This post is based on an interview we conducted with Elias in September 2021.
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: Elias
Age: 25. Soon to be 26 (in a few months).
Where do you live? Orange NSW.
Please tell us a bit about yourself.
I graduated in 2017 and started working at my first real job after a couple of months of graduating.
In the beginning of 2019, I decided to move to Sydney, Australia (on my own) from my home country on a whim, leaving everything behind and without a proper plan.
Since then, I have switched three jobs while being here, and now currently reside and work in Central West, NSW as an engineer for a manufacturing enterprise.
It has not been easy since I left my "home" home, and I am still far from my achieving my (financial and personal) goals while I figure out myself and my on-going visa/residency affairs (hint: immigration is not the easiest thing in this country).
What's your current net worth?
I would say around $51,000.
How does it break down?
Even though I don't consider my car and other daily use things as "assets" as for me they're more of a liability, I would break my net worth into the following:
- Shares ASX: $1,200
- Superannuation: $12,000
- Spaceship Voyager: $27,000
- Car: $5,000
- Savings/Short-Term Spends: $4,000
- Gaming Equipment: $1,500
- Crypto: $1,000
Do you have any debts?
Zero. Zilch. Nada.
How did you build your net worth?
I feel awkward referring to my net worth as "net worth" as I still think I have a long, long way to go.
But to answer the question, all my net worth here was accumulated in this country (in less than 3 years as of today) without any external help. I worked, saved, and then worked some more.
Earn
Tell us a bit about your career.
Well, I am an engineer by degree and have been in various support and project management roles after I graduated. Like I mentioned before, I only started working after I graduated and my first job was in one of Google's backed start-ups and I did quite well there.
That was in my home country and I was making pretty decent money for a fresh graduate. After working there for a bit over a year, I moved to Australia. The next six months I was jobless here and managed to find work later in August 2019 that was irrelevant to my skills and studies.
After that, I moved to an IT focused role and stayed there for a bit over a year till I got an opportunity to work in my current role, which is something that I had been looking for ever since I moved countries.
Oh, and I did get a slight (very slight) pay bump in between these switches as well.
Do you have any income sources outside your job? How much do you earn from each and how did you develop them?
Since I have only started in the investing world, I don't have any other sources of income, per se. However, I am trying my best to come up with some sort of a side hustle because I realised long ago that one source of income is not going to cut it for me unless I am making crazy good ($200,000) money per annum. I need to find another stream of income.
What’s been important for you to learn about money?
To start as early as you can. For whatever it may be. Be it just work, investing or something risky. If I don't have to provide for anyone else but myself, to take risks. Take those big risks that scare the crap out of me and give me crippling anxiety. Take those head on. They will be the best investments in myself whether they're financial or hard life lessons, you cannot go wrong with them.
Also, before investing with everything I’ve got, invest in myself first, take care of my mental and physical health, my intellect, knowledge and personality. A morally strong, charismatic character would give me more ROI (Return on Investment) than anything else in the long haul - true for financial and relationships alike.
Save
What's your savings rate? How has it changed over time?
Before moving to Australia, I would say I was saving around 70% of my income because I had not moved out from my parents' place and I was still dependent on them (in some ways).
Ever since then, being on my own, that percentage has certainly dropped and still fluctuates to this very day. If I had to give a ballpark figure, I would say it is between 25-55% of every pay. It just varies on my needs and wants.
Do you have a budget?
Yes. I use a personalised tracker that I created about four years ago on Google Sheets. Of course, it has been refined over time and serves my needs adequately. I budget on a month to month basis.
How much do you spend per year?
Including all my direct and indirect expenses, it is close to $35,000 a year at the minimum.
Do you make purchase decisions carefully, or are you loose with your money?
A bit of both. I save money where I can but for certain things, I don't second guess it and just go with it. I would say I lean more towards the loose side of things but it depends on what or where my money is going. I guess when I am making certain monetary or purchasing decisions, the fear of missing out kicks in and I just give in, haha.
How is your work-life balance?
At my current job, it's pretty okay. Well, as good as it can get for a 9-5. I get time for myself after work and on the weekends so I cannot complain much. If I had kids or a significant other, I would probably have less time for myself.
What's your favourite thing to spend money on?
Anything that catches my eye - not. I spend generously on gadgets, electronics and food. If I decide that I want something, I just get it or list it down at least that I need to buy it. It is just how I am wired, I guess.
Invest
How do you invest?
I don't have a fixed plan, I put money here and there. Not consistent with anything.
What's been your best investment?
I am too early in my journey to call anything my "best investment" so I would say myself and the constant improvements that I am making (or trying to) in myself, that would be the pick for me, for now.
What’s been your worst investment?
Rushed Crypto transactions. Oh, also, all my time and energy spent on temporary, unworthy people. I am still learning on the latter, but I feel deeply for all that loss.
What’s been your overall return?
Too early in my journey to get anything in returns but I am hopeful.
How are you building wealth?
Saving, working, making smart-ish decisions when it comes to money and managing it closely. I have always believed that if someone is not making enough, they can always work extra. If working extra is not an option, then learn to differentiate between wants and needs and act on it as much as you can, practically.
What are your main roadblocks to building wealth? How are you addressing them?
Not making enough money. I worked two to three jobs at a time before moving to my current job only because I was not making enough to sustain myself. I can see myself working extra again if I have to, but that's why I need another stream of income.
Do you have a target net worth you want?
Not a specific target. I just want to get out of the cycle where I am worried about the next bill or the next rego. I want to have my own place someday and just want to be comfortable enough to not nit-pick even on the smallest of purchases. That's my definition of financial independence. The definition will change depending on the fact whether I am single or in a relationship later down the road.
Behaviour
When did you make your first significant behavioural shift towards wealth building?
I would say when I started earning for myself. Plus, looking at all the people around in my circle spending money without any rational thinking, I think a part of that just sort of etched in me and I decided I don't want to be like that.
If you could start again, what would you do differently?
I would start working way before than I actually did. I would start investing early as well. Also, I would focus on my health and wellbeing before I run after people and other things. Lastly, I would be more honest with myself and would stop being lazy.
What mistakes have you made along the way that you think others could learn from?
Don't start tomorrow. Start today. You are underestimating your potential in the name of procrastination and laziness, get over it and stop making excuses. Be honest with yourself.
Do you have any worries about retirement? If so, how are you planning to address them?
Worries? Not really. I am devising a couple of contingency plans if my actual plans don't work out. Not the best practice, but I cannot help it as I want to retire relatively early.
How are you learning about building wealth?
I read a lot. A lot. Also, looking at others is probably the best way to avoid mistakes that can be avoided, at least for me.
Do you give to charity? If so, what percentage of your time/money do you give/
Occasionally, yes. However, I am not consistent with the percentages. It just varies, a bit here and there.
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