This post is based on an interview we conducted with Jess in October 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: Jess
Age: 28
Where do you live? Newcastle
Please tell us a bit about yourself.
I am an audio and lighting technician who spent five months unemployed last year due to COVID-19. I moved cities for a job last year after COVID-19 decimated all entertainment work.
What's your current net worth?
$191,000.
How does it break down?
- Cash: $50,000
- Shares: $75,000
- Super: $80,000
- Car: $14,000
Do you have any debts?
HELP debt of $28,000.
How did you build your net worth?
Hard work! I worked full time and then added extra casual shifts. Pre-COVID-19, the entertainment industry was huge and you could pretty much work 24/7 if you wanted. There was always a gig or job happening.
Learning the job is very much made through experience, you can't learn it from a textbook so the more work the better experience you had and the more you'd get to know.
Earn
Tell us a bit about your career.
I have worked in the entertainment industry for six years. Being female, I make up 5% and different areas can definitely be boys clubs. So I decided I was going to work hard and learn as much about everything as I could so that I wouldn't get overlooked.
Because of that I spent two years working six-to-seven days a week. Picking up extra shifts on top of my full time job in the industry trying to learn and grow and get those 'coveted' gigs. With the extra work, it meant I made extra cash so set myself high savings goals.
Do you have any income sources outside your job? How much do you earn from each and how did you develop them?
Dividends from shares. They currently bring in about $3,000 a year. I developed them slowly.
Any dividend I receive I reinvest buying more shares. I figure as I am working full-time, I don't need the money now so better to increase wealth in the share market.
What's bveen important to learn about earning more money?
To diversify, start with what I have and stay committed.
I remember coming back from a big European holiday at the beginning of 2016 with $28 in my bank account. Since then, staying committed to financial goals which I set at the beginning of each year and then staying committed to a budget has meant I can get my finances sorted.
Also, to put more money into super! If I sacrifice a bit extra, I think my future self will thank me.
Save
What's your savings rate? How has it changed over time?
40%. This isn't as high as what it was simply because my expenses are bigger now. I didn't have a car until last year and they cost money! With no gigs or shows, I am also not working extra jobs.
Do you have a budget?
Yep!
How much do you spend per year?
60% of my income.
Do you make purchase decisions carefully, or are you loose with your money?
As long as it fits within money saved or the budget, I am loose as! I do love an oat milk chai latte. That is $5 a day.
How is your work-life balance?
A lot better thanks to covid
What's your favourite thing to spend money on?
Music gear and mics.
Invest
How do you invest?
Cash (saving a deposit) and shares. I have a small investment in Spaceship Voyager and the rest is on the ASX.
What's been your best investment?
Shares!
What's been your worst investment?
Shares!
What's been your overall return?
As of today on the share trading app – 59.14%.
How are you building wealth?
I like to think of wealth as holistic. Financially, I want to make sure I am stable whilst living within my means.
Holistically, it is important to be generous and to build memories with family and friends. You don't take your money with you when you die – you leave memories with those still here, so make sure they're good.
What are your main roadblocks to building wealth? How are you addressing them?
House prices have definitely skyrocketed! And I think now there is so much choice and that can cause confusion. So, trying to get better understanding of what I am involved in and try and play the long game.
Do you have a target net worth you want?
I think it'd be really fun to say, I am a millionaire. One day!
Behaviour
When did you make your first significant behavioural shift towards wealth building?
At 16 my mum opened up a super account for me. Back then for every $1,000 you put in the government put in $1500.
But probably the most significant shift was when I moved into shares at the end of uni. I had been saving and my godfather helped me work out what to buy.
If you could start again, what would you do differently? What advice would you give your younger self?
Don't listen to super broad advice. Trust your gut, particularly on shares.
What mistakes have you made along the way that others can learn from?
Bought some absolute dud shares recommended by others. Currently the ones I had good vibes about have all done well.
My strategy is simple, I go for the ones that I think pay decent dividends. I hope I'll eventually make my money back on them, hopefully they go up in price and start becoming an earner for me!
Do you have any worries about retirement? If so, how are you planning to address them?
Not yet, but I do still have 35-40 years of working life left. That said, I am putting away extra into super as throughout the compounding over its lifetime, it'll hopefully make all the difference.
How are you learning about building wealth?
My brother loves talking money, so that is always fun. Talk to my godfather, talk to my mum who has a good instinct. We all got the Barefoot Investor for Christmas one year and that has been really helpful on the bucketing.
Do you give to charity? If so, what percentage of your time/money do you give?
I give a minimum of 10% away a year. Being giving is a core principle for me. There is always someone with a greater need.
We want to hear your Real Money Talk
At Spaceship we’re big believers in sharing our money stories. We want to hear yours, too. In our ongoing Real Money Talk series, members of our community share what they’ve learned about managing money. We’d love you to take part. Here’s a link to our Real Money Talk survey where you can share your story.
