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Rask Australia: Money Money Money
110 Plays3 years ago
*cue the Abba song*
In this episode we are speaking to Owen and Kate from Rask Australia: a diversified investment research, news, education, podcast and money network which is Australian-owned and located in Melbourne, Australia.
This episode is 1 of 2.
We discuss:
- The truth about credit cards and paypal
- The best ways to invest (where and when)
- How to budget as a student
- Important things to consider when moving or living at home
- The best ways to navigate the world of money
- ... and so much more!
Keen to see more of Rask Australia?! Check out the Instagram here.
Let us know if you enjoyed the episode by rating the podcast 5 stars!
Don't forget to subscribe to this podcast and hit the notification so you'll always be in the know about how to succeed in your education.
For more study tips and tricks, check out our Instagram @allthingseducation21
Stay educated everyone!
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Transcript
00:00:01
Speaker
you
Introduction and Recent Changes
00:00:12
Speaker
Hey guys, welcome back to another episode. It's been a long time since I have jumped behind the mic. My apologies, I have to say. It's been a little while. I think the last time I released an episode was August. So that's kind of fun. It feels kind of weird being behind the mic again, not gonna lie.
00:00:35
Speaker
I guess I have excuses. A lot of life stuff has been happening recently. Just been a little bit crazy finishing the year, finishing uni assessments, transitioning to unis. I'll jump into that into another episode actually. But I am currently studying online now and I've actually moved to universities where I'm able to, yeah, completely do my psychology course fully online, which is like awesome.
00:01:00
Speaker
but it kind of has its ups and downs. Anyways, it doesn't matter. I'll get into that in another episode.
Podcast Evolution and Expansion
00:01:05
Speaker
This episode, we are gonna be focusing on finance. Before we did all of that, though, I did just wanna give you a bit of a life update. I have no idea if you wanna listen to this or not. If you don't, just feel free to go ahead and skip. But yeah, I'll give you guys a bit of a life update. Well, first of all, I just wanted to say that I have given this podcast a little bit of a shift.
00:01:34
Speaker
What I wanted this podcast to be about, kind of crazy, literally this time last year, I think it was this month, last year in December, I was collating all my guests and putting together my very first episode, which was just amazing, one year anniversary, woohoo, of the All Things Education podcast. But yeah, I've had a bit of a think, done this for a year, or not quite a full year, I've taken quite a big gap. Yeah, August I think was the last time I released an episode.
00:01:55
Speaker
in the sense that I've had a bit more of a rethink into
00:02:01
Speaker
So that's been quite a few months from August to December, so if the last time that you listened was August, I am so sorry that I've left you hanging. Left you hanging throughout exam period and just all of that end of year stuff.
00:02:15
Speaker
if you're listening in from Australia, that is. Um, but yeah, I've had a bit of a think and I am shifting now from just focusing on study to like just giving you guys study tips. Um, and sort of just like talking about tricks and things that you can do to help you improve and help you guys in your study journey. I thought I might give the all things education podcast a bit more over.
00:02:41
Speaker
Not like a brand reshift, but just the aim of the podcast I think I wanted to more focus on. Yeah, still study tips. So still things that can help you guys. I guess really just be better, like do better in your studies. And just like little things that can just help you study better and do your exams better and live life better. But yeah, I guess just branching out a little bit more.
00:03:06
Speaker
into lifestyle stuff. And really, I just want to take you on a journey of my journey of studying.
00:03:14
Speaker
And I don't know. I don't really know what I'm trying to say. I guess it's more just like I want to take you on a journey of my study life and just share my experiences with you and really just like be real with you guys because I don't know you could notice this I don't know but I feel as though that I wasn't being like my seriously true authentic self on the podcast like it felt very like I was constantly always like interviewing someone and I was always like
00:03:40
Speaker
being like kind of like the interviewer vibe if you could say that and I didn't really feel like you guys have ever really gotten to know me as your host um and I wanted to kind of take you a bit more on a journey about my life and the struggles that I am facing or had to face or will face um especially with a lot of the things that are going to be happening like next year in my life and I'm yeah I'm going to do another episode on that
Community Engagement and Goals
00:04:07
Speaker
Um, but yes, anyways, I have actually just come back from a holiday. Um, that's my life update for you guys It was really really great good time Just to um film some content for the instagram if you haven't if you're not already following go check it out all things education 21. Um And that's been really great. I've planned out some great Podcast episodes for you guys and got some really great guest stars that are gonna join on the show and i'm really excited for that so definitely stay uh tuned for that um, and i've definitely
00:04:34
Speaker
I keep saying definitely a lot, sorry. I've been listening to other podcasts, getting some really great inspiration from them. Particularly, I've been listening to Gals on the Go. They are such a great podcast. I feel like I am kind of starting to get an American accent after listening to them. It's been really, really great to listen to them because they are a lifestyle podcast. If you don't know them, please go check them out. Literally not sponsored or anything, just a great,
00:05:02
Speaker
just two great girls. Their names Brooke and Danielle, they're like I would say pretty successful YouTubers and they talk about everything related to lifestyle and they've just given me a lot of inspiration for this podcast and just I know that I have to do so much more for this podcast so I'm just really excited to
00:05:19
Speaker
progress and I have made a mission of mine to release every single week if not every single fortnight at least just to give you guys some content because I know and I've been receiving a lot of feedback lately people questioning why I've stopped doing the podcast episodes and when I'm gonna pick them back up again and
00:05:35
Speaker
and a lot of people and teachers were telling me as well that they've been referring their students onto them so it's just been really positive feedback so far and yeah I haven't received any constructive criticism or negative feedback so I'm gonna keep doing what I'm doing keep releasing episodes for you guys I'm gonna be doing some more solo episodes I think particularly if I'm doing like the lifestyle kind of stuff I think I'm going to be like
00:05:59
Speaker
I don't know, I guess I'm just going to be doing a bit more talking, like solo talking and just talking to you guys about what I feel like the podcast, like just talking, just talking basically. If you just want to listen to me talk, then I'll be doing some solo episodes. But so we're definitely going to be doing the podcast with a guest star. I'm really excited for that. Yeah, I got some great, great, exciting people lined up. So that's cool.
00:06:23
Speaker
Um, another life update. Yeah, finished my first year of uni. So that's pretty cool. Um, pretty crazy actually. I'm actually doing summer semester. Like I said, I'm doing it online. A little bit different because I'm actually, I basically get to study whenever I want. Like it's just so flexible with the university I'm at. Um, if anyone's interested, it's Deakin University.
Spotlight on Deakin University
00:06:45
Speaker
Um,
00:06:46
Speaker
Yeah, that's pretty cool. Deakin is great for online stuff, especially a lot of people, I think during COVID went to Deakin because they were doing so well with the online stuff and they already had set it up before COVID. So they definitely gained a lot of traction because of that.
00:07:01
Speaker
which is how I found out about Deakin and online. Not that I wasn't happy with my university. It was more just I wanted more flexibility, especially next year, because I'm going to be studying two degrees in two different states, which is very crazy. Anyways, my little rant I think is over. Oh, another thing. I've actually,
Funding and Support Initiatives
00:07:22
Speaker
okay.
00:07:23
Speaker
I hate to beg or plead or ask for things from other people. Not that I'm not too proud to do it, it's just more. I feel like I don't want to make other people feel like they're in a position that they have to help me, but I'm just going to put it to you guys anyways. I basically set up this thing called
00:07:43
Speaker
go buy me a coffee or it's technically called buy me a coffee you might have heard of it quite a few influencers use it or people that are trying to like raise money or just like get fundraise in general or whatever I have set it up it's gonna be in the description box for this episode whether you're listening on Spotify or Apple podcasts or Deezer or whatever you're looking at
00:08:05
Speaker
If you check out the description now, you'll actually be able to see that there is a link to buy me a coffee website. Um, yeah, pretty much if you haven't heard of it, um, you can like, you don't really donate, but you, or you do donate, but it's technically the right terminology is like, you support the person you're listening and you buy them a coffee, which is, I mean, you can't see me, but I'm using quotations right now. Um, it's you give $5 or any,
00:08:34
Speaker
amount of money in increments of five to the podcaster or the influencer or whatever the person and that basically goes to them so for me I'm gonna be using it to help you guys I'm not gonna be spending it on like you know my night out or whatever I'm gonna be putting towards podcasting equipment and I guess being able to spread like create ads on Instagram boost my content on Instagram yeah I think the audio quality right now you're listening to it's not terrible but it's not the best
00:09:03
Speaker
I would really love to upgrade my microphone and some of my podcasting equipment. So any money that you guys donate will be definitely put straight towards getting a new microphone, fancy new microphone to really help your experience. So if you can spare $5, I know most of you guys listening, you're in university or high school and you don't really have a lot of money to yourself, but if you can spare $5, oh my goodness, I would be so, so grateful. That would be literally just so amazing. I'd be beyond grateful.
00:09:33
Speaker
Head to the description and you can donate $5 or more. Anyways, let's jump into the episode. I am very excited.
Introducing Finance Experts
00:09:40
Speaker
I've got Kate and Owen from Rask Australia. I'll give a bit more of an intro to them in a second, but we're going to be talking about all things finance. There's a lot of information on here. They are professionals, so they do know what they're talking about. So yes, you can quote them on what they say in the sense that what they're saying is obviously very general tips.
00:09:59
Speaker
don't take it very specifically to like your specific situation but I would say that a lot of the information that they they are experts in this field so they do understand
00:10:12
Speaker
finance they have experience and you can definitely take their word when they talk about investments and things like that but of course if you do have your own financial advisor um speak with them about about any of the information that you've heard today um but yeah this was such a great episode i'm actually gonna put it in two parts i think because we just talked for so long and it was amazing don't get me wrong like we just kept talking and
00:10:33
Speaker
was brilliant but I think we're going to do a part one and part two so I'm gonna call this part one um we're gonna call this I think let's call this money money money why not like the full full blown app song let's do it um yeah I am so keen um just before we get into it
00:10:49
Speaker
Sorry, I know you're probably really excited to get into this, but I thought I would just say one more thing. And that is, lately I've also been doing a bit of a re-shifting for my Instagram content. If you, again, haven't checked it out, all things Education 21, as in the numbers 2 and 1.
00:11:07
Speaker
That's really, really cool. If you could go through that a follow, I would be most supportive. Most supportive? I can't speak. Most grateful for that. Because yeah, I really want to get that up and running that Instagram. There is a lot of tips and funny content, relatable content.
00:11:28
Speaker
great lifestyle hacks, just some little vlogs. There's just heaps on there that I think you guys would really find enjoyable if you're listening to this episode right now and you're enjoying it. I think you would like
00:11:40
Speaker
the all things education uh instagram in like podcast instagram account um yeah and you know flick me a dm and just say hi and i love chatting with you guys it's very fun um so just like say hi jump on and just shoot me a message and if you ever are interested on being on the podcast at all um obviously i'm always on lookout for guests but yeah if you are interested
00:12:05
Speaker
If you go onto the Instagram, there's actually just a link like it's just bio a bio link kind of like a link link tree sort of thing. And you jump on there and there's like a little form you can fill out and get if you're interested in being a guest. That's pretty cool. I've actually had a couple people that have contacted me saying they want to be guests. So I think that is great because it's like goes to show that this is progressing. My big goal for 2023 and again, I would do another episode on like the goals.
00:12:34
Speaker
that people should start to be making for 2023 or particularly for like the new school year.
00:12:39
Speaker
Um, if you're in Australia, that is where our school year starts in February. Um, late February, actually. Um, but yeah, I would just make an episode about some of the goals, but personally, my big goal is really just to be consistent with the content I am posting on podcast, on the podcast and on Instagram and whatever. Really just to be consistent. Like I want to be posting every single week, um, every Sunday night for the podcast. And I want to be posting.
00:13:09
Speaker
at least five to seven times a week on the Instagram I know that's going to increase and decrease and my goals won't always be consistent throughout like the whole year because I know that there's like a lot of stuff that's gonna be happening next year that I have planned so I don't know how well I can get up with it but as long as I have you guys that are there to support me and you guys are just so encouraging honestly like people have literally given so many positive
00:13:38
Speaker
like words of inspiration and aspiration and everything about this podcast. And yeah, it is very, very encouraging because there have been many times where I've questioned this podcast and I've gone, hey, is this actually really worth it? Like it is so hard just talking.
00:13:54
Speaker
like literally i am sitting here in a room with a microphone talking to myself like it's ridiculous anyways um it is just crazy but i really am grateful i'm very grateful um yeah super super grateful for your support and the words of encouragement that you guys have given me and everything about that so if you do have any positive words or negative or constructive criticism that you want to give me i am totally open to it
00:14:22
Speaker
Please send me an email. My DMs kind of explode every now and then, so it's very hard to keep up with everyone. But email is definitely best if you do want to email me. It is. All Things Education. So one word.
00:14:35
Speaker
21 at gmail.com and yeah say hi if you want to be on the podcast whatever you want to be um and without further ado let's just jump into the episode because i've been talking for like 15 minutes straight and we haven't really gotten anywhere um but yes buy me a coffee definitely go check that out in the description and i hope you guys enjoy this episode and yeah let's jump into it
00:14:59
Speaker
Okay guys, so on the show today we have the lovely Owen and Kate from Rask Australia, which is a diversified investment advice, news research, financial education, podcast and money network. And a surprise, it's Australian owned and based in Melbourne. So one of their big missions is to have 10,000 students enrolled in their free finance course. And we'll talk a little bit more about this later, but if you are interested, we'll link the enrol button in the description box below.
00:15:27
Speaker
So about Kate. Kate is the co-host of the Australian Finance Podcast and the host of the How To Money Podcast that she founded in 2017. She is also an educator of Rask Australia and puts together the financial education courses.
00:15:43
Speaker
And Owen. Owen is the founder of Rask Australia and lead investment analysis for Rask Investment, his members only share research service. Owen is the host of two podcast series, the Australian Investors podcast and the Australian Finance podcast, which also Kay co-hosts.
00:16:01
Speaker
And those are both of two of Australia's top ranked investing and finance podcasts, attracting thousands of listeners each day. So I would highly recommend you guys check that out. So it's my pleasure to welcome you today, Owen and Kate, to the All Things Education Podcast. Thanks for having us on, Mary. It's our pleasure. No, of course. And it's awesome to have you guys. Yes, definitely. So, um, I've kind of obviously given you a little bit of a brief introduction, but, um, Owen, did you want to start off and give a bit of a background of yourself? Yeah, sure. No worries. So, um,
00:16:30
Speaker
My journey to finance is a little bit of a different one. I didn't know what I wanted to do at school and I didn't want to know what I wanted to do out of school. I think I went to five undergraduate unis. So like I studied everything from social science through to economics and ended up graduating with a bachelor of tech. But in between all that, I also had a very brief stint.
00:16:52
Speaker
in the army where I was going to go to the Special Forces Direct Recruitment Scheme. So that's something that Kate and I actually have in common is we both spend a brief amount of time with the Defence Force. And coming out of that, yeah, I threw a friend. We just had some money and we thought, well, why not get started in finance? This sounds interesting. And basically the first investment, Mary, was I got my friend to close his eyes. We put the Australian Financial Review newspaper on the table.
00:17:21
Speaker
And he held out his hand and then I moved his hand while he had his eyes closed to say which stock he was going to invest in. And he put all of his money in that stock. Turns out it was an Indonesian mining company. And he made about 30% in like a month, but then he subsequently lost almost all of it on the way back down. So, you know, trial by fire, but that's how we got into investing. And yeah, the rest is history, as they say. Oh my goodness. Wow. That's awesome. I love it. How about you, Kate?
00:17:50
Speaker
Yeah, well, when I was in the Air Force for a short year and a half, I don't know what that says about us that we both tried in the Defense Force, but I guess it means we're open to new opportunities. But when I was about to leave, I was a bit bored. And so I downloaded a brokerage app and started buying and selling a few things, not really having any idea what I was doing, because as you've probably talked about, we don't learn all of this at school.
00:18:17
Speaker
And yeah, I think I was buying and selling drone companies, jet pack companies, marijuana companies, like there was a bit of everything there. And yeah, I just had no idea what I was doing. So after I left and started exposing myself a little bit more to the world of finance, mostly through massive Google deep dives, because in 2017, there weren't nearly as many resources as there are today, which is fantastic for any student who's wanting to
00:18:41
Speaker
get involved with learning about their finances now. But yeah, I just learned as much as I could. I started How To Money as a way to share what I was learning with my friends because I just thought it was a good way to have a conversation. And so instead of having a conversation 10 times, I could have it once and just share that episode with them. So it kind of just went on from there. I got more involved in the world of finance and realized just how important it is to get some of those foundations right, even if you don't really care about the numbers and the rest of it.
00:19:11
Speaker
by getting the foundations right and just having a bit of idea of what's going on with your money and investing in your super, it's going to set you up for a much better future. And that's what Owen and I try to do with the podcast and with the free courses is just give people all those basic tools that we should learn at school, we should learn at uni, but since we don't, we can learn them as an adult just to take control of our own future.
00:19:33
Speaker
Yeah, that's so awesome. And I guess how did that lead to you both sort of co-hosting the Australian Finance Podcast? Yeah, so that was it. We got us that last week, actually. It's one of those internet interactions we had in 2018. We actually met over Twitter and caught up and had a coffee. We were both working in different roles at the time. And yeah, back when meeting internet strangers and it turned
00:20:03
Speaker
out to actually be quite a good thing and we both were super passionate about talking about personal finance and having these conversations and it was actually Owen's idea at the the end of 2018 to start a podcast and we were just going to start with 10 episodes and cover just the basics of finance everything from budgeting to
00:20:22
Speaker
how to buy your first share or exchange traded funds, which maybe we'll talk about today. But yeah, it just kind of kept going from there. People really wanted to have these conversations. And if you didn't have a friend or family member to talk about money with, listening to a podcast was kind of the next best thing to feel like you were involved in the conversation and weren't going about the journey alone.
00:20:43
Speaker
Yeah, that's awesome. And I guess let's talk about financial security because of course it's a term that I feel like I hear so often.
Understanding Financial Security
00:20:54
Speaker
My parents always say to me, I'll make sure you're financially secure when you move out of home and before you move away interstate and all of those things. But I guess, Owen, do you want to sort of give us a bit of a breakdown of what is financial security and sort of
00:21:09
Speaker
How important is it to be financially secure as a young adult, as a child and in those early ages of tertiary studies? Yeah, sure. Well, I guess there are many different ways. I think people have a basic understanding. If you say, what is financial security? They probably think like, okay, well, I'm not stressed. I'm not overwhelmed by money. And so, you know, that's probably the first test, right? You can do that yourself. There are different measures and there are different surveys that go out every year.
00:21:37
Speaker
One of the most important ones though, Mary, is the ability to, ability to save what we call an emergency fund. An emergency fund is that kind of bit of cash that you put aside. If it's in your bank account, might be under your mattress, wherever you want to put it. And it actually is that a bit of, it's that money that got, it's like a get out of jail free card. You can use it to, um, you know, pay for emergency dental treatment if you have to pay for your broken down car. Um, if you forgot about car registration.
00:22:05
Speaker
or if you need to pay rent or something like that. Now, most people that listen to this podcast will probably be living at home. But for people that aren't living at home, they'll understand the need to earn an income and to be financially secure. And it's actually really scary to think that
00:22:20
Speaker
Um, about one in five Australians can't save any type of emergency fund. And so that could be as little as, you know, a thousand dollars, which sounds like a lot when you're in school. Um, but you know, these are adults that we're talking about here that can't save that type of money. So, um, at the end of the day, financial security is kind of relative. Like what's different for you will be different to me, which will be different to Kate. And so the key idea is that do you feel stressed about money?
00:22:46
Speaker
When I was growing up, when I was in high school, I absolutely felt stressed about money and to the point where I actually worked five days a week or five, like proper shifts a week at a supermarket while I was studying my high school education. Um, because I, frankly, I had to, or at least I felt like I had to, because, you know, there would be times when not just me, but my family's bank account might've been like,
00:23:07
Speaker
in single digits, right? And so that was the, if I look back on it now, that was a lot of financial insecurity. Um, but you know, I'm not unique and there are many people that have on both sides of the spectrum. It sounds like you, Mary have some parents that are giving you a good grounding in that, which is fantastic. Yeah, for sure. And, um,
00:23:27
Speaker
I guess money stress can impact schooling and can impact your mental health, but I guess what other areas of your life can that insecurity and money affect?
00:23:39
Speaker
I think it definitely impacts the way you can focus on your education. So if you're in high school or you're in university and you want to focus on your education, but you can't pay for your food or your rent, then that's going to have a huge impact. And we often forget how much our finance is actually tied to the rest of our life. And coming back to just starting with a clean slate, if you can avoid going into debt,
00:24:02
Speaker
from the age of 18, I'm not talking about, um, getting your education here. So not talking about hex debt, but if you can avoid going into buy now, pay later debt or credit card debt, um, from an early age, that is such a fundamental skill because that will really set you up down the track, having that emergency fund, being able to say, okay, if I have a savings goal, working out how to actually work towards that, that is something that if you figure that out at 18, that's going to really set you up as well. So I think it's just.
00:24:32
Speaker
working out the basics and if you can do that as early as possible, that will hopefully reduce the amount of financial stress in your life and increase that financial security blanket you have. I would probably just, if I can just add one thing onto Kate's answer there, which is great, which is that the moment you turn 18, if you're not already 18, is the exact moment that you will be most vulnerable.
00:24:57
Speaker
It's the moment when you will be sent a credit card because your bank knows your age and they will send you a credit card on that day. And you will be able to sign $2,000 and then you'll have maybe a little bit of repayment history. So they'll give you $6,000. Maybe you can still service that for a little while. They'll give you 10 or $15,000. And before you know it, people are spending all of their 20s paying back a credit card. And it's later in the 20s.
00:25:23
Speaker
when that credit card will come back to buy it and you might not be able to go on a Kentucky tour or go overseas with your friends when they want to do something like that. And those are the decisions that we make at 18, 19, 20 that have many years of a lasting impact. So I think, you know, the sooner we can all figure out that, you know, 18 years of age is probably not the ideal time to get a credit card. It's probably when you, if you are ever going to do it, maybe do it once you have a full time job, but even then, you know, be very careful.
00:25:55
Speaker
I was going to say, I'm way too scared to get a credit card. I don't want to put that debt on myself. And yeah, I guess you were right before when you said, oh, and that my parents have tried to educate me to the best extent. They definitely have encouraged me to not get a credit card, particularly because I love spending money. I guess who doesn't? But yeah, I am very scared to do it. But I guess when is the right time?
00:26:22
Speaker
to sort of think about maybe I should start getting a credit card because I know a lot of adults, parents and families are using credit cards. But like you guys said, it wasn't really wise to get one now because there's no sort of need. So yeah, when is that prime time?
00:26:39
Speaker
Kate, would you want to answer that or do you want me to answer it? Well, I think if it was a bank talking, they would probably say prime time is 18. But I think for Owen and I, if you don't have to get a credit card and you can manage your finances because you've got an emergency fund and because you're saving up for things you want instead of buying them.
00:26:59
Speaker
in advance, you probably don't actually need to get a credit card. And in fact, a lot of younger people in general are actually turning away from credit cards. The trap is they're getting caught up with Buy Now Pay Later accounts. And Buy Now Pay Later companies know that young people are a great audience to target. And I don't know if you've had a look at any of their social media accounts, but they're very much pushing the you deserve it instant gratification. You should get that holiday immediately. And
00:27:28
Speaker
don't worry about future you future you can pay it back down the track and that's really the behavior we don't want to get in and if you can kind of get caught in that trap because you can end up with multiple buy now pay later accounts and it can become really stressful trying to get out of that trap especially as a uni student when you're on variable income and you don't necessarily know what's coming in next week so I mean
00:27:51
Speaker
I think if you're 18 now, don't really need to worry about credit cards if you don't have to at the moment and really focus on building those fundamentals and bring back the popularity. It used to be cool to actually save up for a holiday and you get that experience of saving up and talking about it and crossing up those numbers on the way. That's what I did for one of my trips. I wrote my
00:28:15
Speaker
thousand dollar savings goal and I had hundred dollar increments written on a whiteboard and every time I saved up the next hundred dollars I could cross it off and that gave me a lot of satisfaction in the lead up to booking that trip which all these companies try to talk you out of that behavior but it's good if you can bring that back into your life.
00:28:34
Speaker
I think Barefoot Investor spoke about buying our pay later as a gateway drug. It's kind of like the marijuana of money. And it's basically like it's a thing, right? Like people start on that and like, oh, this ain't so bad. And then they get the credit card. And then before they know it, they're like so deep in personal loans and all this stuff. I'd know because I've never had a credit card and I never will.
00:28:56
Speaker
But I remember when I was young, I had a decent income because I was working in the supermarket so many days of the week while studying, which was super stressful. I eventually got a personal loan. And I later on, I sold the car, I bought a Ute and I did like the whole thing. And I later on reflected on that and I calculated what it would actually cost if I bought a $20,000 car on finance and I held it for five years. So I held that car for five years. It would cost me $72,000.
00:29:26
Speaker
Um, and so when you sign the dotted line for a car in particular, in this case, um, you're paying three or four times your actual dollar. So if you buy it for say, ah, it's only 15 grand. Well, more like 50 to 60 grand is probably after, cause young people have to be insured. If they have a loan against their car, young people get stung with huge interest rates more than I would being 31 years old. I would get a better interest rate because I've got, you know, more of a credit history and whatever.
00:29:55
Speaker
And so for the most part, Mary, like the exact time that you shouldn't get a credit card is the exact time you're most vulnerable to it. And, um, that's just a really scary thought for us as educators, like Kate and I have people write into us and tell us all these things and we see the back end of it and.
00:30:10
Speaker
It's pretty scary. So I'm all for like putting that thing on the wall, like have your vision board on the back of your toilet door. Put like it, put it Italy or Croatia or wherever you're going to go and you're going to have your holiday. Put that on the back of the toilet door and just stare at it for a bit and count down the days until you save enough money to go. It'll be super rewarding.
00:30:30
Speaker
Yeah. And it kind of undoes, undoes, undoes what you were saying, Kate, that sense of like instant gratification. And yeah, I definitely, personally, I struggle from that a lot. It's hard. You're working against multi-million dollar marketing budgets here. Literally, literally, just to your own kind of conscience. They're using all the tricks. I should know with psychology. Yeah. And I love that idea of saving goals, something that
00:30:58
Speaker
uh, definitely, um, can be worked on. And I guess speaking of which, how would you sort of, um, like what's a good goal that people can set for themselves if they do want to, um, yeah, start saving. What's an easy sort of thing that they can achieve towards?
00:31:14
Speaker
Yeah, I think, as I mentioned the emergency funds a great goal to start with and even if that's just $500 in a bank account a high interest savings account so hopefully something that's not directly linked to your transaction card because it's very easy to access then.
00:31:30
Speaker
And just putting that money aside, so you've got that for an emergency. But that doesn't sound as exciting. So I know emergency funds important, but maybe if you are just starting saving and picking a goal for the first time, pick something that you really want to buy. So let's say you really need a new laptop.
00:31:50
Speaker
figure out how much it costs and write that down and then work out, okay, when I get paid each week or each fortnight or each month, how much leftover income do I have that I'm not spending on all my essentials? So maybe you have a hundred dollars left over a fortnight.
00:32:07
Speaker
And so, if you can work out how long it's going to take you to get to that laptop and try and break it down by what's actually achievable, what you're going to be having leftover each fortnight or each month, and try to work out a plan to getting there because then you'll start to build those habits of working towards a goal and actually feeling that satisfaction of getting there and if you can.
00:32:28
Speaker
putting that money aside in a separate bank account. I know some of the new banks have popularized having different bank accounts with emojis, which always makes it a little bit more motivated. And you can even set, some of the new banks have, you can set the goal. You can say, this accounts, I want to save a thousand dollars for this item.
00:32:46
Speaker
And then you can see it tracking, oh, you're 10% towards the goal, 20%. And you can feel that motivation. And then that keeps you going and keeps you saving. And then you've, you've experienced reaching a goal. And then when it comes to setting your next goal, it might be a little bit bigger. It might be that Contiki tour in three years time. That's $5,000. Cause you're going to go all over Europe. And so you're building those skills time and time again. So you can, you know, you can achieve these savings goals and you're working out what's achievable to me.
00:33:17
Speaker
Yeah. And Owen, did you have anything to add to that?
00:33:21
Speaker
No, I think Kate's answer is brilliant. Yeah. Um, there's just find something and Kate will hate me for saying this, but there's a theory and you'd probably like a Mary's that like, if you draw it tastes better. So if you pick that goal, something that you, you want to work towards, um, you know, just kind of live that experience, live the experience of wanting to save for it too. Cause that's, that's half the fun of it sometimes like planning where you might go, how you might save money while you do that is it's super exciting.
00:33:49
Speaker
Yeah, and even involving other people in the goal is always a lot of fun, especially if you're saving up for a trip you might be doing saving up for a trip with a friend so you can talk about all the creative ways you're saving a bit of extra money, maybe you're taking on a few extra shifts and you can
00:34:04
Speaker
track your progress towards your goal and keep each other on track and even just check in with each other because it can feel really lonely working towards financial goals because we don't talk about money and we don't realize that there's many other people around us also setting financial goals, whether that's for their first house deposit or for their travel or to buy a new dress for the ball at the end of the year.
00:34:25
Speaker
Um, just, just talking a little bit more about your goals. Most people do have something in mind that they'd like at some point. So using that as a really good conversation starter to talk about money, especially if you've never had a money related conversation with friends or family. I've seen a lot of success in people starting off with a goal related question and using that as a conversation starter rather than just jumping into where's your. Yeah. Yeah.
00:34:54
Speaker
For sure. And I find that so interesting that I completely agree with you, Kate. Like I think the more that I talk about money with my friends, the easier they sort of see that. We actually are like, we have similar struggles and we kind of have the same goals we want to save. Eventually, you know, make that deposit for the house and you know, everything you were saying.
00:35:11
Speaker
Yeah, it's interesting because there's a lot of things that hold us back from working towards goals or investing for the first time like I'm not smart enough or I should have studied finance to manage my money or my partner's got it sorted so I don't need to worry about it and we have a lot of these things running through our minds and we don't think anyone else has these things running through their minds either so just talking about
00:35:35
Speaker
maybe you made an impulse purchase that you later regret, or maybe you lost a little bit of money, or maybe you found a really good savings tip. Like sharing those things, the good and the bad starts to open up that conversation. You realize, oh, I'm not doing it alone. And I can also be someone that's good with money. I don't have to listen to that person at school that told me I was really bad with money or something one of my family members told me. I can break that and I can become the person who manages my money well.
00:36:04
Speaker
And is that, I guess once you sort of have those savings and that emergency fund or those like saving goals, is that sort of the first step in becoming?
Steps Towards Financial Independence
00:36:13
Speaker
Yeah, I'd say so. If you think that most people or not most people, many people can't do that. Even if you take the numbers like one in five people, that's 5 million Australians that can't do that. So you're definitely on the road there. When you're a younger person, typically you have the opportunity to save lots of money because
00:36:33
Speaker
You typically don't have a huge rental bill or mortgage, which for most people is their biggest stressor. In order of financial stress and difficulty, it actually goes your mortgage slash rent and then your groceries. The way I would say to do this is that if you're in high school or you're in uni, is just graduate slowly into those expenses.
00:36:58
Speaker
You know, we talk about the Australian dreams, like a white picket fence, a golden retriever, two kids and a huge mortgage. At the end of the day, we can, you know, we can take our time getting to that future. Yes, we can think like, oh, I've got to save more. Or yes, you know, I should be doing this with my money or whatever.
00:37:14
Speaker
But at the end of the day, you can move out of home first and you can do a share house, which is heaps of fun and keeps costs down. And then from there, you can then, you know, think of other ways to save money. And when you're at home, like it's the best time to really ramp that savings rate. Savings rate is basically the difference between what you earn and what you spend. So that's what you keep basically. That's just savings, right? And some people when they're in uni or living at home, they can have savings rates of like 70 or 80%, right?
00:37:41
Speaker
But when you look at like the national average, it might only be 10%. And that's because once you get out of home, there are huge amounts of expenses. And I know you know this, but it actually helps. Like if you can bear to stand your parents a little bit longer or move into a share house, it makes a lot of sense. Like you can still have fun while saving money.
00:38:01
Speaker
Yeah, that's true. And budgeting definitely comes into play there. Even while living at home, I've found that I've, you know, still having to kind of start paying for little things, obviously like car expenses, but also food. And it's a great way, I think. I've seen many of my friends kind of negotiate with their parents.
00:38:24
Speaker
sort of a rent that they can work out between them, even if it's something like $20 a week. It sort of starts introducing them to the cost of rent, even at a small increment. But I guess it's helpful and it's a lot better to stay at home or go to a share house, as you're saying, instead of living in a
00:38:47
Speaker
You know, an apartment all by yourself and you know, the city or something. Yeah. Someone was telling me, uh, yesterday they were in a one bedroom apartment in Canberra and it was costing them over $400 a week in rent. That's nothing, mate. Move to Sydney. It's a bit scary. Oh my goodness. Yeah. Wow.
00:39:04
Speaker
So as long as if you can keep those yourself on a uni budget even after uni for a little bit longer by living in a share house, maybe not eating out as much and actually just having friends over for a potluck dinner where everyone just brings a plate or just low cost entertainment, whether that's going for a hike or going for a bike ride, if you can do that stuff for a bit longer and just increase the amount you can save, it does make it a little bit easier when you decide to go full adult and move
00:39:33
Speaker
out and into your own place. I guess in terms of shares and investments, do you recommend that thinking about it or starting to invest in shares is a good idea as you transition from high school into your tertiary studies or if you're just a young adult? You can start investing in shares for as little as a few bucks. There are platforms like
00:40:01
Speaker
shares is Perla, Kate would know more than I raise, you know, the roundup app. And that those some of those platforms like raise in particular, it allows you to you kind of connect it to your bank account. And say if you bought a coffee for $4.50, you can set you can tell it to round up 50 cents to five bucks. And that 50 cents gets invested in the share market for you, it goes through like the app and through the raise platform, but ultimately, it ends up in the share market.
00:40:26
Speaker
And a lot of people, whether you're uni students or older, like I know people that are like 60 trying to use this app, um, before they know it, like they're like, Oh yeah, sit that thing up a couple of years ago. And it's like 500 bucks in there. Or they look down and like, Holy crap. I've been doing this for like three or four years. Now there's $2,000 in here. Um, and that's probably the easiest way to get started in investing. Because when you use an app like that, um, you instantly like buy into something and you don't really have to manage it yourself.
00:40:56
Speaker
If you want to go and buy say Telstra shares, or you want to buy shares of an Australian company that you know well, you need 500 bucks. And so that means that like instead of say two grand, you could invest in one go in 500 bucks. And a lot of the brokers like the online brokers like Stake, Southwell, Perla,
00:41:17
Speaker
Um, all of these superhero, they all offer, um, when you sign up, you actually can, uh, get free trade. So meaning like, normally you have to pay like a few dollars every time you buy or sell, but with them, they'll offer like an introductory offer. They'll make it free for the first little bit. So you can take advantage of that. And while you're there, you can refer a friend and your friend can get a bonus as well. So those are like little tricks of the trade in order to get started with a little amount of money.
00:41:46
Speaker
Um, and try and keep your costs down. I don't know, Kate, if you have anything else to add to that. Yeah, I'd just probably add if you are financially stressed at the moment and you haven't got that emergency fund sorted out and you really want to save for a trip at the end of the year, you can just maybe put $5 in something like a raise account to get the feeling of being an investor, but I wouldn't go, Oh, I'm not investing. I'm doing this whole thing wrong.
00:42:10
Speaker
because you really want to focus on making sure you can manage your day-to-day expenses and you can save for those things that you can only do in your 20s and you can't do in your 60s. If you're not investing right now, you're only being able to invest $5 because you're a student or a uni student.
00:42:26
Speaker
don't tell yourself you're doing everything wrong and something's not right with your finances. I think that's completely okay. And a lot of students won't have the money to maybe properly invest more like $500 a month until they're maybe a couple of years into their full-time job. But the great thing about being a student is often you have a lot of time or a lot of travel time. Maybe you're getting the train to work or uni every day. And what you can start to do is build the habit of learning about investing. And so you've got a couple of years to actually
00:42:56
Speaker
build that foundation of knowledge and whether you prefer podcasts, maybe like ours, the Australian Finance Podcast, you might like books, you might want to read the Barefoot Investor, you might want to watch some videos on YouTube, you might want to use TikTok very, very wisely when it comes to money and definitely do a lot of fact checking there or look at like the government's money smart website, all fantastic places that you can put 15 minutes in a day
00:43:22
Speaker
when you're going for a walk or getting the train to uni and start building up that knowledge and just adding it into your routine because you've got that time to supercharge your knowledge when you don't necessarily have the money to make mistakes with. So you can learn as much as you can. So when you are in a position to do more than $5 a week into your raise or polar micro investing app, you actually know as much as you can at the time to get started. And you've got the confidence to take those steps.
00:43:52
Speaker
Yeah. And I guess on top of investing, is it a sort of a smart idea to put a little bit of money aside into your personal savings as well? Yeah, I mean, the more money that you have set aside, the better you'll be. So just to Kate's point, I think, you know, we try and teach people that the best thing you can do before you invest is actually be financially secure. And the one reason that we say that, and so that means we're like, have your money set aside, have some like, don't be paying for
00:44:23
Speaker
a dinner out using your brokerage account app. The reason why is that the stock market's a pretty uncertain place from time to time, particularly if you're new, you don't really know what you're doing and it feels like you're out of your depth. That's completely normal.
00:44:37
Speaker
What will happen is when you are feeling out of your debt and the stock market starts to bounce up and bounce down from every day, one day to the next, that's what it does. Um, you don't want to have to sell your shares to fund a living expense. So you don't want to have to, let's say you buy, I don't know, like Apple shares, right? I don't know what the share price is. Let's imagine that's a hundred bucks. And then it falls to say $80, which is a 20% fall. They might not happen overnight, but it might happen over say a couple of months. If you were planning to use that money to go on Contiki,
00:45:07
Speaker
Well, you've all of a sudden got 20% less to spend on katiki. So you don't want to do that. And so while it may seem a bit boring, what we suggest is that if you are going to invest meaningful amounts of money, like a few dollars here or there, it doesn't really matter. You know, you use the, the, the Roundup apps and away you go. But if it's like a meaningful amount of money, so if it's 500 bucks, a thousand bucks, whatever, don't invest that in the stock market because you might need that. Um, go away and make sure your, all your financial goals in the short term can be settled in cash.
00:45:36
Speaker
And then once you're in that position, then go and invest. And like Kate said, if you're 18, 19, 20 hearing this, you have a super power basically compared to everyone else. And that's that you can learn. You can learn about this thing that our parents didn't learn. And you can learn about, you can be probably smarter than them when it comes to investing within next three to six months, honestly.
00:46:02
Speaker
You can be wiser than them on something that will end up making you a heck of a lot of money over your lifetime. You just can't invest all the money that you want right away because you've got other things to do and that's fine. We all have that problem like that push and pull and that's okay.
00:46:19
Speaker
Yeah, even now finding balance is really hard between putting money aside for future Kate for spending money as current Kate because you might want to go on a overseas holiday, but you also know, if I invested that money, it might be worth so much more in the future. So it's always a hard balance. I'm sure if people talk to other friends and family members, they'll see.
00:46:42
Speaker
they're trying to balance it all as well. Sometimes you'll go too far in one direction, you'll go, I spent everything I earned this month and okay, let's reel it in a bit for next month because we want to find a nice balance that we can put some money aside, whether that's saving or paying down debt, putting money in our super investing. But we also want to make sure we're enjoying ourselves in the time because there's no point putting everything aside for future you and not actually enjoying the time in the moment.
00:47:10
Speaker
Yeah, it's a constant balance. I find it hard now. I know Owen finds it hard, but it's just something you always have to work with. And that's checking in with your finances on a monthly basis is a really good way to figure out, okay, did I go too far in either direction this month? Am I spending? Am I saving at a good level for me? Do I feel like I can meet all my needs? Have I put a bit of money aside for some of my wants? Have I put a bit of money aside for future me? Or do I need to make some adjustments next month and change course a little bit?
00:47:39
Speaker
Yeah.
Navigating Superannuation in Australia
00:47:41
Speaker
And Kate, you mentioned super, which I would love just to briefly touch on because I know generally if, or I know particularly if you're on a casual rate, you know, money automatically goes into your super and you get those automatic deposits. But would you guys recommend, I guess, putting extra money in on top of that money that's already automatically going in?
00:48:03
Speaker
The brilliant thing about super is it's for savings. If you go overseas and work, you won't get that. Um, and that's what makes one of the things that makes Australia's financial system. So great is even if you can't save money just by working, the government's going to do it for you. So, um, so like the way that works, just for anyone who needs to be, uh, I guess educated on this bit of it. But I was confused about this when I was in my casual employment. So basically the way it works is when you go to your employer and you're on a casual rate,
00:48:32
Speaker
or part-time or full-time, even if you're a subcontractor. So if you're a tradesperson or something listening to this and you do the majority of your work for someone, technically you should get super. And so what it means is it's 10% of everything that you earn is being invested for you. The difference is it's not in, you can't go and invest that money and take it out. It's your money, but it's held by something else called a super fund. And so for example, like my supers with Australian super, right? Well, there's the biggest super fund in Australia.
00:49:02
Speaker
So when I get paid, 10% of my wage automatically goes into my super account. And typically the way you can check if that's happening is you log into your super fund. They all have like a member portal and your employer should be paying you every month or every three months. And the reason I bring this up is that some businesses try and get away with not paying younger people because they don't think that check.
00:49:26
Speaker
and you're entitled to it. So the easiest way to check is to go to the Superfunds website that you're with or go to the MyGov website where it's got your super balance in there. And just remember that when you sign up for an employer, they should give you, I think they have 28 days to give you a piece of paper or tell you to do it online to set up your super account. And if you don't choose one, they'll choose one for you.
00:49:50
Speaker
So you're better off just choosing one of the big ones and, um, just creating a growth account inside that so that all your money is invested for the longterm. And, and sorry, just to answer your question, Mary, I, I, to be honest, for most, for most young people, I wouldn't, I wouldn't invest extra in super right away. I'd maybe wait until I've got my, you know, my, my emergency fund sorted until I know what my financial goals are.
00:50:15
Speaker
The reality is that most people who put money in super today won't be getting it for 50 years if they're that young. So just make sure you know what your financial goals are and just keep that in mind. Just let your super fund, let your employer keep putting that money away for you. Yeah. And Kate, did you have anything to add? Yeah, you just got it.
00:50:36
Speaker
keep on top of super as well so if you are young right now and you haven't looked at your super account that you've got a job so you might have super somewhere and try and hunt down your details for using the the government's mygov account you can link it up with the ATO portal put in your tax file number and it will say hey you've got five super funds floating around and they've all got a little bit of money in them so you can
00:51:00
Speaker
actually put them all in one account, make sure you have a look at your insurances and things like that before you make any changes. You can usually call up one of your super funds as well and say, can I have some free advice? And they'll chat to you about what you're invested in. So making sure you're in a super fund that's focused on long term growth rather than something like 100% cash, which as a young person, you do not want to be in 100% cash for four or five decades.
00:51:27
Speaker
Um, and just making sure you're in a low fee super fund as well. So, um, yeah, there's a great government tool that will actually compare your super funds as well. So if you finally get into the MyGov website, I know we've all had those emails from MyGov that say you've got a message waiting and they're a bit scary. But if you can finally get into the MyGov website, link up your ATO login, there's actually a lot of different tools the government's adding. So you can actually be more in touch with your super account. Sure. I didn't actually ever realize until I got, um,
00:51:57
Speaker
sort of payment, they, the money that was in my super started going down and I didn't know why. And I realized, of course, that's because of the, um, you know, the payments that they take from you to sort of keep the money in your account and sort of away, I guess, almost like a subscription, I guess. Um, and you don't get it. You don't get a receipt. No, you really don't. You don't even know what's gone until you're like, hang on a second. Um, yeah. So I definitely agree with what you said, Kate, you know, finding the right, um, sort of super company that
00:52:26
Speaker
doesn't take a lot of money out. And I think, yeah, there are some pretty good ones and it's quite easy to research into as well. Just a quick Google search and then on the government website that will pop pretty much straight up. So it's very, very convenient.
00:52:43
Speaker
Yeah, just, you just got to give it a few, like an hour or two and just put it in your calendar and go, okay, this afternoon, I'm going to do it. I'm going to figure out what super is, what the different options are, where my super is currently and am I happy with how it's invested? And we've even got a free superannuation, like sort your super course out on Resc education, which people can take if they're wanting to figure out what on earth is super and what do I do with it? So that's another great resource as well for people.
00:53:12
Speaker
Guys, I am so sorry. We have to cut it there. Yes, thank you so much for listening to part one of this episode. Sorry, we had just to cut Kate off so abruptly. I thought that was the best time to kind of put pause on that because we move into budgeting. So definitely get keen for part two of this. I guess you couldn't really call this series, but part two of this finance series, mini, mini, mini series. Yeah, we're going to be talking about budgeting and sort of more the practical side.
00:53:41
Speaker
not more practical but just how a student can really budget their finance and how that gets to help them in their studies especially if they're living out of home or even if they're living in a home or in school I definitely think that it's more helpful for tertiary students because usually most of the time you're you know in uni so your finance has become a lot more different because you're working at the same time or most of you guys are working
00:54:07
Speaker
Anyways, enough of my rant. Go listen to part two when that comes out next week. I'm so excited for that. Yeah, I hope you guys enjoyed the episode. I definitely did. I had such a great chat with Kate and no one. They are absolutely amazing and they're just so easy to talk to. Like seriously, we recorded for just so long because the conversation just kept going. And yeah, sure, we had sort of like our points that we wanted to speak about, but we branched off so many different times. And I always figured that there's so much more to finance and just what I think about.
00:54:34
Speaker
So I guess I originally just wanted to talk about investments in budgeting, and that was kind of my main two points. But we sort of just branched off and just talked about everything and anything in finance, and I'm sure there is so much more that we didn't even cover.
00:54:47
Speaker
Yeah, Kate and Owen, if you guys are listening, thank you so much for joining me on the episode, and I do thank them properly in the next episode. So yeah, definitely get keen for that. I guess the other thing I was going to say is I have this big goal, and I hate to admit it, but I really actually know it. I do not hate to admit it. It's my goal. I'm putting it out there. I want to get a thousand listeners. I got, I think the stats showed I got about 500 listeners across all the episodes I had produced.
00:55:17
Speaker
or released, can't really say produced, I guess I've produced them. Anyways, yeah, 500 listeners across all 13 episodes, 12, 13 episodes I think I released from like last year and now, including this episode, I think it's 13. Could be wrong, someone correct me if I'm wrong, maybe 14, who knows? Anyways, I wanna get a thousand listeners and I would really appreciate it if you guys shared it to your friends. So I dare you, I literally dare you guys to take this episode
00:55:46
Speaker
and copy the link and share it to one friend I mean two would be like amazing but I don't think one friend is too much to ask take this link share it to one of your friends just one and just tell them that you think they like this episode only that if you actually think they would like someone who's interested in money and finance I guess who wasn't these days because like the whole world is built around money right so yeah go share it to your friend and if you are that friend that's listening thank you so much for tuning in and listening to
00:56:15
Speaker
all of the podcast. Anyways, I won't ramble on any longer. Get keen for part two next week for With Rask Education featuring the amazing Kate and Owen. And stay educated, guys.