Whether you’re a family earning under $150,000 and feeling the squeeze every month, or a household earning well over $400,000 and wondering why there’s no assets to show for it, the underlying issue is often the same.
It’s not that you’re doing nothing. It’s that you may be trying to solve the wrong problem.
When financial pressure shows up, the instinct is to jump straight to solutions – tax strategies, investment structures, or clever products – without first being clear on what problem actually needs solving.
This is where good advice matters. A sound financial strategy doesn’t start with products or tax outcomes. It starts with understanding your constraints, behaviour, goals, and opportunities, and then aligning the strategy to what will genuinely move the needle.
The trap of self-diagnosis
A common pattern we see is people trying to self-diagnose their financial problem. The challenge is that once we decide what we think the problem is, we tend to seek information that confirms it.
This is known as confirmation bias. It’s the tendency to look for evidence that supports what we already believe, while ignoring information that challenges it. It’s comfortable, but it’s also how the real issue stays hidden for far too long.
The result is often well-intentioned strategies applied to the wrong problem, leading to frustration and suboptimal outcomes.
Fixing symptoms instead of causes
Here are a few common examples.
A family earning under $150,000 with tight cashflow often believes they could improve their cashflow by paying less tax. In reality, the bigger constraint is usually income. Trying to implement tax minimisation strategies before the income base is strong enough rarely delivers meaningful results.
On the other end of the scale, we see households earning well over $400,000 with no free cashflow or assets to show for it. In this case, income isn’t the issue. Spending behaviour and cashflow management are.
When the problem isn’t tax, it’s behaviour
These households often arrive convinced they are paying too much tax.
They earn well. They work hard. A large portion of their income goes to the ATO. From their perspective, the diagnosis feels obvious. If tax could just be reduced, everything would feel easier.
But once we look under the hood, tax is rarely the real constraint.
Week to week, their spending often looks reasonable. They cook at home. They are not constantly dining out. They do not feel extravagant. The pressure does not show up in everyday transactions.
It shows up in the big, intermittent decisions that feel justified at the time.
Two expensive overseas holidays a year. A car upgrade. A designer couch or home renovation because “we work hard and deserve it”. Premium conveniences that save time but quietly compound. Each decision makes sense on its own. Collectively, they erode any capacity to build momentum.
This is where the misunderstanding around tax really takes hold.
Once income moves into the top marginal tax bracket, the effective tax rate is close enough to 50 per cent. In practical terms, if you want one extra dollar in your pocket to spend, you often need to earn close to two. Half disappears before it ever reaches your bank account.
Saul often explains it this way:
“At higher income levels, it is usually more efficient to save a dollar than it is to earn one. Cutting a dollar of unnecessary spending delivers the same outcome as earning two extra dollars, without the extra hours, pressure or trade-offs.”
Yet many people instinctively chase the harder option. They work more. Push for bonuses. Look for clever tax strategies. All while ignoring the simpler lever sitting right in front of them.
In these situations, the solution is not better tax minimisation. It is clearer spending boundaries, conscious trade-offs, and a cashflow plan that reflects how money is being used, not how people think it is being used.
Until that behaviour is addressed, no tax strategy will deliver the outcome they are hoping for.
Different problems require very different strategies.
| Situation | Common but misaligned strategies | More aligned strategies |
|---|---|---|
| Family income under $150,000 with tight cashflow | Negative gearing, tax driven strategies, complex investment structures | Investing in earning capacity through career progression or a side income, developing a realistic spending plan, paying down bad debt and avoiding lifestyle debt, considering government co-contributions to super |
| Family income over $400,000 but no free cashflow or assets | “Spend today, save tomorrow” thinking, delaying investing until later, novated leases driven purely by tax outcomes, negative gearing for tax savings alone |
A clear spending plan with a pay yourself first approach, maximising concessional super contributions, disciplined investment strategies, debt recycling, investment bonds |
| Profitable business but no cash | Chasing more sales, discounting to increase revenue, expanding too quickly | Tightening accounts receivable processes, improving invoicing systems, setting clearer payment terms, actively managing cashflow |
The cost of getting it wrong
When the wrong problem is being solved, people often feel like they are doing everything they are supposed to, yet nothing improves. Progress feels slow, motivation drops, and confidence erodes.
In many cases, the turning point comes not from a new product or a more aggressive strategy, but from finally identifying the real constraint and addressing it directly.
A final thought from Saul
If any of these examples feel familiar, it may be a sign that the issue isn’t discipline or effort, but direction. A short conversation can often bring clarity far quicker than months or years of trial and error. A discovery call gives us the opportunity to step back, identify the real problem, and determine whether there’s a practical way to improve your financial position.
Sometimes the most valuable outcome isn’t implementing a new strategy but stopping the wrong one before it costs you more time, money, or momentum. Book a call here.
