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Speaker 1: Good morning, everyone, and welcome back to another episode of

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Speaker 1: Sugar Mamma's Fireplay. I am so excited this morning to

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Speaker 1: introduce our mini series which you may have listened to before.

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Speaker 1: It's called Start Here. It's a series that's all about you,

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Speaker 1: your financial questions, your financial challenges, and your financial goals.

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Speaker 1: It is a place where you can actually write to

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Speaker 1: me and get honest, practical general advice to help you

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Speaker 1: take the first and most important steps towards building financial

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Speaker 1: clarity and confidence in your life. So here's how it works.

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Speaker 1: I will read your dms on Instagram and share general

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Speaker 1: advice that I believe could benefit anyone in a similar situation.

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Speaker 1: But please remember this is not personal financial advice, product advice,

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Speaker 1: investment advice, or strategic advice. It's meant to inspire, empower

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Speaker 1: and educate you so that you can think critically and

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Speaker 1: take important action today. So for specific guidance, of course,

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Speaker 1: I recommend you always work with a licensed financial planner,

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Speaker 1: but Start here is a great place to help get

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Speaker 1: you going. And I'm going to be responding to an

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Speaker 1: email from Katherine, a single mom navigating a very relatable

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Speaker 1: situation managing her own financial priorities while making some decisions,

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Speaker 1: let's just say, really important decisions about her family's living arrangement.

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Speaker 1: So let's dive into her story after reminding you, of course,

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Speaker 1: that this is general in nature, of course. So here's

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Speaker 1: the message I received on Instagram from Catherine. Hi, Canna,

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Speaker 1: I need your help. I am a forty five year

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Speaker 1: old single mum. I've been single for seven years now.

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Speaker 1: I bought a townhouse post divorce, but my kids are

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Speaker 1: much bigger and the world has changed a lot. I'm

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Speaker 1: a solo mum as their dad is deceased. I got

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Speaker 1: lumps on payout from their dad, my ex husband's super

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Speaker 1: fun and to help them cover their health and educational expenses.

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Speaker 1: My dilemma is that the townhouse we're living in is

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Speaker 1: getting too small for a sixteen year old and eleven

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Speaker 1: year old, and I can't imagine how it will be

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Speaker 1: when they are twenty five and still living at home.

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Speaker 1: It's inner city Brisbane, and I have an appraisal for

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Speaker 1: around about nine hundred thousand dollars. Their dad's estate will

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Speaker 1: provide them enough for the two of them to buy

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Speaker 1: their own place jointly at age twenty five. She goes

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Speaker 1: on to say it earns around three thousand dollars per

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Speaker 1: month from a property trust in it's a commercial property trust,

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Speaker 1: So I'm going to assume that the kids have actually

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Speaker 1: inherited a commercial property that is being rented out and

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Speaker 1: of course cash flow positive. Now she has mentioned that

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Speaker 1: the trust is not under her control, Catherine goes on

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Speaker 1: to say, I have seven hundred and eighty thousand dollars

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Speaker 1: in home equity and two hundred and forty three thousand

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Speaker 1: dollars in SUPER. My dilemma is I think I need

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Speaker 1: to move out of this home to buy something further

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Speaker 1: to provide a bigger home. I'm thinking of taking a

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Speaker 1: loan of three hundred and fifty thousand dollars. I earn

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Speaker 1: one hundred and fifty eight thousand dollars plus SUPER and

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Speaker 1: have no other debt in my life. Is this a

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Speaker 1: crazy idea? Financially? The change over costs are going to

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Speaker 1: be at least fifty thousand dollars. In all honesty, I

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Speaker 1: probably thought I may have recouped by now, but the

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Speaker 1: magic just hasn't happened. Everyone else is talking about paying

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Speaker 1: off their home loans, but I feel like I'm strolling

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Speaker 1: To provide the basics moreover loading up on more debt,

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Speaker 1: not less. I'm insured to the eyeballs for my life,

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Speaker 1: income protection and disability, so no issues there. But the

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Speaker 1: insurance is one of the reasons why my superbalance is

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Speaker 1: so low compared to my peers. Also, there's a lot

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Speaker 1: of financial education, but it seems only for couples on

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Speaker 1: two incomes. What should a solo parent do, especially with

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Speaker 1: older kids. Is forty five too old to be putting

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Speaker 1: more money into the principal place of residence? Is this

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Speaker 1: the brutal truth that I need to accept? This is

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Speaker 1: the message my family are expressing, but I don't consider

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Speaker 1: them to be financially savvy. Love your podcast and Insta's

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Speaker 1: really helped me at various points. I wasn't salary of

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Speaker 1: sacrificing until you. I now am, and it will help

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Speaker 1: me immensely for years to come. Kind regards to Catherine. Hi,

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Speaker 1: Catherine all right, First of all, thank you so much

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Speaker 1: for writing to me and your kindened words about my

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Speaker 1: podcast and Instagram. To have to say, I also truly

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Speaker 1: admire your determination to create the best possible future for

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Speaker 1: yourself and your two young boys. I can sense how

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Speaker 1: much though you've already put into your financial goals to

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Speaker 1: get ahead and have a sense of financial stability in

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Speaker 1: your life, and today's episode, I really want to help

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Speaker 1: you clarify your next steps now. As I read your email,

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Speaker 1: I noticed you've actually probably already answered some of your

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Speaker 1: own questions in many different ways. You know, mentioning your

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Speaker 1: concerns and worries about superinnuation, taking on more debt, and

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Speaker 1: the long term impact of your decisions are all very

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Speaker 1: valid and insightful. So let's break it down together with

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Speaker 1: everyone listening along with us. So what would I recommend

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Speaker 1: right now? So, okay, take a deep breath. You've got

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Speaker 1: to sit down and spend some time about what is

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Speaker 1: actually most important to you. The first step is to

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Speaker 1: think deeply about what brings you happiness, stability, and freedom.

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Speaker 1: Is it really a larger home for your family right now?

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Speaker 1: Or is it long term financial security and peace of mind?

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Speaker 1: You know, getting really clear on your values will help

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Speaker 1: take the weight off your shoulders and help you figure

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Speaker 1: out the trade offs. What is worth doing what is

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Speaker 1: definitely not worth doing. So invest time thinking and thinking

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Speaker 1: in solitude about what is really important to you and

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Speaker 1: what makes you feel happy. Number two, considering the long

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Speaker 1: term big picture here, Whilst it feels like your kids

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Speaker 1: are outgrowing your townhouse, you've got to remember that they

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Speaker 1: will not live with you forever. At age sixteen and eleven,

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Speaker 1: they're at an age where independence is just around the corner.

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Speaker 1: They're not going to be maybe necessarily want to be

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Speaker 1: hanging out with you all the time, but they want

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Speaker 1: going to be wanting to go out with their peers

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Speaker 1: and hang out maybe at the shopping centers or their

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Speaker 1: ice rinks, or the skateboard parks, or the movies or

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Speaker 1: whatever like beaches, whatever it may be that your kids

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Speaker 1: are really into. They don't tend to hang out at

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Speaker 1: home with you. They go and explore, have adventures in

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Speaker 1: the areas around your community, and in a few years

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Speaker 1: they will quite positively want to move out. So you

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Speaker 1: may find yourself needing to downsize then again, which potentially

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Speaker 1: is going to incur significant expenses like stamp duty that

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Speaker 1: we all know about and hate twice, So it's not

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Speaker 1: really fifty thousand, it's potentially one hundred thousand. Number three

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Speaker 1: is to think about increased living expenses, that is, living costs. Now,

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Speaker 1: a larger house typically means higher utility. We're using more energy,

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Speaker 1: we're using more gas, more lights are on, and of

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Speaker 1: course then there's those maintenance costs, and more time spent

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Speaker 1: cleaning and caring for that property, thinking about gardening, thinking

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Speaker 1: about cleaning roofs and gutters, maybe even a swimming pool.

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Speaker 1: It needs so much more of your valuable time and

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Speaker 1: of course money. Will these additional expenses and responsibilities fit

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Speaker 1: into your budget, particularly if it's already tied right now,

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Speaker 1: or is it actually going to enhance your family's quality

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Speaker 1: of life or could they actually create additional stress? And

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Speaker 1: I'm going to share something with you that's very very personal.

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Speaker 1: Growing up as a child, one of the houses we

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Speaker 1: lived in, actually a couple of the houses we lived in,

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Speaker 1: had these big gardens and swimming pools, and my childhood

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Speaker 1: memories are of my father, in particular, spending the weekends

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Speaker 1: tirelessly sweating in the sun, weeding the gardens, watering the gardens,

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Speaker 1: cleaning the pool, cleaning the filters. When I look back,

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Speaker 1: I can't help but feel a little bit sad because

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Speaker 1: that could have been time spending quality time as a family,

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Speaker 1: not having to maintain these big assets. And often I

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Speaker 1: catch myself looking at my children thinking, you know, as

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Speaker 1: I'm ferociously trying to tidy the house and clean the house. Actually,

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Speaker 1: is this a great use of my time? Is this

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Speaker 1: right for my children particulate it at such a young

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Speaker 1: age in their lives. So think about the increased costs

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Speaker 1: that come from it with a bigger home. And it's

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Speaker 1: not just a financial thing, but an energetic thing as

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Speaker 1: well that actually may stop you dead in your tracks.

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Speaker 1: And I have to say, I can't remember the name

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Speaker 1: of this documentary, but it was one by one of

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Speaker 1: the Daddo brothers, and they did a documentary where they

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Speaker 1: literally took a family that was living in a big

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Speaker 1: home and they cut off half the home. That is,

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Speaker 1: they put these barricades where the family could no longer

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Speaker 1: go into certain areas of the home and they were

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Speaker 1: literally forced into living in a smaller space. Now, this experiment,

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Speaker 1: which was filmed, made the family realize how much time

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Speaker 1: they were putting in the maintenance of the home, doing

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Speaker 1: the laundry, cleaning the gardens, the swimming pool, you know,

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Speaker 1: all the tiding and organization. And they realize actually that

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Speaker 1: having a bigger home wasn't worth it, and that by

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Speaker 1: sectioning off the house it made them well it allowed

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Speaker 1: them to free up their time so they could spend

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Speaker 1: time together as a family. It was a huge awakening.

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Speaker 1: If anyone's seen this documentary, can you please send me

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Speaker 1: a DM and let me know what it's called so

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Speaker 1: I can share the DEAs with everyone else. Another brilliant

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Speaker 1: documentary to watch as well, if this sounds of interest

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Speaker 1: to you is obviously The Minimalists, where they talk about

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Speaker 1: this in more detail, and they talk about obviously the

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Speaker 1: consumerism that also comes with having a bigger home. You

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Speaker 1: need to buy more beds, you need to buy more furniture,

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Speaker 1: you want to redesign your whole entire space. Again, so

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Speaker 1: it's not just the stamp duty and legals we're talking

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Speaker 1: about here. It's actually so many more hidden and upcoming

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Speaker 1: expenses that come from this big shift, all for space

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Speaker 1: that we probably don't use. And again, if I think

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Speaker 1: about myself in this, and I share this to help

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Speaker 1: you work out the right decision for you, We moved

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Speaker 1: to a bigger home about two and a half years ago,

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Speaker 1: and my kids are still sleeping in our beds and

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Speaker 1: we use half the space of the home. So I

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Speaker 1: don't actually prescribe to the need of having necessarily a

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Speaker 1: bigger home. All right, that enough about me back to you, Catherine.

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Speaker 1: All right. Number four, it's the obvious one, and that

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Speaker 1: is the risk of taking on a new mortgage at

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Speaker 1: age forty five. Taking on a new mortgage of three

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Speaker 1: hundred and fifty thousand dollars with a thirty year term,

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Speaker 1: because that's what most banks will just automatically put you on,

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Speaker 1: means that you could still have a mortgage in your seventies.

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Speaker 1: Now this could limit your ability to save for retirement,

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Speaker 1: but also to actually be investing, that is, building other

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Speaker 1: forms and sources of passive income, and of course your

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Speaker 1: ability to actually contribute maybe more to your superannuation. I

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Speaker 1: know you've mentioned salary sacrificing, but you you may have

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Speaker 1: to potentially put that on hold or reduce that if

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Speaker 1: you take on a new mortgage. So it is definitely

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Speaker 1: worth asking yourself if this added financial strain actually aligns

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Speaker 1: with your long term financial goals again, which is why

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Speaker 1: you invest time thinking about what's important to you. Number five,

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Speaker 1: all right, families thrive on connection, not square footage. It's

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Speaker 1: as I mentioned, it's so easy to think more space

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Speaker 1: equals a better home life, but families are built on love,

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Speaker 1: They're built on connection, they're built on presence. A smaller

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Speaker 1: space can be just as wonderful, especially if it allows

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Speaker 1: you to focus on those important you know, the important

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Speaker 1: quality time together rather than worrying about the finances. You know,

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Speaker 1: sitting there with your children, maybe at dinner, but not

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Speaker 1: she not being completely present, daydreaming or actually ruminating about

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Speaker 1: the stress and pressure of the new mortgage and how

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Speaker 1: you're going to actually pay this off, and how you're

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Speaker 1: going to be able to retire and retire comfortably and

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Speaker 1: of course with longevity and financial independence. If this is

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Speaker 1: going to be a distraction, a stress, a weight, a

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Speaker 1: burden in your life, it is time to maybe think

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Speaker 1: about parking this and work with what you've already got,

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Speaker 1: which sounds like a pretty healthy financial situation to me,

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Speaker 1: to be honest. Number six reviewing your insurance cover. All right,

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Speaker 1: so you have mentioned in your DM to me that

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Speaker 1: you're super is lower than your peers because of your

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Speaker 1: insurance premiums. All right, quickly, before I launch into this,

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Speaker 1: please never compare yourself to your peers. Only ever compare

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Speaker 1: yourself against what you need and what you want, Because

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Speaker 1: if you compare yourself against your peers. Your results are

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Speaker 1: only going to be subject to how successful they are,

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Speaker 1: and you don't actually really know about the full picture

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Speaker 1: of your peers financial situation. So please don't ever, and

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Speaker 1: not just Captain but everyone listening. Stop comparing yourself against others.

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Speaker 1: It is fraught with danger and also really toxic to

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Speaker 1: your own mental health. Instead, think about what you need

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Speaker 1: and what you want and build up an asset base,

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Speaker 1: whether it be investing or super to match that. But

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Speaker 1: coming back to the insurance premiums, Okay, this is a

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Speaker 1: very common challenge. It's a bit of a catch twenty two.

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Speaker 1: You need the insurances, but it's also holding you back

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Speaker 1: in that you need the insurances to help create that

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Speaker 1: financial stability think go wrong, but at the same time

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Speaker 1: it's obviously eroding your wealth. Then insurance premiums have gone

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Speaker 1: up significantly over the last couple of years. But think

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Speaker 1: of it this way. If you didn't necessarily upgrade the home,

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Speaker 1: you could potentially explore over the long run and very

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Speaker 1: very carefully, obviously with financial advice, potentially adjust your cover levels. So,

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Speaker 1: for example, you said you are insured to your eyeballs

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Speaker 1: if your mortgage came down and was paid off, or

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Speaker 1: if you were to build up enough emergency money or

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Speaker 1: have more than enough in superinnuation to know that you

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Speaker 1: can afford to retire and retire on the deadline and

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Speaker 1: on the life style that you want. You may not

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Speaker 1: necessarily need as much life insurance or as much TPD.

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Speaker 1: That may be then the opportunity to be able to

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Speaker 1: reduce that cover, which may in turn reduce the premiums

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Speaker 1: that there less of a burden or financial impact on

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Speaker 1: your superannuation. These are just some of the benefits that

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Speaker 1: come from improving your financial situation in that you can

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Speaker 1: slowly carefully lean out of your need or reliance on

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Speaker 1: personal insurance, which then of course saves you more money,

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Speaker 1: which means more money freed up for other things, perhaps

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Speaker 1: holidays or perhaps investing in your superinnuation. Again, because you

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Speaker 1: have mentioned that you're worried is quite low, so review

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Speaker 1: that insurance cover. If you do decide to stay, get

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Speaker 1: advice as to how much you really need, and as

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Speaker 1: your financial situation improves, see whether you can possibly look

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Speaker 1: at changing some of the terms and conditions such as

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Speaker 1: waiting periods or benefit periods, so that it doesn't necessarily

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Speaker 1: cost you as much. Because you don't have as much

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Speaker 1: as many financial risks in your life. And finally, number seven,

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Speaker 1: set some clear financial goals. Please take time to write

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Speaker 1: down those financial goals. Don't just come up with them

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Speaker 1: in your head and think, yeah, that's a good goal.

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Speaker 1: It doesn't just stop at that. You've got to write

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Speaker 1: them down, and might I add you've got to read

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Speaker 1: them every single day, if not twice a day. So

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Speaker 1: questions you need to be asking yourself, and these are

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Speaker 1: the answers you need to be writing down, is when

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Speaker 1: do you want to retire? On how much money per

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Speaker 1: annam do you want to retire? And think about what

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Speaker 1: your desired lifestyle really is. Is it eighty thousand dollars

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Speaker 1: a year or is it one hundred and twenty thousand

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Speaker 1: dollars a year? What would you like to support your

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Speaker 1: children with their education or perhaps maybe their first home.

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Speaker 1: I know you've mentioned that your ex husband's estate will

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Speaker 1: help provide for their education, but what is that exactly?

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Speaker 1: Maybe it's tertiary, but what is that beyond that? Maybe

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Speaker 1: your children want to do a master's think about those

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Speaker 1: additional things, or perhaps you'd like to actually help them

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Speaker 1: buy their own first home so they can keep that

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Speaker 1: commercial property that's currently held in trust for them. Maybe

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Speaker 1: you want to be able to give them something. It's

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Speaker 1: not just your ex partner who's obviously now deceased. Think

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Speaker 1: about what's important to you, but think about the financial

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Speaker 1: goals that you would like to achieve and that you

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Speaker 1: would be really excited about working on and actually seeing

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Speaker 1: birth and grow in your life. And also, to be

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Speaker 1: fair of both sides of the situation or the dilemma

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Speaker 1: that you're juggling up right now, consider how taking on

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Speaker 1: a larger mortgage might actually impact these goals and whether

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Speaker 1: it's a sacrifice that you're actually comfortable making. You may

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Speaker 1: sit down and do this process and go, you know what, Actually,

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Speaker 1: I still really want to buy a bigger home. I

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Speaker 1: want more space. I'm happy to have a garden that

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Speaker 1: may require more maintenance, or have bigger electricity and gas

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Speaker 1: bills and larger home and contents insurance policies. If that's

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Speaker 1: the case, that's fine, But at least you've looked at

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Speaker 1: this with eyes wide open. Those rose tinted glasses were

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Speaker 1: taken off, and you've looked at this with a calm, rational,

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Speaker 1: practical mindset, and you run the numbers and most importantly,

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Speaker 1: it actually aligns to your values here as well of

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Speaker 1: course as your financial goals. So in conclusion for today's episode,

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Speaker 1: so Catherine, your situation is actually not uncommon and I

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Speaker 1: can hear how much you want to make the right

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Speaker 1: decision for your family. So my advice is to take

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Speaker 1: a big step back, take a deep breath, define your

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Speaker 1: long term priorities. Don't just think about the short term

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Speaker 1: issues or obstacles right now, because they are not always

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Speaker 1: going to be the case or the situation. They will

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Speaker 1: evolve and change. And please remember that every financial choice

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Speaker 1: has a ripple effect. You've already made some great financial

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Speaker 1: decisions and made some great strides like Starry sacrificing, So

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Speaker 1: trust yourself, have faith in yourself to make thoughtful decisions

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Speaker 1: here for both you and for your boys. In listening

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Speaker 1: to today's episode, I truly hope that hearing my perspective

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Speaker 1: has helped give you some clarity and to keep focusing

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Speaker 1: on what really matters to you. And of course it

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Speaker 1: goes without saying if you are at all hesitant, you

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Speaker 1: must go and see a financial planner and ask them

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Speaker 1: for advice, particularly around your superannuation and an investment portfolio

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Speaker 1: if that's something that is on your list of doing again.

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Speaker 1: Thank you everyone today for listening to this episode and

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Speaker 1: being a part of the Sugar Mama Fireplay community. I

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Speaker 1: really hope that you have enjoyed listening to this Start

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Speaker 1: Here miniseries. If anyone has any questions or stories that

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Speaker 1: they would like to share with me, please make sure

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Speaker 1: you send me a DM on Instagram because under the

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Speaker 1: banner of general advice, I would absolutely love to help

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Speaker 1: you get started and sailing off to success where you

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Speaker 1: can enjoy all the fruits of your hard work decisions

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Speaker 1: and you found financial literacy. Thank you everyone for listening

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Speaker 1: to Sugar Mamma's Fireplane. This is a Start Here miniseries.

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Speaker 1: Chopin nowh