She's On The Money - MONEY DIARIES: Lifestyle creeper

Episode Date: March 21, 2021

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She's on the money. She's on the money. Hello and welcome to She's on the Money's Money Diaries. Today I am joined by our lovely friend ryan john and he's asked me to intro and then throw directly to him because he's got a quiz for me so everyone because you've clicked on this episode you know what the title of this episode is already but v i'm gonna get you to guess as i read out this email what this person has done wrong straight off the bat okay and what they've done wrong is their name oh like as in is their name for the episode and i've got absolutely no idea what this is yet because i've been provided with nothing and this is the very first time i've had to open a pod with no information that's lying

you know it that's got that's not that is not lying oh maybe it is i don't know i don't remember tell me what was the email so when i was between 19 and 21 i was a really great saver and i was able to save 25 000 on a salary of just 40 000 a year what incredible saver uh yeah shortly after moving out of home when i turned 22 i started spending way more and saving way less i am now 24 received a promotion i've got a really great salary and i'm finding that as my salary increases i splurge more and more unnecessary items i yo-yo back and forth with saving 1500 one pay then spending 2000 to upgrade my laptop on the next and it's just like a big yo-yo i can't get ahead i'm earning way more than i used to earn and i'm saving way less do you want to have a guess

what today's money diarist is a lifestyle creeper look at the piece of paper what oh my gosh that's so i actually didn't even read that i'm so impressed with myself anyway the lifestyle creeper says i have large goals and i always make budgets but i'm never able to stick to them i know if i put my mind to something i can achieve more but i'm feeling like i'm losing my way as my income increases and i want to be able to secure myself financially for when I'm older. I feel like we've probably got some hot tips for this friend of ours but also I feel like I want to know a little bit more about their story so can we have a chat to them? Let's give them a bell.

Hello is this Lifestyle Creeper? Yes it is. I just realized that I hadn't told you what your name was until I called but it's Ryan and Victoria here. How you doing? That's okay yeah good how you guys going well thank you how are you how's your day been oh yeah good just finished work for now i'm relaxing and yeah chilling out so i just read victoria your email yeah and thus we have decided your name is lifestyle creeper yeah love it great now for people who are regular as she is in the money they'll know what lifestyle creep is but it just occurred to me if you don't know what that is it sounds like we're calling you a bit of a creeper that's not the case maybe she is we don't know her well enough yet obviously we've just read the email but just for people that

don't know what is lifestyle creep so lifestyle creep is where you live within your means at multiple different income levels so when you're young and you're at uni and you don't have heaps of money you might be buying makeup at the supermarket or at Priceline and then as you get a bigger job and more income you start to increase your expenses in line with your income and you might now be shopping at Adore Beauty or Mecca and it's one of those things where it's so easy to creep up it's like we all used to drink passion pop but now I wouldn't purchase that if you paid me literally so that's what lifestyle creep is where your lifestyle expenses literally creep up and you don't realize does that feel like an accurate description of

where you're at yeah definitely I think every time that I've had a pay increase it pretty much just creeps up every now and then and without me really realizing until yeah it just happens fair do you drink passion pop though no i don't thankfully i love water but yeah good for you much more hydrating i believe um i've personally found myself in a situation where i've got what i thought was like a good pay rise and then you get halfway through the year to the end of the year and you go oh i got this pay rise where is it where's the rest of the money i think we've all done that 100 it's a bit cheeky but that's why we have to have a budget and we have to allocate that when it comes in all right lifestyle creeper victoria is going to go through our regular money

diary questions so with that in mind uh v do you want to hit the first question i would love to hit the first question i want to know what you do and how much you earn so i work for real estate company um i'm now a senior property manager um i recently got promoted after relocating back home So that's been a bit of an achievement for me. So I'm quite excited about that. I would love to know what you earn as well. So I earn $70,000 before tax. And then on top of that, I also get super.

I also, luckily with my job, I get a car allowance of $7,000 a year as well. So that's quite nice because we do have to use our own cars. But yeah, that's pretty well accommodated for. It's a pretty good money win, I reckon. $7,000 a year. That would get you some pretty good car expenses covered, I think. Yeah, definitely. I only just recently received that as of this year,

which is pretty exciting that I can kind of start putting towards that. Is it a real cliché that I feel like all real estate people have really fancy cars? Is that a myth or do you drive a really nice car? I recently got a new car last year. What do you drive? What do you drive? Come on.

It's a Toyota 86. It looks like a little sports car, but... Of course, it looks like a sports car. I want to know what is in your bank accounts right now. So currently I have $350 in an emergency fund, which was pretty much at zero a couple of weeks ago before my first or second paycheck. Hey, that's good.

Yeah, it's better. I was planning on growing it, obviously, within the next few months, but for a couple of months I didn't have anything, which obviously in the back of my mind every day made me quite worried but it's getting there. And do you have any other bank accounts that you want to tell us the details of? Yeah I do have like as of this year I'm kind of starting to slowly set up after obviously listening to the podcast a few different bank accounts as I just want to try and organize my money because I'm very visual as well so I like seeing my money in separate accounts for each

individual things so it could be like a bills account or you know a spending account a saving account things like that um so I do have them there but they just don't have money yet that is fine I want to ask a pervy and really self-indulgent question are you using the sheets on the money budget and cash flow masterclass by chance uh no but I've heard about it obviously on the podcast well I will set you up with that because you said you're a visual person and it is a super visual guide on what bank accounts you need to set up and i literally just tell you what six bank accounts i think you need to set up for financial success and i feel like that might be something that could help you right now that would be amazing oh my god yes thank you we will add you right after we

finish this recording i promise when you say you're a visual person so is v hence the course looks very pretty and arguably there's more time spent not that there wasn't heaps of time spent on the content but the effort that went into the colors and the fonts and making sure it all popped Yeah, looking beautiful and stuff. That's not an insult. I'm just passing on the info. If people are going to print my cash flow system, it's going to be aesthetic.

Like, it needs to be chef's kiss. Like, it will be the best cash flow system you've ever seen. So, speaking of money, what is your attitude towards money? Like, it's changed over the years. I guess when I was quite young, I think in my email to Ryan, like I said, I was very good with my money. I always saved it. I never liked spending. I was always, you know, in my family, the really good saver. I had, I think about $25,000 in my account when I was between like 19 and 21. So I was always

really proud of myself. And I think as I got older, going into the job that I'm in, it just slowly kept creeping down as I spent more and, you know, bills would pop up and I just didn't have the right attitude towards how I was going to be managing my money. So I think because of that, it just slowly went down. It's a shame, but I do definitely want to try and get back on track this year. I think after listening to She's On The Money, I think a friend posted it on her Instagram story and thought I'd give it a crack and listen to it.

I love that people are now finding it through their friends and it's kind of like even more community because it's not just, oh, yeah, like I joined the She's On The Money community. it's kind of like you're already friends with people in the community and yeah so it's really exciting to hear that and yeah so and now I love it so what is your big money goal well hopefully in four years I want to get a deposit for a house that's pretty much my end goal obviously working in real estate I kind of understand that and I really want to achieve that so yeah in four years I really want to have at least a hundred thousand dollar deposit I know that's quite a big goal but

I think with some good budgeting I hope I can get there I am more than positive that you will get there given your income and how much you want it like I can hear it in your voice I feel like maybe you feel a little bit disappointed in yourself even though you shouldn't because at the end of the day you've achieved a pretty epic salary for your age and you've proven it before that you can save so why couldn't you do it again exactly hopefully exactly so talk to me about how you feel about investing? Do you have any investments? So I'm quite new to investing. Obviously I've listened to the podcast for a bit. I've started looking more into rays and spaceship. I did have rays for a couple of months, which got to about $500 with roundups. But now I've transferred all

that into spaceship. So that's sitting at about 600 at the moment. How good. I feel like you just don't notice it coming out. And then all of a sudden you've got $600 invested and you're like, wow, that was definitely not as hard as I thought it was going to be. Yeah, exactly, especially with the roundups. But now I just auto-transfer, so I don't really see it. It's small, but, yeah, hopefully it keeps growing. As I always say, Ryan, from little things, big things do grow. He's not quick enough.

He's not quick enough. You've caught me without my sound effects. Oh, this is so embarrassing. He's usually got a sound panel in front of him, and that is one of his sounds because I don't like it. But I knew he wasn't listening as well as he should have been during this money diary. What was the song called again?

I don't know. I can't remember. I would love to know about any debts that you have and how do you feel about them? Well, thankfully, I don't have any debts. Obviously, I had one when I had my car like several years ago, but I paid that off I think within the year. So, again, younger me came through

and made sure I didn't have any debt for me now. But I really don't like the thought of debt. I think if it's purposeful, like a mortgage, it makes sense to me, but not like consumer debt. So I think all the money that I've used throughout the years has been savings, thankfully. But yeah, don't really like the thought of it. Absolutely. And what would be your best money habit? Well, my lovely mother, she's always had really good money habits.

and she taught me at quite a young age to always put more money into your super than you think, like, than your normal job does, like, put in for you. So every fortnight I put in $50. So that's investing. And that's going to add up. That's going to add up. So how long have you been doing that?

Since I was, like, my first job. So, like, 18, 17, something like that. That is so good. That's going to be worth hundreds of thousands of dollars to you when you retire. Yeah, do you know what that actually means? like that like definitely if you keep doing that's such a great thing i feel like it was i think it's really funny actually because before when we said how do you feel about investing do you invest like

the only thing you told me about was that 600 that you've got in a micro investing platform where in reality what you're telling me is you've been investing an additional 50 bucks a week since you started working and essentially you're adding what's that let me just i think that's per fortnight or per week we literally have that per fortnight oh that's 25 bucks a week but since you're 18 that is epic we had this post on the she's on the money instagram the other day that if you put an additional 50 a week into your superannuation you would end up with like six hundred thousand dollars more in your super when you retired that's so much money yeah and also because of like all the compounding the fact that you started it not when you were 35 but you started

at 18 that's gonna that's like one of the best things you can do if that's all you did in your investment journey that would be so far ahead but you can see how it would be helpful yeah i just recently found out that super actually does invest i honestly for years i thought it was just an account that sat there yeah and so many people think that and so many people assume that somehow it's not yours and it's not theirs but in reality it is literally a minimum of 9.5% of your personal money that you earned being put into an account for you that is then invested on your behalf. And it baffles me that people don't care how it's invested because they're like, oh, well, it'll be ages before I can access it. And it's like, well, that's why you actually

should care why it's invested because it's forcibly invested for a long period of time and it's going to be compounding over time. Anyway, I just like to rant about investments really. Let's flip this question on its head and ask you what your worst money habit is. Definitely because I don't think before I spend. So I'm definitely quite a big impulse shopper. Yeah, so I definitely act on impulse. If I see it, I go, yep, that's it.

It's done. It's in my cart. So yeah, that's probably one of my worst money habits. You could start putting 24 hours between you and your spending, which is another one of the things. I feel like this has been a very quotable money diary this week. Instead of answering you, I'll just read former quotes from our Instagram page. Yeah, former quotes from my Instagram, which is slightly embarrassing.

But at the end of the day, I am very similar to that. And one of the things that I do is tell myself I can still have it if I want it in 24 hours. And more often than not, I've gone cold on that item or I'm a little bit apprehensive. and I think that when you have issues and I'm not saying massive issues but when you struggle a little bit with impulse spending it can be really helpful to not say things to yourself like no I'm just not going to spend anymore like that never works it's like a diet you're going to crash and burn at some point but saying you know what I can have it I can just have it tomorrow if I still want it and the more time you can put in between you and that purchase the better in my opinion

Yeah, definitely. Last and final question of the formal Money Diaries questions, my friend. What grade would you give yourself if we forced you to give yourself a financial grade? I'd probably give myself like a C-, just because I feel like I have a long way to go and I need to just stick to my plan and not go off it. So, yeah, for now, a C-. I'm not going to argue with you because I never argue with people, but I do feel like you might be being a little bit harsh on yourself.

Definitely a little bit. I would argue an extra $50 on your Superfortnight is in itself worth a grade and a half. Yeah, exactly, at least. I'm going to award you with a B+. I've got my mum to thank for that. But, yeah, no, I'm glad she put me onto it. Cheers, mum.

All right. Thank you so much for answering those questions. We will be back in just a second. all right let's dive straight back in ryan what did you think of that money diary well i think lifestyle creeper uh i think the first thing just realizing that she wants to make a change i feel like we both feel that is that feel accurate i feel like it's very genuine lifestyle creeper is still here to join this conversation by the way lifestyle creeper how did your money diary go in your opinion did you like the questions did you not like talking to me who knows oh i loved it

yeah it's good to yeah get it all out there and have a chat and yeah very exciting so what was the moment you realized that you were in fact a bit of a lifestyle creeper and that you wanted to do something about obviously you've just discovered she's on the money you've noticed that you're saving swindling was there a bit of a line in the sand moment where you went oh hang on a sec i actually want to make a few changes here yeah i think it was kind of like one of those cliche new year's resolution style realizations. New year, new me. Yeah, pretty much. And I think after I got the new job coming into the new year and I guess taking, I took quite a bit of time off work as well. So I think, again, I had a lot of time to sit and realize and yeah,

I just want to get my act together and get back to my former, my former younger self and how good I was with saving so there I do have a question about your former younger self you said in your email to us that you saved about $25,000 on a $40,000 salary which to me is wild what were your circumstances then were you living at home were you renting with friends like what were your living circumstances yeah I was pretty lucky um I was still living at home with my mum um so again pretty much had next to no bills which allowed me to save so much money yeah exactly um and then I was able to also pay my car off within a year so again that led me to not having any debt um so definitely staying with my mum for as long as I did helped a lot um and I think I was just really

good with savings I loved the idea of looking at my account and having that much money in there but yeah I think as I crept up and I got more more of a salary behind me I just wanted to I guess reward myself and stretch my budget but yeah it's time to be a little bit stricter yeah so did you when you got the job did you kind of readjust the plan or you kind of just started getting the money and spending it and it's like you didn't even sort of really think about it too much I definitely didn't think about it a lot on the last couple of years but I think now that I've gotten the job that I'm in it was kind of a big realization to realize I guess the salary that i'm on in the position that i'm in because i still don't have a lot of um i guess

expenses in my life so i really want to i guess utilize that as much as i can because i think with covid as well that kind of also made me have a big realization where i'm in such a lucky position where i still have a job so i don't really want to take that for advantage and yeah get more money behind me again now this is more of a question for v oh um we talked about the money course before which our lifestyle creeper is going to do the budgeting and cash flow masterclass how often should you check in on that update it change it think about it is it just you've done your budget then it's done or no no no no no and i think that i think this is such a common misconception when it comes to budgeting that you have to outline how much your money is going to be allocated to

so you'd be like okay i'm going to give myself a hundred dollars for groceries and i'll just make that work it's kind of the opposite with the budget and cash flow masterclass it's a bit more about okay well what are we really spending let's actually allocate what we're spending so that one we can see that and it's reflected back to us so we can make some positive changes if we need to but being realistic with it it's not about hey we need to fit into this category because Ryan you might prefer to spend $300 a week on groceries because you really like gourmet food and that's the one thing that you spend money on whereas I might be super frugal and only want to spend $50 a week on groceries but I have a really expensive gym membership where I'm spending you

know a hundred bucks a week on that so everybody's values are different and I find it really terrible when people say well that's what your budget should be when then reality that's not when experts in inverted commas come out and say well obviously you should only spend seven percent of this on the art yeah and I don't work on percentages ever as you guys would know but for me I think it's just more about having a good budget is going to help you understand what you're spending so you know what you want to spend and where you can actually save because most of the money that you are spending at the moment is obviously discretionary but it slips through the crap sorry I can't I can't it it slips through the cracks and you just spend it without

even thinking whereas if you actually allocated that money to an account that you knew you could blow you feel a little bit more in control of your money but come back to the question you were really asking I'm just really passionate about budgets I genuinely think you should be checking in on your budget officially once a month to just check in on things I don't think you need to check it each and every single week because every week money is different but on a monthly basis I think you should sit down with your budget tweak it a little bit and move forward and that's kind of what and i i feel like i'm an ad right now and i don't mean to be but i think that's what's so good about the the budget and cash flow masterclass because it's actually all automated so if one

of your expenses changes you just go in and change it and the whole cash flow system updates because i've automated it which is kind of fun yeah so i think less work which is what we're all about yeah i think once you get that set up and i think when you were saying you've started to set up different bank accounts to allocate i feel like you're already positioned to you know you've got your head in the game for that so you're feeling pretty confident once you get that set up oh definitely i hope so and obviously you know with the master class i'm hoping that we can all get sorted and i can get more money behind me oh random ryan and this has absolutely nothing to do with the money diary but i have been asked so many times for this and i haven't been able

to produce it yet because it's far more complicated than i thought it was going to be because as you know i'm a bit of an excel nerd i would say nerd wizard maybe but i built this very very complicated excel you guys it's easy for you it's just the background transferring that to google sheets has been a nightmare but i have successfully done it and it is now up and running yeah so is that people requesting google sheets yeah because not everybody has excel and i didn't realize that not everybody had excel because i'm a potato and now we have google sheets and it is universal what a dream well that is a dream and for an excel nerd like yourself i'm proud of you Thank you.

And I know you're proud of yourself because I can see you grinning. Ask Jess. Ask Jess. She'll chime in on this later. We're going to talk about this on Friday Drinks. Sorry to keep calling you lifestyle creeper. It sounds weird and very impersonal. But I'm curious why you moved from Rays to Spaceship

because I think they don't all get approved, but I reckon someone probably puts in the Facebook group, which one do I go? Like it's an ongoing conversation. A lot of people are making that choice now. I'm interested to know why. Yeah, so there's lots of pros and cons and some is better for some and not for others.

So, I'm just curious your personal thoughts on why you switched across because I'm with both, I think. Yes, I am. Yeah, I think because I have been reading a lot up onto it more and I didn't realize, silly me, didn't check before, but I did realize obviously with the amount that I was putting in versus the fees that they were charging, it just didn't make sense to keep it there

because I didn't have a very big account. So, I think going to Spaceship because they don't charge fees under $5,000. like if you have that in your account which is why i transferred to spaceship instead just for the time being while i learned yeah fair and i think raise recently have upped their fees which is that email came out last week because yeah i'm a user so i got that email and i was like interesting and i actually thought i wonder if anyone else inches and the money's got this email and literally as i was thinking that it pops up in the group and goes hey did anyone else see this everybody saw it yeah absolutely it's actually really interesting because as much as we compare

them all the time and this is absolutely not sponsored it's just my honest opinion and views on this but raise and spaceship are two very different products and they look very similar because they're both investing platforms but raise is more about having etfs and they're kind of run in a fund where raise has picked those and then picks it in relation to your risk profile but then spaceship actually has its own fund which is kind of cool and you put your money directly into their fund which is why they're able to not have as higher fees and usually take a little bit more risk but they don't take into consideration your risk profile now normally we'd say check the pds and it's obviously the case still but obviously check the pds go and check the graphic on our

instagram because as weird as that is for financial advice we actually have a really great thing that kind of says here's the pros and cons of both for people are saying what is the difference what's the deal it's a really great place to start and i'm like why don't you just go on instagram but don't go on instagram for your financial advice because that's terrible but you know I actually wanted to ask about goals really quickly because you said that you make large goals and you always make budgets can you tell us a little bit about how you're creating these budgets and maybe why they're not working for you at the moment because I think so many people are listening to this and they're like I really need a budget but like why haven't yours worked for you yet

I think I'm being too strict with myself um I want to have these big goals and I really want to achieve things. And I think in such a short timeframe and I'm just not able to stick to it with like the lifestyle that I want to live. So I think I just need to be more realistic with my goals and not cut myself short because it looks great on paper, but in real life, it's just not, yeah, not ideal. I once did a big workout plan on paper. Like I even spreadsheeted it out. I'm going to work out three days a week. This is how many calories I'm going to eat. And it just didn't work. Surprisingly, you can have all the plans in the world. I was just about to say, I've thought oh, I'm going to lose 10 kilos, where the goal should be I'm going to eat well tomorrow.

And then if you set the goals really small, and I actually saw this video the other day. It was a bit self-helping and whatever, but it said, are you setting the bar low enough? Because when you set the bar high, you just fail and you go, oh, this is not worth it. But if the bar is low enough, i.e. me just not eating takeaway tomorrow. I like that. We can replace the she's on the money slogan instead of millennials who want financial freedom. And we'll be like, millennials who set their bars really low. But our money diarist, does that resonate with you in terms of

if you just had really little achievable goals? And, I mean, I'd hate to say from... I'm not going to say it. I'd hate to say... What would you hate to say, Ryan? But does that sort of make sense in this context? We're going to have to start paying royalties on that. No, it's below less than 30 seconds.

I looked it up. But money diarist, does that feel right for you if you made smaller goals that were achievable and you could like, yes, I'm doing it. Is that probably a better idea than trying to save for a house, you know, and that's the only goal in mind? Yeah, most definitely. I think just, yeah, just chipping at it very slowly

while still being able to live the life that I want to, then yeah. I actually want to talk about that really quickly because you said breaking stuff down and having small goals. But I want to really point out that it's not about just having small goals. It's about having that big goal and then breaking it down into smaller goals and making sure that that works for you.

So say you wanted to save $10,000 in one year towards your goal and you said, all right, well, what's that per month? That's $833 a month. And if you can't afford that, I think that then you have to reassess that big goal because you're shooting yourself in the foot if you can't actually afford that. If you don't get paid on a monthly basis and you're saving on a weekly basis, if we look at that $10,000 divided amongst the weeks in the year, so 52, it's about $200 a week or $192 a week to save $10,000.

So if you break it down and then those little goals feel too big still, I think that's when you have to really reassess again because if the little things feel too big, then the big thing was definitely too big. We often get messages in the group that are like, I'm able to save $500 a month and I want to have $60,000 by the end of the year. And we're always a bit like, oh, maybe.

Cat maths doesn't check out, my friend. Yeah, so if you, like Vee said, break it down into small little bits. Yeah, I don't want to be rude, but that doesn't equal that. But I feel money direst that even just looking for a finance podcast, reaching out to us, really having a good intention and a big goal, I feel like you're ready to really get this into action and put yourself in a really good spot. I'm feeling confident for you.

Thank you. No, I definitely want to. So fingers crossed and, yeah. I'm excited for you and it's very generous of you to share your story with us as well we're really really grateful for it so thank you so so much for joining us today no worries thank you guys so much so that is the money diary for today but just before we head off we'd like to acknowledge and pay respect to Australia's Aboriginal and Torres Strait Islander peoples the traditional custodians of the lands the waterways and the skies all across Australia we thank you for

sharing and caring for the land on which we are able to learn we pay our respects to elders past and present and we share our friendship and our kindness now dr king usually does a better job than me at this but 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 a financial decision and we promise i am an Authorised Representative of Australia Pacific Funds Management Proprietary Limited, ABN 34132463257, AFSL 339151. And as always, thank you so much to our angel producers for putting this all together. Thank you.