This post is based on an interview we conducted with Susie in June 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.
Where do you live: Waterloo.
Please tell us a bit about yourself.
I’m a management consultant into fashion and travel, and I’ve been living in Australia for almost a year and a half.
What is your current net worth?
Super: No idea, but I’ve been working full time since I finished university.
Debt: $40,000 debt, including mortgage and credit cards.
Assets: Probably about $150,000 in fixed assets.
Investments: I’ve got equities overseas but I’m not sure of their value right now.
Tell us a bit about your career:
I’m a management consultant full time. I’ve been doing that for about 5 years. I’ve pretty much always worked full-time, straight from uni.
Do you have income sources outside of your job? If so, how much do you earn from each and how did you develop them?
What advice do you have for people who want to earn more money?
I would save more rather than spending on depreciating assets (like cars). If you need a car, buy a cheaper one and put as much money as possible into an appreciating asset.
Do you have a budget?
I prefer not to say exactly, but someone at my level would be earning a salary between $140,000 and $180,000.
Rent and utilities: $3,500/month.
Transport: $200, plus $100 in case I need to take a taxi somewhere. I’m more likely to use Uber Pool though because you save more.
Grooming: $150 for hair and nails, and $150-200 every 3 months for my hair.
Groceries: I initially thought I’d need around $150 a week, but I now spend more like $50 a week for groceries, and I’d eat out once a week, probably spending $20-$40. Once a month I might spend around $200 on an evening out with friends.
Shopping: In a good month, maybe nothing. In a month where I do shop, I could spend between $200-$500 on clothes and shoes. I wouldn’t say I budget for that though. It’s more an emotional thing. I do budget for skincare and my daily stuff though. Probably $100 a month on average. If something I know I use all the time is on sale, I’ll usually stock up.
Debt: About $1,000 towards my credit card debt. I also send money back overseas for my investments, mortgage, and car there. That adds up to about $2,000 a month.
Savings: I try to aim for a minimum of $500/month for my savings, but my day to day savings are more for holidays or frivolous things that I want.
What is your savings rate? And how has it changed over time?
I never really had a consistent saving habit. My parents came from the middle-working class to middle class. They never really saved; that knowledge wasn’t passed down to me. Because of the climate in my home country, I had a very low salary and I spent almost half of it on travel. As my salary increased, I was spending as much as I earned.
Do you make purchase decisions carefully, or are you loose with your money?
I have a shopping problem. I’m an emotional shopper. Until I was in my late 20s, I would have clothes in my cupboard that literally still had tags on them, because I was trying to fulfil this need. Around 2010, I went to a talk about the psychological influences of shopping, and that got me in touch with my emotional shopping. It’s still a challenge, but I try to control it more.
How is your work-life balance?
I think Australia can offer a pretty good work-life balance. It’s the best balance I’ve seen across the many countries I’ve worked in.
What is your favourite thing to spend money on?
Holidays, closely followed by designer shoes. Designer anything really.
How are you building wealth?
I’ve got a home overseas which I’m still paying off. That’s the main thing. I’m also actively trying to build a portfolio in different equities. I also want to start up something of my own, like independent contracting rather than consulting for another company. The plan is to save at least three months of my current salary, to get to the point where I can comfortably do that. I also have to try to get my permanent residency, which will have several thousand dollars in related expenses, but it’d give me more flexibility for my work.
What are your main roadblocks? And how are you addressing them?
Being on a work visa.
Do you have a target net worth you want?
I do, but I’m probably 5-10 years away from it.
When did you make your first significant behavioural shift towards wealth building?
Late 20s/early 30s was when I started putting towards equities and savings to buy a home, which I eventually did. When I moved to Australia, I cashed out a lot of my savings to restart my life. My job relocated me, but I still had to pay for my visa, flights, and to ship my stuff over, then they would reimburse me for that.
If you could start again, what would you do differently?
Be more conscious about what I’m spending my money on. Like buying a packet of a new flavour of Tim Tams, tasting one, then throwing out the packet. Now I make a grocery list, and because I have a sweet tooth, I’ll include “up to $6 on a treat,” not “all of them because they’re on sale.” You can also shop smarter. Keep an eye on things you need and buy them on sale. I cook for my immediate need instead of stockpiling for “maybe.”
What mistakes have you made along the way that others can learn from?
Spending too much on a credit card and buying fancy things that I don’t need.
Do you have any worries about retirement? If so, how are you planning to address them?
No, I’m not worried about it.
How are you learning about building wealth?
I think I learned the most from books and social media. I follow inspiring women that are investing and sharing how they got to that point and what they’ve learned. Hitha Palepu and Olivia Jeanette are my favourites. Also, a book called “The Money Book for the Young, Fabulous & Broke.”
Do you give to charity? If you do, what percent of time/money do you give?
Back home I would volunteer quite regularly. Here, I haven’t come across that many opportunities. Back home there are a lot of women involved in certain charities, and I would donate to their causes when needed.