This post is based on an interview we conducted with Mick in November 2022.
Real Money Talk is our series where we interview Australians from all walks of life about their personal finances. The views expressed are those of the interviewees, based on their experiences with money, and as such are not necessarily representative of Spaceship's views.
We have changed the name of the interviewee for their privacy.
Overview
Name
Mick
Age
46
here do you live?
Hobart
Please tell us a bit about yourself.
I'm a married teacher in Hobart and have two kids and a dog.
What's your current net worth?
$396,000 at the moment excluding property. About $400,000 in equity in my house.
How does it break down?
Superannuation is the big one at $381,000, plus $2,000 in savings, $1,000 in crypto, $3,000 in shares and $9,000 in Spaceship. House is worth about $850,000 with a mortgage of $400,000.
Do you have any debts?
I have a mortgage, plus an interest-loan for solar on the roof and currently owe about $8,000 on that.
How did you build your net worth?
The bulk of my net worth comes from superannuation and owning a house for quite a while.
That being said, I don't count the house because I have to live somewhere, and it's only worth something if I sell (and then would need another property).
Earn
Tell us a bit about your career.
I have been teaching for a long time, but was in IT in a previous life.
Do you have any income sources outside your job? How much do you earn from each and how did you develop them?
Not much to write home about. I do get some small dividends from some banking shares, but that's only about $200 per year.
What’s been important for you to learn about money?
To invest early and invest often, and learn from people who know. I took way too long to think about proper saving and investing. Property is a good place to start if you can, but the house you live in doesn't earn you any income (unless you rent out a room or two).
I wish I had bought a house when I was working full-time and still living with my parents.
At least I have spent nearly 20 years putting just a little be extra into my super.
Save
What's your savings rate? How has it changed over time?
I was a shocking saver in my twenties. I had a personal loan for a car, a credit card that was maxed out, then I would extend the personal loan to pay off the credit card but just maxed it out again.
I think I was about 26 when I cut up the card and have never had another one.
Do you have a budget?
I try to, but family and ever increasing expenses makes it very hard to stick to.
How much do you spend per year?
I would say pretty much everything I earn. I try and invest a little, but that has been difficult the last 12 months.
Do you make purchase decisions carefully, or are you loose with your money?
Generally I am very careful with my money, but the other half... not so much.
How is your work-life balance?
Not too bad, but I'm looking into starting a side-hustle to try and bump up my investments.
What's your favourite thing to spend money on?
Unfortunately I love cars and motorbikes and they aren't cheap. I wish swimming was my passion... a pair of speedos is cheap.
Invest
How do you invest?
At the moment, it's either shares, Spaceship or just saving some cash for a rainy day.
What’s been your worst investment?
Not buying property. It's not that I lost money because I didn't invest, but I didn't make any money because I missed opportunities.
What’s been your overall return?
In my Spaceship account, I'm about $2,500 down on the money invested which doesn't sound great, but for me it has stopped me spending it on other things.
Overall return across my assets is difficult to gauge, but probably 30%, mostly due to the increase in property values over the last three years.
How are you building wealth?
Trying to save and trying to invest in Spaceship as much as I can to start.
I'm hoping to use the equity in my house, plus some other money as a deposit on an investment property. I just need to find one that is effectively positively-geared.
What are your main roadblocks to building wealth? How are you addressing them?
To be perfectly honest, my partner is my biggest roadblock to building wealth. If two people who are together are not on the same page, it's really challenging.
Do you have a target net worth you want?
I would like to have at two investment properties paid off, plus $700,000 - $800,000 in super by the time I retire. I may not get there, but everyone has to have a goal.
Behaviour
When did you make your first significant behavioural shift towards wealth building?
Only about six years ago with some crypto mining, and then refined further a bit over two years ago with opening a Spaceship account.
If you could start again, what would you do differently?
Learn about finances from those who know.
My parents were decent, but very risk-averse and spent most of what they earnt. There has not been a time, in my opinion, when investing in property would have been a bad decision in the long run.
Salary sacrifices more to super from the day I started work and don't get a credit card (or at least don't not pay it off every month).
Do you have any worries about retirement? If so, how are you planning to address them?
I'm not too stressed, but I certainly don't want to have a mortgage when I'm over sixty, so that's probably my biggest worry.
How are you learning about building wealth?
I talk to friends that are in business or who have multiple properties. I also read books, follow a few people on YouTube and occasionlly listen to podcasts.
Do you give to charity? If so, what percentage of your time/money do you give?
I do give to charity. Probably $400 - $500 per year.
We want to hear your Real Money Talk
At Spaceship we’re big believers in sharing our money stories. We want to hear yours, too. In our ongoing Real Money Talk series, members of our community share what they’ve learned about managing money. We’d love you to take part. Here’s a link to our Real Money Talk survey where you can share your story.
