This post is based on an interview we conducted with Sophie in February 2022.
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: Sophie
Age: 20
Where do you live? Launceston, lutruwita/Tasmania
Please tell us a bit about yourself.
I’m a 20-year-old Social Work student and casual child care worker living in lutruwita/Tasmania.
I graduated last year with a Bachelor of Arts and began a Master of Social Work this year, and I’m looking forward to a future where I can help people and communities live happier and more empowered lives.
In my spare time I like getting outdoors and doing art/craft projects.
What's your current net worth?
$34,900
How does it break down?
- $36,700 Bank accounts
- $1,400 Spaceship Voyager
- $4,000 Superannuation
- $9,000 (approx) value of car
Do you have any debts?
$16,200 HECS/HELP debt.
How did you build your net worth?
About 90% of it is just from working casually.
I have had a fair few different casual jobs since the age of 15, and always saved a good chunk of my income (usually at least three-quarters of each pay).
I always try to put my money in the highest interest savings account on the market, and therefore grow my bank balance as much as possible.
I’ve also started using Spaceship Voyager to grow my wealth longer-term. About $4,000 was a gift from my parents when I turned 18. They put aside money each year of my childhood and gifted that to me when I became an adult. Another $2,000 was from a uni scholarship.
Earn
Tell us a bit about your career.
I’m a full-time student, which is a job in itself but I don’t get paid for it (or receive welfare).
My casual job in crèche is lots of fun, but the pay isn’t the best as it isn’t technically child care, so we don’t get paid as much.
Before my current job I’ve worked in hospitality, fast food, retail, events, and disability support.
I feel like this has given me an amazing breadth of knowledge and experience, and I’m super keen to start working in Social Work when I get my Masters in two years.
Do you have any income sources outside your job? How much do you earn from each and how did you develop them?
I do market research sessions from time to time, which is great money for what I’m required to do. Either I do quick 10-20 minute surveys which give me a chance to earn a certain amount of money (the odds are pretty good, I’ve gotten prizes from $10-$50 many times) or I do Zoom interviews which I’m paid a set amount for the length of the session (usually $30-$150). I’m signed up to a handful of market research companies who email me opportunities to partake in, it’s an easy gig. I also obviously get interest from my bank accounts and (return from my) Spaceship.
I’ve always worked pretty low paying jobs, I’m just good at saving and have less expenses than many. I mean I could always try to get a higher paying role or negotiate my salary, but won’t do that at the expense of working somewhere I hate, it’s never worth it!
Save
What's your savings rate? How has it changed over time?
I save at least 75% of my income, but as a casual worker the exact amount varies each week. This has always been the same for me, except for when I lived independently for five months and saved only like 5% of my income, very tough times! I’m lucky to be living with my parents whilst studying.
Do you have a budget?
I don’t have a strict budget, but every week when I get paid I do a mini budget of my approximate expenses for the following week, then transfer the remaining amount into my savings.
How much do you spend per year?
I’m not sure to be honest, and my bank account won’t let me see. Probably less than $10,000.
Do you make purchase decisions carefully, or are you loose with your money?
I’m pretty frugal and careful with my money. I always compare products I want to buy and look for the best deal before deciding. I also consider if I REALLY need an item (e.g. should I get that white t-shirt, or do I already have four similar white t-shirts?)
How is your work-life balance?
Pretty good at the moment! My boss is pretty understanding of my needs and only gives me the 10-15 hours a week that I prefer. 15 hours at work + about 20 hours at Uni is a good balance, just under a standard 40 hour week. I am also very strict on myself with studying. I never study outside of 9-5, or on weekends (those are my free times!)
What's your favourite thing to spend money on?
Clothes from Depop! For environmental reasons, I only buy second-hand fashion. I find Depop has the best and most affordable second hand clothing, I can find some really cool stuff!
Invest
How do you invest?
I invest $20 a week into Spaceship Voyager, and the rest of my savings just grows interest in the bank. I have a pretty good interest rate of 2.5%!
What's been your best investment?
Probably any piece of technology I’ve bought. I always use my phones and laptops until they completely die. My last laptop lasted six years, and my last phone four years. I use both of these items for several hours a day.
What's been your worst investment?
Probably my car. I was pressured by my parents to get a more expensive AWD/4WD instead of a hatchback, and although it’s good for the occasional road trip or wet weather, a hatchback would have been a lot better and cheaper for my everyday activities.
What’s been your overall return?
I haven’t withdrawn from Spaceship Voyager yet, it’s currently in the negatives.
How are you building wealth?
Spaceship is my way of building long-term wealth, and I’d like to invest more money into it at some point. I’m also trying to live frugally so I can save enough money to have a house deposit in the next 2-3 years hopefully!
What are your main roadblocks to building wealth? How are you addressing them?
Probably just being a uni student and not being able to work full time. Obviously this roadblock is one I’m working on through getting a tertiary education, so it’s just a matter of pushing through my studies until I’m qualified and able to get a higher paying job with more hours.
Do you have a target net worth you want?
Not at this stage.
Behaviour
When did you make your first significant behavioural shift towards wealth building?
Probably in the last two years, when I set a goal for what I was putting my money towards (house deposit). Before that, I was just saving money blindly.
If you could start again, what would you do differently?
I think I’ve done pretty well in the past few years and I wouldn't change anything significant. Maybe I’d tell myself to worry less about money because I honestly think I’ve done pretty well. Money anxiety is so real!
What mistakes have you made along the way?
Probably just what I mentioned earlier with buying a car that was more expensive and not suited to my needs. I was swayed by those around me, and despite their expertise and good intentions, I should have ultimately listened to myself and focused on my own needs.
Do you have any worries about retirement? If so, how are you planning to address them?
Yes and no? I’m worried because it’s getting harder and harder for people to retire, and I think the government is destroying the pension and welfare system. But I also don’t worry in a way because it’s all so far away (literally 50+ years for me), so what can I do now? When I have a more stable income post-graduating I might look at contributing more to my super, but that's not something I’d do now.
Do you give to charity? If so, what percentage of your time/money do you give?
I sporadically donate small amounts ($10-$50) to charities I care for (eg Indigenous, queer, environmental causes), but it’s not a regular expense.
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