This post is based on an interview we conducted with Billy in July 2019.
Real Money Talk is our series where we interview Australians from all walks of life about their personal finances. The views expressed are those of the interviewees, based on their experiences with money, and as such are not necessarily representative of Spaceship's views.
We have changed the name of the interviewee for their privacy.
Overview
Name: Billy
Age: 27
Where do you live: Adelaide.
Please tell us a bit about yourself.
I grew up in Adelaide, and I’ve always had a good head for money. I love cars, my business, and I’m planning on making a million by the time I’m 30.
What is your current net worth?
Savings: $20,000, and I lent about $15,000 to my dad recently.
Investments: Two investment properties; one is fully paid off [and] worth around $150,000. The second one is worth about $200,000, and I still owe about $150,000 on that one.
Super: $55,000
Shares: $1,000 (index funds), and $500 in my Spaceship Voyager account.
Debt: Just the mortgage on the second property.
Assets: I’ve got a business worth about $350,000.
Earn
Tell us a bit about your career:
I own a business. I bought it about two years ago, but it’s been running for about 15 years. I probably work about 80-100 hours a week running the business, and I pay myself $5,000 to $6,000 a week.
Do you have income sources outside of your job? If so, how much do you earn from each and how did you develop them?
The two properties I mentioned. They net about $15,000 to $16,000 per year, combined.
What did you do before you bought the business, and how did you get to the properties?
I come from a “lower middle class” family. I started working when I was 13 years old, doing letterbox drops. When I was 14, I started working at McDonald's and Aldi, and did that for about nine years total. I worked my way up to manager and saved a lot of money. At that time I was also working as a glassie, and as a gas officer. I saved enough to buy my first property when I was 17. I put down about $50,000. I got the second one when I was about 20 years old.
When I was about 25, I decided to buy a business because I wanted to be my own boss and be able to get more money. When you work for someone else your income is always limited.
What advice do you have for people who want to earn more money?
Work hard when you’re young and invest as much as you can when you’re in your teens and early twenties. Don’t buy stupid things. When an opportunity comes up, just do it. Be open to it.
Save
What is your savings rate? And how has it changed over time?
My goal is to have a million-dollar net worth by the time I’m 30. By that stage, I want to [be able to] buy more properties every year and keep adding more streams of income.
Do you have a budget?
Not really. I just buy essential things. No Gucci jumpers. I buy what I need. I built a house in the back of the shop, so I live there, and I’m not paying rent at the moment. It only cost me about $3,000 to build it.
Do you make purchase decisions carefully, or are you loose with your money?
I’m careful about some things. I do splurge a little bit with cars, but everything else I’m pretty tight with.
How is your work-life balance?
I like to go to the gym in the morning, do all my personal stuff in the morning, then go straight to work.
Do you feel like you have enough time to socialise and relax?
Socialise? What’s that! This is the choice I’ve made until I’m 30 or 31. Then I’ll probably have more days off but for now I’m pretty happy just working.
What is your favourite thing to spend money on?
Properties and cars.
Invest
How do you invest?
Property and shares.
What has been your best investment?
The business, then the properties.
What has been your worst investment?
Probably the car. It depreciates so much.
What are your main roadblocks? And how are you addressing them?
There are no roadblocks. It’s just being patient. I focus on the end goal and remind myself that there’s no rush.
Do you have a target net worth you want?
A million by the time I’m 30!
When did you make your first significant behavioural shift towards wealth building?
It probably started once I got my first pocket money from my parents. I’ve always been good with money.
If you could start again, what would you do differently?
Just keep doing what you’re doing. I wouldn’t really change anything.
What mistakes have you made along the way that others can learn from?
Mostly silly things that I bought, but that’s part of living. I used to buy a lot of cars, but I made more money by selling them after.
Do you have any worries about retirement? If so, how are you planning to address them?
Retirement? Nah. I wouldn’t want to rely on someone else or the government to pay me money when I’m old. You’ve got your whole life to set yourself up, so don’t waste it.
How are you learning about building wealth?
I definitely didn’t learn from my family. They’re not very good with it. I’ve always loved money and selling things and making more money. I don’t think I ever learned it, it’s natural.
Do you give to charity? If you do, what percent of time/money do you give?
I give about $1,000 to $2,000 to a multiple sclerosis charity and to the Seeing Eye Dogs Australia.
