Feat-Mikal Howard, Morgage Broker

Foreward by Mikal Howard of Mikal Howard Finance

Looks like Covid-19 is changing the way we spend.  ATM withdrawals this past quarter are down 12% from November levels across all income brackets.  Have you noticed this in your own spending?  Are you using your card more rather than cash or have you fallen into the Buy Now Pay Later (BNPL) schemes category?

On average, the BNPL schemes are up 22% across all income levels.  This is not good in my opinion.

Using your card (and cash when deemed Covid clean) is still OK, but please rethink BNPL as an option if you want to be borrower ready.

According to Afterpay, the top categories during the Covid-19 crisis are:

✅ Beauty – skincare and home pampering.
✅ Home office equipment and furniture.
✅ Sportswear and leisurewear.
✅ Homewares.
✅ Department Stores – Toys, games and books for kids.
✅ Footwear – athletic.

I was pretty shocked to see this.  The ones I have starred, if you are looking to do any sort of borrowing, you need to avoid putting these items on BNPL schemes.  They are purely discretionary and if you cannot afford to pay for them outright, do not use Afterpay.  There could be a small argument for the other two if they are big-ticket items and they are “needed” rather than “wanted,” but even then, lenders may not view this type of spending favourably.  They do not like the BNPL schemes.

Something to definitely keep in mind when getting borrower ready….

A better mindset is to always save the money and spend it rather than want the items now and then worry about finding the money to pay afterwards.  Who knows, having to save for it might make you realise you didn’t need the item anyway!

*Stats provided by Illion & AlphaBeta (part of Accenture). Based on a sample of the transactions of c. 250,000 Australia consumers.


Cash is no longer king?  I call “bullshit,” politely!

The media are continuing with an agenda of brainwashing consumers towards a cashless society by telling us that ATM withdrawals are down.  Of course they are!  How many places are accepting cash right now?  Not many, in fact, we are being forced to use tap and go payments as cash has been “banned” in some instances across many stores, despite the fact that cash is king and it is LEGAL TENDER!  Additionally, you cannot get COVID-19 from handling money!  Please just wash your hands…

A lot of people right now have been forced to adapt to card only purchases.  For Alyssa and I we have chosen to utilise debit card purchases too.  Why?  Well, because our credit union has restricted their timelines, restricted their hours, closed Saturdays altogether, and restricted people allowed in branch at any-one time, meaning their service levels have been detrimental to their members.

It has become so much harder to get cash in denominations smaller than $50 and $20.  Alyssa Mates, my wife, and arguably better half is an avid fan of cash and loves utilising $5 and $10 notes as part of her weekly budget.  As ATM’s do not dispense these denominations, it prevents Alyssa from running a cash budget.  So for now, and the immediate future, we have a debit strategy in place.  Please don’t get me started on the proposition of “digital footprint,” where every transaction a consumer makes is recorded on your bank statement, and lenders are able to forensically go over your statements when you apply to borrow money.  By using Debit Card purchases we are giving away our freedoms and handing over so much of our information to lenders which has the potential to be used against us, when applying for finance.  For many consumers, having every single purchase tracked and recorded on your statement is not a good position to be in when it comes to applying for finance!

BNPL, in the opinion of Adelaide Budgeting is never a good idea as we deem it as predatory credit at its finest.  “Trendy” consumer behaviour shows desperation amongst consumers who either cannot afford the item, or choose to use this platform and keep cash for other items.  BNPL presents many challenges for brokers/lenders and for consumers who want to be borrower ready going forward.

With so many people losing their jobs amongst COVID-19, delays in getting financial support within the first 4 weeks of COVID-19 striking, Australians having very little in savings (with many in already high debt positions), its no wonder people are reaching out for BNPL services.  They have no other option!  No job, no money, high debt, no cash…. BNPL is the only option for many Australians.

What happens when you are already up to your eyeballs in debt, have no money coming in, no backup plan and use BNPL with no capacity to make repayments?  You will be in a world of hurt as your debt position increases.

We strongly discourage the use of any BNPL services, as time and time again we see so many consumers that need to pulled out of the debt trap from using them.  Please don’t give us the…. “But it helps me budget” argument.  If you are actively using BNPL services and think that it is helping your financial situation by you not needing to spend your own money, you may need to reevaluate your position on spending and why you choose to use services like these rather than your own cash.

A fundamental rule of thumb is to check your budget regularly, apply the 80/20 rule (spend 80% and save 20% regardless of your income) and have a plan for a rainy day.  COVID-19 has caught many people with their pants down, embarrassed that they do not have a cent to their name and scared about their direction going forward.

We need to embrace our budgets and not fear them so we can live a better life.

For more information or to arrange an appointment please contact us:

Andrew and Alyssa Mates on 0420 846 454

or via email at:

“An effective budget is knowing which numbers belong where; and what the values of these numbers are to make the magic in your life happen…”


ANDREW MATES is the director, money coach and operator of Adelaide Budgeting and has always had a keen interest in numbers and the philosophy of succeeding financially in a world full of consumerism.  Andrew is a valued member of the team and is passionate about education and empowerment around finance and providing people with the confidence to successfully manage their own finances.  Equipped with a Diploma in Finance and Mortgage Broking (but not a broker), Andrew and his team can work with you to create a budget plan and savings strategy that is second to none which will see you kicking goals and doing the things you want to do but never thought you could!

In between helping clients and working on strategies, Andrew also enjoys walking on the beach, playing with Lilly his Labrador and road trips with his wife Alyssa.