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What Is A Lot Of Money? · She's On The Money

0:00
Speaker 1: Hello.
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Speaker 2: My name's Santasha Nabananga Bamblet. I'm a proud yr the
0:05
Speaker 2: Order Kerni Whoalbury and a waddery woman. And before we
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Speaker 2: get started on She's on the Money podcast, I would
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Speaker 2: like to acknowledge the traditional custodians of the land of
0:14
Speaker 2: which this podcast is recorded on a wondery country, acknowledging
0:18
Speaker 2: the elders, the ancestors and the next generation coming through
0:23
Speaker 2: as this podcast is about connecting, empowering, knowledge sharing and
0:27
Speaker 2: the storytelling of you to make a difference for today
0:31
Speaker 2: and lasting impact for tomorrow.
0:33
Speaker 1: Let's get into it. She's on the Money, She's on
0:37
Speaker 1: the Money.
0:57
Speaker 3: Hello, and welcome to She's on the Money, the podcast
1:00
Speaker 3: for millennials who want financial freedom. My name is Beckside
1:04
Speaker 3: and with me is Victoria Devine.
1:06
Speaker 1: Welcome to another episode. Beck. I am very, very excited
1:10
Speaker 1: about this episode. So I'm gonna kick it off with
1:12
Speaker 1: a question, and it's gonna be for you, Beck. What's
1:16
Speaker 1: a lot of money to you?
1:17
Speaker 2: Oh?
1:18
Speaker 3: That is a loaded one.
1:20
Speaker 1: It's not that loaded. It's not that loaded, Like there's
1:23
Speaker 1: no ulterior motives going on. But I want to know
1:27
Speaker 1: how much money is a lot of money?
1:29
Speaker 3: To you, it depends what time of the pay cycle
1:32
Speaker 3: you ask me. I think, for context, we get paid monthly.
1:35
Speaker 3: The first week of pay I reckon five hundreds a lot. Yeah,
1:39
Speaker 3: maybe the second last and the last week of pay
1:41
Speaker 3: of the pay cycle. Yeah, maybe, like thirty dollars is
1:44
Speaker 3: a lot of money.
1:45
Speaker 1: Yeah, fair. I find it so interesting that that's how
1:48
Speaker 1: you kind of framed it. You were like, oh my gosh,
1:50
Speaker 1: well it depends on the pay cycle, because it's interesting
1:52
Speaker 1: how you respond because everybody responds so differently to that.
1:56
Speaker 1: Like we're going to talk about it because we did
1:58
Speaker 1: ask the community or I I did go to the
2:00
Speaker 1: community and say, all right, I want to know what
2:02
Speaker 1: does that look like? But we're talking about this today
2:05
Speaker 1: because I think we just need to contextualize that everybody's
2:08
Speaker 1: experience is super different and that you know, to you,
2:11
Speaker 1: five hundred or thirty dollars could be a lot, and
2:14
Speaker 1: someone else might be like, oh, three hundred thousand dollars
2:16
Speaker 1: is a lot of money. And it's really interesting to
2:19
Speaker 1: just see things from other people's perspectives because when we
2:23
Speaker 1: can lean into being able to view other people's perspectives,
2:26
Speaker 1: we learn so much more. And this episode I feel
2:30
Speaker 1: like is really about also acknowledging privilege and the different
2:33
Speaker 1: experiences as wealth. Because even though you said, oh my gosh,
2:36
Speaker 1: thirty bucks like could be a lot of money, I
2:38
Speaker 1: feel like some people would look at that and be like, oh,
2:40
Speaker 1: that's not much money at all. And I think you
2:42
Speaker 1: need to step outside of that and go no, no, no.
2:45
Speaker 1: I'm not asking you whether you think that Bech's experience
2:48
Speaker 1: is valid or not. I'm asking you to acknowledge that. Wow,
2:51
Speaker 1: Like if Beck says thirty dollars and yours is five hundred, like,
2:55
Speaker 1: maybe just go wow, I am pretty lucky that that's
2:58
Speaker 1: my personal experience. This is the way that we want
3:01
Speaker 1: to talk about it. It's a judgment free zone as always,
3:04
Speaker 1: but I really want to be able to highlight people's
3:06
Speaker 1: different experiences and what that means and how that works.
3:09
Speaker 1: And today, Beck, we're going to talk about lifestyle creep
3:12
Speaker 1: and demystifying some of the unconscious or unhelpful ideas about
3:16
Speaker 1: how much you actually need to start investing and how
3:19
Speaker 1: much you need to start when it comes to savings,
3:22
Speaker 1: and about how much money you actually need to be
3:25
Speaker 1: good at money, because I think people have this really
3:28
Speaker 1: weird idea in their head that to be good at
3:30
Speaker 1: money you have to have heaps and heaps and heaps
3:32
Speaker 1: of it and buccaloes cash. So I did think that
3:35
Speaker 1: was the case actually to be fair, and.
3:38
Speaker 3: It's not true, Beck, it's not true.
3:40
Speaker 1: Sure, no, no, let's get into it.
3:42
Speaker 2: Tho.
3:42
Speaker 3: Al right, So I would say it is interesting. So
3:45
Speaker 3: thirty dollars is a lot of money to me. It
3:48
Speaker 3: kind of gets me thinking about like what you would
3:50
Speaker 3: think a lot of money is, even like in your childhood.
3:53
Speaker 3: So for example, for me, it was, you know, if
3:56
Speaker 3: I go to a friend's house and they had a
3:58
Speaker 3: silver frid.
4:00
Speaker 1: Oh my gosh, yes, silver fridge is nicol of wealth.
4:03
Speaker 1: You know what takes it another level up? The water dispenser.
4:07
Speaker 3: That's exactly right, not that, but yeah, that's lip like
4:11
Speaker 3: you must be rich for it.
4:12
Speaker 1: You are, Yeah, you're on another level.
4:14
Speaker 3: If you have a water dispenser, you must be doing
4:17
Speaker 3: well doing wealth. Must be nice. Other things that I
4:19
Speaker 3: thought made people rich growing.
4:22
Speaker 1: Up, Oh yeah, what is it?
4:23
Speaker 3: So I would say things like matching plates.
4:27
Speaker 1: Oh yeah, yeah, set a dinner set, yes, place mats
4:31
Speaker 1: or place mats is big dog energy, big dog energy,
4:34
Speaker 1: Like we're not just eating on the couch or eating
4:36
Speaker 1: at the table. We're setting up for.
4:38
Speaker 3: Dinner, setting up for dinner. We've got You don't have
4:40
Speaker 3: ney in your house. You have dinner, yes exactly, that's
4:43
Speaker 3: when you know. And also reusable napkins. That's big dog andages,
4:48
Speaker 3: big dog energy. You don't just rip a bit of
4:50
Speaker 3: paper towel off. No exactly, Okay, I would use literal
4:53
Speaker 3: toilet paper sometimes to wipe my face.
4:55
Speaker 1: Because I don't makes sense. It's seasy.
4:57
Speaker 3: It's the same material as a aptail, but a little
5:01
Speaker 3: bit cheaper.
5:02
Speaker 1: Yeah, exactly.
5:03
Speaker 3: You'll not find a reusable napkin in my household. I
5:06
Speaker 3: don't know if you had this, but I didn't have
5:07
Speaker 3: any pocket money or anything like that. I mean my
5:09
Speaker 3: mum would, you know, give me money for the movies,
5:12
Speaker 3: and she would find a way to make it work.
5:13
Speaker 3: But no pocket money did you have? Was that just
5:16
Speaker 3: a like being really pervy? Was that a situation where
5:20
Speaker 3: it was like we couldn't afford it, or was that
5:22
Speaker 3: a situation where it was like, oh, my parents didn't
5:24
Speaker 3: believe in it?
5:24
Speaker 1: Because I think those are two different experiences.
5:27
Speaker 3: I think conveniently both Yeah, yeah, yeah, I fit is
5:31
Speaker 3: like it's like chicken all the egg. I think we
5:33
Speaker 3: probably couldn't really afford it because it was that's fair
5:36
Speaker 3: for children, so but also, you know, in the same time,
5:40
Speaker 3: it was maybe one of those things that we didn't
5:42
Speaker 3: just we just didn't do.
5:43
Speaker 1: Yeah, that's fair. We did have pocket money growing up,
5:46
Speaker 1: but I remember thinking it wasn't much, and like not
5:49
Speaker 1: at the time, Like now I look back and go, like,
5:51
Speaker 1: it really wasn't heaps. But that's not a negative thing
5:54
Speaker 1: because we had all our basic needs met and like
5:56
Speaker 1: what does a six year old or seven year old
5:58
Speaker 1: actually need to purchase? Like, probably not that much. And
6:02
Speaker 1: my dad was an accountant. So the reason we had
6:04
Speaker 1: pocket money, I do believe, was to teach us about money.
6:08
Speaker 1: So the amount of pocket money we got was fifty
6:11
Speaker 1: cents for every year that we were alive. So if
6:13
Speaker 1: I was six, I got three dollars. If I was twelve,
6:16
Speaker 1: I got six dollars. And that would however, I feel
6:18
Speaker 1: like that was clever, but like it was also like
6:21
Speaker 1: a graduation. On our birthday, I'd be like, I get
6:23
Speaker 1: another fifty cents, Like this is big dog energy. That's
6:26
Speaker 1: big d energy, And I think it's I think It's
6:28
Speaker 1: interesting looking back because I remember knowing that I got
6:31
Speaker 1: my six dollars or I got my you know whatever
6:33
Speaker 1: it was at that period of time. But then I
6:36
Speaker 1: saw friends who'd get like a clean twenty dollar bill
6:39
Speaker 1: and I'd be like, wow, that's wow good, Like that
6:41
Speaker 1: was insane to me. So it's interesting different experiences. But
6:46
Speaker 1: then also where you grow up really does give a
6:50
Speaker 1: bit of a deep dive into the types of like
6:52
Speaker 1: pocket money experiences, because our pocket money was actually for
6:57
Speaker 1: things we wanted to buy and we had to save
6:58
Speaker 1: up for them. And it was as though, you know,
7:00
Speaker 1: if we said, oh, Mum, I really want XYZ, like
7:02
Speaker 1: we didn't just get it, we had to save up
7:04
Speaker 1: for it. Or I remember Dad always saying things like, well,
7:07
Speaker 1: if you save up for it, I will match you,
7:09
Speaker 1: Like if you can save for X, Y or Z,
7:12
Speaker 1: Like if I wanted a toy or something, he would say, look,
7:14
Speaker 1: you can have it, we can save for it, we
7:16
Speaker 1: can work it out, but I will match you. And
7:19
Speaker 1: that always like motivated me to save even more.
7:21
Speaker 3: It's just making a lot of sense. It's really picture.
7:26
Speaker 3: I can understand how you are the way you are.
7:30
Speaker 1: I didn't always listen to him. We argued about times tables.
7:33
Speaker 1: I would cry at the table. Still not very good
7:35
Speaker 1: at my times tables because of it. And also I
7:37
Speaker 1: did get myself in some pretty serious, significant personal debt
7:40
Speaker 1: when I was younger because I didn't listen to him.
7:42
Speaker 1: But you know, you live in your own So, beck
7:45
Speaker 1: you mentioned something before about growing up in a family
7:48
Speaker 1: of four and the pocket money maybe was a bit
7:50
Speaker 1: of a stretch for the family. How did that make
7:52
Speaker 1: you feel when you saw other kids at school getting
7:55
Speaker 1: pocket money or similar things like that.
7:58
Speaker 3: To be honest, when I was in prime school, I
8:00
Speaker 3: didn't notice it very well. I guess we all just
8:03
Speaker 3: kind of, you know, I somehow still managed to have
8:06
Speaker 3: like twenty cents to buy a red frog or a
8:08
Speaker 3: touch sharp and everything.
8:09
Speaker 1: I feel like kids, they're super resourceful. There will there
8:13
Speaker 1: is a way.
8:14
Speaker 3: Absolutely, I kind of noticed it a little bit more
8:17
Speaker 3: in high school, maybe tried to keep up a little
8:19
Speaker 3: bit with Sino the new trends, fashion trends, et cetera.
8:22
Speaker 3: And there's lunch orders.
8:23
Speaker 1: You know, oh yeah, yeah, yeah, going to the canteen,
8:26
Speaker 1: going to the canteen, get in.
8:27
Speaker 3: The lazagna move Oh my gosh.
8:29
Speaker 1: Yes, the high school Designia was lit. I forgot about that. Actually,
8:34
Speaker 1: that was so good. And we had these things called
8:36
Speaker 1: dinosaur rolls, never ever in that's because I think my
8:40
Speaker 1: school made them up. So is the sausage roll in
8:45
Speaker 1: a white bread roll, with cheese and sauce in the
8:48
Speaker 1: white bread roll, and then they wrap it in foil
8:50
Speaker 1: and they put it in the oven and like the
8:52
Speaker 1: whole thing like melts together and it's like a hot
8:55
Speaker 1: bread roll with a sausage roll with sauce and cheese.
8:58
Speaker 1: That sounds unyeah, right anyway, but those were like seven dollars,
9:03
Speaker 1: Like that's expensive. That's expensive. I feel like it was
9:08
Speaker 1: like looking back on it as well, maybe it wasn't
9:11
Speaker 1: seven dollars, but it felt expensive. So maybe it was
9:13
Speaker 1: like four dollars, but it felt like big dogging.
9:15
Speaker 3: Yeah, expensive energy. So it seems like our perceptions of
9:18
Speaker 3: the value of money are all relative and also highly subjective.
9:21
Speaker 1: Absolutely they are.
9:23
Speaker 3: So you asked our community what they thought a lot
9:25
Speaker 3: of money was. What did they say?
9:27
Speaker 1: I did? I jumped on Instagram and I just did
9:29
Speaker 1: like this piece to camera and I was say, all right, guys,
9:31
Speaker 1: I need to know. I want to know to you
9:33
Speaker 1: how much is a lot of money. I don't want
9:35
Speaker 1: to give you any context, like we're not going to
9:36
Speaker 1: talk about it, and I'll read out some of the
9:38
Speaker 1: answers because they actually were really diverse, and it gave
9:41
Speaker 1: me such an insight just into people's mentalities. And that's
9:44
Speaker 1: why I said before I really loved that. You were like, oh, well,
9:47
Speaker 1: it depends on the pace cycle, because so many people
9:49
Speaker 1: gave context. So someone said a lot of money looked
9:53
Speaker 1: like not worrying about the color of the plate at
9:56
Speaker 1: sushi train o.
9:57
Speaker 3: Amen.
9:58
Speaker 1: Yeah. Someone said over two hundred dollars. Someone else said
10:01
Speaker 1: to be able to buy something without checking my bank
10:04
Speaker 1: account relatable. Someone said one hundred thousand dollars. Another person
10:07
Speaker 1: said a million dollars. Wow. Someone then said millions in
10:11
Speaker 1: order to live comfortably for the rest of my life
10:13
Speaker 1: and set my kids up. I feel like that's a
10:15
Speaker 1: bit more big picture. Then someone said, my friends thought
10:18
Speaker 1: paying one hundred and fifty dollars for a small lamp
10:21
Speaker 1: was a lot, and I actually thought that was pretty cheap. No,
10:23
Speaker 1: they yeah, but like that's her experiences, Like maybe she'd
10:28
Speaker 1: been looking at five hundred dollar lamps and then she
10:30
Speaker 1: was like, oh, this one, this one's a good deal. Nos.
10:34
Speaker 1: Someone said ten thousand dollars New Zealand money and that
10:37
Speaker 1: if I lost more than that, I'd be upset less
10:40
Speaker 1: than that and I'd just be annoyed. And I was like,
10:41
Speaker 1: what in the wealth?
10:42
Speaker 3: Like, what in the wealth?
10:45
Speaker 1: Yeah, exactly. Someone said, I think a lot of money
10:48
Speaker 1: is a salary of one hundred and twenty thousand dollars,
10:50
Speaker 1: but maybe, like a once off, a lot of money
10:53
Speaker 1: is one thousand dollars, and I was like, yeah, okay,
10:55
Speaker 1: interesting context. Someone else said in terms of cost, I
10:58
Speaker 1: guess five hundred dollars, but in terms of wealth a
11:01
Speaker 1: million plus. Someone then said, oh, anything over five hundred
11:05
Speaker 1: thousand dollars, which to them is a decent house deposit,
11:08
Speaker 1: feels comfortable. And I was like, again, what in the wealth?
11:12
Speaker 1: And then someone said anything over one hundred dollars is
11:15
Speaker 1: a lot for me to lose from my bank account,
11:17
Speaker 1: and I was like, okay, So, Beck, with all of
11:19
Speaker 1: that in mind, after I've read them all out and
11:22
Speaker 1: given you said before five hundred dollars at the start
11:24
Speaker 1: of the pay cycle and thirty dollars at the end,
11:27
Speaker 1: how does that make you feel?
11:28
Speaker 2: Like?
11:29
Speaker 1: What are you thinking? Right?
11:30
Speaker 3: Now I didn't notice that thirty dollars wasn't on the list.
11:33
Speaker 1: That's okay. So again, it's personal, it's highly personal. Personal
11:37
Speaker 1: finance is just that it is personal. It is, and
11:40
Speaker 1: we need to respect that.
11:41
Speaker 3: Yes, and well, it actually was very comforting because I
11:44
Speaker 3: did relate to being able to buy something without checking
11:46
Speaker 3: my bank account. I don't even know the last time
11:49
Speaker 3: I bought something about having to check my bank account first.
11:52
Speaker 3: So it did make me feel comforted in some ways.
11:55
Speaker 3: In other ways, you know, for example, let's say I
11:58
Speaker 3: would be finally ten.
12:00
Speaker 1: K that was unrelatable. I would be so anxious that
12:06
Speaker 1: ruin me, but not relatable to you or I maybe
12:08
Speaker 1: other listeners that are listening to the pod are like,
12:10
Speaker 1: oh yeah, I feel exactly the same. And you know what,
12:13
Speaker 1: that's actually okay. So you didn't have any level of
12:15
Speaker 1: judgment over other people's circumstances. Absolutely absolutely In saying that,
12:20
Speaker 1: let's jump to a really quick break and then we
12:22
Speaker 1: get back, we can talk even more about this, and
12:24
Speaker 1: I really want to deep dive into lifestyle creep. Well,
12:27
Speaker 1: let's do it.
12:27
Speaker 3: I was excited. Okav We are back and we are
12:34
Speaker 3: talking about how much money is a lot of money.
12:37
Speaker 1: And it turns out there's not actually an answer to that.
12:40
Speaker 1: It's really dependent. So that was kind of like, what
12:43
Speaker 1: do they call that? Clickbait click creak article titles but
12:47
Speaker 1: podcast titles, So we don't actually have an answer to
12:50
Speaker 1: the quarry everyone, sorry not So I want to know it, Beck,
12:55
Speaker 1: what did you do with your first full paycheck? You
12:58
Speaker 1: mentioned pay before, and it's just making me think, So
13:00
Speaker 1: I really want to know what did you do it?
13:01
Speaker 1: Do you remember?
13:02
Speaker 3: Yeah?
13:02
Speaker 1: I can't think.
13:03
Speaker 3: Yeah, so I would say, and this is probably a
13:05
Speaker 3: little embarrassing. The first thing I did when I got
13:08
Speaker 3: my first full, full time paycheck was fill up my
13:11
Speaker 3: petrol tank all the way, all the way, all the way.
13:14
Speaker 1: I feel so boogie.
13:16
Speaker 3: Oh my god.
13:17
Speaker 1: I've got this conversation in the community before, and there
13:19
Speaker 1: are so many people in our community that are like, nap,
13:22
Speaker 1: I've never done it, Like every time I go to
13:24
Speaker 1: the petrol station, I will only put like twenty dollars
13:26
Speaker 1: in or thirty dollars in or whatever it is, yeah,
13:28
Speaker 1: or can relate yeah, like, and I totally get that,
13:31
Speaker 1: but I also think it's a good way of budgeting.
13:33
Speaker 1: Like a lot of people will be like oh, well, actually,
13:36
Speaker 1: my petrol budget each and every single week is thirty dollars,
13:38
Speaker 1: so I just even though it's more frequent, I still
13:41
Speaker 1: just go to the petrol station every week and put
13:43
Speaker 1: that thirty dollars in because it just makes me feel
13:46
Speaker 1: comfortable and confident and I know I've got petrol. But
13:48
Speaker 1: it like doesn't ever blow the budget. But it is
13:51
Speaker 1: really boogie, especially right now, to be filling your tank
13:55
Speaker 1: all the way. Yeah, that's a bit of a splurge.
13:57
Speaker 1: So would you say that with your first paycheck a
14:00
Speaker 1: little bit of a splurge activity.
14:02
Speaker 3: I think I did. But also I'm trying to remember
14:05
Speaker 3: when I got my first full time paycheck. I was
14:07
Speaker 3: probably eighteen, so it was like five cents an hour
14:12
Speaker 3: or something something related. Back in the day. I remember
14:16
Speaker 3: filling my petro tank up all the way. I also
14:18
Speaker 3: remember buying just like little items that I couldn't really
14:21
Speaker 3: afford before, Like I did a whole grocery shop instead
14:24
Speaker 3: of just bread and some comp and hear the essentials,
14:29
Speaker 3: I thought, Oh, I feel it of salmon, that's all.
14:32
Speaker 1: Oh good? Did it go off in your fridge or
14:34
Speaker 1: did you eat it? I feel like I ate it.
14:36
Speaker 3: I feel like I was very because it was it was,
14:38
Speaker 3: you know, one hundred thousand years ago, but yeah, it
14:41
Speaker 3: was very It still is very, very expensive. I think
14:43
Speaker 3: that's one thing that's never decreased or increased over time,
14:46
Speaker 3: so it's a consistent food.
14:48
Speaker 1: Also good food, great choices there. Petrol and salmon is
14:52
Speaker 1: the two things I bought. You mentioned before that you
14:55
Speaker 1: went and bought a whole heap of little things that
14:57
Speaker 1: you maybe couldn't have afforded before, And I guess. So
15:00
Speaker 1: that's on the flip side of it, And we mentioned
15:02
Speaker 1: it at the start of this episode that it really
15:03
Speaker 1: plays into lifestyle creep, and lifestyle creep is this concept
15:07
Speaker 1: that over time your lifestyle just becomes more expensive. So
15:11
Speaker 1: if you're in UNI, you probably have a cheaper lifestyle.
15:14
Speaker 1: And we say it all the time, right, Like, I
15:16
Speaker 1: don't know, We've had conversations like this offline where I'll
15:19
Speaker 1: be like, oh my gosh, remember at UNI, we used
15:22
Speaker 1: to be able to, like, you know, make fifty bucks
15:25
Speaker 1: last like literally an entire week. And I still went
15:29
Speaker 1: out most days, Like somehow I still manage to go
15:32
Speaker 1: out with my friends, go out for lunch, do this,
15:33
Speaker 1: do that, like and now brunch for my girlfriend and
15:36
Speaker 1: I will be fifty bucks and like, oh, that's me
15:39
Speaker 1: done for the week. Like I don't have another fifty bucks.
15:42
Speaker 1: So I think it's interesting to see that you said
15:44
Speaker 1: something like, oh, yeah, with my first paycheck, I bought
15:46
Speaker 1: things I couldn't afford before. What do you think about lifestyle, creep?
15:50
Speaker 1: Do you think your lifestyle today is more expensive than
15:52
Speaker 1: it was, say, ten years ago. I think so, And.
15:55
Speaker 3: I think that's the funny thing. A good friend of
15:57
Speaker 3: mine once said, this is a direct quote from her
16:00
Speaker 3: Mo money Mo problems, So you kind of.
16:03
Speaker 1: It's your friend a wrapper. Are you trying to tell
16:07
Speaker 1: me you've got famous friends? I have famous friends.
16:09
Speaker 2: Yeah?
16:10
Speaker 3: Cool. But I really do think it's that thing that
16:12
Speaker 3: the more money you make, the more money you spend.
16:14
Speaker 3: So I think that my lifestyle now, the amount of
16:16
Speaker 3: money I spend now is way more than what I
16:19
Speaker 3: used to spend when I wasn't making as much. Not
16:21
Speaker 3: that I'm making twenty billion dollars today, but I kind
16:26
Speaker 3: of always just spend a little bit more if I
16:28
Speaker 3: have a little bit more, you know.
16:29
Speaker 1: And this kind of plays into this concept that I
16:31
Speaker 1: think a lot of people just I don't know they
16:34
Speaker 1: really lean into because they go, oh, I don't have
16:36
Speaker 1: a big salary, Therefore it's not worth it. It's not worth saving,
16:38
Speaker 1: it's not worth investing. Like what's the point, Like I
16:41
Speaker 1: don't even earn that much. But history tells me that
16:46
Speaker 1: it's not actually those people who earn the most money.
16:48
Speaker 1: And I talked about this in my first book. If
16:50
Speaker 1: you've read my book, you know exactly what I'm talking about.
16:53
Speaker 1: But I had two different couples, and I inherited both
16:56
Speaker 1: of them as clients, so they weren't my clients their
16:59
Speaker 1: entire lives, which makes sense because I'm in my thirties
17:02
Speaker 1: and both of them would now be in their late seventies,
17:05
Speaker 1: so it wasn't their financial advisor the whole time. But
17:08
Speaker 1: I had this one couple who he worked as a
17:11
Speaker 1: maintenance man and maybe earned seventy grand a year for
17:14
Speaker 1: his entire career, maybe it went up a little bit
17:17
Speaker 1: towards the end of his career, and they had three kids,
17:20
Speaker 1: and his wife never worked. She stayed at home and
17:22
Speaker 1: looked after the kids because that obviously made sense for them,
17:25
Speaker 1: And he retired with so much money because he had
17:29
Speaker 1: been saving and investing that whole time and was really
17:32
Speaker 1: good at budgeting and really good at making things work.
17:35
Speaker 1: And now they have this lifestyle where they have a
17:38
Speaker 1: passive income of about one hundred and thirty one hundred
17:40
Speaker 1: and forty thousand dollars from memory coming in each and
17:43
Speaker 1: every single year, which is more than they've ever had before.
17:46
Speaker 1: And because he was so good at saving and investing,
17:48
Speaker 1: like they don't have any big expenses, so they don't
17:50
Speaker 1: have a mortgage anymore, Like they're all good to go.
17:53
Speaker 1: But wow, in comparison, I had this client or these
17:57
Speaker 1: two clients who were really really well. They had a
18:00
Speaker 1: combined income of half a million dollars each year, like
18:05
Speaker 1: lots of kids, still three kids, all kids are going
18:08
Speaker 1: to private schools. They have you know, a car loan each.
18:11
Speaker 1: They had a loan for a boat. They had multiple
18:13
Speaker 1: properties that were not paid off because they were just
18:16
Speaker 1: paying the interest on the properties because like, with an
18:18
Speaker 1: income that big, you can get the loan, and like
18:20
Speaker 1: that made sense. But looking at their financial planning, I
18:24
Speaker 1: sat down with them because they were in their fifties
18:26
Speaker 1: when they came to me, and they said, really want
18:28
Speaker 1: to retire, Like what's what's the plan, Like, you know,
18:30
Speaker 1: we obviously have a lot of money, and they were
18:32
Speaker 1: going on ski trips every year to Aspen, like that's
18:36
Speaker 1: big dog energy.
18:37
Speaker 2: That is big.
18:38
Speaker 1: But they couldn't afford to retire, and they couldn't afford
18:40
Speaker 1: to retire because they didn't have any savings or any
18:44
Speaker 1: investments at all to put themselves in a position where
18:47
Speaker 1: they could stop working. So their lifestyle was maintainable if
18:50
Speaker 1: they continued to do their really high income jobs every
18:53
Speaker 1: single year. But for them to retire, we did a
18:56
Speaker 1: financial plan that meant they had to get rid of
18:58
Speaker 1: the cars, they had to get rid of the boats,
18:59
Speaker 1: they had to get rid of one of the houses.
19:01
Speaker 1: And with that financial plan, beck it put them in
19:05
Speaker 1: the same position as my other couple, So their outcome
19:09
Speaker 1: meant that their income during retirement would be exactly the
19:13
Speaker 1: same as my other couple who didn't have that massive income,
19:16
Speaker 1: who you know, had just plotted along the whole time,
19:19
Speaker 1: and you know, they actually financially were going to be
19:22
Speaker 1: in the same position. However, because my first client had
19:26
Speaker 1: been doing it their entire life, they didn't need that
19:29
Speaker 1: much to be contributed every month. But because my other clients,
19:33
Speaker 1: who were really wealthy, were only doing it in their
19:35
Speaker 1: late fifties. They're in a bit of a picky position
19:39
Speaker 1: because that means they've got to save and invest heaps,
19:42
Speaker 1: like more than half of their income had to go
19:45
Speaker 1: towards wealth creation and saving and investing to actually put
19:48
Speaker 1: them in the same position. So I will at some
19:51
Speaker 1: point post that example on Instagram because I think it's
19:54
Speaker 1: a really interesting case study to go. Well, Beck, it's
19:57
Speaker 1: actually not about how much you earn, but more what
19:59
Speaker 1: you do with it over the long term. And this
20:01
Speaker 1: idea of you know, we're talking about lifestyle creep. Obviously
20:05
Speaker 1: they had significant lifestyle creep, but it's this idea that
20:09
Speaker 1: you know, a lot of people think to be good
20:11
Speaker 1: at money, you have to have lots of it, and
20:13
Speaker 1: that's just not the case. It's not the case at all,
20:15
Speaker 1: Like anyone can create financial freedom if they put their
20:18
Speaker 1: minds to it.
20:19
Speaker 3: Well, it's actually very interesting, very hard, very very hot.
20:23
Speaker 3: The earlier today, you were telling me about lotto winners, and.
20:26
Speaker 1: Yes, that's actually a really good example here. So we
20:30
Speaker 1: always hear this idea that a lot of people who
20:33
Speaker 1: win the lottery go broke, right, Like, that's not a
20:35
Speaker 1: new concept. I think a lot of people have heard
20:38
Speaker 1: it before, but there is some research out of Boston
20:41
Speaker 1: University that actually found that, you know, putting that aside,
20:46
Speaker 1: the people that are most likely to go broke are
20:49
Speaker 1: actually the neighbors of lotto winners. What So, if you
20:52
Speaker 1: live next door to someone who won the lotto, you
20:54
Speaker 1: are more likely to go broke, right. So it was
20:57
Speaker 1: this article that was published in a working paper from
20:59
Speaker 1: the f Reserve Bank of Philadelphia in the US, and
21:02
Speaker 1: the researchers poured over Canadian data relating to lottery winners
21:06
Speaker 1: and then bankruptcy claims from two thousand and four to
21:09
Speaker 1: twenty fourteen. And this article it's centered around people who
21:13
Speaker 1: won less than one hundred and fifty thousand dollars because
21:15
Speaker 1: people who won more than that tended to move away
21:17
Speaker 1: to that more fancy, fancy pants areas where they lived
21:20
Speaker 1: among you know, more rich people. So it's not as
21:23
Speaker 1: relatable of course, yep. But the bigger the lottery win
21:27
Speaker 1: in a neighborhood, the more cases of bankruptcy they're tended
21:30
Speaker 1: to be in the same area. Wow. And the total
21:33
Speaker 1: amount of cash board also rose across the whole neighborhood
21:38
Speaker 1: relative to the amount that was one and This trend
21:40
Speaker 1: apparently occurred because neighbors of lottery winners tended to splurge
21:44
Speaker 1: on what we call obvious displays of wealth, like brand
21:47
Speaker 1: new cars or boats or things to put in their
21:49
Speaker 1: driveways because they saw their neighbors with them and they
21:52
Speaker 1: got jealous and got a little bit of fomo and
21:54
Speaker 1: wanted to do the whole keeping up with the Joneses thing.
21:57
Speaker 1: And they're like, oh, well, Beck did it, but maybe
21:59
Speaker 1: didn't know. Beck won a whole heap of money. So
22:01
Speaker 1: people are more likely to go broke because they want
22:04
Speaker 1: to keep up with the Joneses. Isn't that wild?
22:06
Speaker 3: That is so wild? It kind of in a way
22:09
Speaker 3: makes sense. And I don't know if you know this
22:11
Speaker 3: about me, v, but keeping up with the Joneses is
22:14
Speaker 3: kind of what made me go bankrupt.
22:17
Speaker 1: So I know that, but the community is not going
22:19
Speaker 1: to know that. You and I have spoken about it,
22:20
Speaker 1: and I think the thing I love about you is
22:22
Speaker 1: that you're so open and willing to talk about that journey.
22:25
Speaker 1: And I'm assuming it's because you don't want other people
22:27
Speaker 1: to end up in that position, nor do you want
22:29
Speaker 1: to end up in it again yourself. But from your perspective,
22:33
Speaker 1: having been in that circumstance, do you still, I guess,
22:36
Speaker 1: have the mindset of thinking that you need a whole
22:38
Speaker 1: heap of money to be able to create wealth, look.
22:41
Speaker 3: To a degree, because for me, it was kind of like,
22:44
Speaker 3: you know, I knew that I wanted to go to
22:46
Speaker 3: UNI and study and make a career for myself. So
22:49
Speaker 3: I'd see people around me and they would have the
22:51
Speaker 3: newest MacBook, the best devices, and you know, I kind
22:56
Speaker 3: of had like a really old laptop or just a
22:59
Speaker 3: note pad and pen, and I kind of thought there
23:01
Speaker 3: are certain parts of life where you need money in
23:05
Speaker 3: order to have a bit of a leg up. I'm
23:07
Speaker 3: not saying it's impossible to move forward with that money.
23:09
Speaker 1: But it obviously is a very very nice advantage.
23:12
Speaker 3: Right, a nice advantage.
23:14
Speaker 1: One hundred percent doesn't hurt one hundred percent. But given
23:17
Speaker 1: you've given us a little bit of context, I'm assuming
23:19
Speaker 1: you didn't grow up in a super wealthy family, so
23:21
Speaker 1: it's not as though you could go, oh, mom and dad,
23:23
Speaker 1: I need new laptop for you. Me like, is that
23:25
Speaker 1: a circumstance that would have ever happened for you?
23:27
Speaker 2: Yeah?
23:27
Speaker 3: Like I know that growing up, I knew that my
23:29
Speaker 3: Mum would always come through with the goods. She always
23:32
Speaker 3: found a way too. It sounds like her queen. She's
23:35
Speaker 3: a queen, probably a budget queen. She's actually now quite
23:37
Speaker 3: a budget queen. I've realized I need to take a
23:40
Speaker 3: page out of her book. Ironically, she always came up
23:43
Speaker 3: with the goods. But it kind of hit a point
23:44
Speaker 3: where I was about seventeen eighteen, and my circle of
23:47
Speaker 3: friends always had, you know, the newest shoes. They're always like,
23:51
Speaker 3: you know, completely decked out and cool stuff, and so,
23:54
Speaker 3: you know, I got to a point where I kind
23:56
Speaker 3: of needed to keep up, and I found myself in
23:59
Speaker 3: a bit of debt. Just you, we're just spending more
24:01
Speaker 3: than more than I was earning. And I got myself
24:03
Speaker 3: a credit card at eighteen, and then before I knew it,
24:06
Speaker 3: I hit like twenty I needed a personal loan to
24:08
Speaker 3: pay off that credit card, and then I kind of
24:11
Speaker 3: just it just snowballed. I needed more and more loans
24:14
Speaker 3: to pay off more and more loans, and then by
24:16
Speaker 3: the time I hit twenty five, I was like, I
24:18
Speaker 3: am drowning.
24:20
Speaker 1: I am in a pickle. And a minut of people
24:22
Speaker 1: how you ended up going bankrupt? We will do some
24:25
Speaker 1: more deep diving I think into how that worked, because
24:27
Speaker 1: I think that bankruptcy has a lot of shame associated
24:31
Speaker 1: with it, which is absolutely not necessary, because I'm assuming,
24:34
Speaker 1: you know, grand assumption that when you got a credit card,
24:36
Speaker 1: you didn't know how bad that could be for you,
24:38
Speaker 1: of course, because you just didn't have the right mindset,
24:39
Speaker 1: you didn't have the right educational knowledge. And I'm sure
24:42
Speaker 1: that today, if you were handed a credit card, I
24:44
Speaker 1: feel like it would be thrown across the room and
24:46
Speaker 1: you probably wouldn't want it. But I also think that
24:49
Speaker 1: you would have a lot more knowledge today than you
24:51
Speaker 1: did then to use it respectfully.
24:53
Speaker 3: Right, Yes, absolutely, I mean I would hope, so, I
24:55
Speaker 3: would hope, so get a couple of dollars in my hand,
24:57
Speaker 3: and I do become a bit white.
25:00
Speaker 1: We talk about this concept on the podcast that from
25:02
Speaker 1: little things grow and it's kind of about these small
25:05
Speaker 1: steps in the right direction. And you know, there's this
25:08
Speaker 1: quote that says, if you can't manage one thousand dollars,
25:10
Speaker 1: there's no way you can manage ten thousand dollars, and
25:12
Speaker 1: I think that that is so true, and I get
25:15
Speaker 1: so frustrated because people in our community, you'll be like, oh, well,
25:18
Speaker 1: that's nice. Like, I'll put an example up right, I'll go, oh, well,
25:21
Speaker 1: if you invest five hundred dollars each and every single month,
25:24
Speaker 1: by the time you reach retirement, you'll have an investment
25:26
Speaker 1: portfolio of one point two million dollars at a rate
25:29
Speaker 1: of return of seven and a half percent. People be like, well,
25:31
Speaker 1: I don't have five hundred dollars a month, Victoria, And
25:34
Speaker 1: I'll go, look, that's a really good example, though, Like,
25:36
Speaker 1: I'm not here saying that everybody needs five hundred dollars.
25:40
Speaker 1: What I'm saying is that, hey, look at the power
25:42
Speaker 1: of compounding. Look at the power of time. Right, But
25:45
Speaker 1: what you could do, and whether you have five hundred
25:48
Speaker 1: dollars a month or five dollars a month, compounding over
25:52
Speaker 1: that period of time is going to happen. And every
25:55
Speaker 1: small step is a step in the right direction. Because today,
25:58
Speaker 1: back you might have five bus that you can invest
26:00
Speaker 1: every month. How good is it that you have created
26:04
Speaker 1: this habit to invest every single month. You've started this
26:08
Speaker 1: habit that can grow from there, and maybe in the
26:10
Speaker 1: future you'll have ten dollars a month, and maybe in
26:13
Speaker 1: the future you'll have fifty dollars a month, right, And
26:15
Speaker 1: I promise little things and little steps in the right
26:18
Speaker 1: direction are still steps that are absolutely worth taking, because
26:23
Speaker 1: if you're waiting for that five hundred dollars to pop
26:25
Speaker 1: up in your account that you can spare, I promise
26:28
Speaker 1: it's not just going to come from nowhere, Like your
26:30
Speaker 1: boss doesn't just walk into your office one day and
26:32
Speaker 1: go Beck. So I've been thinking, I'm going to give
26:34
Speaker 1: you a raise that is another five hundred dollars in
26:36
Speaker 1: your pocket each and every fortnight, like it's just it. Yeah,
26:39
Speaker 1: I wouldn't hate it, but it's just not going to happen.
26:42
Speaker 1: Like no one's going to come in with a magic
26:44
Speaker 1: wand and go okay, cool now Beck, all of a
26:46
Speaker 1: sudden you have that five hundred dollars free in your budget.
26:49
Speaker 1: But what can happen is we get into a groove
26:52
Speaker 1: of investing five bucks a month and then going wow, like,
26:55
Speaker 1: you know, I did have a pay rise. Maybe I
26:57
Speaker 1: could allocate some of my pay rise towards that, because
27:00
Speaker 1: sometimes we can't change our lifestyles, especially if someone is
27:04
Speaker 1: on a lower income, you can't actually go, oh, well,
27:07
Speaker 1: I would love to invest that amount. We would all
27:09
Speaker 1: love to invest that amount, but if let's say, for example,
27:13
Speaker 1: you're a single mum of two young kids and you
27:15
Speaker 1: have an income of sixty five thousand dollars, The idea
27:19
Speaker 1: that if you have two young kids you could invest
27:22
Speaker 1: is absolutely wild to me on that income. Like, unfortunately,
27:26
Speaker 1: in that circumstance, paying for daycare, paying for formula, paying
27:30
Speaker 1: for all of the things that are baby related is
27:32
Speaker 1: going to be the priority. And I think that that's
27:34
Speaker 1: where we need to embrace this idea of seasons of
27:37
Speaker 1: life where yes, you know what, that doesn't mean it's
27:40
Speaker 1: useless for you to learn about investing. What you should
27:43
Speaker 1: do is learn about it and acknowledge that right now,
27:45
Speaker 1: this season of your life that you're going through is
27:48
Speaker 1: actually just a season where it's not possible, but you
27:50
Speaker 1: know what you're going to get out of that season,
27:53
Speaker 1: and then you're going to have the skills and the
27:55
Speaker 1: knowledge and the information that you need to take that
27:57
Speaker 1: next step to put yourself in the best possible position
28:00
Speaker 1: because you've already learned about it. It's kind of like
28:02
Speaker 1: doing a uni degree and then getting the full time
28:04
Speaker 1: job later, like you equipped, my friend. So I think
28:07
Speaker 1: it's super important that we don't just assume oh Beck
28:11
Speaker 1: wait until you actually have enough money to invest, sure,
28:13
Speaker 1: because it's twenty twenty three. Like, and I'm not plugging
28:16
Speaker 1: Chazy's here because like, you know, I love Shares's, I do,
28:20
Speaker 1: but I'm plugging them because even that platform, like they
28:23
Speaker 1: openly say you can invest with as literal as one dollar, Like,
28:27
Speaker 1: how much more accessible can we get? No longer are
28:30
Speaker 1: we looking? You know, ten years ago, minimum investments on
28:34
Speaker 1: platforms were five hundred dollars, and that was unobtainable. And
28:38
Speaker 1: so I think that there's this ongoing mentality in the
28:40
Speaker 1: investment world, or in especially women's minds, that I can't
28:44
Speaker 1: invest because like it's really expensive to get started, because
28:47
Speaker 1: we've been fed this idea that it is expensive to
28:49
Speaker 1: get started because that's what it used to be, but
28:51
Speaker 1: it's not anymore and it's changed. And even if you
28:55
Speaker 1: can only afford a dollar a month, how great is
28:57
Speaker 1: it that you are teaching yourself to invest in putting
29:01
Speaker 1: future you in the best possible position. Yeah, because even
29:04
Speaker 1: if it ends up being fifty dollars in an investment account,
29:06
Speaker 1: fifty bucks you didn't have before, isn't it Beck.
29:08
Speaker 3: That's so true. That's a really good takeaway. I think,
29:11
Speaker 3: just start with what.
29:13
Speaker 1: You have exactly and stretch. It's a lot of money
29:16
Speaker 1: to one person might not be a lot to somebody else.
29:19
Speaker 1: But I don't think that should jade your opinion of
29:22
Speaker 1: yourself or your own financial circumstances. And just because you know,
29:26
Speaker 1: Beck says thirty bucks is a lot of money, don't
29:29
Speaker 1: feel bad if you thought five bucks was a lot
29:31
Speaker 1: of money. Like that's not something that is helpful or
29:34
Speaker 1: constructive to you. And that's a layer of judgment that
29:37
Speaker 1: you don't deserve. And the one person that shouldn't be
29:40
Speaker 1: judging ourselves is ourselves. So I think very probably a
29:43
Speaker 1: full place to leave it. What do you reckon?
29:45
Speaker 2: Beck?
29:45
Speaker 3: I absolutely love that. I think it's a really good takeaway.
29:47
Speaker 3: I'm going to go away now and invest fifty cents
29:50
Speaker 3: to the dollar.
29:51
Speaker 1: I love it. I love it all right. I don't
29:54
Speaker 1: know if that makes sense, but let's do you know what,
29:55
Speaker 1: We're going to take it and we're just going to
29:56
Speaker 1: run with it. Go get a coffee, all right, guys,
29:59
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30:24
Speaker 3: I need all the sport I can get right now.
30:26
Speaker 1: Please put me and tell me I'm pretty all right.
30:28
Speaker 1: See you on Friday, Guys, Bie guys. The advice shared
30:36
Speaker 1: on She's on the Money is general in nature and
30:38
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