This post is based on an interview we conducted with Stuart in October 2021.
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: Stuart
Age: 31
Where do you live? Sydney
Please tell us a bit about yourself.
I work in e-commerce which I’m hugely grateful for as it has not been negatively impacted by the lockdown/s. I’ve recently bought an apartment off-the-plan with my partner which should be ready by mid-2022.
How does your current net worth break down?
- Real Estate - $52,500
- Savings - $31,000,
- Car - $15,000
- Spaceship Voyager - $5,000,
- Super - $72,000
Do you have any debts?
- Mortgage - $546,500
- Car loan - $3,500
- HELP - $9,500
How did you build your net worth?
I saved enough to pay for my upcoming wedding and the deposit through moving back in with my folks (paying reduced rent and paying for groceries) over the last two years.
I also ensure I pay myself first and stick with a budget. As soon as my pay comes in 45% goes to savings and 20% goes into Spaceship Voyager.
The remainder I use for expenses which will increase significantly once our apartment is built.
Earn
Tell us a bit about your career.
I grew up wanting to be a chef originally, though was convinced to pursue other dreams as my dad (an ex-restaurant owner) convinced me it’s not a life I want if I plan to raise a family.
Instead, I went to uni, got a couple of degrees and moved into a corporate sales and events job.
Account/client management is actually a dream for the most part. The clients that I have a good connection with, achieve and even laugh a lot with are the best. Trust is everything in my field.
Do you have any income sources outside your job? How much do you earn from each and how did you develop them?
Only Spaceship and high interest savings accounts. Spaceship has been doing well for me overall but recently I’ve seen my gains fluctuate. It’s a good thing I don’t need the money right now!
I had lost a bit of money on crypto during the early days but am thinking of jumping back in just for the ride. And who knows, maybe I could win big?
What would you say to other people who want to earn more money?
Have a big hairy goal and chase it like you’re a crazy person! Yes my social life has taken a bit of a dive but I would rather own my own home when I’m 40 than fall into over the top drinking and eating (which is where most of my money used to go).
Save
What's your savings rate? How has it changed over time?
I used to live hand to mouth up until about 5 years ago when I met my now fiancé. I now put 45% of my pay directly into savings and another 20% into Spaceship.
Do you have a budget?
Absolutely. I have most of my money allocated to different pools and then broken down into smaller buckets; expenses, savings, investing, fun money.
How much do you spend per year?
About $30-35,000 a year.
Do you make purchase decisions carefully, or are you loose with your money?
With the play money I have, I’m very loose with it. I can’t say there’s usually much by the end of the month to carry over. All my other money is very strictly managed.
How is your work-life balance?
It’s improving. I work for a global company so the hours are often quite long. Plus I’m relatively new to my role so I expect to get better/faster with it soon
What's your favourite thing to spend money on?
Food, food and more food. And trips to Japan. I can’t wait to go back!
Invest
How do you invest?
Primarily through spaceship but now that I’m a homeowner, I’ll be directing most of my savings there. I plan to pay off the house in 10 years.
What's been your best investment?
My career. Although I left uni with $50,000 in HELP debt, I’m now in a very secure job in a global company.
What's been your worst investment?
Crypto. I lost faith and withdrew too early. Luckily I hadn’t put too much in but what I could’ve earnt hurts a little (a lot).
What’s been your overall return?
That’s hard to say. Probably 10% annually.
How are you building wealth?
Real estate is where I plan to make it big. I’m going to throw everything I can to increase my equity and then use it to buy investment properties.
ETFs and perhaps crypto will be a portion too. I’ll also salary-sacrifice into super once I have my debts paid (excluding my mortgage).
What are your main roadblocks to building wealth? How are you addressing them?
Time. So little time and so much to achieve! Apart from that, I have a couple of small debts which I’ll pay off by the next financial year.
Do you have a target net worth you want?
Around $5 million (big and hairy right?).
Behaviour
When did you make your first significant behavioural shift towards wealth building?
It was when I became serious with my partner. Long story short, we started with $3,000 in the bank between us and decided enough is enough.
Do you have any worries about retirement? If so, how are you planning to address them?
Sure, who doesn’t? Cost of living is going up massively, especially in housing costs. With that said, I think we’ll be okay given our rate of savings and living below our means.
Do you give to charity? If so, what percentage of your time/money do you give?
Only ad hoc and not as much as I should. Perhaps I’m naive but I believe in establishing myself before I can significantly help others. It’s definitely on the roadmap!
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.
