She's On The Money - 'Cause if you like it, then you shoulda put a ring on it

Episode Date: March 10, 2020

Diamonds are a girl's best friend - OR ARE THEY? The figures are in friends and we can confirm that Aussies are spending STACKS on that sweet finger bling... but how much is too much to be spending on engagement rings and how the heck do we make sure we're on the same page as our partner? Join Victoria and George as they share a sparkly chat (get it?) about everything engagements including exactly why we're all wired to complete diamond devotion... Do you love the podcast SICK and want more SOTM? Of course you do! Join our Facebook page to share your money wins and money confessions, follow us on Insta for daily inspo to keep you on track and DEFINITELY subscribe to our newsletter, the written recap of the pod's key takeaways, including some bonus bits you won't want to miss... In a money mess and need help untangling the muddle? We've got you sorted - simply record your qualm and send it through to us at [e-mail] and you may end up on the podcast! Your podcast hosts are Georgia King and Victoria Devine. The advice shared on She's on The Money is general in nature and does not consider your individual circumstances. She's on The Money exists purely for educational purposes only and should not be relied upon to make an investment or financial decision. Victoria Devine is an Authorised Representative of Consultum Financial Advisers Proprietary Limited ABN 65 006 373 995 I AFSL 230323.See omnystudio.com/listener for privacy information.

She's on the money. She's on the money. Hello and welcome to She's on the Money, the podcast for millennials who want financial freedom. This episode of the show is brought to you by our brilliant ride-sharing friends at Didi, but more on them a little bit later. My name is Georgia King, but if you're a diligent pod listener, you'd already know that by now. And as always, I'm joined by my lovely friend and money expert, Victoria Devine. Good morning.

Before we jump into it, Victoria, let's have a quick chat about the lack of toilet papers in the supermarkets right now. What is going on? Okay, let's go. You are absolutely correct. It's a little bit of wild hysteria going on. Obviously in relation to coronavirus. Yes, at this point in time.

And I think it has been quite reflective in our Facebook community as well. People asking about their investment portfolios and what's going on with their raise accounts. And I think it's really important to just note here that investment is for the long term. We go into an investment because we want to hold it and create wealth and the share market has ebbs and flows and this is a really normal thing to happen. And if we look back on world epidemics and the global stock market performance, we often see a dip when an epidemic hits. So if you look back and you look at SARS or the swine flu or Ebola, every single time something like that has hit our newsstands, it has significantly impacted, one, our global economy, but two, it's also impacted share prices. And that is really scary when you go log into your Raise account and you see that it's worth $300 less or $1,000 less or you're looking at your superannuation and it's off. but if you are invested properly for your risk profile and you're invested in a way that is

aligned to your values it shouldn't impact you at all so we shouldn't be rushing to pull out our shares in certain areas in my opinion no it's definitely worthy of getting some financial advice there because i would never recommend that you go and pull all your shares out or even put more money in unless you've got some good advice on that right often when share prices are a little bit lower because something has impacted the share market you can often view it as a discounted share. So at the moment in my personal portfolio I've actually put some more money into the marketplace because I know that over time it will increase in value and I feel right now that a share that I wanted to invest in is discounted and therefore I'm happy to invest. These things

happen in the share market and it is definitely worthy of consideration but not worry. Alrighty Victoria today we are going to be having a chat about something that has been slightly controversial in our facebook slightly a lot um and that is how much we should be spending on our engagement rings now i'm actually a little way off this myself it's not something i'm really thinking about but i know when i'm scrolling the feed on insta it seems like getting an enormous rock when you do get engaged is the norm however this actually wasn't always the case no it was not so we were doing the research earlier and in the 1940s less than 10 of couples getting engaged actually exchange diamond rings which seems incomprehensible now. Nowadays it seems every engagement comes with

a huge rock. 80% of engagements actually now come with a huge diamond rock. While I can't wait to discuss that and how we have gotten to a point where the average cost of an engagement ring in Australia is now $5,147. It is. I think we should first kick things off the way we always do by sharing a money win or confession from our own weeks. Victoria what have you got for me this week this week I actually have a really good money win for you and it's so on point for this episode one of my girlfriends has gotten engaged recently which seems to be one of the biggest themes in my friend group of late you're at the age I know it's terrifying they're also having babies on purpose no need for that wild um but one of my girlfriends has gotten engaged and I've

been asked to be a bridesmaid and I am so proud and so excited to be a bridesmaid but that comes along with needing to purchase a dress and that dress needs to be a certain color right so I'm really excited my money win this week is that her wardrobe had an ex-rental dress sale and then they had an additional 50% off so I have picked up my dress for this wedding for $37.50 and it is a $450 dress and it is gorgeous and I am so excited about it and it is literally perfect for this wedding and it is $450 that I actually thought I was going to have to spend. That is so good. And her wardrobe, by the way, absolutely not sponsored, just really good.

Shout out to Alex. Love you. Love your work. They're Melbourne based. They're based in St Kilda and I am obviously obsessed with them because I feel like I go there all the time. But I'm really excited that I've got an address for such discount. It's wild.

Anyway, what have you got, G? Mine's a money win as well. Far less exciting. It's mid-March now and I decided it was time to head out there and buy myself a diary to get organized for 2020. So a little bit late, but this meant that when I rolled into the local news agency... Do they still sell them? Yeah, they do.

And it was half price because I'm so late to the party. So instead of a $40 diary, I got a $20 diary. That is wild. It's basically the same as your dress. Well, you've got three months that are now invalid in that diary. So I would hope there is a significant discount associated. Okay, moving right along. Let's take a quick look at the Facebook community,

which was impressive as it always is week after week victoria did anyone stand out to you in the facebook group this week i have one from our friend kristin and she said that she has a money win with the tongue out dollar sign i face thank you for describing that no problems i've taken a note out of your book out of your diary may i say and she said that she got quoted recently seven and a half thousand dollars to install some shelves in her house and she refused to pay that which obviously is very very fair so she put her tradie partner to work and it took them almost the whole weekend but it ended up costing them sixteen hundred dollars and they're proud of what they came up with and she posted a really cute photo of these new shelves and like a desk space

in her house really cute really proud of her anyway loved that money win and the fact that she has a really handy partner that could help her out yes what have you got mine is crafty as well so this one is from Aji who has written in I wanted to do something special for my nephew's birthday this year so I made 24 cupcakes from scratch as a part of his present rather than buying a cake or cupcakes from the bakery oh my gosh I saw this are they the koala ones they were so cute she saved heaps of money and the rest of the money went in his birthday card which is gorgeous very creative and clever money win now victoria as i mentioned before the average engagement ring costs

five thousand one hundred and forty seven dollars according to the 2019 australian wedding industry report and that has only been increasing this seems like a wild stat to me especially when you take into consideration that one in four households in australia has less than one thousand dollars in cash savings and that two in three australians could not raise $3,000 within a week of an emergency. So Victoria, where on earth did this expectation come from? Because it seems like a lot of money to be spending on a ring. It is a wild amount of money if we think about what we could do with $5,000.

And whilst I think it's really important to preface this conversation about engagement rings really up front is more about values. Like if you want to spend $5,000, I am here for it. If you want to spend $10,000, $15,000, sure, go for it. No judgment. No, absolutely none. In fact, I don't even know if when that happens for me, I don't know what that price point looks like so I'd hate to have a whole episode on

on engagement rings to then shoot myself in the foot later so there's absolutely no judgment when it comes to what you're spending it's more about well where has this come from and why are these expectations in place and are they actually reasonable for us to be putting on each other or putting on ourselves I think one of the most interesting things when we start talking about engagement rings is that diamonds haven't always been the social norm. You mentioned before that in the 1940s, less than 10% of people were actually proposing with a diamond. And in Japan, if we look at this on a global scale, in the 1940s, less than 5% of men were proposing with an engagement ring. Then De Beers came onto the scene. De Beers? De Beers, not the kind that you

like G but De Beers was a company that actually held the monopoly of the diamond market for decades and they came into the market in 1938 and they started a marketing ploy they started to get Americans reinvested in diamonds because of their marketing strategy which arguably is probably one of the most successful marketing strategies in the world nearly 80% of people now putting rings on fingers when they get engaged and that's only like 80 years later exactly and the same stat is true for america and now australia historically we didn't actually invest in engagement rings yeah it's a big marketing strategy that has been put into the market that we have all eaten up and i think that if we start talking about it more logically five thousand dollars is a lot of money

and we're in a position where it's like okay well fine i'm not saying don't get an engagement ring but what i am saying is let's start having conversations about what is reasonable in 2020 we often view diamonds as rare and that's why we want to have a diamond because diamonds are forever they're a good investment often we're told you know that's why they're valuable look at the four c's you know you look at your cut you look at your color you look at the clarity you look at the carrot of the ring and that is what people are led to believe but for anyone who starts to do even a little bit of research you'll find that diamonds aren't actually rare they are just highly regulated and that has come from the de beers cartel and even if for one minute we

pretended that they were rare we're faced with the problem that artificial diamonds can actually be created in the absolute boatloads so why are we so stuck on diamonds as a valuable investment diamonds aren't actually liquid if i put my investment hat on they are quite hard to sell i don't know if anyone has had to and i don't think that i would ever wish this on someone but if you go and try and sell a secondhand diamond engagement ring there's often a lot of stigma that associates that so we know bad luck like often women are like oh well i don't want to wear somebody else's engagement ring or wedding ring from a failed marriage but then you've also got antique jewelry yeah but if you've ever gone to sell a diamond it is very hard to sell

and you are going to make a significant loss when you do go to sell it so to me that's not a very good investment in fact so many jewelers refuse to buy back diamonds even if you previously purchased that same diamond from them and there's documentation to prove it like they just won't have it there's often really strict refund policies in place when it comes to diamonds and engagement rings so in my book diamonds are probably a terrible investment if we look at it on an investment side of things they're not rare they're not liquid and they're not that valuable but because of the way that they are being marketed and because of the way that they are sold they're really expensive yeah so what would you say then is a reasonable amount of

money to be spending on a diamond ring this is such a hard question to start having a conversation about I would love to say it's a tale as old as time but it's not because it's not been around for that long it's been around our entire lives though so if we want a diamond engagement ring I think it's also really important to look at what our expectations are so if we're talking to what the expectations are often I will have a client say well isn't it three months worth of salary, that is often a stigma that is associated with it. If we look back to the 80s, it was two months worth of salaries. If we look back to the 50s and 60s, that was actually one month's worth of salary. And we've got indexation, we've got inflation, we've got increased cost of salaries.

I think that we are now looking at something that is actually quite unreasonable when it comes down to it. So what does a three-month salary actually look like, Victoria? So if you look at the Australian median annual income that actually sits in 2020 at around $86,000 which is a lot of money after tax that is what $66,000 going into your bank account every year so that means that you've got a monthly take-home salary of $5,400 times that by three and we're at $16,000 already and that number when I calculated it made me feel a little bit sick so if we start talking about sixteen thousand dollars in more tangible terms like if you're spending that on engagement ring that is absolutely fine and as i've said so so many times before on the podcast this is more

just about educating you into making decisions that you are completely aware of but if we took sixteen thousand dollars and put it into the share market over the next 40 years because that's how much longer we've got to retire at and then we used an effective interest rate of seven and a half percent because as i've told you guys before i always use seven and a half percent even though the australian share market returns more than that on average over a 30-year period sixteen thousand dollars turns into three hundred and eighteen thousand dollars over the long term imagine how many engagement rings you could buy with that victoria exactly but i think it's more about what are your values why are we placing such significant value on a ring that that capital could be invested

somewhere else and now I'm not saying don't do it that is absolutely not the message just think about it go okay cool no problems but what could we save how could we do that could we invest that for our future and spend three hundred thousand dollars in retirement going on holidays and having a really really big really long honeymoon we are purchasing an asset that is not really an asset because it doesn't provide any wealth for us it doesn't create wealth it might make us feel really good really pretty yeah it's really pretty and please don't get me wrong like I'm hypercritical of this because I'm a financial advisor is that really something that you want to be putting your money into and there is a lot of research that says that it's actually putting couples behind

so they're spending twenty thousand dollars on a ring which I'm telling you right now is actually very very common really spending twenty thousand dollars on a ring and that is putting them back because they want to purchase a home it is actually getting in the way of their larger financial goals and if that is one of their financial goals that is fantastic I am here for it. But I want to make sure that people are purchasing in line with their values, not necessarily purchasing in line with what the society that they see expects them to do. And I think that that's really hard in a world where we have comparisons galore. We have Instagram, we have Facebook, we have targeted advertising. The second you input into Google that you are

looking for an engagement ring, you are absolutely bombarded with it on Instagram, on Facebook advertising it is absolutely everywhere and i think that that is really hard to shy away from as well because no one on instagram is really showcasing smaller diamonds or alternatives they're all showcasing their big 1.5 carat diamond engagement rings and you go oh okay well maybe this is the expectation because i know i see that so the price is constantly rising as is the expectation of society what are we actually meant to be spending such a hard conversation to have And I wish I had a dollar figure because I think it's one of those things that everybody's looking for that figure.

Like everybody wants me to say, all right, well, $2,000 is reasonable. And then they go, all right, no problems. That's exactly what I'm going to spend because that's what is real and reasonable. But I think it comes back to values and it comes back to money goals and it comes back to how much you are spending and saving each and every single month. I am a very strong believer that if you're going to purchase an engagement ring, you should not be going into debt. If you're going into debt, you are not ready to get engaged.

and that is probably very opinionated but it is one of those things where you should be spending within your means and if it is something that you cannot realistically fit into your budget why is that something you are making space for when you have other values and competing priorities everybody knows how i feel about debt by now and we avoid it like the plague and if you're going to take on debt it needs to be good debt that is going to increase your wealth whilst i believe that getting engaged is an incredibly special time in your life like we're not here saying it's not and we're not here saying don't get engaged we're not here saying you know it's a bad idea don't get me wrong it's something that I want at some point in my life but it is not a priority for me to go

into debt to buy a ring that is stretching me beyond my means. Do you even need the ring like can't you just get engaged and purchase the ring later or you know? There are so many ways and whilst doing my research i found a really great report it was the 2019 australian wedding industry report and it said that 60 of couples that get engaged are formed with a ring that is a surprise okay 24 of couples are choosing an engagement ring together and six percent of engagements are agreed upon without a ring six percent six percent which i think is really interesting because if you're going to be spending $5,147 on an asset why are 60% of you choosing that as a surprise I feel like if my partner went out and spent five grand on something without my consent

or without me understanding what's going on and having a conversation about money I'd be pretty unimpressed but that's me and I think that that's then leading into a really good conversation about your living situation and about your financial situation like who pays for the ring I don't know but at this point in time and I've been quite open about this journey I've started working with my partner on having joint finances yeah and that means complete visibility on both sides of the story how does someone save for an engagement ring if I see his bank account yeah how do I do that without ruining the surprise essentially yeah and I think that's where it comes into play where you could either choose it together or get engaged with a stand-in ring.

I know a couple of girlfriends who have had that happen where their partners have just gone and bought cheap rings from LaVisa and proposed with those rings so that they can then go and choose the ring together later but they haven't lost that element of surprise and I think that that's a really nice way about going about it but it's 2020 as well. I think things have changed. It's no longer about your partner going and spending a lot of money on something and then proposing and surprising you. I think the narrative around getting engaged and getting married is now changing because in 2020, we're far more collaborative. If we're going to be all about equality, aren't we meant to be equally contributing to our relationships? And if we

are equally contributing to our relationships, does that then extend to paying half for our engagement rings? What does that actually look like? And I think that that is then a really personal question. You know, some women are going to say, well, Victoria, regardless of how much of a feminist I am I still love the idea of having a surprise engagement and that is so okay but it's a conversation you need to have with your partner because one we don't want to be disappointed when it happens but two we also don't want to be surprised by something that is actually a really big financial commitment so back to what we should be spending Victoria what yes give me some money figures come on oh you keep you keep questioning me for this but I think it's a really hard thing

to answer like it is back to values as I said I do not want you going into debt I do not want you to be going to a place that is stretching you so financially that you aren't achieving your other goals I think it's really worth having a look at all right well yes you will be wearing this ring hopefully for the rest of your life probably spend some money on it so that you feel comfortable and you love the item that you have chosen together but then also is it actually within your budget how do you budget for this is it something that you you know save up quite aggressively for so it's over and done with like we are young and unfortunately when you get to the stage where you are getting engaged it is the most expensive period of your life you've got an engagement

you've then probably maybe got an engagement party then you've got a wedding and then you often spend money on a honeymoon and then more likely than not you know without stereotyping then a baby comes onto the scene and you've got financial commitments coming from everywhere and unlike any other period in your life this is the period that you are spending the most money and I think it's worthy of consideration to actually just reflect on that and go okay well how could I save money how could I get the things that I want what is really going to matter to me the most 10 years from now and base decisions on that rather than getting caught up and swept up in the world of Instagram and all of that absolutely and I think that having hard and

fast numbers is really hard because every couple has a different set of values and every budget has room for movement so we all have different things in our budgets like we were talking a couple of weeks ago in the Facebook group that someone was absolutely not negotiable on their eyelash extensions and someone else was like wow why would you have that in your budget at all like I don't have any value on that but they're spending $70 a week on a gym membership yeah so we are all so different I think it would be quite inconsiderate of me to give you a number like okay well I think five thousand dollars is reasonable it is not I know women who have gotten engaged with a hundred dollar engagement ring and that is the ring that they are wearing

for their entire lives and they love it and it is so so special to them but then I also have clients who have spent upwards of fifty thousand dollars on an engagement ring and they are it's a lot of money but they are really happy and I'm really happy for them so I think it is purchasing something together that is in your budget that you have allocated funds to or you have organized funds together to purchase something yeah I think we often try to spend to be on our means because we are trying to impress people that we don't need to impress I think all that matters here is that it is what you would like to wear and it is something that makes you and your partner really happy so what if you can't afford the ring that you so desperately want I

think that that is such a common thing and that is something that a lot of women are struggling with because they see these big beautiful two carat diamond rings and they go well that's what I would like and this is where we can start a conversation I guess gee around diamond alternatives yes so there are so many great diamond alternatives on the marketplace yeah my money win before was about buying a dress for a wedding that's coming up and the friend that got engaged actually has this absolutely gorgeous blue sapphire it is an heirloom from her family that she has reset and honestly I have never seen something more stunning yeah it is this like three stone ring that I'm obsessed with yeah but it is so her it's not funny yeah so I think if an heirloom is an opportunity

for you definitely look into that because it is it's nice to have something sentimental absolutely but then also gemstones have a color if you've got a favorite color fantastic like if that is something that makes you really happy go for it but then also if you just really want that perfect diamond looking clear stone there are so many alternatives like on the market I've been doing a little bit of research for this episode and there are white sapphires that look very similar to diamonds there's cubic zirconias so companies like secrets yeah however you say that they have really beautiful rings at really really reasonable prices that look very similar to diamonds you've then got stones like moissanite or moissanite I'm unsure of how to say that and that is incredibly

popular in the US. It doesn't seem to be very big in Australia yet. And then you have lab grown diamonds, which to the human eye are absolutely indistinguishable from real diamonds. So we can actually find alternatives that give us the look that we want and the ring size that we want without actually having to go into a lot of debt. And doing my research, they are less than a quarter of the price of a diamond. And that's crazy to me. If you want a certain ring or if you want something that is a little bit out of your price budget maybe have a look at an alternative that means that you get the look essentially for less and you get exactly what you have been looking for all along and I think that that's actually really I don't know there's something about that

individual and personalized I think as well yeah I love it like I actually think it's something that you know like when my time comes you say like I think that's something that I would genuinely look into because I do love personally the look of bigger rings yeah like I just think they are really beautiful and I've got a couple of friends that have these absolutely stunning rings but I really don't want to spend what they've spent on those rings but I also kind of want the opportunity to have a big sparkly thing yeah so I don't know what the right or wrong answer here is I think looking into alternatives is definitely something that is worthy of consideration it is definitely something that to me is a little bit sexy in terms of budgeting and in terms of making sure that it

fits within your cash flow, fits within your lifestyle. But too often do I see couples that come in and have a meeting with me and they've overspent on their engagement ring and they actually regret it. Like I don't meet any couple that has spent out of their budget that doesn't say, hey, yeah, like we probably could have been a bit smarter here. We just got swept up in it. Hi there. You've reached the She's on the Money mailbox. Do you have a money problem you want help solving do you have a money dilemma you just want to chat about victoria is here to help every week we'll be playing your questions to help make sense of a money mess you may have found yourself in make a quick recording on your phone and send it through to podcast at shoes on the money.com.au

and you might even find yourself on the show but for now here's today's listener question hey girls so i recently just got engaged and i've just started planning my wedding which seems to be getting a lot bigger than I thought it would be. Our wedding's just over a year from now but on the weekend my partner said that he wants to host an engagement party as well. Originally we weren't going to do this but now that he's changed his mind I've started to think about it. I just think the costs of the wedding are already adding up and the engagement party would just be another cost that I don't particularly want to plan for especially given that we've already booked half of our wedding. My question is how do I approach my partner with this?

I don't think he realises how much of an extra cost this engagement party would be. Thanks. Another tough question this week, Victoria. This is going to be very expensive with the engagement party and the wedding. Do you need to be doing both? I think it's a double whammy here. It is a double whammy. I think this one's really interesting.

So Australians on average are spending $36,000 on weddings, which you guys would know if you listened to our wedding episode from last season and according to money smart 82 of couples are dipping into their savings to pay for their wedding which is fine i like that they've saved for it but 60 of couples are also relying on a loan and 18 of couples are using a credit card to pay for parts of their wedding so i think that this is a really interesting question because it comes back down to money budgeting and i am wild about budgeting as you guys would know but I also think that if you've got a wedding coming up you need to be doing a comprehensive budget that takes into consideration every single part of your

wedding and the whole process so for me a wedding budget includes the engagement party it includes the engagement ring it includes all of the honeymoon and every other yeah everything literally your hen's party your bucks party the bridesmaids dresses if you're paying for them hair makeup like every single thing including the thank you notes that you send out at the end of the wedding so i think that that is a number that needs to be agreed on between you and your partner and you need to be under the understanding of what is included in that budget to begin with yeah so if you're choosing a wedding budget let's call the average if you've chosen to spend thirty six thousand dollars on a wedding you need to make all of those events fit into that budget

it is not all right thirty six thousand dollars is happening just for the wedding and then we've got engagement party and then we've got engagement rings and then we've got wedding rings and we've got a honeymoon so i think it's pick a budget and that covers every single festivity related to that event and then you break it down from there and that's where couples come really unstuck when planning a wedding because they say oh we're going to spend thirty thousand dollars but they actually didn't realize that the florist they want has a minimum spend of five thousand dollars and so then bam you've eaten up a very significant portion of your budget there without even thinking about and everything in wedding like when weddings roll around is yeah wedding tax yeah that's it

exactly so i think that it's really important when you are planning an overall wedding budget be educated understand what these things cost before setting a wedding budget have a think about the things that you want make some inquiries understand what the videographer is going to cost often videographers these days if you want one of the ones that are really fancy on instagram sit between eight and ten thousand dollars for the day and that adds up so quickly and whilst it might be a value to you I think you really need to get on the same page with your partner and say okay we've got this wedding budget what needs to be taken into consideration how do we put an engagement party into the budget that we already have do we need to have less flowers at

the wedding and you know maybe have the really standard drinks package as opposed to the premium one we were previously considering because it means that we've got more cash to play with for something else and I think that that's where we need to be seeing these things I don't have an opinion on whether you should or shouldn't have engagement parties it's each to their own and often when things happen like weddings families get involved so sometimes your family will pay for some things or sometimes you've got these expectations from a family member that you will have an engagement party or you will be paying for this that or the other yeah and I think that everybody's situation is so different that it's hard to say what's right or what's wrong and the

advice here from me is actually just create an overall budget and make everything fit into that so if you need to chop and change what that budget looks like you can reallocate funds from a different part so as I said before you could take some money off your florist budget and put it into something else if you needed to but that's how we should be looking at weddings because that is how it gets so wildly out of control because we don't actually take into consideration every single piece that we need. I think as well engagement parties don't have to be as enormous as the wedding. You could just have an intimate gathering of your nearest and dearest and yeah it doesn't have to be overly expensive. 100% but it could also be the flip. It could also be a massive

engagement party with a hundred plus people and then you have a really small intimate wedding and I don't think that that is bad and I've got clients who have had these epic engagement parties that have turned into their weddings or epic engagement parties that have then turned into them eloping and saying, ha ha ha, we actually, we actually already, we actually already got married. Jokes on you. And I think it's a really important thing to remember that everyone has a different set of values, but everyone can keep a clear budget. Okay. Now for the fun stuff. What good would a money podcast be without the pervy bits? It's time for Money Diary. Strap yourselves in guys, because this one's a goodie. Hi, I'm 21 and 90% sorted. I would

say that my relationship with money is pretty decent. I work for myself as a videographer and social media manager. So I base my income off invoices, which is kind of a roller coaster of a way to live at 21. But I love it and money's okay. Okay. So now we know what she does. Let's get into the juicy stuff. How much does she earn and how much is sitting in her bank account right now? I don't have a salary so just basically how much I work how many clients I can bring on board I think in like my last year of high school when I kind of sort of started getting serious about business I profited like $13 after tax it was a win I was positive so that was cool and then it just kind of has progressed since I moved to Melbourne three years ago and it was like $13,000

then like $30,000 and then this year I'm looking to do this financial year looking to do about $80,000 pre-tax so sitting in my savings account right now between my business and personal is about ten thousand dollars it's not a huge amount of money but I tend to be the person who will just wake up one day have like too much money in my account and I'll go to a camera shop and be like literally say goodbye to like like eight thousand dollars just because I want new camera gear Victoria's going nuts over here so at this point in time I have about thirty three thousand dollars worth of camera equipment to my business which is really it's a cool achievement for me but then I also I think about and all my friends are like going on European holidays and American

holidays and I'm like where's my holiday like I work I work and I save but where's my holiday and then my mum sends through like my insurance thing and she's like insured gear is like 33 grand and I'm like hmm that might be it might be where my America trip is. And what exactly happens to that money after it's deposited into her account? Everything that I earn I kind of only pay myself $200 a week and then the rest goes to my business. Money comes into my account and when I get an invoice paid, it's 30% tax and GST that goes to my up account. Then it's 30% to my business within my CommBank and it's 30% to my personal. Then I pay my rent from my personal account as that adds up and then anything I buy for my business goes from my business account. Okay then, so how does

you feel about investing does she invest and if so how I think investing for me was never something that I grew up with like neither of my parents I did not know anything about investing until I went out to look for it so it was never something my mum was super duper skeptical about it because she never knew like understood it so I went out and learnt about it learnt the basics and learnt like how it works and I just see it as a way to this is probably a real dumb way of saying it, but it is a way to grow wealth without really doing much. It kind of just compounds over time. And that sounds like a good deal to me. So at this stage, I am currently investing monthly into raise. So it's just a hundred dollars a month, but because I work based

off invoices, I try to have my expenses set out and that anything above what comes in that's not in my necessary expenses usually just goes into raise. So I have about $2,000 in raise at the minute, but with the current financial climate, it could be $500 tomorrow. We'll just hang in there and see how that goes. What about debts like credit cards or personal loans? So I'm actually super, super duper lucky that the only debt I have is my HECS debt, help debt. I just graduated from uni last month and I have $21,000 in a help debt, which I'm really not in a hurry to pay off because it's super duper low interest and I'd rather put my money elsewhere. So growing up, my mum really instilled into me that it was really important to be careful around credit cards

in saying that I did get a credit card when I was 18 it had a $900 limit on it and I had that because I moved from a very small hometown where all my family were so it's like 18 hours from Melbourne and moved down to Melbourne and my mum's like I want you to be okay like if you need something like it's not like you can just trip around the corner and come and see us like you have this if you need it and I also use it for my business like a lot of the times for clients that I work for I'll have to go and spend five hundred dollars on flights that I don't have the money for because they haven't paid me yet but they're like you need to get here you need to do the work and then you can send your invoice and then I'll pay it so I'll book flights to Tasmania for work last

night it's like four hundred dollars but I won't see that money until probably mid-April so it's like something like that super duper handy and then when I have enough money I'll just pay that credit card off. Does she have any good money habits that she's especially proud of? Yeah so another good habit that I'm actually really proud of is the fact that I allocate for tax and I actually work based off percentages so say if it's a thousand dollar month which only really happens one month a year 30% of whatever comes in goes to personal 30% goes to business and 30% goes to tax and then my tax sits there until June 30 and I sit down with my accountant he's like you need to pay this month money for this this quarter and then it pretty much isn't really mine I kind of just

allocate it there doesn't come into my account of spending or anything like that like at the minute there's there's 13 grand in there and I'm like oh sick look at the things I could buy with 13 grand but I can't and then whenever I've made all my actual contributions to for my bass and for my tax and things like that then at that point I'll then decide what to do with the money and depending how much is there, I'll probably go 50% investment and then probably 50% holiday because why not? And what about her worst money habit? My worst money habit is probably not really that bad.

I just have super-duper high expectations. So, like, my worst money habit is probably spending a little bit too much money on, like, books and, like, learning knowledge and stuff. Like, I can easily, like, I try and only go once a month. But, like, that once a month can be, like, $200 just. but then I'll read every single book but like in the big scheme of things what do books other than the knowledge in them they just kind of sit on my shelf. How would today's money diarist rate her own relationship with money if she had to give herself a grade? Based on my expectations if I

was to force myself I'd give myself a B only because I'm like I know I'm pretty decent at it but I also know how much better I could be. This is where the 21 and 90 percent sort of comes from because I know what I want and how to get there and then sometimes I just go out and drink a little bit too much alcohol and wake up the next day and I'm like, ah, bugger, that wasn't part of the plan. But then we move on and I just work extra hard that week to make that money back. That is all we have time for today. But before we head off, let's quickly wrap the boring but important stuff.

The advice shared on She's On The Money is general in nature and does not consider your individual circumstances. She's on the money, exists purely for educational purposes and should not be relied upon to make an investment or financial decision. And fear not, we promise Victoria Devine is an authorised representative of Consultum Financial Advisors, Proprietary Limited, ABN 65006 373995, AFSL 230323.

And thank you, of course, to Brian John, our audio king, for whipping our wild chat into the podcast you love. We would love it if you joined our Facebook group where our community shares money, tips and tricks every single day free of judgment search she's on the money on facebook and join if facebook's not your thing you can also find us on instagram we're at she's on the money aus we are see you next week guys see you soon