Latest / The Curve / How to Build the Ultimate Budget.

Transcript

How to Build the Ultimate Budget. · The Curve

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Welcome to I Owe You Some Money Education because we owe you and you guys owe me some money education
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because I didn't really learn it growing up.
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We're Soph and Vic from The Curb and we have
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roped in Lucy Blackison from She You Should Care About so that she can ask all the questions that
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you wish you could.
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And if you want to watch this episode on YouTube click the link in the podcast
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show notes below and please leave us a comment, rate, review, share with your friends, we'd love
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to hear it.
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Oh my god and actually also if you want to see me learn how to implement everything
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that they've tried to teach me.
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We have IOU, the practical lessons,
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where there's actually a course
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where you can do everything we've taught you how to do.
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It's really easy.
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It's really fun.
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The link for that is also in the show notes.
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In this month's episode, we talked about budgeting,
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which we figured out was something
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that I actually don't do.
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So we learned how I'm going to split my money,
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which means you're also going to learn
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how you can split your money.
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And actually my favorite part of this episode
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was we introduced a new character,
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Reese Witherspoon, our piggy bank
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and we answered a lot of questions about budgeting
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which kind of called me out quite a bit.
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We also heard the most delusional things
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that you all think are non-negotiables
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in your weekly or monthly spending
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which were really funny to talk about
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and we did some extra credit
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which is basically where I have to do homework
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and learn how to do the things
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that we have been teaching in these lessons.
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So you're not going to want to miss this episode.
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It's a really good one.
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Eh, Reese?
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this episode of iou some money education is proudly brought to you by the bank of new zealand
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when you're just starting out managing your money should feel easy so that you can focus on winning
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at whatever you're doing whether you're flatting saving to travel or making a career move they have
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all the tools to help you master your money from the get-go thanks so much the bank of new zealand
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for making iou some money education possible don't forget to check out iou the practical
1:48
lessons to put what you're learning into practice find the details in the podcast show notes
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so this episode we are talking about budgeting oh god now no everyone's gonna turn it off no
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don't turn it off because i've never budgeted ever and i think it's gonna be really interesting
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and it's simple and it's not complicated and it's fun trust us let's before we get into the episode
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let's draw green or red who is in the green this month who's in the red this month never not in a
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million years absolutely not in the red green with envy or green
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I'm in the green now
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As opposed to last month
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There was a bit of redemption going on
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In terms of I hermited a lot
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Chilled out a lot
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So I haven't actually spent a lot of money
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Which I'm
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Next month though
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It's going to be biggie
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So I'm kind of pre-empting that
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I've got weddings and stuff
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So I'm just like
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Good money mindset
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She's budgeting
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Forward thinking
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I really do think the planning piece
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In terms of being able to look ahead
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Is the single best thing you can do for your money
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like in terms of you know even we were speaking like in the last episode about like in the plan
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like up to Christmas thinking about it months and months in advance the more that you can look at
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your whole year and think like when am I going to be spending and saving and blah blah it's just so
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good I'm actually sorry to be also jumping on the trend of being in the green but I'm in the green
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this month but kind of in a different round I'm sort of in the red and green I'm in the red because
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I actually have a second investment property, which is wild.
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Oh my God.
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I know.
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But I'm in the green because we have tenants in the house.
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Can I ask you guys a question?
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I don't have a yearning to buy a house as somewhere to live yet
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or as an investment property.
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In fact, I never feel like I will want to buy a house
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as an investment property.
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is it just as good for me to be investing my own money in different things or is a house still like
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the best thing that you could be investing in before you answer it vick can i just ask you two
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questions because i i think because last year we interviewed maddie borg who's this young like
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gen z influencer and she spoke a lot about the idea of how a lot of gen z aren't interested in
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own property for many reasons because mainly because it's out of reach but I'd love to know
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is the reason you don't have interest in that because you don't want to be tied down is it
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because you don't want to be in debt is it because you don't think it's good investment is it morally
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like what are the kind of reasons behind it honestly I think it is that I don't want to be
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tied down and I like right now the things that I invest in there's no admin yeah I so get that
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because the last month for me, even though I'm in the red slash green,
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has been so much admin.
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And, like, I've done this with a friend, so we do it together.
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And he sat me down and was like, no.
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Yeah, so she's been doing more admin than you.
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And I was like, no.
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But it's also, like, I don't know.
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I think that the monetary payoff can be massive if you do it right.
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Yeah.
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Yeah, like I have built a lot of wealth from owning my property.
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I think there is ways that you can make it work for you.
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there's obviously countries where it doesn't make sense to buy property but new zealand
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we have no capital gains on your on your first house we have means not really so like no tax
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if the price goes from like uh like 100 grand to like 200 grand you don't get taxed on anything
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of that which is great like pretty much 99.9 of other countries you do uh and it's like so that's
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basically like the return that you're making if the house goes up in value you don't pay tax on
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increased value we don't have stamp duty either so if you're like that's that's a price that people
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pay when they have to like sell their house or buy a house it's like a transaction fee essentially
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we don't have that like it's honestly like one of the most lucrative places to buy property if you
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were going to buy property but also coming back to what you said in the last episode about like
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how you have subscription fees and you've got like advertising revenue you've got like all this
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money from different places of your business coming in for me having my property and money
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coming in and money growing growing my wealth through property yeah as well as shares it's
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diversifying right so it's like if if the world went tits up and the stock market went to zero
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yeah hopefully you'd still yeah like I'd still have an asset and and it's kind of the same it's
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like diversifying your the way you make money yeah I need to give you another spanner for this
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because actually this isn't really validating the decision of not buying property but it is
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something that I think it's good to know and this is something that it took me ages to get my head
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around but um and we'll go into more detail in this when we talk about good debt bad debt
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but essentially there's like certain debt that you can take on that's really good right and
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increases value and it gives you a real advantage financially and then there's things like buy now
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pay later if you're i don't know using that to buy a new dress and it's out of your budget which
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we're going to get to in a second where that's obviously not doing that yeah but like when it
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comes to borrowing money when you borrow money from a bank to invest in property let's say you
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bought a property for $100,000 and you have $20,000 to use as your deposit and then you have
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to borrow the $80,000.
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Let's say you buy it in five years time, that property is now worth $200,000
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rather than $100,000.
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You only have to give the bank back the $80,000.
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Like the idea of leverage
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is you borrow money to be able to invest more.
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So it's kind of like if you were doing that with
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the stock market, it would be like borrowing $80,000 to put in to compound what you can make.
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So essentially what it means is like it's really the only way or one of the only ways where you can borrow money from like an institution to make even more returns.
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So like what you could make say 10% in the stock market, 10% on your property is like 10% on not just the deposit but also the money you borrowed.
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So basically what it does is magnify the amount you can make which is why the idea of being on the property ladder or buying your first property.
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It's why I've been able to go for round two so quickly.
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It's just, I think it's just like the awareness of property and what leverage can do for like
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compounding the amount of money you make is actually quite amazing.
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But it is interesting that you think like that.
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Well, yeah, only because it's like such a thing of people my age.
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But it is also interesting because I'm like a woman on my own considering what it means
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for me to be able to buy a house, which I haven't actually been considering.
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But if I really wanted to, I could make it work.
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But I really don't want to.
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I'm just happy with investing personally right now.
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And I'm wondering, am I being stupid for doing that?
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And I just wanted to get some clarification that maybe I am.
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You can also invest in other things outside of property, right?
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Like you can invest in other businesses or things like that, which would be quite cool,
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which I feel like would be more up your alley than like.
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I think what's really cool is the idea of investing used to be invest in the stock market.
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And that was kind of the long and short of it or invest in the property market.
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there's so many other things that you can invest and make money in and I think if you're not feeling
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like overly called to invest in property don't go and do it because that's what everyone else does
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I don't think that's the answer but what I will say is that there it's just like going to a really
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popular cliche tourist attraction like it's cliche for a reason do you know what I mean yeah and so
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it's kind of like when it comes to building wealth building wealth and property makes sense in a lot
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of ways but if it's not for you you don't want to go do it just because everyone else is should we
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talk about budgeting I reckon we go around the room and just have a little open chat around
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who does it what are your feelings around it thoughts etc because I mean Vic and I probably
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do it in a pretty similar way but I would love to hear from you like is this something you do
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how do you feel about it etc okay personally in my personal life don't budget never have
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have always just worked jobs that means I know I'm making enough money to pay for what I need
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I've also never used buy now pay later and I've never had a credit card so I have had to think
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less about paying things off and having to be really strict on checking my accounts all the
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time because I'm just comfortable that I don't spend what I don't have and I always have money
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I need to make sure that I always have money for rent and food and things like that so personally
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I don't budget and I actually never check my accounts I forget to because I just I'm not that
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interested in having a shit ton of money which is interesting when we're talking about building
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wealth right now that's not my goal my goal is more like building a business that has longevity
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which then will result if I do it right in building wealth for the business because of my lovely
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accountant he makes me sit down once a year and do my budget with him which I never check never
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look at but it's a really helpful exercise to do once a year to see what I'm spending most of my
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money on and like so for example the past two years has been travel because I have been like
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building my personal profile and going and speaking at more things and meeting more people
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and I've agents now that live in the UK and so there's a lot more going on in different parts
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of the world and travel is a really beneficial thing for me even if you can't directly see a
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correlation between travel and income that expense is one that's been going up up up and
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my accountant is just like I just want you to be conscious of this but it's really good and it's
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fine that you're doing this and then like it's helpful to check what I'm spending on website
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costs and subscriptions and things like that but the budget is something I look at once a year
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and he will check in with me we used to do monthly and then he was like we don't need to do monthly
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you're fine and is this for personal business business yeah and I think I'm just a really
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interesting person because I just do not focus on finances very much but also I make enough that I
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don't have to focus on them yeah and that's such a privilege and at the start of the business when
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it was me, Ruby and Liv all working all on a salary.
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My job did become, oh my God, I need to
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make sure we have three salaries being paid all the time.
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It was a bit more stressful because
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you're looking after other people.
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But now that I'm just looking after me and money isn't my
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biggest worry or biggest flex, it's just not top of mind for me, which is a flex in itself and
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privileged.
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But it's because I've worked really hard to make it so that money's not what I'm
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thinking about 24 7 like the world is what I'm thinking about 24 7 I think that IOU the practical
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will be really really good for you in terms of the splitting your pay because what I will say is
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I used to think I know this might sound I hope this doesn't sound rude so I'm prefacing this
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but it might I used to think that was a flex in terms of like I don't think about or look at my
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money or open my accounts what I've really noticed is by um you know spending an hour an hour and a
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half figuring out what are my like things that I really need in terms of like the essential stuff
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I need to pay for like rent and blah blah blah the things that I want to pay for like if I want
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to go out for brunch whatever and then making sure I have enough for my investments like my surplus
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yeah and then also having this like regular awareness of like what's in my accounts in each
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of those buckets it's taken away so much more money stress than I could have thought and it's
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just interesting because the concept of checking it or like having done that or it being more top
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of mind I fully appreciate the idea of how that could sound like oh you're more obsessed or it's
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more on your mind or whatever but actually definitely splitting my pay in this way has
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actually freed up so much brain space and anxiety because there was times where I would spend and I
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had no idea what was on my card or I wouldn't know what was in that amount to spend if that
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makes sense yeah and I think having clarity for me in the different areas between like okay well
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I know that my rent always is automated out in a different account I know that the money that I can
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spend on fun shit is always automated out so when I check those accounts it's just and we'll go
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through that in more detail if people are listening to this and they want to learn how to how we teach
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it obviously you can do it in the course but I I think it would be so interesting to check in with
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you yeah do we've done that and for you to have this like newfound way of approaching money to
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see if that works for you I mean Vic you didn't used to be a huge budgeter no because you earned
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sorry I'm throwing under the bus here but you earned so much that you didn't need to budget
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well no it was kind of like I was like look I can I I've earned a decent salary I give context
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maybe for those who who don't know the curve or you or your background it might be so I used to
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work in finance so I was I we used to get we were on decent salaries and bonuses were great and like
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it was yeah very different now but no but yeah and I think that was kind of when I took you know
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budgeting seriously was when my salary was a lot lower and I was like right okay I can't spend how
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I used to spend well I have to reprioritize yeah I think the light bulb moment for me though was
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during COVID when like a lot of people in finance were losing their jobs a lot of you know and I was
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like I remember my boss being like if you get a call this afternoon you've lost your job and I
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It was just like, it was kind of this, like, I know.
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That is also a really shit thing to say.
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Put everyone on edge.
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And then he called me.
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He called me to tell me I didn't lose my job.
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And I was like, you said if my phone rang.
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So anyway, but for me, that was the moment of, oh shit.
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Like, yes, I've got money in investments,
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but I still have to pay a mortgage next month.
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You know, and like, if my salary doesn't, you know,
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like you can't just rely on one income stream,
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I think was my, my holy shit moment,
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even though I was still on a large salary,
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but now more so I have to be a lot more strict in terms of what I spend money on do you guys think
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because I don't have any dependents and I don't have a mortgage and I like don't really have and I
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don't have debt other than my student loan which I just pay off in lump sums when my accountant's
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like hey you need to pay this off now it means that my thinking is really different because
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I'm not having to split off so many I'm not having to pay a mortgage I'm not having do you pay rent
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though yeah so I think it's more just like if if you lost your job or you didn't have income coming
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in from tomorrow like yeah what would be the things where you're like oh shit I literally
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can't live without that and that's what like we talk about as being your your needs like what do
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you need to spend money on and for me it's having an emergency fund that yes if I did lose my job
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tomorrow then these are things I need to pay for and I've got a three-month buffer but I think also
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So to counter that is having multiple income streams or multiple revenue streams.
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What I also think, though, is particularly the people that are listening, because if you have an abundance of money or you're in a situation where you kind of always have leftover, you're less inclined to think you need to budget.
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But you're also less inclined to be able to do as much with your money because you're not being as clever with it.
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Yes, like you don't have to be.
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But then the other side of that is a lot of people who don't earn a lot of money.
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There's actually so much value, I think.
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in being in a position where you're not earning a lot because you learn the habits you get savvy
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and like your salary isn't what makes you wealthy or grows wealth it's being clever with it and
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there's a saying that like we often talk about where it's like if you can't manage a hundred
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you can't manage a million you know it's like someone could be earning a million dollars and
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spending 1.2 million because they've got a big big house and expensive cars and holidays and
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someone could be earning 60 000 and be spending 10 000 and they're actually a lot more wealthy
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you know so it's just like this whole you never know what people's outgoings are
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but if you can't keep your spending below your income the thing is you are spending below your
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needs and that's kind of the baseline here of this lesson is you need to spend less than your
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earning that's like what comes in you need to be at a minimum net net yeah you shouldn't be going
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into debt to buy things like new clothes that's just not the way to do it but i just think that
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the whole purpose of this is if you can learn how to split your pay yeah in a clever way that gives
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you because you might actually be able to essentially be investing 40 percent or like 30
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percent like you might actually be able to be putting more away and the earlier you can do that
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the more wealth you'll be building and so if you've just left school or you're in your first
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job it is like the perfect time to put these habits in place with what's coming in and figure
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out okay well like based on what's coming in how do I split this across the different elements of
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like what I need now, what I want now, and then the life I want in the future.
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Because like if you've got the beauty of living at home because you're young
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and you've got your first job, your first paycheck, your needs bucket,
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which is usually the most.
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So we split it into needs, wants, and then like surplus,
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which is like for future you where you're investing all your savings.
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If your needs is tiny, like put more into your surplus.
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Like you'll be so thankful in the future.
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Like don't just be like, I can spend more on my wants, you know.
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It's like, no, no, no, no, no.
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So if I had this in all those times that I was working when I was a kid and I instead of just walking to the bank and like giving them my money and depositing it, if I was putting it into investments, that would be insane.
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And I wish I did that.
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I wish I had this podcast.
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Lol, that's why we're doing it.
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Hot take.
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Wish I had this podcast when I was younger.
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Yeah, well, I mean, I think perhaps like a really good place to start would just be doing a quick overview of this session, which we're going to do in way more detail for you and for anyone that's interested.
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in iou the practical course but i think we just do an overview for anyone listening so that you
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at least have the fundamentals because it's super super easy like it's the most straightforward
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thing ever and i think that this is something that's like changed my life and i know that
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sounds so dramatic but for a long time with the curve like we spoke a lot about investing and
19:30
growing wealth and then we kind of missed this budgeting piece because you sort of assume that
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that this is the thing that your parents teach your school teaches you but no one does yeah
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and so for me like I had quite a few moments where I was either investing I was over investing which
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is great like it's a it's better to be investing than spending that on like a holiday in Europe
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but I was investing too much then I would pull stuff out and I think because similarly what
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you're doing in terms of like oh I've got leftover but it's not this consistent amount
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yeah you don't have a consistent place you're putting it etc the last thing you want to do is
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like pull money out of somewhere because that's where you can actually make a loss and that's
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where yeah you just don't you don't want to be this is what a lot of I see a lot of people doing
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is they put so much into their savings or their investments but then third week of the pay month
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or they're having to pull it out and that's just like you want to put habits of people or like
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just not go out and not spend any money and like hibernate it's like no that's not you just want
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to have like a formula that you can do every month that gives you control but also freedom
20:31
Okay, well maybe should we classify needs once?
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Surplus.
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Because like, what do you think would be your needs?
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Rent.
20:39
Yep.
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Petrol.
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Food.
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What kind of food?
20:42
Yeah.
20:44
We're going to split this one.
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Food in terms of I cook dinner with my flatmates,
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so I need to be able to cook at least one dinner and have...
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You cook.
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Just like, sorry, quick side note.
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What?
20:52
Am I going to cook?
20:53
No, and I hate cooking.
20:54
Same.
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I like hate it so much,
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but it's nice because I only have to do it once a week.
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Yeah, it's really great when you can share with people.
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But Fridays we all get takeaways
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And then the weekend is just a write off
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So there's like groceries versus food
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Okay so this is a good question
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Friday night takeaways, is this your essential or is this
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It actually is because I don't want to cook on a Friday
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Nah
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If you lost your job tomorrow
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You would be eating like spaghetti
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Or like baked beans
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This is a really good example
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If I lost my job I would not be getting takeaways
21:27
On a Friday
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but also I'd want it yeah yeah so maybe it's a want with that I think this is the this is the
21:34
perfect example right because it's like you have to be really clear about what are your needs and
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what are the things you want rather than merging it all together because that's where it gets
21:43
confusing because you shouldn't have an endless pot of money you spend on fun stuff like takeaways
21:50
or going out you should have a set amount that is just like a way more clever way to do it hard
21:57
and I'm like, oh my God, I'm getting up at 5 a.m. every morning,
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writing a newsletter, blah, blah, blah.
22:01
What's the point of working so hard if I can't then play hard?
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But I'm not saying you shouldn't spend money to play hard.
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I'm just saying you need to spend a certain amount each month to play hard.
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Plus your surplus will go into, you know, part of that goes into short-term goals,
22:12
like a holiday.
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So yeah, work really hard.
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More goes into your surplus, which goes into your holiday fund.
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Then you can have a holiday and thank yourself for working hard.
22:20
The easiest thing when it comes to like figuring out the amount you should have
22:23
in each bucket is generally the stuff that's in particularly the stuff that you need like your
22:29
essential bucket should be pretty standard every month like the things that you need like whether
22:34
you have insurance like that's the same every month your rent should be the same yeah yeah all
22:39
those things are the same so you know for me I put my um exercise in my essentials which a lot of
22:46
people might not but for me to be like happy healthy going to a yoga class yeah getting in a
22:51
downward dog brings me a lot of joy and I think even if I lost my job or I was in a position where
22:56
I had to really scrounge around I would still spend money on that because I would I feel like
23:01
I need it but for everyone it's kind of different and we'll go through this in way more detail to
23:06
give you examples and we'll go through your actual personal amount that's coming in and show you
23:11
exactly how to split it but I think it's more just giving you a taste for it and making the
23:15
idea of budgeting not feel like oh my god i have to have a spreadsheet an answer
23:25
okay so we have a new segment that we didn't do in the first episode but we're going to try to
23:29
moving forward we ran out of time too much shit chat from all of us it's called i owe you an
23:34
answer now we've put the questions in a piggy bank literally behind you so if you could pull that out
23:40
did you just oink oh gosh if anyone listening we have a piggy bank with flowers all over it's got
23:44
a very pink bottom.
23:46
I thought it would be clear
23:46
by the fact that I oinked.
23:48
It's very cute.
23:49
It's a literal piggy bank.
23:50
Can I tell you as well
23:51
the effort that Emily,
23:52
our producer,
23:53
went to to get this.
23:53
So yesterday we had,
23:54
this was a last minute idea
23:55
just before we,
23:57
you know,
23:57
got recording.
23:58
Last minute idea.
23:59
And we were looking at Amazon
24:00
and we were trying to find
24:01
a piggy bank.
24:03
This was one of the ones
24:04
on Amazon.
24:04
And we were like,
24:04
perfect, perfect.
24:06
And then it wasn't going
24:07
to be delivered
24:07
until tomorrow.
24:08
Emily found it on Facebook
24:10
and went and picked it up
24:11
from a random.
24:12
Love it.
24:12
Emily for president, honestly.
24:14
absolute dedication to the cause why do you think piggy banks oh a piggies i actually want to check
24:21
this i reckon that's because they're like you want to fatten them up it started with p y g g
24:26
not pig in medieval england people stored coins and jars made from an orange clay called p y g g
24:32
pig they were called pig jars over time the word pig stopped being used for clay
24:37
but stuck around and then turned into pig the picture it is so random so wrong i would have
24:43
Never have guessed it.
24:44
And in many cultures, pigs represent wealth, luck, and prosperity
24:47
because pigs get fat and they're tied to abundance.
24:51
And then they became cute and markable.
24:53
A little animal with a coin slot?
24:55
Way more fun than a plain jar.
24:56
So true.
24:57
Anyway, our cute little piggy.
24:58
Should we call it?
24:59
Should we name it?
25:00
Yeah.
25:00
What's it called?
25:01
Sophie.
25:02
No.
25:03
Is it called Emily?
25:05
No, let's call it.
25:05
Emily the Pig.
25:06
Should we call it Emily?
25:07
No, no.
25:07
Yeah, this is our producer.
25:09
This is our producer, Emily the Pig.
25:11
She's very greedy.
25:13
Madonna?
25:14
just in case she listens oh yeah maybe it's someone that's unfollowed you oh okay hello
25:20
reese witherspoon this pig is now called reese witherspoon
25:26
because it unfollowed me on instagram so good so funny am i picking out yeah you picked them
25:37
okay spending bingo go to your 10th payment and you'll yeah this was this was naughty for me
25:44
go to your 10th payment in your online banking app what was it and are you happy with the decision
25:50
to spend on it oh yeah all of us or you oh no it was actually fully lucy but we can all do it
25:55
okay wait i'll get mine up i'll get mine i'm not afraid oh my god i've got a really good one okay
26:02
what's yours oh okay yeah so i've been on holiday my baggage got lost so for two days i had nothing
26:09
so mine is 25 euros at the pharmacy so not that exciting but so what were you buying at the
26:15
pharmacy like i bought a hairbrush i had to buy toothpaste i bought a toothbrush deodorant i
26:21
bought all yeah which bucket did this come out of this is out of my needs i'm getting reimbursed
26:26
by British Airways.
26:27
Okay, nice.
26:28
Thank you.
26:29
That's really great.
26:30
But also in the south of France,
26:33
pharmacies are not cheap.
26:35
Yeah.
26:35
So I was like,
26:36
British Airways,
26:36
you better freaking come to the party.
26:39
Loss baggage is so admin.
26:41
Like having to borrow underwear
26:42
off my friends, you know?
26:43
Not ideal.
26:44
Yeah, sorry.
26:45
Lois, go.
26:46
Mine is
26:48
NJ Blackiston business account.
26:50
That is me
26:52
and it's negative $500.
26:54
That is me paying my dad
26:57
because I crashed my car quite a while ago,
27:02
but I pay for car insurance, right?
27:05
So I kind of fucked up the front of it.
27:06
And then I sorted out all the insurance stuff,
27:08
but I pay for it, but it's under dad's name.
27:12
It's a whole thing.
27:13
Anyway, I wasn't there,
27:14
so he ended up having to drop the car off to get it fixed
27:17
and pay for the insurance excess.
27:19
And then he just texted me being like,
27:21
it was 500 bucks and I had to pay him.
27:23
And that came out of my emergency fund.
27:25
Nice.
27:26
I don't really have an emergency fund.
27:27
I was looking at you like, don't lie.
27:29
It came out of my surplus, which is basically my emergency fund,
27:32
the stuff that just sits there where I'm not quite sure what to do with it yet,
27:34
but also thank God I had it because.
27:36
Yeah.
27:36
So basically emergency fund.
27:37
So I should have taken mine out of my emergency fund, to be honest.
27:39
I think so too.
27:40
That's why I asked because I was like, I think the point here is.
27:43
But I'll just reimburse it.
27:45
Well, both of ours are reimbursements,
27:46
so they'll just go back into wherever we took them out of.
27:48
Yeah.
27:49
But I think on that, when it comes to your emergency fund,
27:52
which again, we will get to, but like,
27:54
essentially you want to have that in a place that you can access quickly because for you
27:58
yeah I needed to you needed it like it wasn't a let's wait for it to come out of a term deposit
28:02
like so it's I think because in your head you're like well it's good I didn't have it somewhere
28:06
else but it's like yeah you can still have it somewhere else it's easy to access though
28:09
if you do you know what I mean um okay so mine was actually what was it not your wardrobes
28:18
no well hold on the reason I thought it was is because I got scammed I thought I could use that
28:22
as an emergency.
28:23
Oh, wardrobes, wardrobes.
28:24
Yeah, yeah.
28:24
Do you not think?
28:25
I think, well, I'm not the expert here, so I'll shut up.
28:28
If you haven't listened to the last episode,
28:30
Soph had a bit of a drama with her wardrobes.
28:32
Oh, scammed.
28:33
And leave it there so that they go and listen.
28:34
Oh, good idea.
28:35
Everyone go and listen.
28:36
Should we go back into Reese Witherspoon's bum and get in there?
28:39
Yes.
28:39
I have a question.
28:41
It's also not even her bum.
28:43
It's her tum-tum.
28:44
Do you want to go?
28:45
You go, Luce.
28:46
Into the bum.
28:47
It's your turn.
28:48
Come here, Reese.
28:48
The hole's pretty small.
28:50
Oh, if you had to approximate how much of your money should go to your future fund, building wealth, what would you say?
28:57
What percentage of your pay every month do you think should be going to your future amount?
29:02
So what's your future fund again?
29:03
Your surplus, your savings, your investments.
29:06
So after you've done essentials, after you've done your needs, what's your leftover?
29:09
Which also is used to pay down debt, if you've got debt.
29:12
If you were imagining a pie and the whole pie is what's coming into your account and you have a slice for the stuff you've got to pay for, like your rent and your blah, blah, blah.
29:20
You've got a slice for your fun shit.
29:22
What do you reckon would the future stuff?
29:24
I think 30%.
29:25
Wow.
29:27
Is that too much?
29:28
I mean, that's amazing.
29:30
Well, no, I'm not saying I can do that.
29:32
No, but I can.
29:32
Can I guess?
29:34
I mean, look, I hope you know the answer.
29:35
Oh, you bitch.
29:35
This is your whole life since you were eight years old.
29:39
Can I guess?
29:39
I know all the answers.
29:40
Pick me.
29:41
Yeah.
29:42
Oh my God, can I tell you what a bad thing is?
29:45
What is it?
29:45
Rhys wants to know.
29:46
20%.
29:47
So you're close.
29:48
Oh, okay.
29:49
But if you can do 30, amazing.
29:50
I've got a feeling you can.
29:51
I think I'm going to do 70.
29:53
I think you can do it.
29:54
I'm kidding, everyone.
29:55
She's a rich girl.
29:57
Okay, but your brother said this in his voice note in the first episode,
30:02
that you do, you live quite a modest lifestyle.
30:03
You're not going out and being like super lavish.
30:05
You don't live by yourself.
30:06
You purposefully live with friends.
30:08
You've got your costs.
30:08
I live with seven people, everyone.
30:10
Yeah.
30:10
I'm living in a hostel.
30:11
Yeah.
30:12
how fun with that though it means that that's probably why you have left over yeah which you're
30:17
kind of just like what am i doing and like i live in i work from home i don't do that much when i'm
30:22
at home i just sort of hibernate a little bit and then when i come and do things like i really want
30:28
your surplus to be working more though i feel like there's like i think in the practical episodes
30:34
that you guys are all gonna watch you'll see that i'm actually gonna start splitting off like we
30:38
We leave a little bit there for an emergency and then we take out.
30:42
Sorry, we don't leave it in a transaction account.
30:43
We take that out.
30:44
We put it into a high returning savings account
30:47
and we put the rest into investments.
30:49
Cool.
30:49
Do we reckon race has had enough?
30:51
Yeah, I reckon maybe I'd be quite keen to move on to cash and burn.
30:55
Yeah.
30:55
Cash and burn.
30:58
Cash and burn.
31:04
Cash and burn time.
31:06
the questions i asked for this one were what do you splurge on but that to you is a non-negotiable
31:14
and what is the most unhinged thing you've justified spending your money on so they're
31:19
kind of similar questions actually now that i'm thinking about it but um let's just see what
31:22
people responded someone said i convinced myself that i wouldn't get hired as a copywriter unless
31:27
i got veneers okay and then they said i got veneers and then got the job to be fair but it's
31:34
Like copywriting has nothing to do with having turkey teeth.
31:37
It's like having, like, you have a face for radio.
31:39
It's like your face has nothing to do with your copywriting.
31:43
It's more about, like, how good your fingers are for your copywriting.
31:45
Or your brain, maybe.
31:47
Lots of people were saying bread and coffee.
31:49
Like, they could justify buying good bread and good coffee.
31:54
I agree with that.
31:55
And I think there's something in the ritual of going to the bakery
31:58
and getting your bread or going to the cafe.
32:01
It's kind of also, yeah, it's the experience as well as the thing.
32:03
It's like flowers.
32:04
like some people think they're an absolute waste of money but to me i'm like no okay i actually
32:09
have something that i'll admit that i spend money on that i um justify to myself even though it's
32:16
insane oh no maybe it's not that insane when i work from home i'm sitting at my desk for a really
32:22
long time each day and i work from home basically every day and a few years ago my friend got this
32:29
candle that smelled like this old Taylor Swift perfume that I used to wear and I just fell in
32:34
love with this candle and then only since I've moved into my new house I've been like I really
32:38
need to light a candle and have my room smelling really nice every day and so it turns out the only
32:43
candle that I love so much is huge and it costs a hundred dollars and I light it at my desk every
32:50
single day.
32:51
For the whole day?
32:52
Yeah.
32:52
It's lit the whole day?
32:53
It's lit the whole day.
32:55
I'm more concerned
32:55
about like well it's lit while i'm in my room okay the whole day which i'm a really hard worker so i
33:01
am there most no um but i will say i buy it like on mother's day i will go on the website and it's
33:09
usually like two for one so i'll buy it on mother's day i'll buy it when i know that there's
33:13
deals but that is something that i um it makes my work day so much better i think that's kind of
33:19
an essential i actually i know that that's not technically an essential it's not but there's
33:24
Like, yes, there's the, like, strict you should, you shouldn't,
33:26
blah-de-blah-de-blah.
33:27
But also, it sounds to me like that is, like,
33:29
one of the highlights of your day.
33:30
Oh, my God, I love it.
33:30
It's almost like the candles, like, your takeaway coffee.
33:33
Coffee, down.
33:34
Coffee that I've made at home.
33:35
It's good to know what brings you, like, what you value, right?
33:39
Like, rather than spending money on clothes that you don't actually want to
33:42
or that don't bring you value.
33:43
If that brings you value, that's all good.
33:44
Also, sorry, you work from home.
33:46
You're not exactly splashy.
33:47
I don't have a big office and all this other shit.
33:48
It's like, I think you can buy the candle.
33:50
Okay, someone spent 70 pounds on a competition to meet Chris Evans.
33:54
Who's that?
33:54
But they were hundreds of dollars in debt and then they cried when they didn't win.
33:58
Oh no.
33:59
Oh my god, that sounds like a scam.
34:01
Who's Chris Evans?
34:02
He's the guy, he's off like...
34:05
Was he a materialist?
34:06
Yeah.
34:06
It's got Pedro Pascal and Dakota Johnson.
34:09
Yes, he's in that one.
34:10
Lots of people said books and beauty items, like lots of beauty things.
34:14
Lots of people said Botox.
34:17
Wait, is this the answer to what?
34:19
to what do you splurge on that you see as non-negotiable oh that's so interesting the
34:25
books would be mine i spend like way too much on books i reckon and justify it as like it's
34:31
work related and it's you know but also i'm there i'm here for that honestly like buying books for
34:37
me is kind of a non-negotiable if we're talking about like mental health things someone said a
34:43
$1,500 gaming PC
34:45
just so that my Sims 4 game
34:47
looked better.
34:48
But what is that?
34:49
Like a big screen, basically.
34:50
Like a big computer,
34:51
yeah.
34:51
Gaming computer.
34:53
Sims 4?
34:54
You are so funny
34:55
that the things you don't know.
34:56
Yeah, yeah, yeah, I know.
34:58
It's rogue.
34:58
Like, what is a PC?
35:00
But also, sorry, does Sims still exist?
35:03
Do you know people that play that?
35:05
Like friends or...
35:06
It's like lemmings.
35:07
Yeah, my designer, Abby,
35:09
she loves, she doesn't play the game,
35:11
but she loves designing houses
35:12
and interior designing and stuff.
35:14
So when she needs to just like have a break from the world,
35:16
she will log on to Sims and just design a billion houses.
35:19
Wow.
35:20
Niche, real niche.
35:21
And then the last one is I spend way too much money on my dog.
35:25
He is fully pimped out.
35:27
I know this sounds funny, but like it's actually starting to be a problem.
35:30
I can't help myself.
35:31
I just look at my dog and I don't know if she enjoys life.
35:34
So I try to bring her joy.
35:37
For the record, I'm sure Vic looks after her dog very well.
35:40
But you know, like, I'm like, you literally, like, I take you to the park and you love it.
35:44
But like, I like to treat you with food, with toys, because I don't know if you are actually enjoying life.
35:50
They can't tell you.
35:51
I know.
35:52
Miso is Vic's dog.
35:53
And I can tell you, she's living a stunning life.
35:55
Okay, good.
35:56
When I went to her house.
35:57
Her bed looks comfier than mine.
35:58
I had a bit of a saga where, long story, I had to go stay with Vic for a couple of days, not that long ago.
36:03
And I got there and Miso was sitting on this chic couch with all this gorgeous furniture.
36:08
just say this is my home I was like yeah you've got it good I figured out how you're gonna earn
36:14
that extra credit so extra credit is like homework that we're giving you for the month
36:22
yeah and last month's was to write down any whenever you spend money how did you how did
36:28
you feel did it give you anxiety did you feel great like yeah okay so most of the things I
36:36
spend money on i feel really good about can i just say that's a huge tick to even realize that yeah
36:42
well i just think i wouldn't spend it if i didn't feel good about spending it
36:46
but is that like is that like not normal i guess my my my experience was just like i i think when
36:55
i made an effort to start looking at it i started noticing the times that i yeah and i get for me
37:00
like group dinners I think because I don't drink heaps of alcohol okay I don't value spending money
37:06
on alcohol and it was just something I noticed when I would be out with groups and everyone was
37:10
ordering heaps of different drinks because they value spending money on alcohol when it would
37:14
come to splitting a bill they're fine with it it really it's something I find really difficult to
37:19
go and spend like 50 pounds on like especially because I drink slowly and I generally have quite
37:26
cheap drinks or not not alcoholic that just for me has just become this thing that I'm quite aware of
37:31
yeah okay um so I think it was more just and then I noticed I'm like oh but I'll spend 15 pounds on
37:37
nut butter and not feel like bull and can I live and it's just quite it's just different because
37:41
like people are different with that and so I think when it came to then like the pay splitting thing
37:46
and figuring out where I place value like for example with like wants or things I don't actually
37:51
need i love going out for brunch i love it it brings me so much joy because i love daytime
37:56
things because i'm i'm not so much of like a partier yeah so when it comes to then mapping
38:01
out how much should be in the different amounts it helped to know the things i like spending money
38:06
on and don't yeah if that makes sense yeah i think the one and it's really hard because i like
38:11
spending money on this but i feel this brings me a bit of guilt because i don't think i use it
38:17
enough is I get quite a lot of subscriptions because my job is reading the news and so I
38:21
subscribe to newsletters and I subscribe to the New York Times I subscribe to the Atlantic
38:26
and for example with my Atlantic subscription it's like over a hundred dollars a year and I'm meant
38:32
to be getting physical copies of the magazine and I haven't seen a physical copy in years and I keep
38:40
trying to fix it I've got no idea what account I subscribe to it on and so it gives me a bit of
38:47
stress that I like can't really cancel it and I don't know I could if I put the energy into it
38:53
it's one of those like like low level anxieties right to do or like to do on the to-do list but
38:58
like you're like oh and it's a business expense as well so it's like less on my priorities but
39:03
also like if I'm not reading the New York Times enough I'm like oh my god Lucy I'm not using it
39:07
I'm not using my subscription yes so when I don't use my subscriptions enough and it's same with
39:11
newsletters I read so many and some months I just don't have time to like read them and then
39:17
I'm like, I feel good because I'm paying for media that I love
39:19
and it's usually independent, but I also feel bad because I'm like,
39:22
oh my God, this money is just coming out of my account
39:24
and I'm not even reading the newsletter.
39:26
So those are things that actually bring me a bit of guilt.
39:30
I think that's a good one though, the fact that you've even looked
39:32
at subscriptions because that's one that a lot of us are like,
39:35
and actually, fun little bingo, subscriptions for you, essential,
39:39
like from a business expense, but for most of us,
39:43
Netflix is not an essential.
39:45
sorry to spoil it
39:46
but it's not
39:47
but also looking
39:47
at your accounts
39:48
will help you realize
39:49
if you've got like
39:50
two Netflix subscriptions
39:51
or like
39:52
an Atlantic one
39:53
that you need to
39:54
totally or a rogue
39:54
like Amazon Prime
39:55
one that you never
39:56
actually realized
39:57
you had
39:57
the amount that
39:58
comes out for me
39:58
for Apple
39:59
is disgusting
40:00
me too
40:00
and it's like
40:01
obviously I need
40:01
this iCloud shit
40:02
but what even is it
40:04
why did I just have
40:04
another 16 pounds
40:05
come out
40:05
like what is that
40:07
because there's not
40:07
like a sub category
40:08
and it's like
40:08
sign in with your
40:09
Apple ID
40:09
I was like
40:10
well I don't know
40:10
my Apple ID
40:11
so I'll just keep
40:12
I'll keep paying
40:12
until I figure it out
40:13
next time
40:14
so we have some
40:15
extra credit for this month.
40:17
God homework just doesn't stop.
40:19
Yeah exactly.
40:20
Welcome.
40:20
Welcome to school.
40:22
So I want when you get paid next month
40:25
I want you to split that into
40:26
a needs bucket, a wants
40:29
bucket and then a surplus bucket.
40:31
And if there's anyone else that's listening to this
40:33
that would like to do the same thing this month
40:36
there's a link in the podcast show
40:37
notes to do IOU
40:38
the practical course.
40:40
Where I'll actually be doing
40:41
it so you can kind of do it with me.
40:43
and you should because then we're not alone
40:46
guys
40:47
we are not alone
40:48
everyone look at the camera
40:49
Rhys you're not alone
40:50
we're all in
40:52
okay well see you next month
40:58
that's it for this month's episode
40:59
of IOU some money education
41:01
if you liked the show you know what to do
41:04
rate, review
41:05
and make sure you hit follow or subscribe
41:07
or whatever it is to make sure that you don't miss
41:09
next month's episode
41:10
and if you want to do IOU the practical course
41:12
alongside Luz.
41:13
You will learn everything
41:14
that she's learning at the same time.
41:15
You can hit the link
41:16
in the podcast show notes.
41:17
Thanks for coming, Luz.
41:18
Hope you learned something
41:19
and we'll see you all next month.
41:20
Thank you so much,
41:21
the Bank of New Zealand,
41:22
for sponsoring this episode
41:23
of IOU Some Money Education.
41:24
There is an art to starting something new
41:26
and just like any art form,
41:28
you need the right tools to make it work.
41:30
Whether you're flatting
41:30
or you're saving to travel,
41:32
maybe you want to make a career move,
41:33
the Bank of New Zealand has the tools
41:35
to help you master your money
41:36
from the get-go.
41:37
And don't forget to check out
41:38
IOU The Practical Lessons
41:39
to put everything
41:40
that you've been learning into practice.
41:41
You can find the details in the podcast show notes.
41:51
Okay, quickly, the curve was created to empower and educate you about investing,
41:54
but we are not financial advisors.
41:57
Our platform exists for educational purposes only, and it doesn't provide personalized
42:00
investing advice for your individual needs and should not be relied upon to make an investment
42:05
or financial decision.
42:06
And always remember to do your own research before making any investment or financial decision.
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we're here for any knowledge and support you need but the final call is always yours
42:15
and thanks for being here you got this yeah we know you got this