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FRIDAY DRINKS: Afterpay is in HOW much debt?! · She's On The Money

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Speaker 1: Just before we get started, we'd like to acknowledge and
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Speaker 1: pay respect to Australia's Aboriginal and torrest Rate islander peoples.
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Speaker 1: They're the traditional custodians of the lands, the waterways and
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Speaker 1: the skies all across Australia. We thank you for sharing
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Speaker 1: and for caring for the land on which we are
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Speaker 1: able to learn. We pay respects to elders past and present,
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Speaker 1: and we share our friendship and our kindness. She's on
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Speaker 1: the Money, She's on the Money. Hello, and welcome to
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Speaker 1: She's on the Money, the podcast for millennials who want
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Speaker 1: financial freedom. Welcome back to another one of our Friday
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Speaker 1: Drinks episodes, arguably our favorite episode of the week, where
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Speaker 1: we get to celebrate the money wins from the She's
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Speaker 1: on the Money community. There are always so many great
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Speaker 1: money wins and confessions that are shared in our Facebook
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Speaker 1: group each and every single week. And we've told you
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Speaker 1: a million times before, and I'll continue to tell you
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Speaker 1: how much we talk about you in the office when
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Speaker 1: you're not around. So given we do all of that,
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Speaker 1: we only feel it is right to share that information
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Speaker 1: with you and recap the week and have a chat
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Speaker 1: about some finance topics and I cannot wait to get
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Speaker 1: here because this week, Jess, you have some juicy afterpay information,
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Speaker 1: so definitely stick on around for the end of the
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Speaker 1: episode to get to that. But before we get there,
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Speaker 1: Jesse Gridici Monday Saucy Monday is our money Diary episode.
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Speaker 2: What happened it sure is we chatted to a lovely
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Speaker 2: person who works as a diesel mechanic, which is obviously
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Speaker 2: a super male dominated industry, and she talked us through
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Speaker 2: her experience, like that she makes great money because it's
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Speaker 2: obviously a skilled job, but that does mean that she
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Speaker 2: has to compete with certain other things and that's why
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Speaker 2: it's so high paid. So with no degree, she went
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Speaker 2: out she got herself this an incredible job that plays
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Speaker 2: incredibly well and is working towards her financial goals, which
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Speaker 2: is awesome but also really cool to you from someone
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Speaker 2: who does something a little bit different.
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Speaker 1: I felt like she was just so cool and every
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Speaker 1: time we brought up a new question should just be like, yeah,
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Speaker 1: wrapping it, I'm a diesel mechanic, and I'd be like,
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Speaker 1: you're a sick oh, I love you in Cred was like,
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Speaker 1: that's definitely not the right way to cool. So I'm
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Speaker 1: just outing myself as the not cool sibling growing up.
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Speaker 1: Gee King, Hello, you were friends with my very cool
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Speaker 1: sibling growing up. Cool lady, she's much cooler than me.
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Speaker 2: Don't tell yourself.
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Speaker 1: Shot, thank you, thank you. What happened on our Wednesday
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Speaker 1: deep dive there?
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Speaker 3: So this week on the show, we spoke about budgeting
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Speaker 3: for charity and philanthropy. It's something that comes up in
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Speaker 3: the Facebook group time and time again, and we haven't
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Speaker 3: really touched on it.
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Speaker 1: For some people.
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Speaker 3: I guess it might be perceived as like a bit
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Speaker 3: of a luxury. If you've got a bit of extra cash,
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Speaker 3: you can put it towards something that means a lot
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Speaker 3: to you. And obviously as well, like this year, there's
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Speaker 3: been so much tragedy all around the world.
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Speaker 2: We've had the floods, we've.
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Speaker 3: Had everything going on in Ukraine. So it's interesting to
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Speaker 3: hear the ways that we can help and the implications
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Speaker 3: of that from like a tax perspective and so on
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Speaker 3: and so forth. It was a really helpful episode. Oh,
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Speaker 3: I'm glad you liked it.
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Speaker 1: I felt like it could have been a bit of
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Speaker 1: a dry one, because finance can sometimes be dry. But
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Speaker 1: the big takeaway I felt I wanted everybody to get
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Speaker 1: out of that episode. And if you didn't get it,
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Speaker 1: I'm telling you now is that it is a privilege
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Speaker 1: to be able to, you know, donate to charity and
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Speaker 1: give money away. And I don't want anyone in a
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Speaker 1: financial position where they're like, oh, I now feel so
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Speaker 1: much pressure to give money away when I don't even
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Speaker 1: have enough to put food on the table, Like, no,
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Speaker 1: you do you You put your own oxygen mask on first,
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Speaker 1: And if you have the ability to help others, you
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Speaker 1: have the ability to help others. But it's not expected
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Speaker 1: of you at all. And I think that what goes
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Speaker 1: around comes around, and if you're not able to at
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Speaker 1: this point in your life, that is totally okay, and
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Speaker 1: you can do it at another point that might make
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Speaker 1: more sense to you. And I also don't want people
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Speaker 1: to forget that it's not always just financial, Jess. You
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Speaker 1: do a lot of volunteer work where it's not financial.
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Speaker 1: Like I remember I called you the other day and
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Speaker 1: I was like, I put you up to and you
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Speaker 1: were like, ah, just volunteering on the flood relief collecting items,
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Speaker 1: and I was like, oh, angel, she actually is an angel.
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Speaker 2: Stuff but I was like, how did.
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Speaker 1: You even get into that? Like, I didn't know you
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Speaker 1: were going to do that today. You were like, oh,
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Speaker 1: I drove down because I was going to donate something
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Speaker 1: and they needed a hand, so I stuck around. And
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Speaker 1: I just think that that is really beautiful. One because
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Speaker 1: Jess is a legend, but we already knew that. But Two,
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Speaker 1: it's really not always about money. It can just be
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Speaker 1: about sometimes we need hands on decks, sometimes we need
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Speaker 1: to volunteer, and those opportunities exist, So if you've got time,
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Speaker 1: please try and sort them out, because there are lots
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Speaker 1: of them, especially at the moment.
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Speaker 2: Donating time is just as good as donating money if
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Speaker 2: you can't donate money. But it's also really interesting to
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Speaker 2: think about the tax implications because I think, like as
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Speaker 2: you guys discussed on the show, like there are certain
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Speaker 2: financial benefits for certain charities or certain donations you know,
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Speaker 2: very specific to what you're doing or whatever. But I
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Speaker 2: feel like it's very much a rich person thing to
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Speaker 2: be like, I am donating money for this particular like
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Speaker 2: oh yeah, right, Like the everyday person really doesn't know about.
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Speaker 1: That, no, And it totally doesn't benefit you if you're
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Speaker 1: under one hundred and eighty thousand dollars in earnings, which
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Speaker 1: most of us are, let's be honest, So it's not
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Speaker 1: actually something that is known to us. But I think
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Speaker 1: it's important to know that even if you make a
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Speaker 1: donation of more than two dollars, if you have the
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Speaker 1: re seat, you can claim it on tax exactly. So
5:18
Speaker 1: that's really nice. And obviously, if you're doing good bookkeeping,
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Speaker 1: you'll be collecting that anyway and making sure that you
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Speaker 1: give that to your accountant tax time, or putting it
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Speaker 1: into your tax return when you do it yourself online.
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Speaker 1: So I think it's important to keep track of it
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Speaker 1: because you can claim it. But yes, we can't all
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Speaker 1: just go make massive donations to museums to write it
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Speaker 1: off on tax. Unfortunately, we'll get there.
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Speaker 2: I'll get there.
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Speaker 1: Ge King wants to buy a yacht, so we're going
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Speaker 1: to get there, aren't we. Exactly.
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Speaker 3: Please donate to my charity, Cheeking Yacht Foundation Foundation.
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Speaker 1: All right, that sounds very a a delv.
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Speaker 2: Let's move on. That's my inspiration. Should we talk about
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Speaker 2: money wins?
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Speaker 1: We absolutely are you putting on the table this week?
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Speaker 3: Girl is our first one comes from it to Sena.
6:00
Speaker 3: I feel like you guys going to love this, so
6:02
Speaker 3: make sure you're listening. I am looking to Shina. I've
6:06
Speaker 3: been eyeing off a new vacuum cleaner for ages. Decided
6:10
Speaker 3: to buy it. Here's the breakdown. The cost originally was
6:13
Speaker 3: three hundred and ninety nine dollars. I had a code
6:16
Speaker 3: for eBay that took off thirty two dollars, and I
6:19
Speaker 3: cashed in my shop back dollars for an eBay card
6:21
Speaker 3: that took off three hundred and twenty five dollars. Total
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Speaker 3: spend forty two dollars plus I've now got nine dollars
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Speaker 3: in cash back from buying e Bay cards.
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Speaker 2: How good. We met her at the Sydney event and
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Speaker 2: she literally said I love shot back like I'm such
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Speaker 2: as she's on the money person, like I listened to
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Speaker 2: everything I do, all of these things. I have these
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Speaker 2: tricks and hacks. And there you go. She clearly was
6:45
Speaker 2: not lying.
6:45
Speaker 1: To She is putting down what she is peaking up.
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Speaker 2: I love her. How good is that?
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Speaker 1: I'm glad you made us listen, as though we never
6:53
Speaker 1: listened to the money with I know, I don't know why.
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Speaker 3: I said that.
6:55
Speaker 1: All right. The next one comes from Tyler.
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Speaker 3: I went to the car wash yesterday, and when I
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Speaker 3: got out to wash my car, the car in front
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Speaker 3: had left ten dollars on the machine or money. We'll
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Speaker 3: have a clean vehicle.
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Speaker 2: Next wind comes from Rachel.
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Speaker 1: I'm actually laughing because it could have been a like hey,
7:14
Speaker 1: forward gone like random back to your guy, and they've
7:19
Speaker 1: left it thinking that you please the next person.
7:23
Speaker 2: Nap, I'll catch up.
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Speaker 3: The next wind, guys, comes from Rachel. I finally got
7:29
Speaker 3: COVID and pretty sure it's a money win because I'm
7:32
Speaker 3: saving ten dollars a day on my coffee habit by
7:34
Speaker 3: not being at work. That's say to look at it, yes, exactly,
7:39
Speaker 3: feeling better soon, exactly right, We've all been there.
7:41
Speaker 1: I spent so much on cough lollies and cough drops
7:43
Speaker 1: in Panandole. I don't know what if it makes up
7:45
Speaker 1: for it. Did spend a lot on cottee.
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Speaker 3: The next wind comes from Trista. I flew to Perth
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Speaker 3: and back for Easter for twenty dollars each way due
7:53
Speaker 3: to some cheap flights I nabbed a while ago. She
7:56
Speaker 3: must have got like deep in twenty twenty or something
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Speaker 3: when it was just never.
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Speaker 1: Like I really should have made use of that pariod
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Speaker 1: more than twenty dollar.
8:09
Speaker 4: Going.
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Speaker 2: Truly, I'd be like, put me on a plane, I
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Speaker 2: don't care, send me anyway twenty dollars.
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Speaker 1: Do you really not care?
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Speaker 2: Oh? Here we go? Where would you send me?
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Speaker 1: I'm not telling I think I just can you imagine
8:18
Speaker 1: putting just on a surprise flight.
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Speaker 2: See Elena have fun?
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Speaker 3: Twenty dollars thanks coming where it would be funny to go?
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Speaker 1: I don't know, but I can't imagine being able to
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Speaker 1: get someone on a flight without them knowing by virtue
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Speaker 1: where they're going, without making them look like a hostage. Literally,
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Speaker 1: you'd have to like blindfold her and put ear pods
8:38
Speaker 1: or something on her so.
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Speaker 2: She couldn't couldn't hear the announcement.
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Speaker 1: Yeah, it looked like I was kidnapping her or trafficking
8:44
Speaker 1: her or something. It would be cost stressful to know
8:46
Speaker 1: from me what's the next money When the.
8:48
Speaker 3: Next one is a money win slash loss. It comes
8:51
Speaker 3: from Libby. My emergency fund is coming to use as
8:54
Speaker 3: someone hit the back of my car and didn't leave
8:56
Speaker 3: their contact details so I don't have to pay for
8:59
Speaker 3: repairs slash e access to get it fixed. I'm very
9:01
Speaker 3: grateful that I don't have to stress about where the
9:03
Speaker 3: money is going to come from. Little clap of how.
9:05
Speaker 1: Good is that?
9:06
Speaker 2: It's really good? But also it's a bit of.
9:08
Speaker 3: A dodgy move from the other driver.
9:10
Speaker 2: Don't be a.
9:10
Speaker 3: Dickuse what goes around comes around. I'm going to get
9:16
Speaker 3: that person had bad coma. The next thing comes from Anna.
9:19
Speaker 3: It was easter long weekend and lots of people were
9:22
Speaker 3: ordering fish on Friday. I do Uber and dow Dash
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Speaker 3: and made six hundred dollars just on Friday alone.
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Speaker 1: Yes, do fish and chip shop down on the peninsula
9:32
Speaker 1: where I'm from closed all easter. YEH missed opportunity.
9:37
Speaker 2: From my understanding, I'd been super interested to know how
9:40
Speaker 2: much people can make on Uber.
9:42
Speaker 3: That surprised me.
9:43
Speaker 1: I didn't know that was a thing. She must have
9:45
Speaker 1: done it per order. Perhaps I don't know how it
9:48
Speaker 1: works either, And that send us a message we want
9:51
Speaker 1: to know more about your pervy financial situation. Just you
9:54
Speaker 1: know what we need to get. We need to get
9:55
Speaker 1: somebody who's done Uber and get them to do money dough.
9:58
Speaker 1: I reckon that would be that would be pervy, Like
10:01
Speaker 1: I don't just want to know, Oh, how much do
10:02
Speaker 1: you earn? In general, like how much per trip? Like
10:06
Speaker 1: obviously the longer you stay out, the more money you make,
10:08
Speaker 1: but like is it more do you get surges if
10:11
Speaker 1: you do uber eats?
10:13
Speaker 2: I don't know.
10:13
Speaker 1: There's a lot of questions I have that are currently unanswered.
10:16
Speaker 2: We'll find a person.
10:16
Speaker 3: Let's move on, though, Je it's our final win for
10:19
Speaker 3: the day, guys, it comes from Ram money win. I've
10:21
Speaker 3: been waiting for my turn to be able to post this.
10:24
Speaker 3: I paid fifty thousand dollars a debt off in fourteen months.
10:28
Speaker 3: Last week we had the bank backflip on our pre
10:30
Speaker 3: approval for our home loan after our offer was accepted,
10:33
Speaker 3: so I had to get a loan on my own
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Speaker 3: and borrow fifty thousand dollars from my parents. It took
10:37
Speaker 3: lots of hard work and sacrifice to be able to
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Speaker 3: pay them back so quickly. Now we are so used
10:42
Speaker 3: to saving that we will have our house paid off
10:44
Speaker 3: in six years. Wow.
10:48
Speaker 1: Air pic along that she'd been waiting to post it.
10:50
Speaker 1: I was like, oh my god, it's my time to shine.
10:52
Speaker 1: And we get so excited seeing posts like that, so
10:55
Speaker 1: keep them coming. But George, Jess, do you know how
10:58
Speaker 1: much that is per month? This woman was saving thirty
11:01
Speaker 1: five hundred dollars per month to give that fifty grand back.
11:05
Speaker 2: Losh, imagine the streamers. Congratulations, so excited that that is
11:11
Speaker 2: airpit huge. That's it for the week, ladies.
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Speaker 1: Well let's go to a quick break, and then when
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Speaker 1: we come back, we are talking once again about after pay.
11:19
Speaker 2: Oh rady, guys, I have an article for you that
11:22
Speaker 2: I know we're going to have some fun with.
11:23
Speaker 1: We're talking, though, well what are we talking?
11:26
Speaker 2: We're gonna have fun, don't know I anybody else will.
11:27
Speaker 2: I'll have fun. We're talking about after pay.
11:30
Speaker 1: You guys know we're their biggest fans.
11:32
Speaker 2: Oh cough cough. No, but it's a really interesting article
11:35
Speaker 2: came out last week because they did drop a financial
11:38
Speaker 2: report recently and it said that they have been operating
11:41
Speaker 2: at a massive loss.
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Speaker 1: I'm just shook that a company that is so in
11:47
Speaker 1: debt is still just like plodding along getting it done,
11:50
Speaker 1: getting more of you in debt.
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Speaker 2: It's wild. So they reported that in the first half
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Speaker 2: of FYI twenty twenty two, so June to December last year,
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Speaker 2: last year correct, they had one hundred seventy six million
12:02
Speaker 2: dollars of bad debt bad debt, not just debt.
12:04
Speaker 1: For like you know, growing the business or whatever. Debt, debt, debt, debt,
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Speaker 1: And that was up the year previous they only had
12:12
Speaker 1: seventy two millions. They were up over one hundred million
12:15
Speaker 1: dollars in bad debt in twelve months, which, oh, easy
12:18
Speaker 1: to do it, that's real easy to Yeah, we've all
12:20
Speaker 1: been in there.
12:21
Speaker 2: Everyone in the community is like, I'm in debt. You're
12:23
Speaker 2: not in debt that bad.
12:24
Speaker 4: That makes you.
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Speaker 2: You're not enough to pay any better.
12:28
Speaker 1: It's how much you will cost you after pay a yacht.
12:32
Speaker 2: Surely not, you wouldn't be able to do that. Yeah,
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Speaker 2: So it's pretty crazy when you look at the numbers.
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Speaker 2: Their lately revenue increased exponentially. Once again, just got me.
12:41
Speaker 2: I was shook for a company that tells us no, no, no,
12:44
Speaker 2: we're not putting people in a worse off position. We're
12:47
Speaker 2: making sure that they're doing the right thing. If we
12:49
Speaker 2: do credit checks, though, that would be compromising their privacy.
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Speaker 2: Don't really want to do that, Jess, what is it
12:54
Speaker 2: this year? So this year it was for that same
12:57
Speaker 2: time period seventy eight point five million, which is, if
13:01
Speaker 2: my math is right, over double the year previous which
13:04
Speaker 2: was six point quick math, great for me, good work.
13:07
Speaker 2: Bear so many millions of dollars and again that is
13:10
Speaker 2: just from late fees that they have changed fees.
13:12
Speaker 1: That's disgusting for a company that ah makes me so angry.
13:16
Speaker 1: Can you imagine how much money that is, like just
13:20
Speaker 1: in a room, and how many people could be out
13:22
Speaker 1: of debt if we had that money.
13:23
Speaker 2: It just it makes me really annoyed because they're big
13:27
Speaker 2: thing that they push in all of their marketing. They're like, spend, spend, spend,
13:30
Speaker 2: get what you want, worry about paying it off later.
13:32
Speaker 2: And then they try and flip the narrative in their
13:34
Speaker 2: advertising and say, were you for you to help you
13:36
Speaker 2: cash flow yourself, to help you make sure that you
13:38
Speaker 2: can break things down and keep them manageable. But if
13:41
Speaker 2: you're making back almost eighty million dollars in late fees,
13:44
Speaker 2: I would argue that you're probably not making things manageable
13:47
Speaker 2: for people. In fact, you're doing quite the opposite.
13:49
Speaker 1: Because you can sign up to after pay and only
13:53
Speaker 1: have the amount of money in your account for the
13:55
Speaker 1: first installment. You don't have to have that full amount
13:58
Speaker 1: because it's not taken out.
14:00
Speaker 2: On that day.
14:00
Speaker 1: And even if you did have that full amount in
14:03
Speaker 1: your account on that day, there's nothing to say that
14:05
Speaker 1: you wouldn't go and spend it in another transaction five
14:08
Speaker 1: minutes after signing up to after pay, meaning.
14:10
Speaker 2: You can no longer afford it, which is insane.
14:12
Speaker 3: So there's still no credit checks at all happening.
14:15
Speaker 1: No, they keep saying things like, oh, maybe in the
14:17
Speaker 1: future will do soft credit checks, which I don't think
14:20
Speaker 1: is enough because for every other credit product in Australia
14:24
Speaker 1: and every other debt product in Australia, you have to
14:27
Speaker 1: do a credit check. And that credit check. As much
14:29
Speaker 1: as people always like, oh my credit score, you know
14:32
Speaker 1: it's bad or I don't want them impacting my credit
14:34
Speaker 1: score by checking, it's putting you in the best possible
14:37
Speaker 1: position by having it checked, because they might check it
14:40
Speaker 1: and be like, gee, you can't afford it because you
14:42
Speaker 1: just bought a yacht, Like it's not going to work.
14:45
Speaker 1: You don't have the cash flow or the proven record
14:48
Speaker 1: of paying your yacht back, so we aren't going to
14:50
Speaker 1: give you access to more debt. Or we can see
14:53
Speaker 1: that you already have three or four credit cards. This
14:56
Speaker 1: isn't in your best interest like it is for the
14:58
Speaker 1: greater good that credit checks had done on the flip
15:01
Speaker 1: side of that, though, credit checks are also done to
15:04
Speaker 1: protect the borrower, to protect after pay. If they did that,
15:07
Speaker 1: they'd say.
15:08
Speaker 2: Ugh, g has a yacht.
15:09
Speaker 1: Probably shouldn't be lending to that person. And they look
15:12
Speaker 1: at Jess, who's been saving for a first home very diligently,
15:15
Speaker 1: I might add, and doing you know, everything right, and
15:19
Speaker 1: has really great cash flow, and that would be reflected
15:21
Speaker 1: on her credit report, meaning she's a better contender to
15:25
Speaker 1: lend to. So at the moment, they're just like spraying
15:27
Speaker 1: it out everywhere and not really minding who goes where
15:30
Speaker 1: or what. And the people like George who have yachts
15:33
Speaker 1: are the ones that are paying late fees because they're
15:36
Speaker 1: not good at managing their money and they're not good
15:38
Speaker 1: at the cash flow side of things. But then this
15:41
Speaker 1: company is, you know, showcasing people like Jess, and they're like,
15:44
Speaker 1: oh my gosh, it's just a tool that she uses
15:47
Speaker 1: to be in charge of her cash. It's like, no,
15:49
Speaker 1: people are turning to this because they can't afford things,
15:52
Speaker 1: not because they want good cash flow. Because if you
15:55
Speaker 1: want good cash flow, I can give you a system
15:57
Speaker 1: that's like after pay with your own bank account.
16:00
Speaker 3: In terms of this debt that is making news, it's
16:03
Speaker 3: clearly massive, it's substantial. But who is it substantial for.
16:06
Speaker 3: Is it for the investors who are looking at after
16:08
Speaker 3: pays a good option or is it for after paid.
16:11
Speaker 2: Users or ken or lost dogs? Okay, talk me through that.
16:14
Speaker 4: Why.
16:15
Speaker 1: So the debt that they carry is obviously their own
16:17
Speaker 1: debt from spending money on growing their company, but also
16:20
Speaker 1: the debt that individuals have with after pay, because at
16:24
Speaker 1: the end of the day, the brunt it stops with
16:26
Speaker 1: them and they're the ones that are in debt technically.
16:30
Speaker 1: So when you use after pay, you're going, all right, well,
16:33
Speaker 1: I'll put this one hundred dollar item on after pay,
16:36
Speaker 1: and that's a debt that you owe to after pay.
16:39
Speaker 1: So therefore, on the balance sheet of after pay it
16:41
Speaker 1: sits in their liabilities column and it would say Georgia
16:44
Speaker 1: King one hundred dollars. So that's a debt that they
16:47
Speaker 1: haven't recovered yet. And every single user, and Jess, I
16:50
Speaker 1: think you said before there were eleven million of them.
16:53
Speaker 2: Yeah, it was eleven million in I believe twenty twenty,
16:57
Speaker 2: so okay, so.
16:58
Speaker 1: Arguably quite a few more ways definitely more than that,
17:01
Speaker 1: but there would be a line item technically for every
17:04
Speaker 1: single person that uses after pay with what they owe,
17:07
Speaker 1: and then if you add all of that up, that
17:09
Speaker 1: would be some of their debt. So I think it's
17:11
Speaker 1: interesting because jess that would be a real big spreadsheet.
17:14
Speaker 1: That would be spreadsheet that would intimidate that. Yeah, they
17:18
Speaker 1: probably don't use spreadsheets anymore.
17:20
Speaker 2: They've probably got some very fancy back end stuffwere I
17:22
Speaker 2: would imagine.
17:23
Speaker 1: I'm just taking a stab in the dark.
17:25
Speaker 2: I just assume.
17:26
Speaker 1: But if we boil it down, that's how it works.
17:28
Speaker 1: They have this line item that's Georgia King or jessic Ricci,
17:31
Speaker 1: and that's how much you own.
17:33
Speaker 2: It gets added up.
17:34
Speaker 1: So if George Ow's one hundred dollars and Jesso's fifty dollars,
17:37
Speaker 1: their debt collectively that they haven't recovered yet its one
17:40
Speaker 1: hundred and fifty dollars. Does that make sense?
17:42
Speaker 2: Yeah, I wonder if that's the reason why. So after
17:45
Speaker 2: Pay if you didn't know if anyone listening at home
17:48
Speaker 2: was purchased by Block, which is like a tech company.
17:50
Speaker 2: There are a number of companies that they own that's
17:52
Speaker 2: all very stock standard. But when they purchased after pay,
17:55
Speaker 2: the projected growth was at seventy percent, So, which.
17:58
Speaker 1: Is wild, Like, that's a good purchase, right you go, ooh,
18:01
Speaker 1: seventy percent return.
18:02
Speaker 2: Voyners sounds incredible on paper and would probably have played
18:06
Speaker 2: a very big part in the amount of money the
18:08
Speaker 2: Block chose to spend and all of those kinds of things. However,
18:11
Speaker 2: now with their current financial position, it's actually only running
18:15
Speaker 2: at about twenty five to thirty percent.
18:17
Speaker 1: And that is a massive decrease, especially considering the premium
18:21
Speaker 1: that Block had to pay for after pay, Like they
18:24
Speaker 1: didn't just pay what after pay was valued at. They
18:26
Speaker 1: paid a massive premium because they're like, you are the
18:29
Speaker 1: biggest buy now, pay later in the world.
18:31
Speaker 2: We want to own you. They already own Zippay. The
18:34
Speaker 2: people who own Block are the people who own Twitter.
18:36
Speaker 2: Like they are big. They're going for collecting data. It
18:39
Speaker 2: was worth it to them, but like, you'd be pretty
18:42
Speaker 2: peeved if you had made such a big investment to
18:46
Speaker 2: then have it, yeah, not work out the way you
18:49
Speaker 2: wanted it to. Hey, wild When I was looking into
18:52
Speaker 2: some articles on this particular topic, because they have been
18:54
Speaker 2: a whole bunch of them popping up all across the
18:56
Speaker 2: finance space. Over the past week, I saw a few
18:58
Speaker 2: different outlets reports that there is now concern that because
19:02
Speaker 2: by now pay later platforms and you know after Pay
19:05
Speaker 2: obviously being the leader in that space, are operating at
19:08
Speaker 2: such significant losses, there's concern now that that will actually
19:12
Speaker 2: trigger us some kind of massive financial crisis, which is very.
19:16
Speaker 1: But it's very possible. So in two thousand and eight,
19:18
Speaker 1: we saw the start of the Global Financial Crisis or
19:21
Speaker 1: the GFC. I refer to this a lot in the
19:23
Speaker 1: podcast because it's where a lot of people lost a lot.
19:26
Speaker 2: Of money because they sold down, right, Yes and no.
19:28
Speaker 1: So firstly, yes, because the emotional investment journey means that
19:32
Speaker 1: when things are crashing, we want to hold everything close,
19:35
Speaker 1: and we go, oh my gosh, my shares are crashing
19:37
Speaker 1: in value, and I want to turn them all into
19:39
Speaker 1: cash so that I can hold them close and not
19:41
Speaker 1: feel that loss anymore, because I will just crystallize it.
19:44
Speaker 2: And it'll stop it.
19:45
Speaker 1: So yes, yes, a lot of people lost a lot
19:47
Speaker 1: of money because it was going down and they just
19:49
Speaker 1: got really anxious and sold out. Understandable. But a lot
19:52
Speaker 1: of people also lost a lot of money because companies
19:55
Speaker 1: were carrying a shitload of really bad debt. And that
19:59
Speaker 1: is what we see again in the buy now, pay
20:01
Speaker 1: later space, like how are they going to pay that back?
20:03
Speaker 1: Think about how much debt they have and how they've
20:06
Speaker 1: never actually, ever, ever, ever turned a profit. This company
20:10
Speaker 1: has never produced a dividend for any of the investors.
20:13
Speaker 1: Yet when we look at the share market, afterpays pretty glamory, right,
20:18
Speaker 1: it's pretty glitzy. People go, oh, do you buy after pay?
20:21
Speaker 3: Oh?
20:21
Speaker 1: Yeah, I bought it when it was XYZ. It's like,
20:23
Speaker 1: as an advisor, I obviously can't be like, oh, buy
20:25
Speaker 1: this or buy that, but we're not really talking about
20:28
Speaker 1: it being a good share or a bad share to purchase.
20:30
Speaker 1: It just confuses me around people's portrayal of what that
20:34
Speaker 1: looks like, because if you look at the financials, you're like,
20:36
Speaker 1: that's cool.
20:37
Speaker 2: That's not good at all.
20:38
Speaker 1: I see the potential. I see the blocks now bought it.
20:42
Speaker 1: But block buying it to me, should have meant that
20:44
Speaker 1: the company would then be successful.
20:47
Speaker 2: Is it no big picture question? If they're in these
20:51
Speaker 2: huge amounts of debt that they're like, you're looking at
20:54
Speaker 2: out going, how could you possibly repay that? Is that
20:57
Speaker 2: why they're spending so much money on marketing because they're
21:01
Speaker 2: trying to generate users that they're hoping will pay late
21:04
Speaker 2: fees so that they can then afford to pay off
21:06
Speaker 2: some of their debt. I don't think it's late fees
21:08
Speaker 2: because they are a lending company. At the end of
21:11
Speaker 2: the day, it might not cost you, as the consumer anything,
21:14
Speaker 2: but they are borrowing out money and making money on
21:17
Speaker 2: that money. So you don't see that, you don't feel
21:20
Speaker 2: that because essentially we're very small fish in the grand
21:22
Speaker 2: scheme of lending out money. But at the end of
21:25
Speaker 2: the day, I also don't think that their late fees
21:27
Speaker 2: are ever going to be enough to pay off their debt.
21:30
Speaker 2: It's just a very big portion of the income they derive.
21:33
Speaker 2: And I just feel like they say one thing and
21:35
Speaker 2: then you know, the numbers are speaking a little bit
21:37
Speaker 2: louder as to what their true values are. Because if
21:41
Speaker 2: it was so important to them to be putting their
21:43
Speaker 2: consumers in the best possible position, and it was important
21:46
Speaker 2: for them for you not to incur late fees, and oh,
21:48
Speaker 2: they don't care about that income, it's just a part
21:50
Speaker 2: of it. Don't have the late fees, then yeah, exactly,
21:53
Speaker 2: especially coming out of COVID, then why are they there.
21:55
Speaker 2: I completely understand your account being crystallized so you couldn't
21:58
Speaker 2: make any more purchases. I can play understand it impacting
22:01
Speaker 2: your credit report. I completely understand you being in a
22:05
Speaker 2: position where a debt collector comes and asks for that
22:08
Speaker 2: money back. I'm not saying they should just write off
22:10
Speaker 2: the money because oh, Jeff spent it and shouldn't have
22:12
Speaker 2: a yolo like.
22:13
Speaker 1: That's not in at all. I'm saying Jeff should pay
22:15
Speaker 1: back her money. But does that mean she has to
22:18
Speaker 1: incur a fee? I mean, credit cards have interest rates,
22:22
Speaker 1: so that makes sense, and they rack up over time.
22:24
Speaker 1: Arguably that's very detrimental as well. But the thing credit
22:27
Speaker 1: cards have that after pay doesn't is the credit check
22:30
Speaker 1: to make sure that you're a responsible person to lend to.
22:33
Speaker 3: So B If they don't make their money from late fees,
22:36
Speaker 3: despite that being quite a significant sum, how are they
22:39
Speaker 3: making their money now?
22:41
Speaker 1: This is a spicy topic, and my partner Steven shout
22:45
Speaker 1: out to the guy who's never listened to our podcast
22:47
Speaker 1: because it makes him feel awkward. But he works in
22:51
Speaker 1: data science, right, so he's smart guy, smart cookie. This
22:54
Speaker 1: is why we're going to get married to him, guys,
22:56
Speaker 1: So I'm trying to get you guys to buy in
22:57
Speaker 1: as well, so you've got more interest in my wedding.
23:00
Speaker 1: But on the afterpay website it says that they absolutely
23:04
Speaker 1: would never sell your data, Jess, So that makes you
23:06
Speaker 1: feel pretty good. But they do share it with their
23:09
Speaker 1: commercial partners. How do they get around that because they're
23:11
Speaker 1: a commercial partner and it's for research. Does it say
23:14
Speaker 1: that after pays retailers and commercial partners are independent of
23:18
Speaker 1: after pay and may have privacy policies that differ from us.
23:21
Speaker 1: But they do share it with third parties who are
23:24
Speaker 1: commercial partners, So that could be retailers or if they're
23:27
Speaker 1: working with a bank at the time, they could share
23:30
Speaker 1: that information because in a way, it's for the greater
23:33
Speaker 1: good of the relationship, and right, it benefits the customer
23:35
Speaker 1: if we're doing all of this research and it's not
23:37
Speaker 1: selling the data. If this bank is paying us to
23:40
Speaker 1: do this separate research and therefore we're partnering together and
23:44
Speaker 1: they happen to get access to the data, right and
23:46
Speaker 1: a lot a lot a lot of companies do this
23:49
Speaker 1: where they say, oh no, we would never sell your data,
23:51
Speaker 1: and you go Oh that's nice. They don't call it
23:53
Speaker 1: selling data when they're sharing it, right.
23:56
Speaker 2: So interesting. So it's like, we're not going to sell
23:58
Speaker 2: it to a shady telecommunity, we never do that, No,
24:02
Speaker 2: but we absolutely might sell it to a big bank
24:04
Speaker 2: who's prepared to pay a lot of money for that.
24:06
Speaker 1: Yeah, for research carried out. Definitely, not for your data.
24:09
Speaker 1: They would never pay for your data because jess, they
24:11
Speaker 1: don't sell data, remember wow. But they might share it. Yeah,
24:15
Speaker 1: but they might share it along the.
24:17
Speaker 2: Way, and that's clearly disclosed on their website in a way.
24:20
Speaker 2: But everybody would ever freaking absolutely no.
24:22
Speaker 1: Stop getting so upset about this. They would never share
24:25
Speaker 1: your data with anybody after pay. They do though, they do, though,
24:29
Speaker 1: get us every time. It piss me off because the
24:32
Speaker 1: lack of transparency is just wild, like it just it's
24:36
Speaker 1: really upsetting. And I'm not saying that after pay the
24:38
Speaker 1: only people to do this, So don't get me confused
24:41
Speaker 1: when I say that after pay doing this, and they're
24:43
Speaker 1: being sneaky, like lots of businesses do this, and they
24:46
Speaker 1: do this because data is king. That is the one
24:49
Speaker 1: thing that makes your business valuable at the end of
24:52
Speaker 1: the day. If you're a Digital twenty twenty two. Company
24:55
Speaker 1: data is the thing that you should be prioritizing. This
24:57
Speaker 1: is just like a top tip small business advice, but like,
25:00
Speaker 1: that's why you should be prioritizing owning your own data.
25:04
Speaker 1: And that's why if you've ever spoken to a small
25:06
Speaker 1: business owner like over on the Business Bible podcast, they
25:09
Speaker 1: really prioritize their eedm so their email lists. And the
25:13
Speaker 1: reason they do that is because they actually own those
25:15
Speaker 1: as opposed to I have this many followers on Instagram
25:18
Speaker 1: or TikTok or Facebook. As we know, those accounts can
25:21
Speaker 1: disappear whenever, and your business absolutely goes capute. But when
25:26
Speaker 1: you own the data, that's what is the actual value.
25:29
Speaker 1: That's what people are paying for. That's what people see,
25:32
Speaker 1: and that's why they would be prioritizing having that and
25:35
Speaker 1: potentially sharing it, but definitely not selling it.
25:37
Speaker 3: Definitely not head to our website to sign up for
25:39
Speaker 3: our news.
25:41
Speaker 2: Go for it.
25:42
Speaker 1: I wouldn't even know how to sell data. Anybody in
25:44
Speaker 1: for it. No, our privacy policy says we wouldn't sell data,
25:47
Speaker 1: might share it.
25:50
Speaker 3: No.
25:50
Speaker 1: A see if I would do that, that would be
25:52
Speaker 1: so contradictory to everything I believe in ladies.
25:55
Speaker 3: It's been a while, a week in fact, since we've
25:57
Speaker 3: had a listener question. Should we have You don't want
26:00
Speaker 3: to talk about chatter anymore, Let's move on, Okay, no problems,
26:04
Speaker 3: Straight to some data. One of our listeners sent into.
26:07
Speaker 2: US high Team Shoes on the Money.
26:10
Speaker 4: I'm a British expat living in Sydney and I'd like
26:14
Speaker 4: to start investing here in Australia as i'd like to
26:17
Speaker 4: stay long term, so just for financial security in the future. However,
26:23
Speaker 4: when I'm looking into all the apps like rays and
26:25
Speaker 4: chair z'se, it says you need to be an Australian
26:27
Speaker 4: resident in order to invest. So I was just wondering
26:30
Speaker 4: if you knew if it's possible for people on temporary
26:34
Speaker 4: work visas to invest in app like these, or what
26:37
Speaker 4: would be the best way to start investing.
26:40
Speaker 1: Thank you take it away, VDA.
26:41
Speaker 3: What's the answer to this one?
26:42
Speaker 1: Why do you always come back to me with the
26:44
Speaker 1: advice you guys are giving.
26:46
Speaker 2: It's almost like you're the expert.
26:49
Speaker 1: This is a hard one because I'm so excited that
26:51
Speaker 1: you want to invest and that you are so on
26:54
Speaker 1: top of it and you're looking into it. But unfortunately,
26:57
Speaker 1: because you are a temporary resident. You can't invest directly
27:01
Speaker 1: in Australia without permission. And when I say without permission,
27:04
Speaker 1: it's not me going yeah, ge King, you can do it.
27:07
Speaker 1: I'm more mean legally, you need to get permission as
27:09
Speaker 1: a foreign person who is on a temporary residence visa
27:13
Speaker 1: to get actual permission from a place called the Foreign
27:16
Speaker 1: Investment Review Board or the FIRB, known to the locals
27:20
Speaker 1: ERB the FERB, but you need to get permission from
27:23
Speaker 1: them to invest in Australia, whether that is shares or property.
27:27
Speaker 1: I would also argue that if you're only on a
27:30
Speaker 1: temporary visa, I obviously don't know what your long term
27:32
Speaker 1: intentions are, whether that is to go back to the
27:35
Speaker 1: UK or settle here permanently, and that would change the
27:38
Speaker 1: direction of the conversation because if you're planning on going
27:41
Speaker 1: home in the next couple of years, I would really
27:44
Speaker 1: consider whether investing in Australia is right for you, and
27:47
Speaker 1: if it's something you really want to pursue, I'd be
27:49
Speaker 1: getting advice on it. So talk to either an accountant
27:51
Speaker 1: that you have or a lawyer that you have that
27:53
Speaker 1: could help you out in that particular circumstance, because it's
27:57
Speaker 1: a really gray area and it completely depends on what
28:00
Speaker 1: your future plans are and what the plans are in
28:02
Speaker 1: the immediate future, and whether it's even worth it for
28:05
Speaker 1: you at this point, because you could be up for
28:07
Speaker 1: some pretty hefty tax implications if you do the wrong thing.
28:11
Speaker 1: So get advice, I think is the main thing. But
28:14
Speaker 1: really understanding that it is quite limited for people who
28:17
Speaker 1: are on temporary visas, and that sucks, but hopefully we
28:20
Speaker 1: get to keep you and those temporary visas turn into
28:22
Speaker 1: permanent once and then you're allowed to invest in whatever
28:24
Speaker 1: the hell you want in this country. And with that
28:26
Speaker 1: g I think we are actually done with savage d
28:29
Speaker 1: after pay again. We've talked about data again. We've talked
28:32
Speaker 1: about listener questions again. We've never tackled that topic. So
28:36
Speaker 1: that's new and fresh and bright and bubbly. But you
28:38
Speaker 1: know what is not new, fresh, bright and bubbly our disclaimer,
28:42
Speaker 1: So take it away my life.
28:43
Speaker 4: To do it.
28:43
Speaker 3: The advice shared on She's on the Money is general
28:46
Speaker 3: in nature and does not consider your individual circumstances. She's
28:50
Speaker 3: on the Money exists purely for educational purposes and should
28:53
Speaker 3: not be relied upon to make an investment or financial decision.
28:56
Speaker 3: Wow and remember Victoria Divine is an authorized representative of
29:01
Speaker 3: in Focused Securities Australia Propriety Limited a b N four
29:04
Speaker 3: seven zero nine seven seven nine seven zero four nine
29:07
Speaker 3: a fos L two three six five two three. See
29:10
Speaker 3: you next week, guys, See next week