loans and there is always someone to blame.

But let’s put aside the external factors for a moment and talk about ourselves. Many of us choose to live comfortably on the assumption that “it’s going to be okay.” We often rely on bonuses and future gifts, love to live “in the here and now”, and most importantly: are used to living in overdraft because this is how everyone lives and that “there is no choice”.

Our surveys revealed that families believe that an additional NIS 2,000 to their monthly income will bring them economic balance. What is interesting is that there is no connection between what these families earn and the amount they think they lack.

The “good life” has another less pleasant side. Such behavior sometimes leads to the feeling that we have no control over what

enters the bank account or what comes out of it

, and creates a feeling that the money we earned through hard work is “gone”. Without realizing it, we get used to living in overdraft and occasionally take out a loan to cover it. The result can be devastating: debts from which it is difficult to recover.

So whether you think you know what your financial situation is or you don’t, taking responsibility for your finances starts with understanding your real situation.

 

Test Yourself: How You Are Managing Financially”

For mirroring preparation

עיצוב ללא שם (22)

What the bank must tell you

לפרטים נוספים What the bank must tell you
עיצוב ללא שם (12)

Elevating the Professionalism of Paamonim’s Support System

לפרטים נוספים Elevating the Professionalism of Paamonim’s Support System
עיצוב ללא שם (13)

Read about Liraz and Avi’s experience with Paamonim

לפרטים נוספים Read about Liraz and Avi’s experience with Paamonim
ad0a8c0a908f0462362b0aaee0a807c8

“After the holidays”- Everything takes on a fresh start

לפרטים נוספים “After the holidays”- Everything takes on a fresh start
Skip to content