This post is based on an interview we conducted with Stella in January 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: Stella
Age: 35
Where do you live? Gold Coast
Please tell us a bit about yourself.
I’m a 35-year-old nurse, living on the Gold Coast. Fur children only, no dependents.
I have been careful with my money and made investment choices with the future in mind. At the moment I would say I’m asset rich but cash poor.
I work two jobs and plan on doing this for the next five years. At that point I’m hoping COVID-19 won’t be such an issue and I can go back to travelling overseas more.
How does your current net worth break down?
- Real estate -$1,382,203
- Super $265,000
- Shares $15,000
- Car $10,000
- Savings $10,000
Do you have any debts?
Just my mortgages. I try to save for other big purchases rather than take out loans.
How did you build your net worth?
Working two jobs and studying to increase my pay rate. I have been working since I was 14 and my parents were good examples on how to save.
Earn
Tell us a bit about your career.
I went to uni straight out of high school and started working as a nurse, full time at 21 years old.
Nursing has been a great career for me. I’ve found I can basically do anything nursing-related with the degree and if I need more money it’s very easy to pick up shifts.
There is also the chance to work at a nursing agency on top of my usual job if I need extra income.
I took three years away from full time work to have a working holiday which led to career experience, this has meant when returning to my current position I was looked at for promotions and definitely helped with career retention.
I love spending time with my friends and family and hope this year I can work a little less and spend time with them more.
Do you have any income sources outside your job? How much do you earn from each and how did you develop them?
I work nursing agency shifts on top of my full time job.
I make around $800-1300 per fortnight extra from doing this. If I know I have bills coming i.e. rates, car etc. I’ll pick up a few extra shifts.
I also have money sitting in shares. Last year I made $900 from them. In the near future I will focus more on this stream of income.
I have three properties, two I rent out completely which makes me around $20,000 per year.
I also rent a room out in my current residence which makes around $5,000 per year.
The money from rent of the properties goes straight back on the mortgages.
My goal is to have financial freedom by 45 and I feel like I’m on track for this.
What’s been important for you to learn about making money?
I don’t think university is for everyone but having a university degree has definitely opened doors for me.
Sit down and make a plan for 12 months, five years, ten years and retirement.
I don’t think we can assume that things like pensions from the government will exist in the future so a plan for a self-funded retirement is essential.
Save
What's your savings rate? How has it changed over time?
I use multiple different accounts. I have a spending account which is my fun money, which is about $500-600 per fortnight. The rest of my income goes straight into mortgages and savings.
As my income has increased my ‘fun money’ has stayed at the same rate, occasionally I dip into my savings for holidays etc.
I would love to have four properties before I’m 40.
Do you have a budget?
Yes.
How much do you spend per year?
About $25-35,000 a year.
Do you make purchase decisions carefully, or are you loose with your money?
It depends. Big purchases I spend time researching i.e. car, property etc.
I'm trying not to buy things that are not environmentally friendly and my goal this year is to only buy sustainable fashion. This has seen a slight increase in my outlay but I’m hoping the quality means I buy less often. I’m a sucker for nice fashion and shoes.
I love a nice dinner with friends and family and tend to splurge on these things.
How is your work-life balance?
At the moment I’m working too much but am trying to step back a bit.
What's your favourite thing to spend money on?
Property.
Invest
How do you invest?
ASX shares have been a consistent investment for me. I was using Spaceship Voyager but have put a hold on that for now to try and dabble myself.
What's been your best investment?
Property and university.
What's been your worst investment?
Cheap fashion, the money I spent on clothing that has just sat in my wardrobe is crazy.
What’s been your overall return?
It’s hard to say at this point.
How are you building wealth?
I have my fingers in many pies: property, shares, personal education and career progression means after many years of focus my wealth seems to be passively building.
What are your main roadblocks to building wealth? How are you addressing them?
I worry about when interest rates rise again and by how much. Currently I’m putting as much money into my properties as I can while the rates are low.
Do you have a target net worth you want?
I want to be a self funded retiree and have researched the target I think I’ll need to make that happen.
I’m hoping to have my properties paid off by 45 and then invest the rent until I retire.
At the moment I keep a nest egg of $10,000 in savings for the ‘just in case’ bills etc. The rest is invested in shares / property and education.
Behaviour
When did you make your first significant behavioural shift towards wealth building?
Probably at 14. My parents were really good influences. They didn’t have high paying jobs however set a great example.
If you could start again, what would you do differently?
I think I’m doing ok. But probably spend less money on fashion and look at investing in shares earlier.
Do you have any worries about retirement? If so, how are you planning to address them?
I think I have addressed this earlier but my biggest worry is that I’m not sure a government pension will be an option when I retire.
Do you give to charity? If so, what percentage of your time/money do you give?
I donate $10 per fortnight to the hospital fund. And $20 per month to Surf Life Saving Australia.
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.
