This post is based on an interview we conducted with Joe in February 2019.

Real Money Talk is our series where we interview Australians from all walks of life about their personal finances. The views expressed are those of the interviewees, based on their experiences with money, and as such are not necessarily representative of Spaceship's views.

We have changed the name of the interviewee for their privacy.

Name: Joe

Age: 29

Where do you live: Ultimo, Sydney

Please tell us a bit about yourself.

I’m a UX designer, graduated about 6 years ago now and have been working full time since then. I live with my partner in Sydney, have been here most of my life and loving it (hate the beach though…). When I can, I love to do hobby projects, anything from painting to building tiny robots!

What is your current net worth?

About $395,793.50

How does it break down? (shares, real estate, businesses, home, superannuation, etc.)

Liabilities

Home Loan: -$454,576.35

Credit Card Debt: -$823.50

Assets

Apartment: Valued around $780,000.00

Car: Valued around $8,000.00

Superannuation: $48,543.00

Savings: $24,000.00

Crypto Currencies: Around $650.00

Total: $405,793.15

Any debts? (including HELP from Uni)

Aside from the home loan and credit card, not that I’m aware!

How did you accumulate your net worth?

The largest part of it is the apartment. That came from saving enough for a deposit on a home loan through working.

Earn

Tell us a bit about your career:

I originally studied science and business but started working for small start-ups from about midway through university. I’ve since zig-zagged a bit between roles in banking and the tech space but decided to make a direction change into product design a few years ago.

Do you have income sources outside of your job? If so, how much do you earn from each and how did you develop them?

Occasionally some freelance design work, but it’s a borderline hobby. Never more than a couple hundred dollars once a few months.

What advice do you have for people who want to earn more money?

Don’t undersell yourself when negotiating or trying to sell services. Your price is what people are willing to pay, not what you think you are worth.

Save

What is your savings rate? And how has it changed over time?

It used to be much higher, probably peaked at something absurd like 30% when I was trying to get a deposit together. It’s gone way down since then, probably only putting scraps into an offset account at the moment.

Do you have a budget?

Not a “hard” budget, but I do have rough expectations of what I’ll spend on groceries, food and entertainment (roughly $100 per week on each, so $300 total). It’s hard to estimate because I consume all those things with my partner. I do retrospectives every couple of months to ensure my gut feel was on track and cut down on blowouts with subscription services.

How much do you spend per year?

God… maybe 20k-25k a year discretionary spending? More? That would not include the mortgage which is something like 30k total a year.

Do you make purchase decisions carefully, or are you loose with your money?

I’m pretty careful about larger purchases, but perhaps too loose with anything small enough I don’t have to sign for!

How is your work-life balance?

Pretty great at the moment, I have time for the things I want!

What is your favourite thing to spend money on?

Small hobby electronics! Cute little spare parts and knick-knacks. I actually did a budget retrospective a few weeks back and realised my biggest discretionary expenses were robot parts and video games.

Invest

How do you invest?

I used to try to follow the stock markets and was interested in small cap mining companies. But my mortgage has taken all my attention away from “discretionary” market investment. I’m thinking about getting an index fund investment going to park the remainder of my savings. Financially speaking, I consider myself just educated enough to not do anything fancy.

What has been your best investment?

Real estate.

What has been your worst investment?

Cryptocurrencies.

What’s been your overall return?

Buying an apartment at the right time, probably returned 35-40%?

How are you building wealth?

Career growth, and, unfortunately, relying on real estate investment in Sydney. I’m pretty beholden to any downturn in the market.

What are your main roadblocks? And how are you addressing them?

Diversification. I’d like to start putting my money somewhere a bit more stable than a single city’s property market!

Do you have a target net worth you want?

I have a target lifestyle, which means a target income in my mind. But I’m not particularly interested in being a multi-millionaire. For my age/stage in life, I’m actually currently living my target lifestyle, minus some chicken-coops...

When did you make your first significant behavioural shift towards wealth building?

Reading about value investing in early university!

If you could start again, what would you do differently? (Advice for younger self)

Not mess around in casual market speculation. I should have been following the advice of all those value investing books!

What mistakes have you made along the way that others can learn from?

Don’t invest in what you don’t know – and remember that fancy marketing/hype for financial products is a bad sign if you aren’t already benefiting from it in real dollars!

Do you have any worries about retirement? If so, how are you planning to address them?

Not at the moment. When I have a stronger idea of the lifestyle I want (kids, travel etc.), I’ll probably attempt to build some goals around it.

How are you learning about building wealth? Is it from family, books, forced to learn as wealth grew, etc.?

Books, blogs and general interest in economics!

Do you give to charity? If you do, what percent of time/money do you give?

Not on a regular basis. I used to do regular payments to some charities directly from my salary but stopped when I began saving more. I should be giving more.

Anything else interesting?

I do digital paintings for fun, and I’ve actually sold some of them before. Not sure I want to turn it into an income stream though.