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Rask Australia - Budgeting and Saving your Income
123 Plays3 years ago
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 2 of 2.
We discuss:
- The best ways you can budget your money
- A great saving technique for maximum savings
- The basic need-to-know facts about buying a house for the first time
- The potential for making money on social media
- Why it's never too early to start saving
- ... 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 giving a review and 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
Introduction and Podcast Overview
00:00:05
Speaker
Hey, it's Mary Coleman, your host for the All Things Education podcast. If you don't know, I'm a student too and I'm currently studying psychology. I'm so glad you're listening today because we learn about study and lifestyle tips, chat with professional guests about a range of topics. We learn about the ins and outs of school and uni life, how to form solid friendships, actualized career aspirations, chat about relationships, moving, traveling, and so much more. We have a range of content on this podcast and it's all to help you be that much more informed about the world we live in.
00:00:34
Speaker
So let's get educated, shall we? Hello, hello, how we doing? Welcome back to yet another episode.
Series Introduction with Owen and Kate
00:00:42
Speaker
It is Mary Coleman, yours truly your host for the All Things Education podcast.
00:00:47
Speaker
Basically today it is part two of the Rask Australia money, money, money. That's our mini, like a mini times a million series. It's really like the smallest mini series in every mini series possible. Pretty much today in this episode, we are going to be chatting with Owen and Kate. Once again, we're going to be finishing off the rest of our conversation that I had with them.
00:01:10
Speaker
And if you haven't already listened to the first part of this episode, you definitely should. It's not, uh, the most recent episode before this one, but two times before that. So if you just jump onto whatever podcast platform you're listening on
Mary's Personal Updates and Interests
00:01:21
Speaker
to.
00:01:21
Speaker
scroll down two more episodes and you'll be able to see that it is part one of the Grask Australia money money money episode okay in terms of the weekly recap what has been going on well um i did release an episode friday night and that was about 22 things i've learned in 2022 so i guess um it's sort of the same weekly recap it's
00:01:41
Speaker
That episode was a bit different, I guess, in the sense that I wanted to do it before 2022 finished. So, yeah, the week has progressed a little bit. I mean, I'm recording this New Year's Eve, so that's pretty exciting and very keen for that. Very keen for New Year's Day as well, just to start afresh for the new year. And just, you know, it's just always good to have like a mental sort of reset new, I guess, new year, new me sort of thing. I mean, not quite, but you get the good gist. It's just nice to have a refresher restart.
00:02:11
Speaker
starting into a new year and 2023. Wow. That's very exciting. Um, just to think, I mean, in terms of things like COVID that was in 2019 or end of 2018 really. And you think of just so many different things like, Oh, there's just, there's honestly just so much. There are so many things that have happened, um, in the past year.
00:02:31
Speaker
And I would love to do a recap on that. But first, let's do a little psychology update. Again, not much to update you guys on. I'm still on my holiday break. But in terms of how uni is going for me, I think that I'm very excited to get these next couple of big assessments done. I think I've got three or four assessments kind of all due late January. So I'm going to start chipping away at those and I will definitely keep you guys updated on
00:02:53
Speaker
Um, how that's going, which is, yeah, I think that's exciting. Um, I guess it's something that I'm looking forward to giving you guys updates on. Yeah. How psychology is going and I guess how that that's developing more and, um, and the struggles that I'm facing. And if you are a psychology student and you're listening to this, I guess it's great because you can sort of touch base with me and you can see how I'm going and listen to how I'm going.
00:03:17
Speaker
And if you ever wanted to reach out on my DMs at allthingseducation21 on Instagram, I would be more than happy to say hello and chat about psychology. Or if you have any other just general study questions, I'm happy to talk to you on Instagram as well. Anyways, how do we like the intro? I think it's pretty cool. This is the second time I've used it. It's obviously pretty recorded as you can hear. And it's great because I can just put it in and it's a great little introduction. I think I've also made it the trailer, as I said,
00:03:42
Speaker
In the last episode, so very keen for that. Another update is, um, thank you guys for donating on the, um, like supporting the show by buying me a coffee on that website. I'm able to create an ad on Instagram and, um, you know, spread the word about the podcast a little bit. So thank you guys for your ongoing support. If you haven't already donated or you would like to donate again, if you go into the podcast description.
00:04:06
Speaker
and you will be able to see a hyperlink that says support the show. If you click on that, you are able to donate increments of $5 and you are able to support me, your host, to basically make a better listening experience for you. So every money, every dollar that I receive, I'm putting it towards better podcasting equipment, creating more ads on Instagram and just better content, you know,
00:04:27
Speaker
getting subscriptions sort of going and be able to monetize a little bit and just everything like that. So I guess the more money that is donated, the more that I can give back to you guys and say thank you. So please click on the link in the podcast description and donate an increments of five dollars. Now let's move on to the next segment. Let's talk about my favorite book of the week.
00:04:49
Speaker
each week I'll give you guys updates on the book that I'm currently reading. Whether that's educational, fantasy, fiction or non-fiction, you'll hear about it all. Hopefully you'll be inspired to read some of the books that I'm reading so you can be more educated in different areas of your life. Let's jump into it! Alright, so I'm still reading Throwing Sheep in the boardroom. As I said, there's not really much to update you guys on considering that my most recent episode was released
00:05:12
Speaker
yesterday actually, or two days ago. So Throwing Sheep in the Boardroom is how online social networking will transform your life, work, and wealth by Matthew Fraser and Sumitra Dutta or Dutta. It's really great. I actually have read the first chapter and I can say that it is pretty cool. It's pretty much just all about social networking and how it's a global phenomenon. Pretty much how the Web 2.0 revolution has reached this tipping point socially
00:05:43
Speaker
And there's a lot a lot of things that like a lot of room for growth and just a lot that you can utilize So if you're ever interested in social media networking or social networking, this is book for you
Meet the Guests: Kate and Owen from Rask Australia
00:05:54
Speaker
Okay, let's talk about the amazing guest stars on the podcast today. We have Kate and Owen from Rask Australia. Rask Australia is a diversified investment advice, news research, financial education podcast, and money network. It is Australian owned and based in Melbourne, if you were wondering. One of their big missions they actually have achieved now, and we'll talk about that a little bit later, is to have 10,000 students enrolled in their free finance courses. And yes, they have achieved that goal, which is great. So stay tuned to talk a little bit about that later. Kate,
00:06:23
Speaker
She is the co-host of the Australian finance podcast and the host of the how to money podcast, which was founded in 2017. She is also an educator of Raskest education and she puts together the financial education courses. So a superwoman, in other words. Owen is the founder of Rask Australia and lead investment analysis for Rask Invest. His members only share research service. Owen is the host of two podcast series, the Australian investors podcast and the Australian finance podcast.
00:06:52
Speaker
which are two of Australia's top ranked investing and finance podcasts, attracting thousands of listeners every single day. I think that's just so cool. Kate and Owen are absolute bombs in this finance industry. They're great in the sense that they have just done so much and I'm so keen to share a conversation with you. So yes, if you haven't listened to the first part of this episode, please go back a couple of episodes and listen to
00:07:15
Speaker
part one of Money Money Money with Kate and Owen. And this is part two, so we're gonna be jumping straight into the second part of the podcast episode. So yes, grab your cup of tea, plug in those headphones, and let's get educated.
The Psychology of Budgeting
00:07:26
Speaker
I reckon let's dive into budgeting now. Because everything sort of, in a way, indirectly links back to budgeting. Because it's hard to be financially secure if you're not sort of managing your money. And if eventually you do want to make those extra deposits into super, you need to be budgeting.
00:07:43
Speaker
et cetera, et cetera. So yeah, I guess what are some good ways, um, Oh, and that students can, uh, yeah, budget and ultimately save their money throughout their studies. Um, also kind of living with a bit of leisure as well. Yeah, sure. Um, so there are many different ways to budget, but budgeting basically comes back to one thing and one thing only, and that's psychology. So the way you, the way you budget is normally a reflection of who you are. So.
00:08:12
Speaker
We have rules about budgeting. People think budgets are like mathematical formulas or something really complex. The oldest budget is what we call a 50-30-20 budget, which is 50% is the stuff that you absolutely have to pay. 30% is like your wants. And then the 20% is long-term investing or saving your money. And so if you just think about that 50-30-20 budget, you're still spending on the things that you want.
00:08:40
Speaker
I think Barefoot Investor would call it splurging when you spend on things that you want. And at the end of the day, you know, that's a very simple framework. But as I said earlier on, if you are living at home, that's the big one. If you are living at home, you can save a lot more and potentially even invest a lot more than 20%. But as you get older and as you move out of home and you get a car and you do all that sort of stuff, you're going to be spending more. So just be aware of that.
00:09:10
Speaker
Basically the three biggest costs that we have in our lifetime are our house or like where we live. It's our transport, so how we get to and from places. And the last one is actually our education. We're pretty lucky in Australia that we've got free schooling and we've got, you know, unless you want to go to private school, of course. And, you know, uni is basically free because you can take on a hex debt and it's no big deal. You'll pay it back when you start earning a certain amount of money. So really that leaves us the two big ones, the two big rocks in our jar, so to speak.
00:09:40
Speaker
And the first one is obviously where we live. And the second one is our, is our vehicle or how we get to places. So if you can focus on those two a lot, I think that you'll find that the other stuff, the little stuff like the coffees or, you know, the, the cheap wine and whatever you do, whatever you do on a weekend, like you can afford to do that. Um, there are so many different ways to budget and Kate is basically like the guru on this. So I'm sure Kate will have a bit more to weigh in here, but I just say it comes back to who you are.
00:10:10
Speaker
I find that designers in my experience, designers are the people that tend to be very good with money and it might sound weird, but it actually makes sense because designers want to make things look right and be right. And they typically think about their life and what they want their life to look like. And if you work back from that, you can basically figure out, okay, what do I want my life to look like? And what do I need to get it there? And I think that's a really powerful thing. So the designers have got like the one over,
00:10:40
Speaker
the finance folk like me. Um, so yeah, I dunno, Kate, I feel like you'd have heaps to weigh in on this. Yeah. I think the biggest thing is knowing what money is coming in and out of your bank account.
00:10:50
Speaker
every month because there's so many things that it's so easy to use Apple Pay, I mean Owen and I joke about me using my watch to pay for everything because it just makes it so easy and you can spend without thinking about it at all and what we really want to get back to is spending with intention and that's really what budget eating is really working out where you're spending your money and are you spending in line with that as well and there's going to be a lot of things you have to spend on that
00:11:16
Speaker
you probably don't want to spend on but if you can reduce the cost in those areas as Owen said maybe getting a second-hand car and shopping around for insurance and things like that to reduce the cost there and maybe sharing a place with flatmates or living with your parents for a little bit longer if you can reduce costs in those bigger areas then you can spend more on other areas and
00:11:37
Speaker
One thing that's really good to do if you've never gone through what you're spending and what you're saving and what you're making on a monthly basis is maybe your bank does this because some of the banks will categorize your spending and tell you how much came in and out this month, but if not, even just
00:11:55
Speaker
printing out the list or using the computer and highlighting and working out what did you actually spend money on in the last month and how much came in and working out did more come in than went out or vice versa and so did you end up with
00:12:11
Speaker
Did you actually sort of use your savings this month just to pay for your living costs? Or did you end up with a bit extra at the end of the month that you could add to your savings account? So really understanding that and even categorizing the broad expense categories. So working out where does most of my money disappear to? Is it going to
00:12:30
Speaker
public transport and Uber costs? Is it disappearing to going out with friends? Is it disappearing to paying for my textbooks? Where's the money going? And once you have an idea of how much money is coming in each month from different sources of income, maybe you've got a couple of part-time jobs, maybe you've taken on some extra shifts, and working out what are the broad categories I spend on each month? At that point, you can kind of work out, is that in line with what I want to do? Is there a way I can shift this to better match
00:12:59
Speaker
what I want to spend on. And then you could try, if you want to try a few different budgeting methods, some people are super specific and they'll have a spreadsheet and go, okay, I'm going to spend $100 on clothes this month and $50 on entertainment. And so that works for some people. For me, I find it really hard to stick into exact categories. And so having a more of a percentage based system. So as Owen mentioned, sort of 50% to your needs.
00:13:27
Speaker
30% to your wants and 20% for future you, and you can adjust that to what feels comfortable. So you might be able to, if you're living at home, you might have less in the needs category. So you might be able to put 30 or 40% to future you, depending on what works for you. And even just some people, the paying yourself first budget works, where you go, every month I am going to try to put $200 aside for future me, and then everything else will kind of work out.
00:13:57
Speaker
So just experimenting and getting to know yourself. We often don't really think about our own behavior and how we manage money. So take a few months to experiment. I mean, put your lab coat on and try different things. If it doesn't work, that's okay. You tried something and you learned something from it. And then you can try a different budgeting method. Or you might realize that budgeting doesn't really work for you and you would rather just have a coffee date with yourself on a monthly basis and go, where did all my money go?
00:14:26
Speaker
happy with the general gist and am I happy with the amount I'm putting aside for future me? Do I need to make some more income? So even just checking in with yourself, that works for some people as well. So I guess what I'm trying to say overall is just experiment, learn from each experiment and figure out something that works for you in your life. You almost always end up in a situation where you want to save more.
00:14:49
Speaker
Like I've never met someone who was like, I wish I saved less. Well, maybe some people that are like on the extreme end, but like you for the most part, um, people, you know, we always are pretty hard on ourselves. We're our worst critic. I actually use the budget strategy that Kate just mentioned when I was in uni, I actually use the pay yourself first budget. And I think that's really valid. So basically you do like your budget once, right? And you might be like, my, you know, I earn $2,000 a month. That's my income.
00:15:18
Speaker
Um, and I want to save 500 bucks. Right. And so what you can do is it's, it sounds harder than it really is is basically in life and in our money. If we think about a money jar, we could, the best way to maximize the size of a jar is to put the big things in first and the little things fall around the outside. Now, if your most important thing is saving for the future and investing for like your Contiki trip or whatever you're doing, put that in your jar first.
00:15:47
Speaker
and then let all the other stuff fall around the outside. So what that would mean was, back to the example of $2,000 with 500, put the $500 into your savings account where you can't touch it easily, and then figure it out. Figure out the rest. Like that $1,500 that you've got, you're just going to figure it out. And you'll have to make sacrifices, but at least you know at the end of the month, you paid yourself first. You did that. And in that way, you don't have to worry about being in a spreadsheet all the time.
00:16:15
Speaker
New month, 500 bucks. Got to pay it in now and I'll figure out the rest. Um, and that worked for me. Some months I didn't nail what I wanted to do, but for the most part, like if I took 12 months, I probably did it 10 times out of those 12 months. And boy, that has paid off huge, like doing that.
Generational Views on Finance and Career Opportunities
00:16:34
Speaker
Yeah. Yeah. Incredible. So good advice from Kate.
00:16:38
Speaker
For sure. It's a bit hard in my situation. I've sort of figured out a balance where I do 80% towards my savings and 20% towards spending. And it must sound so weird, but yeah, I've kind of figured it out and gone, you know what? I only really need to spend 20% of my money.
00:16:56
Speaker
if I get yeah a $200 oh I'm terrible at maths but okay let's just say yeah a $1,000 paycheck that'll be easy so I'll give myself you know $200 to spend for the month or for the week but yeah so I do that and I guess it's a system that works that I've just sort of found that kind of balance I think the worst thing personally and I'm sure many listeners can relate is like slowly digging into those savings just being like oh just take $50 out really quickly it's not gonna hurt me and I need it because I want to go bowling with my friends
00:17:25
Speaker
And, you know, you sort of start to build up that habit where you just take out of your savings, just keep going. And it actually decreases a lot quicker than people think. Don't be too hard on yourself though. True, true. Your lifetime's a long time to save. So one of the things that people do, particularly the people that are really like, they love a spreadsheet, is they put it all in the spreadsheet. And then one thing goes wrong and it's like a house of cards or like dominoes. And they're like, they hate themselves for the rest of the month.
00:17:55
Speaker
Well, no, don't worry about it. Get up, go again next month. One of the things you can do is have like a semi-savings account or like a mini, what I call a float. So this is like, if things do go wrong, you're not touching your core long-term savings. You're touching like this other account, which is like 50-50. It's like, I want to save it, but it's okay if I do spend a little bit of it. And so that's kind of one thing. And because once again, it comes back to behavior. If you're already negative on yourself for spending a little bit extra last month,
00:18:24
Speaker
you're not going to be satisfied with yourself. So just be content with what you've done. If you do spend that money, hey, spend it on something fun and make the most of it. Like go out there and bowl like your heart out because yeah, make it worth your while. For sure. Yeah. And, um, I guess there must be heaps of budgeting templates out there, but I guess, Kate, would you recommend sort of, you know, making your own or does Rask offer some or, you know, is that easy to sort of find some online? Um,
00:18:54
Speaker
Yeah, one of the best ways to sort of budget and plan out that budget and that template. Yeah, I think there's so many apps now and there's lots of templates online. If you, some people like to print things out, there's things you can find online. If you just start Googling in the US, budgeting templates are really popular thing to make and provide online. So, um, but it's, yeah, it's working out what works for you and you might just be writing down something in a notebook. I know that works for some of my friends. They just write, okay.
00:19:23
Speaker
this is how much I've got coming in this month, and these are the broad categories of what I want to do with it. Especially if you're using a simpler structure like the needs once and future me, it's quite simple to write that out. And at the end of the month they'll have that sit down and go, okay, did I manage to fit roughly into those areas? And there's, yeah, a lot of the banks are offering budgeting tools and features now. So I definitely check that out if you want something that's really accessible that you can see.
00:19:50
Speaker
at any moment in time? Am I fitting into my budget this month or have I spent a little bit more in food than I expected? And maybe we're going to do a few more home cooked meals until we get to the end of the month. And do you think that the importance of saving actually has a bit more of a higher or lesser value than our parents? I guess in a way, like does Gen Z value money more or less? Is there sort of any statistics or trends or just personal insights that you guys have?
00:20:20
Speaker
I think that it's different. Like our parents always say they like, they're like, Oh, I don't know how you guys do that. Like, as in like spend money. Cause they're like, they grew up in an era, right? When money wasn't as available as it is today. Um, and you know, now if you go to university and you do reasonably well in your career, in your schooling, you get your first job could give you more money than your parents earn.
00:20:43
Speaker
if they didn't go and study and do all that sort of stuff. And that's like really strange, right? Whereas in the generations gone by, it was like the elder person is the one who's senior, who's paid more and all this sort of thing. So it's very different the way where
00:21:00
Speaker
I guess brought up these days. And the value of money is interesting, right? I won't necessarily have much to say on Gen Z versus Boomers or whatever. But what's interesting is that I often find that people that go to uni can often be better with money than people who take up trade. And this is not always the case. It's definitely not. I'm not saying that like all my family's are tradies and whatever. And I did carpentry before I started uni.
00:21:27
Speaker
And I loved it, but basically what can happen is you can become desensitized to money. Now there are many behavioral biases that we succumb to, but we can actually become desensitized to it. So for example, imagine if I gave you two people, someone who is, they're both 22 years old, right? One of them has just come off earning 60 and $70,000 for the past couple of years.
00:21:52
Speaker
The other one has been at uni and was living on say, you know, $20,000 a year. And this year, both of them are going to earn $80,000.
00:22:03
Speaker
which one will save more. And you'll probably say the one that's been at uni, because unless their lifestyle inflates like four times, they should be pretty good with that money. They should be able to save a bit of it. And so what I would say is that if you are in a position where you can earn a bit more money, don't let your lifestyle inflate with that. And, you know, this is particularly the case for younger people that might be graduating. There are a lot of jobs that are in demand right now.
00:22:28
Speaker
It's particularly in healthcare. Psychology is one of those areas. Science and mathematics is one of those areas. Teaching is one of those areas. These are all hugely in demand. You can walk out of uni and you can be earning 60, 70 or 100 grand sometimes. Really make the most of
00:22:46
Speaker
having that low cost base and running on fumes for four years or whatever it is. So when you step out, you're looking pretty and you can save in rapid time. That's all I'll say for that. But Kate might have statistics on Gen Z versus Zephyrin's The Boomers. Not in front of me, no. But I think Gen Z are getting really involved with their lives, their communities and everything like that and taking an interest in finances and looking after your financial future is a part of that. So I love
00:23:16
Speaker
love talking to younger listeners. I love that we have younger listeners joining, whether that's through YouTube or through social media. They're not always podcast listeners, but it's great that they are taking an active interest in their financial future as well. And I guess there are so many more ways that like the, yeah, the prospect of jobs has definitely widened, I feel like. And there are, yeah, a lot of more ways that people can make money nowadays.
00:23:41
Speaker
In good and bad ways, I guess. I guess an awesome way that I know, like, yeah, like more of like our parents' generation, they don't really, or I know for a lot of my parents, my parents are my friends' parents. I don't see a lot of value in making money from social media and the elements like that.
00:24:00
Speaker
I'm not sure if you guys agree or disagree, but definitely I think there's a lot of opportunity in that direction. And it's a lot of way that I feel as though Gen Z sort of seeing the beauty in that going like, oh, quick money, I can make a lot of money through starting a fan account or through creating an online business through Instagram or Facebook. I just think their jobs are definitely bigger.
00:24:27
Speaker
It's interesting because every generation thinks that they invented sex. It's a saying. Every generation thinks that they're the ones that have done something. I don't know what I fall into, by the way, but I'm quite a bit older than you. When we were starting out, internet companies were a huge deal.
00:24:49
Speaker
And this is only like 10 or 15 years ago. And now it's web three technologies, right? So who knows where that goes. Um, and the next one after that would probably be like artificial intelligence or a metaverse or something. Who knows what crazy stuff's going to be around. And with each, with each generation, there is progress. And within that kind of wave of progress, you will find opportunity. So 350 people of yesteryear still going to be as thrifty.
00:25:13
Speaker
you know, as they are today. And for example, yourself, right, like starting a podcast, you could run ads on it, you could do whatever, maybe in the past,
00:25:22
Speaker
a prior version of yourself in some other parallel universe, maybe they didn't have, maybe you didn't have a podcast, but maybe you had a newsletter, or maybe you did like physical mail and you dropped that around, right? And so I would say that for the creatives, there's always opportunity. And so, yes, we have huge amounts of tools available, but I'd say that you also have to be careful
00:25:47
Speaker
in that we probably have too much information nowadays, because the stuff that really matters in life doesn't change all that often. And so, yes, if you you could go and drive for Uber, you could work on air task on a weekends, which is fantastic. And so if you're willing, you can do that. But you know, a lot of people still, you know, has just like they were 50 years ago, they don't want to do that. They don't want to do this.
00:26:11
Speaker
They're just happy just to go home and, and, you know, play Xbox or watch the Kardashians or something like this, which is okay too. It's just like, yeah, it's fascinating. Like I see people like yourself, Mary, that do this sort of stuff. And I think, wow, like huge opportunity for you to go and do things because you're taking the opportunity that's in front of you. And I think everyone has that opportunity. Just, it just varies depending on, I guess, what era you grew up in and what opportunity set you have with the tools that you have as well.
00:26:41
Speaker
Yeah, for sure. And Kate, did you have anything to add to that? I think it's just been open to the world around you. There's always different things you can try and say yes to. And I think it's just about learning from everything you do. So maybe you try to start an Instagram business and it doesn't work, but you learn a lot about.
00:26:59
Speaker
personal branding and writing and how to communicate with other people or how not to communicate with other people along the way and we don't need to be obsessed with the idea that we need to find that perfect thing or the perfect fit for us because you can learn a lot through the experimentation. I sort of take that experimentation approach from my finances and apply that across all of my life because
00:27:21
Speaker
I just learn a lot during the process. Maybe the result's not what I thought it might be, or it ends up going a completely different direction. But you can learn a lot as you go. And you meet a lot of really interesting people along the way if you just say yes to new opportunities and try things that might have seemed a bit weird, but could end up really changing your life as well. So just keep your eyes open as you go about the world. Like meeting people on Twitter.
00:27:46
Speaker
Are we talking about Owen here? Okay. Oh, exactly.
Is Housing a Good Investment?
00:27:49
Speaker
Oh, I love it. Yeah, so let's talk about houses, deposits and saving for houses. That's, yeah, the average, I said this before to you guys before we started filming the episode, but you know, the average age of listeners kind of ranges from about 17 to 22.
00:28:09
Speaker
So I feel as though people are starting to think about houses at that age. I remember as a kid, I sort of thought, I don't have to worry about that. And 14 years old, I was, oh, that's silly. And 16 years old, still didn't worry. 18 and now I'm like, oh my goodness, I need to think about a house in the next 10 years and all this stuff. So it's definitely popped to the forefront of my mind now. But yeah, I heard someone say once that houses are in fact liabilities.
00:28:38
Speaker
and not investments, but I want to just sort of ask you guys, do you think, do you agree with that statement? I guess do you still think it's important to sort of start saving for a house in that sort of early tertiary part of your life or tertiary education? Maybe I'll start and then Kate can answer with her experience buying a house. But for me, I think the time you want to start
00:29:04
Speaker
saving for a deposit is probably three years before you need it. So start saving. If you want to prioritize getting a house, do that. In a formal life, Mary, if you asked me what I thought of housing as an investment strategy, I probably would have said that housing or a house is a liability masquerading as an asset. So meaning that we think it's an asset, but it could actually be a big liability and we could end up hurting us financially.
00:29:34
Speaker
Now, I look like a fool because over the last five years, already high house prices have gone even higher. And so people now, like you said, are getting more worried about it earlier in life. And that's really unfortunate. Like if you go to the United States,
00:29:51
Speaker
You could get a palace for what you can get a shack here in Australia for like it's ridiculous. And so, you know, housing doesn't have to be as expensive as it is we just have these weird rules in Australia that make housing really unaffordable. And so what I would say to most people that are stressing out about this is
00:30:08
Speaker
For the most part, as long as you start early enough, you'll get into a position where you don't necessarily need to worry as much as the next person. So I made a decision earlier in my life, Mary, when I was, I'm going to say when I was 20 or 21, I had about $100,000, $120,000 saved up, which is a bit more today, but I could have bought a house. And at the time, the houses that I could have bought were like 400 grand and they're now like a million dollars, right?
00:30:38
Speaker
And so I thought to myself at the time, I was like, not, not going to invest in property. It's not worth it. Blah, blah, blah. Sure. If I'd invest in that, I'd be sitting pretty today. But I took that money and I started a business instead. And that was how I wanted to spend that money financially. It may have been better to still put it in a house may have been, but for the most part, like I don't regret it because I did, I spent deliberately and ended up buying a house anyway. So.
00:31:06
Speaker
Um, it was just like, what were my priorities at the time? So if your priorities right now, you know, you're in your uni degree and you want to go overseas and you want to get experiences. That might be a priority for you. I just think we put a lot of pressure on ourselves here in Australia to save for a house early, to get into the property market. Like how many times have we heard that as kids or like property doubles every seven years, like some crazy stuff that gets thrown around. Um, yeah, I just said, don't stress. Um, enjoy the time while you got it.
00:31:36
Speaker
Once you're earning some big bucks, you can always save a bit more. Yeah. And do you think that's just the culture of Australia though, just that whole mindset about, you know, wanting to get a house and saving for that at a young age? Yeah, it is. And, um, it's a huge thing and fair enough too, because property has gone up very fast in Australia. Um, I mean, I don't need to bore you with all the statistics, but you know, everyone thought the same thing about the Canadian property market too. And then people thought that about the American property market until the
00:32:05
Speaker
2008 2009 happened and during this window, people had like multiple properties and none of them were positive like their mortgages were all bigger than the value of the house. And so in America, what was happening was people that owned homes couldn't pay
00:32:22
Speaker
And the foreclosures would come in and they would effectively just say to the next person, do you want the keys to this house? You can have the keys today, but you've got to just keep paying the mortgage. And that was basically what happened in the United States. And we probably won't get to that anytime in Australia, but.
00:32:38
Speaker
My point is that sometimes things that we think about investing aren't always what they're cracked up to be. So it's best to just sit back, observe, take it at your own time. Don't feel fomo. Don't feel greedy. Don't feel fearful. Just go into it and just think, it's okay. I'll get there when I get there. I'm running my own race. And this is what my goal is. Kate, you've obviously bought a property recently, so maybe you've got something to weigh in on this. That's so exciting, by the way.
00:33:06
Speaker
Yeah, no, it is definitely a scary process. And yeah, just trying to figure out everything along the way. There's a lot of people in your life giving you a lot of tips and stories of what happened in their day or what happened in their situation. But I think it's really important, yeah, just to focus, as Owen said, on your own race and do what works for you because you'll be hearing tips left, right and center. People like to give out more, a lot more property tips than really tips on anything else.
00:33:34
Speaker
So just make sure you're doing what works for you. And if not buying a property works for you, then that's great. You can rent forever. There's no shame in that. And so yeah, just with everything in finances, you're wanting to work out what works for you in your life and maybe with your family. So yeah, just coming back to that, whether it's budgeting, whether it's saving, whether it's what you want to spend your money on,
00:33:59
Speaker
coming back to what do I want to do with my money and what does my financial future look like? Yeah, wow, I love those. They're really, really good tips. And I guess just, is there any other handy tips that you wanted to give the listeners just about how to save money or anything at all?
Financial Tips for Students
00:34:16
Speaker
Yeah, keep in mind, most of them are secondary or tertiary students, so they are currently studying and potentially living at home. Yeah, any tips from your own?
00:34:26
Speaker
I'd just say make the most of having a student card, like seriously. Um, go and do things like when you go to the movies, like go and like tide us Tuesdays or, and still use your student card or like just look up places that offer student discounts. Uh, if you're at uni, um, there are places like where you can go and go like dumplings, super cheap. Um, and like, there's so many cool things that you can do as a student. Like if you go to like bars or clubs, there'll be discounts as well.
00:34:51
Speaker
make the absolute most of it. Join those student societies, get your free food. Enjoy the activities. It's so much fun. And public transport. Public transport, yeah. Stings. Yes. As an adult. Yeah. I think we pay like $10 or $11 as adults. And it's like, we may as well just driven. So make the most of that while you can. And also, I guess it just comes back to saving that money. There's a saying that,
00:35:20
Speaker
You know, that someone is sitting in the shade today because they planted a tree 20 years ago. And then the next saying is that, you know, the next best time to plant a tree is today. Because that's basically what investing your money is. You're basically, you sow the seeds and it takes 20 years, but all of those $5, $10,
00:35:40
Speaker
whatever that you put away, I like to think that $1 saved and invested for the long term is $17 or $20 depending on how long you invested for. And so, you know, you might only think, ah, you know, it's 10 bucks or five bucks and it's going into that one of those roundup apps. But over the long term,
00:35:58
Speaker
Like you can seriously create a steam roller. It just keeps on rolling. And just Google some of the fire community stuff to get a sense of that. Those would kind of be my big rocks for people to think about.
00:36:12
Speaker
My biggest one probably would be don't let your fear or the fear from your friends and family members stop you from taking that first step, whether it's just checking in with your super or just starting to think about budgeting. Maybe people are like, why on earth are you saving money? Like you can do that when you're an adult. And there's a lot of things around you in society, whether it's marketing, just saying,
00:36:34
Speaker
Do this now, don't do this now. So I think at the end of the day, don't listen to what everyone else is saying because a lot of that will stop you from taking that first step with your money and really do as much learning as you can from multiple sources and set some goals that work for you. And when it comes to investing, you'll see a lot of different information out there, but really come back to like, why are you doing this?
00:37:00
Speaker
What's your timeframe? We've got some great free courses that are independent of banks and all sorts of things on risk education that take you through everything from psychology of money to sorting out your super and making your first investments. So there's those free sources. There's a lot of other free resources online. So just look for some information, learn as much as you can and just make sure you're living your own life and not what your friends and family are putting onto you about money as well.
Closing Remarks and Resources
00:37:29
Speaker
Yes. Yes. So true. Oh, thank you guys so much. This has been such a great chat. I absolutely love it. I'm thinking that we might actually have to put this into two parts because it was just the best discussion. But yes, I really very much appreciate your time. Thank you so much for joining us and just for the listeners that are tuning in now. Owen and Kay actually, we did mention at the start,
00:37:54
Speaker
that you guys have a mission to have 10,000 students enrolled in your free finance courses. So did you want to just quickly tell us quickly how could the listeners go about enrolling or give us a little bit of what it's about?
00:38:07
Speaker
about the course. Sure. Yeah. We've actually got 16,500 students enrolled right now. Oh my goodness. So we're super stoked with that. Yeah. It's been incredible. And Kate and the rest of the crew have just put their finishing touches on something called the Rask Road Trip. So if you just Google R-A-S-K Road Trip, six online courses, they're like miniature courses and they're completely free. So Kate, I don't know if you want to give a shout out to them, but yeah, super impressive.
00:38:34
Speaker
Yeah, as I mentioned, it takes you on a journey through psychology of money to better understand your money behavior. Then you get to do a bit of budgeting, figure out what works for you, sorting out the understanding the fundamentals of investing and what is actually going on when you make an investment and what are you actually buying? Because a lot of people don't really understand that you're buying part of a business that has customers and it has products. So that's a really exciting
00:39:02
Speaker
step and a lot of people love that part of the course. Plus we cover superannuation, which is super important in Australia, tax. So you hopefully have everything sorted at the time end of financial year rolls around. And I think there's insurances in there as well. So a bit of everything, plus we've got some courses on
00:39:22
Speaker
Some other topics as well, including properties, which I know everyone in Australia loves, careers, financial independence, and of course there's also the Australian Finance Podcast where Owen and I talk about everything and anything to do with money and time and just how we're living our lives more intentionally as well.
00:39:42
Speaker
Feel free to change that. Definitely. And I'll pop everything down below. So there'll be a lot of links, but that will be super helpful. I honestly think I'd be taking that course as well. It sounds amazing. Super, super keen for that. Yes. Thank you so much, guys, again. Appreciate your time. And yeah, I look forward to maybe having on the podcast again sometime. Thank you. We really appreciate it, Mary. Thanks for the great podcast and the great interview. Thanks for having us.
00:40:14
Speaker
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00:40:35
Speaker
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