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FRIDAY DRINKS: G and V take the wheel! · She's On The Money

0:00
Speaker 1: She's on the Money. She's on the Money.
0:23
Speaker 2: Hello and welcomed. She's on the Money, the podcast for
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Speaker 2: millennials who want financial freedom. This is one of our
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Speaker 2: Friday Drinks episodes where we celebrate the money wins from
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Speaker 2: our She's on the Money community. As you guys know,
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Speaker 2: there are so many great wins and confessions that are
0:39
Speaker 2: shared every single week in our community, and over the
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Speaker 2: last week we have spent a very big chunk of
0:45
Speaker 2: time going over everything you guys have achieved over the
0:48
Speaker 2: last week. So this episode is for you. It is
0:51
Speaker 2: celebrating you. Georgia, Welcome to the show.
0:54
Speaker 3: You get a mate.
0:56
Speaker 2: Hi, I am so well. I bet you didn't think
1:01
Speaker 2: that you'd log on to record an episode and it'd
1:04
Speaker 2: just be me awkwardly sitting here. It's just us.
1:07
Speaker 3: It's literally just Victoria and my good self. It lacks
1:11
Speaker 3: a bit of a vibe, but that's okay.
1:13
Speaker 2: We bring the energy. No, we bring the vibe. Georgia.
1:17
Speaker 3: Did you want to explain why it's just the two
1:18
Speaker 3: of us?
1:19
Speaker 2: Yeah? I do. It's because no one likes us. No no, no, no,
1:22
Speaker 2: that's not true. I mean, but the real reason is
1:26
Speaker 2: because it's the day before Melbourne Cup day here in Melbourne,
1:30
Speaker 2: and any smart individual would have taken to day off. Yeah,
1:34
Speaker 2: it's did you know that we were meant to take
1:36
Speaker 2: the day off, Joorje.
1:37
Speaker 3: Well yeah, look in hindsight, i'll know for next year.
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Speaker 2: Yeah, we'll know for next year and Jess can carry
1:44
Speaker 2: the show all over exactly, it'll be fine. So we've
1:48
Speaker 2: decided to just do the show anyway instead of doing
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Speaker 2: it later in the week because we had it scheduled
1:53
Speaker 2: for Monday, and like, we just stick to the schedule,
1:56
Speaker 2: you know, George. Absolutely, we just those types of people.
1:59
Speaker 2: So to have a chat about what happened on the
2:01
Speaker 2: show this.
2:01
Speaker 3: Week, absolutely start us off with money diaries, pluse.
2:05
Speaker 2: Well, technically we're recording and it came out this morning,
2:07
Speaker 2: so I know all about it, and you're gonna do
2:10
Speaker 2: a bit of a spoiler, but it won't be a spoiler,
2:13
Speaker 2: like you know what happens on Wednesday, Georgia. But we're
2:16
Speaker 2: pre recording this week because we're so busy.
2:18
Speaker 3: It's meta. There's a lot we shouldn't have.
2:20
Speaker 2: Told people that we should have just been like, oh,
2:22
Speaker 2: this is definitely us in your ears on a Friday morning. Anyway,
2:26
Speaker 2: this week on money diaries. We sat down with a
2:29
Speaker 2: money diarist that was honestly so interesting. So she slid
2:33
Speaker 2: into our emails last week and she had this really
2:36
Speaker 2: great story that I was super excited to listen to,
2:39
Speaker 2: and it was all about how her and her partner
2:41
Speaker 2: were saving for their first home and that her partner
2:43
Speaker 2: was a relatively high income earner, Like we're not talking
2:47
Speaker 2: like a couple of grand a week. We're talking like
2:49
Speaker 2: ten grand plus per week as an income that is.
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Speaker 3: Not relatively high, that is ridiculously high.
2:56
Speaker 2: Yeah, like insanely high. And so she was talking through
2:59
Speaker 2: that and how they managed their money, and we really
3:01
Speaker 2: wanted to talk to her about balance and how she
3:04
Speaker 2: you know, split the relationship because she's on more of
3:06
Speaker 2: a quote normal salary issue. It's about sixty grand a year.
3:10
Speaker 2: And I was like, yeah, get her on. That'll be
3:11
Speaker 2: so interesting because in her email she also said, you know,
3:15
Speaker 2: I do a lot of the home stuff, and my
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Speaker 2: partner pays far more of the bills in rent than
3:19
Speaker 2: I do. And I'm like, wow, let's do this. So
3:21
Speaker 2: we organized a time with our money darrest and she said, Hey,
3:25
Speaker 2: are you guys still okay to record because my situation
3:28
Speaker 2: significantly changed. We were like, oh, okay, like you sent
3:33
Speaker 2: this email. I think it was like seventy two hours before,
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Speaker 2: Like what could have changed so much? But turns out
3:40
Speaker 2: she broke up with her boyfriend. He had decided that
3:43
Speaker 2: alcohol was more important to him than their relationship, and
3:47
Speaker 2: she said, no, mate, kick it to the curb, we
3:49
Speaker 2: are done here and left. So she in that period
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Speaker 2: of time had gone from the financial goal of saving
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Speaker 2: for a home and thinking literally thinking seventy two hours
4:01
Speaker 2: earlier that coming on shees on the money was you
4:04
Speaker 2: know something that she wanted to do, have a chat
4:06
Speaker 2: about it, to being like, you know what, enough is enough?
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Speaker 2: I am done here. And now her financial goals are
4:10
Speaker 2: more around travel and setting up her emergency fund and
4:13
Speaker 2: like looking after herself. So it was a wild ride
4:17
Speaker 2: and one that I was so grateful to be on
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Speaker 2: with her because you would have thought maybe she's a
4:22
Speaker 2: bit vulnerable right now. And we obviously did our due
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Speaker 2: diligence George and say, hey, are you sure you really
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Speaker 2: want to record this, Like we promise we will do
4:29
Speaker 2: this with you, but if this week ain't the week,
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Speaker 2: that's okay. She was like, no, like I've made the
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Speaker 2: right decision for me, and I want to share it
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Speaker 2: and I hope that it can really help somebody going
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Speaker 2: through something similar to hopefully pull the trigger and make
4:41
Speaker 2: the same decision I did. And I was like, yes, Queen,
4:44
Speaker 2: come on the show.
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Speaker 3: So God, that sounds juicy.
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Speaker 2: It was juicy, So if you haven't listened to it,
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Speaker 2: I highly recommend that episode. The vibes on it are
4:54
Speaker 2: also supreme.
4:56
Speaker 3: How long had they been together? For me, they've been.
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Speaker 2: Together for a number of years and they had broken
5:01
Speaker 2: up a couple of times historically, but she said she
5:04
Speaker 2: wasn't quote serious about the breakups. She was more like, oh,
5:08
Speaker 2: like I ended up going back or whatnot. But I
5:10
Speaker 2: don't want to spoil too much because obviously it's a
5:12
Speaker 2: really good story. But to overlay that, she was also
5:16
Speaker 2: helping him get his visa here in Australia, so he's
5:19
Speaker 2: really dependent on Oh.
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Speaker 3: My gosh, so many little plot points here.
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Speaker 2: So go listen to the Money Daries episode if you
5:25
Speaker 2: thought that was pretty interesting. But as I said before,
5:29
Speaker 2: I don't want to ruin the whole episode or spend
5:30
Speaker 2: this entire episode recapping what happened on Monday. When you
5:34
Speaker 2: just listen so Georgia King on Wednesday. What did we
5:38
Speaker 2: get up to.
5:39
Speaker 3: So the Cast your Mind Back. We discussed what you
5:43
Speaker 3: need to think about financially when it comes to living overseas,
5:47
Speaker 3: and as I mentioned forty nine times in the podcast,
5:50
Speaker 3: I'm very keen on living in London at some point
5:52
Speaker 3: soon in London. In London. I don't know if you
5:55
Speaker 3: can do that, but we've done it.
5:57
Speaker 2: If that's proved. But that's so gay.
6:00
Speaker 3: But it was so interesting because it turns out there
6:02
Speaker 3: is so much more to it than just throwing your
6:05
Speaker 3: backpack on your back. You got to think about tax,
6:08
Speaker 3: you got to think about super health insurance, like all
6:10
Speaker 3: of these things that I just you know me, I
6:14
Speaker 3: don't think too deeply about many things. So it was
6:17
Speaker 3: a real eye opener. So if anyone is thinking about
6:20
Speaker 3: heading over now that we can definitely give it a listen.
6:24
Speaker 2: It was a great I thought it was a really
6:25
Speaker 2: good episode as well, because there's someone who has not
6:28
Speaker 2: lived overseas before. I was just like, yeah, actually, what
6:31
Speaker 2: do you need to consider because I've always done the
6:34
Speaker 2: travel insurance and stuff like that, but like, what other
6:37
Speaker 2: factors do you need to take into consideration? And one
6:40
Speaker 2: of them was Superannuation, which isn't that sexy, but at
6:43
Speaker 2: the end of the day, has a massive impact on
6:46
Speaker 2: the way that you're going to retire, and you don't
6:48
Speaker 2: want to put yourself in a position where you're like,
6:49
Speaker 2: I'm going to move overseas and live my best life
6:52
Speaker 2: to the detriment of future me. Someone wants to do that,
6:55
Speaker 2: and you don't actually have to, Whereas I think a
6:57
Speaker 2: lot of people just go, oh, if I move overseas,
7:00
Speaker 2: I won't be contributing to super that's bad bubow. But
7:04
Speaker 2: the reality is you can make a plan that happens before, during,
7:07
Speaker 2: or after you come back to make sure that you
7:10
Speaker 2: don't skip a beat, and that's pretty exciting.
7:12
Speaker 3: Well, one of your remedies that you suggested was for
7:15
Speaker 3: me as someone who wants to go over there in
7:17
Speaker 3: like two months or so. I'm joking. I'm joking. I
7:20
Speaker 3: knew you'd Okay, I'll keep.
7:21
Speaker 2: You on the show. You know what, George, I can't
7:24
Speaker 2: deal with any more change in my life. What we're
7:27
Speaker 2: going to do, We're just going to keep you here.
7:29
Speaker 3: Let's chat. We'll lock her in. No, buts as someone
7:32
Speaker 3: who wants to go in the you know, the not
7:34
Speaker 3: too distant future. I'm going to start making additional contributions
7:38
Speaker 3: to my super so that I don't have to worry
7:40
Speaker 3: about it when I'm there. Remember you said that, Yeah.
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Speaker 2: Oh that's exciting.
7:44
Speaker 3: I think it's it's smart. So yeah, it was an
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Speaker 3: episode packed full of tips, so have a listen.
7:49
Speaker 2: Covid has taught us anything, Georgia. It's that remote recording
7:52
Speaker 2: of podcasts is entirely possible. So if you think you're
7:56
Speaker 2: leaving She's on the Money and going to London, what
7:58
Speaker 2: you're actually meaning is you're taking Shees and the Money international.
8:02
Speaker 3: These Mike supportable.
8:04
Speaker 2: You hurt guys, But do you know what we should
8:07
Speaker 2: do now? We should go into the money wins of
8:09
Speaker 2: our She's on the Money community, because George, that's what
8:12
Speaker 2: this episode is about, and this week we have had
8:16
Speaker 2: a heap of them, and there have been a number
8:18
Speaker 2: of absolute bangers.
8:19
Speaker 3: George, okav I have not been in the Facebook group
8:22
Speaker 3: for a while, so I need to hear these. Lay
8:24
Speaker 3: them on me please.
8:25
Speaker 2: For a woman who works in social media, you spend
8:28
Speaker 2: a significant amount of time not on social media. It's
8:31
Speaker 2: honestly impressive, George. But first one g is from our
8:35
Speaker 2: friend Carly, and I say our friend because she pops
8:38
Speaker 2: up in the She's on the money community relatively consistently
8:41
Speaker 2: and has done for I would say the last few years.
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Speaker 2: So super appreciate you, Carly. But I thought this was
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Speaker 2: a good money win. She said, I earned enough points
8:50
Speaker 2: on the internal recognition rewards system at work to redeem
8:54
Speaker 2: one hundred and twenty dollars worth of Wooly's vouchers. That's
8:58
Speaker 2: her weekly grocery shop done.
9:00
Speaker 3: Not perhaps I don't what's an internal rewards thing in
9:03
Speaker 3: but it must be like Flybys or something. But for
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Speaker 3: your job, amazing.
9:08
Speaker 2: How good is that? I don't have that?
9:10
Speaker 3: I'm sorry, do we have that? She's on the money.
9:12
Speaker 2: We're going to move on. The next money win was
9:15
Speaker 2: from Anna, and Anna is a new friend in our community,
9:19
Speaker 2: and her money win is about botox, but not in
9:21
Speaker 2: the way you would think. She said, I have a
9:23
Speaker 2: medical condition that requires botox injections. I had moved out
9:28
Speaker 2: since my last lot and had to find a new dermatologist.
9:31
Speaker 2: She said she rang about five clinics in the fifth
9:34
Speaker 2: one which happened to be closest to her house and
9:37
Speaker 2: had the earliest appointment. If that's not a sign. I
9:40
Speaker 2: don't know what it is. Only charges for the reduced
9:43
Speaker 2: PBS cost of the units of botox, which means she
9:46
Speaker 2: didn't have to pay any specialist fee and no partial payments.
9:50
Speaker 2: She went this week from paying over six hundred dollars
9:53
Speaker 2: a year for her botox injections to now forty bucks. Yeah,
9:58
Speaker 2: that's a money win.
9:59
Speaker 3: That is a money win.
10:00
Speaker 2: That's so geez.
10:02
Speaker 3: Speaking of botox, b this is a little segue. I
10:05
Speaker 3: did a union assignment on botox quite recently, little mini documentary.
10:10
Speaker 3: Oh not about like medical botox. Well, I've just noticed
10:13
Speaker 3: a lot of people around me at the moment are
10:16
Speaker 3: getting botox and I'm in my twenties, as.
10:18
Speaker 2: You know, that's relatively normal. I feel my friend group
10:21
Speaker 2: does it. That's the main thing.
10:22
Speaker 3: That's the thing.
10:23
Speaker 2: Spoiler, I do it. So it's not a sacret. It was.
10:27
Speaker 3: It was really really interesting to look into it and
10:30
Speaker 3: how common it is and why that is. Anyway, Please
10:33
Speaker 3: no one google it because it was kind of awful.
10:35
Speaker 3: Got an HD though, so that's what counts. Sorry to
10:38
Speaker 3: make that about me, sor tell me our next money
10:41
Speaker 3: win please?
10:41
Speaker 2: All right? So next oney win is from Emily Jade
10:45
Speaker 2: and Emily says, I had twenty two thousand dollars owing
10:48
Speaker 2: on my car at the start of the year, and
10:50
Speaker 2: yesterday I paid it off fully.
10:53
Speaker 3: Where did you say, how did you get any tips?
10:57
Speaker 2: No? Maybe we should follow up a message. Excuse me,
11:01
Speaker 2: what is going on the next one. I can't say
11:05
Speaker 2: that this will apply to me because, as you know,
11:07
Speaker 2: g I'm probably not very likely to walk into your
11:09
Speaker 2: local butcher. But our friend Jess had a money in.
11:13
Speaker 2: She said, My partner and I recently had a really
11:15
Speaker 2: rude experience at our local butcher, but we try to
11:18
Speaker 2: support locals, so I have continued to go there despite
11:20
Speaker 2: our bad experience. We went back again on Saturday and
11:24
Speaker 2: the same rude lady was there serving us. However, when
11:27
Speaker 2: she went to enter the amount into the f FOS machine,
11:30
Speaker 2: she only charged us four dollars twenty four instead of
11:33
Speaker 2: forty two dollars forty. She didn't know, she said, usually
11:36
Speaker 2: I'd go back and pay the difference, because we didn't
11:38
Speaker 2: realize till we got home. We just tapped our cards.
11:42
Speaker 2: But given the experience, she's not going to and she's
11:45
Speaker 2: taking it as a small win for her continued support
11:47
Speaker 2: of their business.
11:48
Speaker 3: It's karma baby overall trying to be good people.
11:51
Speaker 2: So I was like, you know what I feel like?
11:53
Speaker 3: That's gramahm, definitely definitely love that one. Butchers are usually
11:57
Speaker 3: so lovely, don't you think it's quite confus can't say
12:01
Speaker 3: I go into the butcher very all right, vegan Vegan
12:04
Speaker 3: because this.
12:05
Speaker 2: Muddy winji is the last one I'm going to share
12:08
Speaker 2: with you today before we go to a quick break.
12:11
Speaker 2: But it's got something to do with diceon vacuum cleaner,
12:13
Speaker 2: so I thought i'd leave the best to last. Wait
12:16
Speaker 2: for it, she said, money win. I've been eyeing off
12:19
Speaker 2: a dice in vacuum cleaner for so long, and recently
12:22
Speaker 2: I played one of those arcade games at time Zone
12:26
Speaker 2: and she won, and it arrived the other week. The
12:30
Speaker 2: retail price for the disons five ninety nine. And because
12:33
Speaker 2: she got it playing the game, she got it for
12:35
Speaker 2: three bucks.
12:36
Speaker 3: What the devil?
12:37
Speaker 2: A three dollar dice in Georgia.
12:39
Speaker 3: Key time Zone first of all times, baffling that time
12:43
Speaker 3: Zone is still with us, But oh my gosh, that's incredible.
12:47
Speaker 2: I didn't expect anybody to say, you know what, went
12:50
Speaker 2: to time Zone got a dice with a Dyson. You
12:53
Speaker 2: cannot say that time Zone is not keeping up with
12:56
Speaker 2: the demographic that it initially engaged with.
12:58
Speaker 3: Exactly like his story.
13:00
Speaker 2: George, I think you and I when we were a
13:01
Speaker 2: bit younger, we'd go to time Zone after school, get
13:03
Speaker 2: some slime or like those slappy, strappy hands, you know
13:07
Speaker 2: what I'm talking about.
13:08
Speaker 3: Puss.
13:08
Speaker 2: Now they're like, oh, these guys closer to thirty than
13:11
Speaker 2: they are twelve. They want it's upgraded. I really like it.
13:16
Speaker 3: That's hilarious.
13:17
Speaker 1: Love it.
13:17
Speaker 2: We're going to talk about property in a hot second,
13:19
Speaker 2: but let's go to a quick break before then. All right, George,
13:22
Speaker 2: we are back, and this week you've been asking me
13:25
Speaker 2: a lot about property. You said that you saw something
13:27
Speaker 2: on Instagram and you wanted to talk to me about it.
13:30
Speaker 2: But in true victory divine form, I was like, no,
13:32
Speaker 2: we're not going to talk about it. You're going to
13:34
Speaker 2: hold this back for the show.
13:35
Speaker 3: We're going to talk about it on the mics.
13:37
Speaker 2: Yep, George, what did you find this week? What property
13:40
Speaker 2: questions did you have for me? Because I'm absolutely certain
13:43
Speaker 2: that you're probably not the only one that has these
13:44
Speaker 2: property questions.
13:45
Speaker 3: Okay, So I was scrolling the gram and I came
13:49
Speaker 3: across the Daily Oz Friends of the show incredible Instagram
13:53
Speaker 3: accountant Zara's a wizard. They make news digestible. Yeah, it's amazing. Anyway,
13:57
Speaker 3: there's this graphic which says house prices in Australia have
14:02
Speaker 3: increased by about twenty two percent in the past year.
14:06
Speaker 3: Twenty two percent. It definitely feels like that, but that
14:10
Speaker 3: is a huge jump. Fee.
14:12
Speaker 2: That is a pretty significant jump. G And if you're
14:15
Speaker 2: already in the property market, you're probably pretty happy about it.
14:18
Speaker 2: But if you're not in the property market already, like yourself,
14:20
Speaker 2: G and at some point you know you want to purchase,
14:23
Speaker 2: that's probably a pretty discouraging thing to see.
14:26
Speaker 3: It is made well and you're you're in there, So
14:28
Speaker 3: I'm happy for you. I'm not at all jealous. But
14:31
Speaker 3: it's just when you do see stuff like that, it
14:34
Speaker 3: just it makes the dream further and further away. But
14:38
Speaker 3: I'm wondering, like, will it just keep on increasing or
14:42
Speaker 3: is it reaching now such a height that it can
14:44
Speaker 3: only go down? Like, help help a gal out.
14:46
Speaker 2: Help a gal out? All right, so I'm on it.
14:48
Speaker 2: Economists have said that by the end of the year
14:51
Speaker 2: it will surge by twenty two percent, and I'd already
14:53
Speaker 2: hear that, which is the news that you're talking about.
14:56
Speaker 2: But they've also said that they can see a gradual
14:59
Speaker 2: easy on the way. I think that over the last
15:02
Speaker 2: twelve eighteen twenty four months, we've been in a pretty
15:06
Speaker 2: we've been in a pretty prickly situation with COVID and
15:10
Speaker 2: everything going on. I mean, the lower interest rates during
15:13
Speaker 2: the pandemic were absolutely seized by property hunters. They were like, heck, yes,
15:18
Speaker 2: let's get into the market. They're going to be lower
15:20
Speaker 2: repayments and obviously better return on our money and what
15:23
Speaker 2: we're investing. So I think that a lot of people
15:26
Speaker 2: who had been saving up for holidays or you know,
15:29
Speaker 2: travel or whatever they wanted to do instead of property,
15:32
Speaker 2: We're like, well, now I've got all this money sitting here,
15:34
Speaker 2: I'm just going to invest it into property because it
15:37
Speaker 2: seems like a reasonable thing to do. And the thing
15:40
Speaker 2: that drives property prices g is demand. So the more
15:44
Speaker 2: people that want property, the more the price is going
15:47
Speaker 2: to increase. So it's not surprising that this has happened
15:50
Speaker 2: during a period of time where we literally couldn't leave
15:53
Speaker 2: the country and a lot of people who do have
15:55
Speaker 2: a lot of money, We're like, well, what else is
15:57
Speaker 2: there to do?
15:58
Speaker 3: So do you think, THENVI, that that is probably more
16:01
Speaker 3: people who are buying their second or third homes rather
16:04
Speaker 3: than first home buyers like me who just can't manage
16:07
Speaker 3: to crack the market.
16:08
Speaker 2: No, not necessarily. So we're seeing it across the country.
16:12
Speaker 2: It's not just in those higher priced homes. But earlier
16:16
Speaker 2: this month, and I say earlier this month, it's the
16:19
Speaker 2: first of the month today, mid last month, gee, we
16:22
Speaker 2: saw a statistic come out that said prospective home buyers
16:26
Speaker 2: are going to be hit with increased median house prices
16:29
Speaker 2: in Sydney of three hundred thousand dollars this year, which
16:34
Speaker 2: took Sydney's average house price to one point three million
16:39
Speaker 2: dollars for the very first time. Is that not crazy?
16:44
Speaker 2: Those numbers make me want to be sick. But furthering that,
16:47
Speaker 2: other research also showed us that the Australian housing market,
16:50
Speaker 2: as I said before, increased, but it actually increased by
16:54
Speaker 2: seventeen point six percent of the first nine months of
16:57
Speaker 2: twenty twenty one, and that growth rate has literally not
17:02
Speaker 2: been seen since June nineteen eighty nine. So g in
17:06
Speaker 2: our lifetimes We've never seen such significant increase in the
17:10
Speaker 2: housing price market.
17:12
Speaker 3: Like what literally that it just makes me feel flat
17:16
Speaker 3: v Like I'm so happy for everyone that has a home,
17:19
Speaker 3: but ah, the highest has been in our lifetime.
17:24
Speaker 2: Like maybe like, oh yeah, look, I don't think it
17:28
Speaker 2: is the worst thing to happen, though. I think we
17:30
Speaker 2: need to understand that this is a market as well.
17:32
Speaker 2: It's not something that is stagnant. It's not like when
17:35
Speaker 2: they increase it's like a price increase of bread, right,
17:39
Speaker 2: So like this is not inflation where you know, in
17:42
Speaker 2: nineteen eighty nine, maybe bread was like fifty cents or
17:45
Speaker 2: a dollar or whatever it is. And now when we
17:47
Speaker 2: walk into the supermarket, g if you want to slab
17:49
Speaker 2: a wonder why it's going to cost you four dollars
17:51
Speaker 2: fifty or whatever it is. It's that what wonder way
17:53
Speaker 2: it costs? I don't know how it feels from free life,
17:56
Speaker 2: but that's what we call inflation, Whereas that's not what's
17:58
Speaker 2: happening in the property market. What we are seeing in
18:02
Speaker 2: the property market is demand is increasing and therefore prices
18:05
Speaker 2: are increasing, and demand and prices of property are only
18:09
Speaker 2: going to exist as long as people want to purchase it.
18:12
Speaker 2: Whereas once this tape is off a bit, everyone's going
18:14
Speaker 2: to be in a situation where're like, do I actually
18:16
Speaker 2: want properties? That what I'm going to do? People are
18:18
Speaker 2: going to start being able to travel again, We're going
18:21
Speaker 2: to read gig our priorities, and I genuinely think we'll
18:24
Speaker 2: see a dip in the way housing prices have increased.
18:26
Speaker 3: What about the like where they've increased, because I know
18:30
Speaker 3: down here, I'm down at my mum and Dad's recording
18:32
Speaker 3: today and the houses down here by the beach have
18:35
Speaker 3: just gone. It's crazy. What is selling for a million
18:39
Speaker 3: dollars now?
18:40
Speaker 2: It is insane to think. But again I think that's
18:44
Speaker 2: relatively lifestyle driven. Like we're not talking about beach shacks
18:48
Speaker 2: if we can go to Italy, whereas over the last
18:51
Speaker 2: eighteen months we haven't had that option, and the people
18:54
Speaker 2: who could afford that are like, we better get a
18:56
Speaker 2: beach house. We've got to get somewhere that we can
18:58
Speaker 2: work remotely from. I think there's a lot of change
19:01
Speaker 2: going on, and that's okay, Like change is good, but
19:04
Speaker 2: I think we also need to remember that while housing
19:07
Speaker 2: prices increasing, as you said before, by twenty two percent,
19:13
Speaker 2: our income is not increasing in the same way. Like
19:16
Speaker 2: I mean, there have actually been a few people in
19:17
Speaker 2: the Sheese on the money community they've been like, oh,
19:19
Speaker 2: double my income. But those are the outliers. But unless
19:23
Speaker 2: our incomes across the board are all of a sudden
19:26
Speaker 2: going to change to match this increase in pricing of
19:30
Speaker 2: the property market, it's not actually going to be sustainable change.
19:34
Speaker 2: Like imagine if we're in a situation where that just
19:36
Speaker 2: becomes the norm. We know that the interest rates over
19:40
Speaker 2: the next few years are going to increase. We've seen
19:43
Speaker 2: it at an all time low, and it's not going
19:45
Speaker 2: to be sustainable. It's not going to exist forever. It's
19:48
Speaker 2: like remember when we're recording g like probably like eighteen
19:51
Speaker 2: months ago now, and you and I were like, oh
19:53
Speaker 2: my god, up bank has an interest rate of two
19:56
Speaker 2: point five percent. Money win that is so good? Noways
20:00
Speaker 2: doing that anymore? Because it's not sustainable because of the
20:02
Speaker 2: way the market works. So these things come and go
20:06
Speaker 2: and they change. But I don't want you guys to
20:08
Speaker 2: be disheartened by the fact that you're not in the
20:11
Speaker 2: market and that it's significantly increased. Put your blinkers back on.
20:15
Speaker 2: Keep saving. You will be on the pathway, you will
20:18
Speaker 2: be set, you will be fine. It is something that
20:20
Speaker 2: we just need to watch stagnate over time, because I
20:24
Speaker 2: think things have gone relatively crazy recently.
20:27
Speaker 3: One hundred percent. Just to add to that, Vee the
20:30
Speaker 3: second little slide from The Daily Oz said that according
20:34
Speaker 3: to Tim Lawless from Core Logic, that housing prices continue
20:39
Speaker 3: to outpace wages by a ratio of about twelve to one.
20:43
Speaker 2: Yes, which is crazy. Exactly can you imagine a world
20:46
Speaker 2: where it becomes the norm to be paying twelve times
20:49
Speaker 2: your income is a purchase price for a property?
20:51
Speaker 3: Gapes, I don't have to imagine it. That's where we're living,
20:53
Speaker 3: I know.
20:54
Speaker 2: But like, it just seems wild, and it does make
20:57
Speaker 2: me want to prompt you guys to think, if property
21:00
Speaker 2: something that you're doing just because you think you need
21:02
Speaker 2: to do it because it's like the right thing and
21:03
Speaker 2: it's the way of the world. Think again, Like, you
21:07
Speaker 2: have so many investment options, so many different ways to
21:10
Speaker 2: create wealth. If you want a house, great, let's work
21:13
Speaker 2: towards that. But I think we really need to remove
21:16
Speaker 2: the pressure from people who haven't bought houses yet to
21:18
Speaker 2: buy them if that's not even in line with their
21:20
Speaker 2: values or what they want to do. George, you and
21:23
Speaker 2: I did an episode recently what feels recent I think
21:26
Speaker 2: it was like a month ago now on renting for
21:28
Speaker 2: life and how that can impact your life and what
21:31
Speaker 2: that actually means, and that that's actually a really valid
21:35
Speaker 2: way of living and it doesn't mean you're not creating wealth,
21:38
Speaker 2: whereas I think there's still this stereotype that if you
21:41
Speaker 2: don't purchase a house, you're not financially successful one hundred percent,
21:44
Speaker 2: and that's not the case at all, absolutely not. Well,
21:47
Speaker 2: you were saying that that is actually an investment strategy
21:49
Speaker 2: for a lot of people that they're using renting to
21:51
Speaker 2: their advantage. Yeah, I've got clients who are like, I'm
21:54
Speaker 2: not going to buy Victoria. I just don't want that
21:56
Speaker 2: type of commitment. We're just going to aggressively invest in
22:00
Speaker 2: an apartment in the location that we want to live.
22:02
Speaker 2: I've got a couple of clients who rent full blown
22:04
Speaker 2: houses that are gorgeous with pools because they're like, we
22:07
Speaker 2: don't want to pay the maintenance on that pool, like
22:09
Speaker 2: for breaks, Like that's not in line with our values.
22:11
Speaker 2: I'm like, get it, that's fantastic, but I think we
22:15
Speaker 2: really need to be breaking this stereotype that to be
22:18
Speaker 2: successful or to be financially stable, we need to own property,
22:22
Speaker 2: because it's twenty twenty one and we absolutely do not.
22:25
Speaker 3: Love that woman. Okay, so before we've round off today's
22:29
Speaker 3: show VD, I wanted to ask you a question from
22:31
Speaker 3: the community. Now we are thinking, guys of in our
22:34
Speaker 3: Friday Drinks episode bringing back the money questions that V
22:37
Speaker 3: and I did back in the day. So if you're
22:40
Speaker 3: interested in that, let us know, but I'll put the
22:42
Speaker 3: call out on Facebook, so keep your eyes peeled. Anyway
22:45
Speaker 3: to this week's question B. It is from the lovely
22:49
Speaker 3: Shaye Lee. So she has asked what is the minimum
22:53
Speaker 3: amount that a first home buyer could be earning slash
22:56
Speaker 3: have in their savings to approach buying or building a house.
23:00
Speaker 3: Obviously it's going to vary depending on the type of
23:03
Speaker 3: past you're looking at and where in Australia you are.
23:05
Speaker 3: But the majority of our listeners are in Melbourne and Sydney,
23:08
Speaker 3: so we're going to say that the houses they're looking
23:11
Speaker 3: at are probably between what's six hundred and a million
23:15
Speaker 3: at this point.
23:16
Speaker 2: Yeah, and it's really hard to answer that question. I'm
23:19
Speaker 2: such a pest on this show. Honestly, why do you
23:21
Speaker 2: come here?
23:22
Speaker 3: No?
23:23
Speaker 2: But more seriously, it's really going to depend on your
23:26
Speaker 2: cash flow situation whether you have a guaranteur or not.
23:28
Speaker 2: Let's pretend you don't have a guaranteur, because that is
23:31
Speaker 2: a privilege that not many people actually have. Albeit banks
23:34
Speaker 2: make it sound like every second person has a guaranteur
23:37
Speaker 2: on the mortgage they take out, like apparently everybody's parents
23:41
Speaker 2: are helping, when in reality that is not the case.
23:43
Speaker 3: Interest but that is okay.
23:45
Speaker 2: So when it comes to how much you need in savings,
23:48
Speaker 2: obviously the ultimate goal is twenty percent, and we can
23:52
Speaker 2: talk about that as being the OG. The reason for
23:55
Speaker 2: that is because if you have a twenty percent deposit saved,
23:58
Speaker 2: you're not going to be in a position where you
23:59
Speaker 2: have to pay LMI, which is lenders mortgage insurance, and
24:03
Speaker 2: lender's mortgage insurance does not protect you, it protects the bank. Yes,
24:07
Speaker 2: you can put it on your mortgage, which means that
24:09
Speaker 2: some people are actually able to secure mortgages for as
24:12
Speaker 2: little as five percent deposit, and with some new schemes
24:16
Speaker 2: that are coming up, even like three percent deposit, which
24:18
Speaker 2: is really cool, but it's not necessarily how much you're
24:22
Speaker 2: having savings, it's actually what your cash flow looks like.
24:26
Speaker 2: So I've said before on the show that I've worked
24:29
Speaker 2: with people who have half a million dollar incomes and
24:33
Speaker 2: banks won't lend to them. And the reason banks won't
24:35
Speaker 2: lend to them is because of their cash flow situation.
24:38
Speaker 2: And when I say cash flow situation, g I mean
24:43
Speaker 2: that you are spending less than you are earning, so
24:46
Speaker 2: you can prove to a bank that you've got some
24:48
Speaker 2: disposable income that you could allocate towards paying their loan back.
24:53
Speaker 2: We're not here talking about like, oh, well, you actually
24:55
Speaker 2: you need to have an income of a minimum of
24:59
Speaker 2: one hundred thousand dollars, because that's actually not the case
25:02
Speaker 2: at all. I've seen people be approved for mortgages when
25:05
Speaker 2: they're casual employees and they just work weekends. But the
25:09
Speaker 2: situation is different for everybody. And when I say that,
25:13
Speaker 2: I'm not saying, oh, the situation is so different you
25:15
Speaker 2: like I couldn't comment on it. It's more okay, if
25:18
Speaker 2: you are a casual employee and you do want to
25:20
Speaker 2: purchase a home, that situation is going to be really
25:23
Speaker 2: different than a dual income family who has two incomes
25:27
Speaker 2: of one hundred grand, because they're going to actually get
25:29
Speaker 2: to that goal much faster than you. You might actually
25:33
Speaker 2: spend ten or twelve years saving up for a deposit,
25:36
Speaker 2: and that's totally fine. In this day and age. That's
25:39
Speaker 2: actually really normal. It's not normal for people. And I
25:42
Speaker 2: know we had a money when like this before, So
25:44
Speaker 2: I do apologize emily, because as much as that's a
25:46
Speaker 2: really really impressive thing to do, not many people can
25:49
Speaker 2: save twenty two thousand dollars in one year. So if
25:53
Speaker 2: you're in that situation where it's going to take eight
25:55
Speaker 2: to ten or ten to twelve years to save for
25:57
Speaker 2: your first home, that's cool. Save for that, But then
26:00
Speaker 2: it's going to be about the purchase price of your property.
26:03
Speaker 2: So if you're you know, let's say, g you're earning
26:06
Speaker 2: sixty five thousand dollars and you're in a situation where
26:09
Speaker 2: you want to purchase a one point three million dollar property,
26:12
Speaker 2: I don't want to burst your bubble, but it's not
26:14
Speaker 2: going to happen. And I say it's not going to
26:16
Speaker 2: happen because even if you got to the point where
26:19
Speaker 2: you had that deposit and you've worked your butt off
26:22
Speaker 2: and literally you have hundreds of thousands of dollars in
26:25
Speaker 2: the bank to put down as a deposit. You're not
26:28
Speaker 2: going to be able to afford the repayments. Yeah, and
26:30
Speaker 2: I don't want to be oh no, you can't afford it.
26:33
Speaker 2: But at the end of the day, we need to
26:35
Speaker 2: be really reasonable. And one of the things you can
26:37
Speaker 2: do when setting goals, especially around money, and I always
26:41
Speaker 2: say that you want to use that SotM goal setting methodology,
26:44
Speaker 2: which is in my book and in my online course,
26:46
Speaker 2: So go and look at those things. But you want
26:49
Speaker 2: to be really reasonable. So Gee, the question isn't how
26:52
Speaker 2: much do I need to have in my bank account,
26:55
Speaker 2: but it's actually going to be how much can I
26:57
Speaker 2: afford in loan repayments? Because if you have the deposit
27:01
Speaker 2: and your set forget, let's pretend that's all out of
27:04
Speaker 2: the way. If you're going to borrow a million dollars,
27:08
Speaker 2: can you actually afford six grand a month to pay
27:10
Speaker 2: that loan back? No? Okay, Well let's work out what
27:14
Speaker 2: you can borrow. So if g we wanted to look
27:17
Speaker 2: at purchasing, let's just say a four hundred and fifty
27:19
Speaker 2: thousand dollars apartment and you've saved you know, fifty grand.
27:22
Speaker 2: You've worked out that you're going to, you know, get
27:25
Speaker 2: a nice loan of four hundred thousand dollars and you're
27:29
Speaker 2: going to do a fixed two year loan of two
27:31
Speaker 2: point h nine percent for thirty years, which is standard terms.
27:34
Speaker 2: You're going to be up for about fifteen hundred dollars
27:37
Speaker 2: a month in loan repayments. So if you hear that
27:40
Speaker 2: amount and go, oh, Victoria, I can't afford that, well,
27:44
Speaker 2: then we need to rejig what you're doing. So you
27:47
Speaker 2: can do one of two things. You can reset your
27:49
Speaker 2: goal and say, all right, well, Victoria, I'm going to
27:51
Speaker 2: look for something different. I'm going to find a different
27:53
Speaker 2: property maybe instead of that. What does three hundred thousand
27:57
Speaker 2: dollars look like? And I would say, okay, gee, if
27:59
Speaker 2: you just borrow three hundred thousand dollars and maybe you've
28:02
Speaker 2: saved for a little bit longer, or you reset your
28:04
Speaker 2: goal so that you're not buying something as expensive, you'd
28:08
Speaker 2: be up for about eleven hundred dollars a month, which
28:10
Speaker 2: is pretty significant in terms of differences in what you're
28:13
Speaker 2: paying back. So it's not necessarily hey, how much do
28:17
Speaker 2: I have to earn? It's actually how much can you
28:19
Speaker 2: afford to payback? And go from there. So maybe your
28:23
Speaker 2: budget is all right. I know that on my current income,
28:27
Speaker 2: I could afford a loan of four hundred thousand dollars. Great,
28:31
Speaker 2: let's work towards that. If you can afford three hundred
28:33
Speaker 2: thousand dollars, great, let's work towards that. But if we're
28:37
Speaker 2: talking about the median house price Georgia being one point
28:41
Speaker 2: three million dollars in Sydney, let's just say you had
28:45
Speaker 2: to guarantee George, which would mean that you wouldn't have
28:48
Speaker 2: to put down a deposit, which means you would be
28:50
Speaker 2: borrowing one hundred percent of the purchase price of that
28:53
Speaker 2: property one point three million dollars as a loan. Again,
28:58
Speaker 2: at two point h nine percent free a thirty year term,
29:01
Speaker 2: it equals four thousand, eight hundred and sixty four dollars
29:05
Speaker 2: a month. That's what people earn per month. That's their
29:09
Speaker 2: entire income. Is that reasonable to expect people our age
29:14
Speaker 2: to be paying that on a mortgage?
29:16
Speaker 3: Absolutely not.
29:17
Speaker 2: Yeah, exactly. So I think that we need to just
29:19
Speaker 2: be reasonable and actually give ourselves a bit more context.
29:23
Speaker 2: So when we say things like, oh, do you research
29:26
Speaker 2: this is what we mean. Go google mortgage repayment calculator,
29:30
Speaker 2: pick whichever one you want, and then have a bit
29:33
Speaker 2: of a play around with it. Work out what the
29:35
Speaker 2: repayments might look like. And if at the moment you're like, look,
29:37
Speaker 2: I can't really afford that, but one day, you know,
29:40
Speaker 2: in a few years, I might have my income go
29:42
Speaker 2: from seventy thousand to eighty thousand, and then that's a
29:44
Speaker 2: bit more feasible, then great, because don't forget that if
29:48
Speaker 2: you're going to take eight years to save a deposit,
29:50
Speaker 2: you're probably gonna have increased your income by then as well.
29:53
Speaker 3: Yeah, that's true' Does that help?
29:56
Speaker 2: Does that answer the question in a round about long way?
29:59
Speaker 3: I think so. It's kind of just like, there isn't
30:02
Speaker 3: really a minimum, but it's probably going to be more
30:05
Speaker 3: than you think. Slash the deposit isn't the most important
30:07
Speaker 3: piece of this puzzle.
30:09
Speaker 2: No, and it absolutely isn't. And while we still need
30:12
Speaker 2: to think about things like the deposit, one of the
30:14
Speaker 2: most important factors of getting a mortgage is not necessarily
30:18
Speaker 2: coughing up the money at the start, but proving to
30:20
Speaker 2: a bank that you are a good person to loan
30:23
Speaker 2: to and you actually can service that mortgage. And if
30:26
Speaker 2: you've enjoyed this chat and want to talk more about property, George,
30:30
Speaker 2: did you know that we have an entire property podcast.
30:32
Speaker 3: I did hear a whisper of that, actually did.
30:35
Speaker 2: It's called the Property Playbook, and we have an entire
30:39
Speaker 2: community as well where we share money, tips and tricks
30:42
Speaker 2: about property literally every single day. It's hilarious because someone
30:47
Speaker 2: in the Facebook group the other day, George actually over
30:50
Speaker 2: the weekend, they were like, oh my gosh. They submitted
30:53
Speaker 2: a question and I approved it and it said, is
30:56
Speaker 2: there any money podcasts, a books, or like any resources
31:00
Speaker 2: that I could look at for property? Like does anybody
31:03
Speaker 2: have anything? And I was like, hello, it is me.
31:06
Speaker 2: I have another one and they were like what is
31:10
Speaker 2: So if you haven't checked out the Property Playbook yet,
31:12
Speaker 2: please do. I am co hosting that with Amy Lenardi,
31:15
Speaker 2: who is a buyer's advocate who has bought and sold
31:18
Speaker 2: more than a thousand properties in her time. Has she
31:21
Speaker 2: just yes, it's crazy and she's young and you wouldn't
31:25
Speaker 2: believe it, but she has.
31:27
Speaker 3: Now it's a great listen guys, do have a listener
31:29
Speaker 3: after this one. But v lord, I think that's all
31:31
Speaker 3: we have time for todays. That feels like a deep dive.
31:35
Speaker 2: Yeah, look, let's run away before we muck it all up.
31:37
Speaker 2: It's just been us so as always, just before we
31:41
Speaker 2: head off, we'd like to acknowledge and pay respect to
31:43
Speaker 2: Australia's Aboriginal and Torres Strait Islander people's. They're the traditional
31:48
Speaker 2: custodians of the lands, the waterways and the sky's all
31:51
Speaker 2: across Australia. We thank you for sharing and for caring
31:55
Speaker 2: for the land on which we are able to learn.
31:57
Speaker 2: We pay respects to elder's past and present, and we
32:00
Speaker 2: share our friendship and our kindness.
32:02
Speaker 3: And remember guys that the advice shared on She's on
32:05
Speaker 3: the Money is general in nature and does not consider
32:08
Speaker 3: your individual circumstances. She's on the Money exists purely for
32:12
Speaker 3: educational purposes and should not be relied upon to make
32:15
Speaker 3: an investment or a financial decision. And we promise Victoria
32:18
Speaker 3: Divine is an authorized representative of Australia Pacific Funds Management
32:23
Speaker 3: Proprietary Limited A B and THI for one three two
32:26
Speaker 3: four six three two five seven AFSL three three nine
32:29
Speaker 3: one five one.
32:30
Speaker 2: Catch your next week.
32:31
Speaker 3: I'll see you guys next week with more people. Yeah,
32:35
Speaker 3: us