She's On The Money - Is There Such A Thing As A Self-Made Millionaire?

Episode Date: January 9, 2024

Some people want you to believe that all that lies between you and your millions is hard work and determination. Well...maybe, BUT often the thing that isn't mentioned is the privilege or family connections helping people on their way to their fortune. Today we unpack the damaging myth of the self-made millionaire and take a look at what really counts...opportunity. Acknowledgement of Country By Natarsha Bamblett aka Queen Acknowledgements.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. If you do choose to buy a financial product, read the PDS, TMD and obtain appropriate financial advice tailored towards your needs.  Victoria Devine and She's On The Money are authorised representatives of Money Sherpa PTY LTD ABN - 321649 27708,  AFSL - 451289.See omnystudio.com/listener for privacy information.

Hello, my name is Natasha Nabanunga-Bamblett. I'm a proud Yorta Yorta, Kernai, Wolperi and Awadjeri woman. And before we get started on She's on the Money podcast, I would like to acknowledge the traditional custodians of the land of which this podcast is recorded on Awadjeri country, acknowledging the elders, the ancestors and the next generation coming through. As this podcast is about connecting, empowering, knowledge sharing and the storytelling of you to make a difference for today and lasting impact for tomorrow. Let's get into it. 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 to become millionaires. Hey, I see what you're doing there. My name is Bec Syed and with me is Victoria Devine. Hello, my friends. Hi, Vicky D. Hi, how are you?

I'm good, how are you? Good week. I'm having a good week. Yeah, I'm having a good week. Love. Now, V, I do want to ask you about something that's a little bit controversial. Yeah. Are self-made millionaires a thing?

No. Is that an oxymoron? Like, it's crazy. I wrote an article a couple of weeks ago for the Age and Sydney Morning Herald. if you guys don't know I have a weekly column in there because I'm a big dog yeah also I get really anxious every week when I write them and I like fluster and I send it to six million people I'm like is this good is the internet gonna come after me anyway I wrote an article about this myth of the self-made millionaire because I'd just been thinking about it a lot thinking about this idea

of the self-made millionaire I feel like I'd seen so many headlines that said I became a self-made millionaire by the time I was 40. And there was another one that was like, oh, the surprisingly simple things I sacrificed to become rich. And I was just like, there's so much pressure on us to be more and do more and have more and amass more wealth. And that doesn't necessarily make us better human beings. But also we're not recognizing that for someone to become a millionaire, for someone to become a billionaire, it's at the cost of other people's labor. Like I was saying to you off air that if I dumped you on an island and said, okay, create wealth and you didn't have anybody else to help you, you're not going to make millions. Sure. Like from my perspective,

the only self-made millionaire is someone who won the lottery. Yeah. Because like you walked in, you bought a ticket, full stop, end of story. There was no real work or effort that had to go into that. And like, if you Google how to become a millionaire, there's so many tips and tricks and strategies. And I'm just, I'm not talking about people who become millionaires on this episode as a bad thing. Like, please do not get me wrong. I have absolutely every intention of one day retiring and being able to say I am a millionaire because that is going to put me in the best possible position to live the life that I have been working so hard for. But I think we need to talk about this idea that this narrative can be incredibly isolating and this narrative

can always put a lot more pressure on us and make us feel like we are less than when we are not. Like how many times do we look at social workers and nurses and teachers and those people that don't ultimately usually become millionaires? Those people deserve so much more respect, so much more recognition. But these self-made millionaires get that respect and recognition in the media and it puts so much unnecessary pressure on us to go, maybe I'm not enough. Maybe I should be doing more. No, you shouldn't. The world is about so much more than that. And ultimately, I think this episode is really about talking about how it takes a village to create wealth, regardless of where you come from. And I know that there are going to be some

people listening to this and they're like, well, I'm wealthy now, but I grew up in poverty and I had all of these extenuating circumstances that for any other human being would have made it really hard to be successful. And you're not wrong. I'm not putting you in a position where I'm saying, Bec, that person didn't work hard. You absolutely had to work hard. Like to amass any type of wealth, you have to have some level of intelligence of how to invest it and save it and put it in the right position. But you also have to work hard for that money to come in the door in the first place. But there's always going to have been some other labor in the background because your time is ultimately capped, right? Like I am only going to be able to work for 40

hours a week, right? But by growing my team and relying on their labor, yes, I'm paying for it, but relying on their labor, I can create a more successful business. I can become an individual who doesn't have any team members and become a millionaire, but it's because people teach you and offer you mentoring opportunities and say yes when other people say no. So I think there's just so much to it and I think we should break it down and talk about it because I don't believe that there is such thing as a self-made millionaire, regardless of how many times people want to put in the media. Yes. When you put it like that, I think I agree with you. But why are we talking about this? Obviously, I could rant all day, but I just feel like at the moment, as I said before,

there's just been so much in the media about how, you know, at this point, we are putting so much pressure on ourselves to strive for more and be more and be better than we were the day before. And it just seems as though the sum of our life's worth is based on the number of zeros in your bank account? And Bec, is it? No. Oh my gosh, I hate that it took you so long to think about that. I'm so sorry. I feel like you're like the number one person that's like, man, money's helpful, but like, I want to go lay in the grass and have a good time and enjoy my friend's company. And I think that you are the poster girl for being like, who wants to be a self-made millionaire? Not Bec. I mean, I don't think you'd say no. If someone was like, do you want to be a millionaire?

You'd be like, I can buy a lot of English muffins for that. Yeah. I mean, I wouldn't say no, but also, I don't mind. Yeah. I feel like this idea of the self-made millionaire has become really popular because like you click on it, you're like, I would like to become a self-made millionaire. It's like that headline, real catchy, does the job. But we often hear stories of individuals who, you know, came from humble beginnings and then worked tirelessly and amassed incredible wealth. And I just think, obviously, we're not downplaying their incredible dedication and hard work but the truth is no one becomes successful in isolation every single person who has any level of success has actually benefited from some level of support whether it's

direct or indirect along their journey to success and we need to acknowledge that like we need to talk about that and then also talk about what life is really about because I think it's about the relationships that we have and how much we give back and how much we care because I don't look at people and go, hmm, I wish they were richer so I could be friends with them back. Or maybe you do. Maybe you do, but I've never done it. I do. It's kind of a prerequisite. I do have to check my friends' bank accounts before we officially hang out as friends. Yeah. Do you want me to send you a screenshot before our next catch up? Or do you just want me to tell you, like, how do I prove it? I do need some proof.

Okay. Sorry. I'll just give you my banking details. You can log in and check it whenever you want. Your card might be good as well, actually. Yeah, actually. And your PIN code. How about if I just give you a copy of my credit card? Yeah, perfect. That would be great. Thank you so much. But V, it seems like this episode today is a bit of, I guess, like a mindset check. If you're someone who, like myself, for example, there's definitely been a time in my life

where I've been like, oh my God, if I had just worked a little bit harder, I could be more wealthy or something like that. But let's say, for example, you grew up in a home, you're born into a family where there's like, I don't know, abuse and trauma and all this stuff. and you end up moving into your teenage years, you become, I don't know, it's just like a troubled future for you. I can't imagine that hard work and dedication will make you become a self-made millionaire. That's not it.

So like putting that pressure on ourselves and being like, wow, if I had just worked harder. No, isn't it crazy? It's not the case for everyone, you know what I mean? And yes, exactly as you're saying, it takes a village. Yeah, it's also about the support that you receive, right? Yes, holding people up. It's crazy to think that people would drill it down and go, well, it's just about hard work and effort, Bec, if you put more hard work. Like, Bec, what if you started working 90-hour weeks at work?

That's actually not going to translate to you earning more money. That's not how it works. Like, you have to have some level of support to create something different. You have to have some level of support to know where to go and what to do and how that all works because just putting in the effort, let's be honest, it's not enough. It's all about networking connections and how all of that works. And even if that networking connection isn't in person, like, you know, as a part of my business, I do online courses, right? And I adore it.

And we're about to launch a few new courses. And I don't have anyone that supports me on that because there's no one in Australia that I know that does courses. But the support I receive is all of the YouTube videos that I have watched on how to set up that online course, that support from people that I don't know who have put out this content to help me grow. it's support from all of the blogs and the websites. And, you know, I log into my course provider platform, right? And I have the live chat option to talk to people. So yes, you can work

really hard, but you also need to realize that the world is now, you know, I think the self-made millionaire is far more popular nowadays because it's a bit more accessible, if we're honest. Like to become a millionaire these days is much easier today than it was back in the fifties because of technology and what we have access to like nowadays everyone has access to the internet and the internet is a beautiful place that can change lives can ruin lives as well let's be honest but we have access to information but that information is there because of the labor of other people right like it is there because other people have put it out there to help you and when you go I'm self-made I did this all myself I'm like well yeah you did do the work but the hard work is not

enough. Does that make sense? That makes so much sense, V. I have some stats though, so it's not just fluffy. So I know you said before, it's a bit of a mindset check. It totally is because I want everyone to pull their heads in and care less about money, which is funny because this is a money podcast. But like, that's, I guess, the ethos of She's On The Money, right? Yeah, I love that. It's not about what you earn, it's about what you do with it and the values you hold and respecting those values and really reflecting what you want to create as a life. Yes. But global wealth inequity, what does it look like right now? Bec, I'm so glad you asked. Credit Swiss, who I really like their reports, actually. They've documented the rise of the super rich and the growth in

global inequality over the past decade with their global wealth report, which, by the way, has lots of infographics in it. So if you ever wanted to go and look at a global wealth report and thought, oh, that's not going to be good. It's just going to be text. It's not like it's so pervy, but I've pulled out a few stats for you because Beck, you and I both know you were never going to go look. But I was going to ask the question. Are you wrong? Well, you're not wrong. Exactly. So it found that in 2019, the richest 10% of people in the world owned 82% of the world's wealth. Oh, wow. This means that the top 1% of the richest people in the world own 45% of global wealth. Oh, that's like half of the entire world. That's half of the world is owned by the 1%.

Geez. Isn't that cooked? Yeah, that is cooked. Half of the world's population, so 50% Bec, has 1% of the wealth. Wow. Just shared up evenly. I mean, not evenly. Yeah, just really nice and even. Just makes sense, right? They were like, oh, well, we heard that it was 50 and 1%. We'll just reverse that, yeah? And the Forbes billionaire list gives real-time daily updates of the fortunes of the richest people in the world. So pervy. Very depressing. Beck, the top 10 richest men. Like it's not a list of like just men. It's actually just the top 10 richest people happen to all be men, Beck, which I don't think anyone's surprised by. Have amassed a total of $967 trillion, Beck, which is absolutely cool. Oh my God. But I feel like as the average lay person,

Like you and I, we hear the word millionaire and billionaire. You kind of go same bucket, right? Like you're just like a million, not that much different from a billion, right? Like you go, that's like a hundred million. That's like a lot. But like you kind of go, oh yeah, like at some point if you start collecting millions, you'll become a billionaire. So let's put that into perspective of how much bigger a billion dollars is than a million

dollars, right? Sure. So seconds. One million seconds, Bec, is 11 days. Cool. One billion seconds is 31 and a half years. Oh, okay. I see.

I see. What about, and you might not know this off the top of your head, which is completely fine, but what about a trillion seconds? All right. You want to know trillion? Yeah. So one million seconds is 11.6 days. Yes.

One billion seconds is 31 years, or 31.7 years. I do apologize. Wow. And one trillion seconds is 317.1 centuries. No, it's not. Yes, it is. How is that possible? The map is mapping.

Like, I feel like we just don't have the ability to comprehend what the difference is. But I think that puts it into context. Definitely. So 10 people share, well, they're not sharing between each other, but they have in total $967 trillion. Yep. And that was $1 trillion. They have $967 of those.

My God. Yep. Okay, let's go for a quick break, V. I need to absorb all of this. But stick around because after the break, we're going to be looking at some key concepts around the myth of the self-made millionaire. Okay, V, we are back. We've talked before about how much money is a lot of money on the show, but how much money do we really need and should there be a limit, do you think? That's probably controversial, but what do you reckon? Many people think, yes, I know. So I think in this day and age, this is going to sound very

entitled, but I do think people should be allowed to be millionaires. I totally get that. I think in this day and age, actually, if we're talking about wealth generation, and my favorite example, which you've heard on the podcast a million times, is Beck, if you had a $1.2 million investment portfolio, by the time you retire at a 5% interest rate return, that would return you about $60,000 a year of income. Right. So we obviously, as a podcast, as a community, me as an ex-financial advisor, I want you to reach that. A million dollars sounds like a lot of money, but in this day and age, sadly, it is not actually a lot of money when it comes to talking about retirement, talking about generating wealth, talking about property, like the average property price is now

a million dollars. So if we think about that and the strategy of getting to retirement, if the average millennial is purchasing a property worth a million dollars, the strategy is to pay off your property before you retire completely, right? That just makes sense. That means that most of you will retire with more than a million dollars of wealth. Right. Just because you're going to have a property worth more than a million dollars, by the time we add in your superannuation, hopefully that bumps it up. By the time you retire to another million dollars, you're sitting at $2 million. Obviously, there might be other extenuating circumstances. You might have an inheritance. You might have another investment portfolio. It doesn't matter what it

is. But the idea that most millennials will actually retire with more than a million dollars is not incomprehensible. It's actually quite normal. It sounds like a lot because a million dollars is a lot of money. But Bec, I hope that when you retire, you've got about that, if not more, because that's what's going to create a level of financial freedom for you not to work, especially with how money is going to increase. Because we know that a dollar today is not worth a dollar tomorrow. Like a dollar today is going to mean, we talked about this on the shrinkflation episode, where like back in the 50s, a basket of goods was like 20 bucks and now it's $120. Like we actually need more money in the future than you need today.

Yeah. So it sounds like an incomprehensible amount of money, but I promise you it is not. Many people obviously are going to have spicy views on this. That's fine. Your opinion is not my opinion and that's what makes the world go around but my opinion is that billionaires should not exist nobody beck needs a billion dollars yes not one person needs a billion dollars and with the amount of impact that a billion dollars could have like it blows my mind to think that people you know just hoard it and have all of this wealth like we talked before about how the top 10 richest men in the world literally the top 10 richest men have 967 trillion dollars that amount of money

even half of that amount of money could solve world hunger yes like it could do so much good and they're just choosing not to because it's their money hey like it's their choice i don't know how you would do that but there is a concept called limitarianism and it's a view that states that there is a moral limit to how much we can have. It is not as demanding as some forms of egalitarianism because it actually accepts some level of inequality can exist and can be acceptable, Bec, but it does have a clear cap on how much inequality there could be before that becomes immoral.

And I think that that's important. I kind of like the sound of that. Because otherwise we live in a communist society and that's not what actually makes us thrive, Bec. Sure, sure, sure. Like I think that, you know, obviously there's lots of different views on this. There are going to be lots of people who go, no, they shouldn't be millionaires. They shouldn't be billionaires. Like I totally agree with the billionaire statement,

but I just go, all right, well, actually for you to create wealth and have a good life, becoming a millionaire is not actually at the detriment of other people, but becoming a billionaire absolutely is at the compromise that that money could have done more and been more. And yes, we could talk about having a billion dollars invested and it creating a passive income stream of XYZ and creating future wealth, but no one needs that much money back at the end of the day. No one does. Yes. I quite like the sound of this libertarianism thing. But V, as a business owner and someone who is now not necessarily on the hustle the way you would have been at the start of your career, do you think that you have an

opportunity to take a different approach to distributing wealth in your company? I think it's an interesting conversation because obviously, I don't know, I feel so uncomfortable talking about it because it just makes me sound like a wanker, let's be honest, but I'm not the highest paid person in my team. That's cool. It is, but it isn't. Like I have amassed some level of wealth. Like I have a home, my husband and I own an investment property. Like my husband has a good income that we rely on. And when we did our maths and worked out, well, what do I need to survive on? How does this work? What does this look like? That meant that I could invest more into my business. When I say that, not sitting on mass amounts of cash in my business, but meaning

that my team are paid very, very well. Like, I don't know, being she's on the money, I look at it and I want my team to be able to create wealth. I want my team to comfortably be able to go on the holidays that they deserve and buy the houses that they want. Like, I can't think of anything more embarrassing as a business owner than going, hey, like I bought an investment property and I know full well that my team can't afford to buy property to begin with. So, you know, we talk about Jess, right? She's in a position where she's going to be able to buy a property all on her own and that's absolutely fine. The only stumbling block is actually the market, not her income. And so that makes me as a business owner go, I must be running a pretty okay business if that's

the circumstance for my whole team. And I'm not here going, oh, I pay so well, rah, rah. Like it is fair, they work really hard. It all makes sense. But I think that there's this idea as a business owner that you really should be talking and thinking and looking at the wealth of your team but also the labor that they put into it because I'm in the position I'm in because my team works so hard I'm not just here because I had a good idea and it started working like I have the flexibility in my life to you know record these podcasts on a Tuesday when they go out on a Wednesday and have you know this life where there is a lot of flexibility but that has come at the cost of other people having to put labor on the table and put their time, energy and effort into

it. And yes, they're remunerated for it, but I look at it and I just go, well, you know, I would like this to be a sustainable business with team members who are respected. And to me, that's how you do that. So it's an interesting question when you're like, how do you distribute wealth in your company? I just make sure my team are well looked after and it's not about hoarding cash or sitting on it. It's always about making sure that it's distributed well to them. We were talking a couple of weeks ago, actually, on Instagram about Christmas parties. And I posted this thing and I said, hey, guys, like, what are some Christmas party ideas for Zella and She's on the Money? And, you know, a Christmas party is fun, right? I think everyone in the team

looks forward to going out, having a drink, having a bit of a band, maybe wearing a nice dress and just having a good evening, right? The amount of people that were suggesting things that their businesses did for them, like one of the examples, Bec, was flying everybody to the Yarra Valley on a helicopter to have an incredibly expensive lunch at a winery and then flying them home, I looked at the cost of that and I was like, okay, like, would I spend $1,500 per team member to go to a Christmas party? Well, it depends what kind of year it's been, let's be honest. But you look at the impact of that $1,500 and I just know my team would value having the cash in their account above and beyond that.

And it also makes me go, okay, well, if the businesses that are making those decisions are making those decisions and their team are like, yep, this is great. This is stunning. Are those teams being appropriately remunerated each and every single day for the labor that they put into their jobs? Or are they just being, you know, remunerated okay, but like, oh, they don't have an emergency fund or they don't have the ability to buy a house. In which case, I would be really embarrassed. That's the type of showy Christmas party I was putting on when my team can't even, you know, put the same amount of food on the table that they good the year before. Yeah. Does that make sense? Like, I just think there needs to be some level

of practicality and thought put into it when it comes to team and wealth distribution, because you also can't just pay people heaps and heaps of money. And I say that because it actually locks people into a role. Like, let's pretend I paid you back five times what the average annual income was for the role that you perform. That means that you might become really disenchanted and not, you know, push your career forward or change anything because you're like, well, I can't leave working for Victoria because I'm paid so well here, no one else will ever measure up. So like in every other aspect of your life, you might not be as actively engaged. So it's finding that fine balance of like, well, how do I appropriately remunerate and reward staff

while making sure that they still have equal opportunity and flexibility in the rest of their life. That's a tough one. It's very hard to balance. But Bea, ultimately, at the end of the day, what would you like people to take away from this? Honestly, this idea of a self-made millionaire and my reflections on it, I guess it opens up the idea of a wider issue. And that's the undue emphasis that we put on financial success and the lengths people go to achieve it. I guess in our digitally driven society, the idea of keeping up with the Joneses has really changed into, I guess, a perpetual race against time, you could say, where the measure of your success is not just your wealth, but how quickly you can achieve it. Like, you know, if somebody retires at 65 with a

million dollars, you're like, yeah, okay, that makes sense. But if you said, I'm 25 with a million dollars, you're like, wow, what a big dog. Like, that's so impressive. This consistent and relentless storm of what success stories look like I guess makes us feel trash about ourselves like how many times have we seen young entrepreneurs that were like I achieved a six-figure salary by the time I was 22 and you're like well that never worked for me that doesn't make sense like and they're showing off their cars that are worth house deposits and they're always going on holidays to the Amalfi Coast and I just think it's so easy to forget those of us in our community who work tirelessly day in, day out, put food on the table and they don't end up amassing millions. And

somehow that's not deemed to be as worthy or like, what about those people who work for the sheer passion of it? Like they're just so wildly passionate about something. Like what if someone is so wildly passionate about their craft or making a difference to their community? Why aren't we rewarding these people with the center stage, I suppose, when we talk about it? To me, I think it's like the artists, the teachers, the community workers, the nurses, the caregivers, their contributions never make the headlines. They made the headlines during COVID because I think people finally realized how much we rely on these people and how important they are when they always were that important. But yeah, I think that their narrative deserves so much more acknowledgement

and respect. And, you know, when the spotlight gets put on people who have become millionaires as being like the pinnacle or what we should be becoming, it really, you know, obscures the fact that, you know, at some point, a majority of us are going to face financial struggle in our lives. We need to talk about that. That's not something to be ashamed of. That's not something to sweep under the rug. But if the narrative is, oh, I became a self-made billionaire, you immediately think, well, these people don't have these problems. I can't relate. I'll never be successful. Sure. And I think that in a world where we have unforeseen, you know, interest rate rises and we have health issues or even just like a mere stroke of bad luck can see us, you know, spiral into a

financial crisis, we need to be protecting ourselves against that. And that's not by becoming a millionaire and hustling our way to the top, Bec. Like, I just think we need to remember that wealth is not the only measure of success in this world. Like personal growth, beautiful relationships contentment in your actual achievements and what you do every single day no matter how small are actually the indicators of this and I think that it brings us to what I would say is the irony of our time and that while it's essential to you know have aspirations and push our boundaries we also need to be aware of not letting the societal pressures that exist define your worth because you're worth so much more than that and I won't go on and on about

that because I just, I could and I would. And if you gave me the platform, I will. And we might even link my article that I wrote for the Age and City Morning Herald here, because that actually is another thousand words of me ranting about how important this is if you're interested. But I just think, yeah, you can't do anything in a vacuum, Bec. The world requires support. The world requires us to have connections to be successful. And when you have this narrative of the self-made millionaire puts unnecessary pressure on you and me to do better and be better and hustle but also it doesn't acknowledge the people that are actually you know supporting the fabric of our society yeah so true that's where we'll probably leave it though because

like otherwise i'll just go on and on babe hey we can go on and on off mic but so good and i think it's a really good thing for people to take away from this episode is that it's probably not on you you are where you want to be and where you have to be and where you should be exactly you are exactly where you need to be right now my friends yes and also my favorite quote of all time let's leave on that a rising tide lifts all ships love it love it let's go have the best day my friends and we will see you on friday bye guys 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. If you do choose to buy a financial product, read the PDS, TMD and obtain appropriate financial advice tailored towards your needs. Victoria Devine and She's On The Money are authorised representatives of Money Sherpa PTY LTD ABN 321 649 27708 AFSL 451 289. Thank you.