Speaker 1: Just before we get started, we'd like to acknowledge and
Speaker 1: pay respect to Australia's Aboriginal and torrest Rate islander people's.
Speaker 1: They're the traditional custodians of the lands, the waterways and
Speaker 1: the skies all across Australia. We thank you for sharing
Speaker 1: and for caring for the land on which we are
Speaker 1: able to learn. We pay respects to elders past and present,
Speaker 1: and we share our friendship and our kindness.
Speaker 2: She's on the Money, She's on the Money.
Speaker 1: Hello, and welcome to She's on the Money, the podcast
Speaker 1: Millennials who Want Financial Freedom. Today is Friday, my Friends,
Speaker 1: which means it is time to sit back with the girls,
Speaker 1: namely my girls, Jess and George, and we're going to
Speaker 1: sit back with a bev in hand, to unpack our
Speaker 1: favorite moments of the week and of course to celebrate
Speaker 1: you how incredible She's on the Money community. As always,
Speaker 1: we're going to be sharing our favorite money wins. We're
Speaker 1: going to be discussing what's making news in the finance
Speaker 1: world cough scimo cough, and we'll be helping to answer
Speaker 1: a very juicy money question, which this week is all
Speaker 1: about salary sacrificing But first things first, guys, it is time,
Speaker 1: as always to recap the week that was Mistiss GURRICHI
Speaker 1: can you please tell us what happened on our money
Speaker 1: Diary Monday?
Speaker 3: I sure can. This week's diarist was living the dream.
Speaker 3: She was working in an incredible role in a nonprofit
Speaker 3: making change, which is so incredible. She was really really
Speaker 3: passionate about the space, and particularly about getting women a
Speaker 3: seat at the table, getting voices of diverse people heard,
Speaker 3: which we need to see more of it. We talk
Speaker 3: about it all the time, so it was really incredible
Speaker 3: to hear her say that. But she actually realized that
Speaker 3: after a few years there, she wasn't feeling fulfilled anymore,
Speaker 3: and she had a few other things that she wanted
Speaker 3: to do, and she took a lee of absence, which
Speaker 3: she's currently still actually on, and we chatted a bit
Speaker 3: about what her plan looks like and what she'll be
Speaker 3: doing going forward. So at the moment she's just taking
Speaker 3: some time with her family, which I think is really special.
Speaker 3: But we delved really deeply into the nonprofit space and
Speaker 3: what it's like to be on a board as a woman,
Speaker 3: and why you should want to be on a board
Speaker 3: as a woman. Because I think for a lot of us,
Speaker 3: a board is a bit of.
Speaker 1: A like bougie. It's like so out of reach.
Speaker 3: Yeah, it's a concept that, to be honest, I've never
Speaker 3: really thought about. Like it's like I know that they exist,
Speaker 3: didn't know what they did really though, So true.
Speaker 1: And it's it's funny because I'm on a board and
Speaker 1: you work with me, but you wouldn't see any of
Speaker 1: that work I do because I don't do it during
Speaker 1: business hours, so you'd be like, oh, yeah, she's at
Speaker 1: a board meeting, like you have any idea what I do.
Speaker 1: And I find that quite funny because I'd never, i guess,
Speaker 1: thought about the fact that nobody really knows what I
Speaker 1: do in that space or how that works. But I
Speaker 1: also found it really cool because she is a friend
Speaker 1: of ours from across the ditch. She lives in New Zealand,
Speaker 1: and in New Zealand they have been far better at
Speaker 1: embracing diversity than we are here in Australia. They have
Speaker 1: embraced so many beautiful malady people to come into Parliament
Speaker 1: as well, which I absolutely adore, and I think that, yeah,
Speaker 1: we've got a lot to learn from them. And she
Speaker 1: was so special But the other thing we touched on
Speaker 1: in that episode, which I thought was really cool. Nothing
Speaker 1: to do with boards. I'm sorry that could be a
Speaker 1: little bit dry, but it was actually income guilt. So
Speaker 1: she felt really guilty about how much money she was earning.
Speaker 1: Because she was quite senior, she did have quite a
Speaker 1: significant income, but she was still like, I'm an exec
Speaker 1: and I feel really guilty. Obviously working in a non
Speaker 1: for profit sector. She felt like that was you know,
Speaker 1: a lot of money that could be allocated, and I
Speaker 1: was like, yes, but like, you're working really hard and
Speaker 1: you're worth every cent, and I just think that no
Speaker 1: one should have guilt over what they're earning because you're
Speaker 1: literally earning.
Speaker 4: It.
Speaker 3: Correct very interesting, very interesting episode indeed, so highly recommend
Speaker 3: giving that one to listen.
Speaker 1: Skip on over to our Wednesday episode, Missus Georgia king a, hoy, hoy,
Speaker 1: how are you? My Lafe's are we? And happy? Is
Speaker 1: it because you saw Jess?
Speaker 4: Yeah?
Speaker 5: Well could have been that to be with my girls
Speaker 5: in the studio.
Speaker 1: What happened on our Wednesday episode.
Speaker 5: My last on Wednesday this week, girls, we discussed weddings.
Speaker 1: Sad which it was.
Speaker 5: It was a good time because one of the three
Speaker 5: of us sitting at this table, is in fact planning
Speaker 5: her own weddings.
Speaker 1: Why didn't you tell usring on my hand?
Speaker 5: But it was super interesting, of course, picking the brains
Speaker 5: of Victoria divine, part bride to be part financial advisor.
Speaker 1: It's the purpose, It's really not. It's really not.
Speaker 5: You had lots of tips.
Speaker 1: I tried to give lots of tips. It's interesting because
Speaker 1: after that episode, I had a few chats. I have
Speaker 1: a girlfriend who's also a financial advisor, and she planned
Speaker 1: her wedding to a t like absolute budget queen, like
Speaker 1: you can learn a lot off this woman. Facts On
Speaker 1: the podcast Rebecca Pritchard, we talked about baby stuff. Yeah,
Speaker 1: she's gorgeous. Anyway, she planned it to an absolute chage
Speaker 1: and I feel like I'm trying really hard to do that.
Speaker 1: I promise I would like to call myself the Queen
Speaker 1: of spreadsheets. But just because you have a spreadsheet and
Speaker 1: just because you're tracking, it doesn't mean you're not naughty
Speaker 1: and you're not overspendy. And I feel like recently I've
Speaker 1: just been like, yeah, but I really I really want
Speaker 1: the cute matching pajamas and I didn't realize how expensive
Speaker 1: they were, and I want like all these other things
Speaker 1: that I'm like, all right, actually I need to take
Speaker 1: a step back and reevaluate my budget because I had
Speaker 1: just assumed, like, this is so dumb because Peter Alexander pajamas.
Speaker 1: Obviously not everyone in my bridal party is getting Peter
Speaker 1: Alexander pajamas. Sorry, not sorry, but I just assumed that
Speaker 1: they were, like, you know, forty or fifty bucks just
Speaker 1: to get like some Plaine matching. No, everything's just blowing
Speaker 1: out of proportion. Guys. I am a wreck and I
Speaker 1: need help.
Speaker 3: Lots of people have been asking for the wedding contents,
Speaker 3: so I hope they were some happy people.
Speaker 1: Maybe a lot to come. Amah, there's so much more
Speaker 1: to come because I feel like I'm also learning a
Speaker 1: lot on this journey as well about values and priorities.
Speaker 1: And it's one of those things that you know, when
Speaker 1: you're buying a house, for example, with a partner, it's
Speaker 1: do we buy this house yes or no? Whereas with
Speaker 1: the wedding, there are so many different moving parts that
Speaker 1: we have to allocate different budgets towards, and Steve likes
Speaker 1: some things that I don't like. And Steve's priorities are
Speaker 1: quite different to mine. Like I think we've mentioned it before.
Speaker 1: He's a bit more of a party boy, whereas I'm
Speaker 1: kind of like, oh, I really want good wine and
Speaker 1: he's like, oh, I kind of don't mind. I love
Speaker 1: a good wine, but like I'm going to be drinking
Speaker 1: heaps of it, So well, oh that's not me at all.
Speaker 1: So there's just this consistent conversation of either compromise or not.
Speaker 1: And it's a lot harder than I thought it would be.
Speaker 1: Because as much as you know, we're very grateful to
Speaker 1: be going through this process with you know, easier budget,
Speaker 1: I would say, it doesn't mean that it's not hard
Speaker 1: to still pick and choose and oh my god, Florist's
Speaker 1: let's not even start on that too much to think
Speaker 1: about it too much, too hard, way too hard. You
Speaker 1: know what's not hardeg way of breaking the sheese on
Speaker 1: the money community. Who's with me? Girlies?
Speaker 2: Ah?
Speaker 3: We are? I think you know what's not hard? Was
Speaker 3: going to go into my direction, but it didn't.
Speaker 1: So let's get into out this week budget direct money
Speaker 1: wins guys.
Speaker 5: Let's do it very exciting. So the first win this week, ladies,
Speaker 5: comes from Erin it's quite exciting. I have been offered
Speaker 5: a promotion after getting a new job just eight months ago.
Speaker 5: Between my new job and this promotion, I will have
Speaker 5: almost doubled my income in less than you are amazing.
Speaker 5: The next win comes from Indiana Money Win. I normally
Speaker 5: spend seven dollars a day on coffee, five days a week.
Speaker 1: That adds up.
Speaker 5: So I trotted down to Coohl's and they had the
Speaker 5: Nest Cafe packets of twenty six sachets for eleven dollars.
Speaker 5: So now I make one every day before going to work.
Speaker 1: That's a hot saving of eighteen hundred and twenty dollars
Speaker 1: a year from scouts. I also rate those Nest Cafe
Speaker 1: you know what, They're not that bad and they're not
Speaker 1: that bad. I feel like instant coffee gets a really
Speaker 1: bad rap. But I have a secret addiction. It's not
Speaker 1: so secret now to a million people, but a secret
Speaker 1: addiction to the ConA caramel one. You probably had it
Speaker 1: at my house, because if you come to my house,
Speaker 1: I'll be like, you're on a coffee We do have
Speaker 1: a coffee machine, or offer you that. But I'll also
Speaker 1: be like, do you want to macona? Though you want
Speaker 1: you want the good stuff. It's in the coverage. I
Speaker 1: love that.
Speaker 5: I'm gonna chop that and buy some later. The next
Speaker 5: one here, ladies, comes from may Read. There is a
Speaker 5: lot going on, so keep up. I'm apologies in advance.
Speaker 1: We are strapped in. I paid off the.
Speaker 5: Remainder of what I owed to my mum. I'm broke now,
Speaker 5: but at least that's finally done. That's point one, done
Speaker 5: and dusted. Nice so impulsively bought a Dyson air rap
Speaker 5: on Zippay. I know, I know, dot dot dot sigh,
Speaker 5: but you guys can relate to that.
Speaker 1: I know that the air rap is epic. I mean
Speaker 1: the way you've acquired it, let's be honest, but you're
Speaker 1: quite clearly very aware of it.
Speaker 5: Yes, She then packed it up and posted it back
Speaker 5: to Dyson for a refund.
Speaker 1: I just said how good it was. I hope that
Speaker 1: that doesn't trigger any regrets.
Speaker 5: Maybe she can say for it and then by it
Speaker 5: at a more sensible time in her life.
Speaker 1: I agree. In fact, that's actually a really adult decision.
Speaker 1: Exactly how many times have you I can't say I've
Speaker 1: ever bought something and then returned it because I'm like,
Speaker 1: do you know what. This wasn't in budget.
Speaker 3: I've done it once.
Speaker 1: But that's really cool, isn't it. Yeah?
Speaker 3: I think I genuinely think, you know what, And in
Speaker 3: my situation, I feel like maybe in her situation as well,
Speaker 3: it was just like and in the moment, you're like,
Speaker 3: I deserve this, I'm going to get it, treat yourself,
Speaker 3: and you know what, you do deserve it. However, I
Speaker 3: think if it arrives and you're regretting it, you're going
Speaker 3: to continue to feel that regrets. So I think it's
Speaker 3: awesome that she's gone, actually, don't love this for me,
Speaker 3: I'm going to send it back.
Speaker 1: That takes real power. That's a really good win. Yeah,
Speaker 1: love that, But it goes on girls. Oh.
Speaker 5: I then popped to my local library and picked up
Speaker 5: a copy of Victoria's book, so hopefully that will lead
Speaker 5: to more money wins.
Speaker 1: Finally, So I thought she was going to say she
Speaker 1: went into the lib and there was an air raft
Speaker 1: and I was going to go this story to well
Speaker 1: recently that my local library. I don't know, I'm not
Speaker 1: telling you which one because that would be a bit
Speaker 1: too much personal information, but they rent out cake baking trays,
Speaker 1: so really, yeah, so like, if you want to make
Speaker 1: a dinosaur cake? Oh, I have it? Yeah, Like there's
Speaker 1: tubs of.
Speaker 3: Like can they to go alongside that? They have a
Speaker 3: copy of the Women's Weekly?
Speaker 1: Could borrow it?
Speaker 3: Can we have a competition?
Speaker 1: I don't remember.
Speaker 3: I saw something on TikTok where everyone made a Women's
Speaker 3: Weekly cake?
Speaker 1: Can we have the cake off? Let us know?
Speaker 3: Would you be interested in how she's on the money?
Speaker 1: Cake off? I reckon? That would be so fun.
Speaker 5: It's not money related at all.
Speaker 1: I don't even care. Let's call mastership ask if we
Speaker 1: can borrow their kitchens. Our whole heap of novices who
Speaker 1: can't bake in to make a duck with chippy lips.
Speaker 1: I love that one? How good?
Speaker 5: The next one comes from Sophie. It's diy vibes. Yes
Speaker 5: you're listening. I was quoted eleven one thousand dollars for
Speaker 5: new flooring in my recently purchased apartment. I managed to
Speaker 5: knock off three thousand dollars by doing my own removal
Speaker 5: of the old floor and skirting boards. It was exhausting work,
Speaker 5: but at least it makes it more affordable.
Speaker 1: Incredible.
Speaker 3: I think a really good place to save if you're
Speaker 3: running v you're going through this right now, and you
Speaker 3: guys did a bit of a dareut wide job as
Speaker 3: well in your backyard.
Speaker 1: We did, We did, I mean I did have some
Speaker 1: professional help. But floorboards. When we got the quotes for
Speaker 1: the floorboards, I was shook. So I love Pinterest right,
Speaker 1: and Pinterest blows our expectations completely out. For water, you go,
Speaker 1: I want that that doesn't look too hard, very clean,
Speaker 1: easy kitchen. They're like three billion dollars. No, I don't
Speaker 1: think so.
Speaker 3: Yeah, but if you don't have the skills to put
Speaker 3: something in yourself, maybe you can take it out because
Speaker 3: argument it takes less skill to remove it and you
Speaker 3: can save yourself and get a big of aggression out.
Speaker 1: Yeah, it's really expensive, and we got a quote that
Speaker 1: was very similar in cost, and we've now decided to
Speaker 1: just polish the pre existing floors and call it today,
Speaker 1: because you have to have some level of compromising your
Speaker 1: budget when you're renovating, because otherwise it all just completely
Speaker 1: blows out. And as much as I wanted the beautiful
Speaker 1: herringbone floorboards, it just wasn't a money win day. Next time.
Speaker 5: The next week comes from Lauren. I paid off my
Speaker 5: after pay and closed the account. After listening to the
Speaker 5: podcast every morning for the last two weeks.
Speaker 1: Oh my gosh, hi again, we've seen each other every day.
Speaker 5: For the first time in a decade. I'm going to
Speaker 5: have money leftover in my next fortnight's pay now onto
Speaker 5: financial freedom.
Speaker 1: That makes me so happy.
Speaker 5: Well done, Lauren.
Speaker 1: That must be such a good feeling to be like.
Speaker 1: I've never had money left over in my payin now
Speaker 1: I do.
Speaker 5: Yeah, really special stuff. The next weeen is from Ali
Speaker 5: massive money win. I went to Spotlight to buy some
Speaker 5: jars that were on sale to deck out my pantry.
Speaker 5: I walked to the car after paying, and I thought
Speaker 5: that was a little bit more expensive than I thought
Speaker 5: it would be. Looked at my receipt and lo and behold.
Speaker 5: It turns out the discount wasn't applied. So I went
Speaker 5: back in and the lady at the counter calculated my
Speaker 5: refund incorrectly, so instead of getting fit fifteen dollars back,
Speaker 5: I got seventy dollars back total. I walked away with
Speaker 5: thirty glass jars with bamboo leads for twenty five dollars,
Speaker 5: so like cool, no.
Speaker 1: Corporation, they'll rat.
Speaker 5: Finally, the last one here is.
Speaker 1: From don't Company Swotlight. Sorry, we still want to get sponsored.
Speaker 1: Jessica is really good at do I want to do now?
Speaker 1: I would love to do a DIY series. If anyone
Speaker 1: knows anyone's get let us know. Sure, I'll refund. That's
Speaker 1: seventy bucks you guys, so that there's no qualm still,
Speaker 1: please talk to us.
Speaker 5: The last one, guys, comes from Rose. I started a
Speaker 5: new job with a twenty thousand dollar pay rise working
Speaker 5: from home part time, so no fuel costs.
Speaker 1: How cool?
Speaker 5: Rat I successfully negotiated to work four days thirty hours
Speaker 5: over three days to save money on crazy childcare costs.
Speaker 5: I would have never had the balls to negotiate my
Speaker 5: new working arrangement without the support of my feminist husband,
Speaker 5: Victoria Divine.
Speaker 4: Thank you.
Speaker 1: I do I do for best husband?
Speaker 3: How iconic?
Speaker 1: Oh my god. Well I'm taking that and running with it.
Speaker 1: It's been great celebrating some of your budget direct money wins,
Speaker 1: who were the winners of the Cancer Insurer of the
Speaker 1: Year Award twenty twenty two. Budget Direct Insurance Solved. But
Speaker 1: now we're going to go to a really quick break.
Speaker 3: Alrighty, guys, I've got a good one.
Speaker 1: This week.
Speaker 3: It was requested so many times, and before before I
Speaker 3: get anywhere out, Victoria Divine, I know you're ready to go.
Speaker 3: I can see it in your eyes. You're ready to
Speaker 3: take someone down. I just want to say, because we
Speaker 3: got torn a new one on our Instagram and just.
Speaker 1: Always get torn a new one on Instagram for just.
Speaker 3: A little reminder, Guys, when you're cracking onto you know
Speaker 3: a company's post, generally there's a very soft, very sad
Speaker 3: social media manager on the other side of that, and
Speaker 3: in our case that's me. So Jessica, it's been kinder
Speaker 3: sometimes it's very easy to make her cry. It really is,
Speaker 3: you know what, I need to grow a bit of
Speaker 3: thick skin. But just very very clear, we as a
Speaker 3: podcast have not and will not be taking a political stance.
Speaker 3: It is not our place, and we so strongly encourage you.
Speaker 3: If you don't know who to vote for, head to
Speaker 3: the vote Compass website. Find a party that aligns with
Speaker 3: your personal values and your personal beliefs. We can't tell
Speaker 3: you who what when we're or how However, today we
Speaker 3: are going to talk about a proposed policy. We're not
Speaker 3: talking about the political party in question, just the policy.
Speaker 3: The policy in isolation, and if you follow Victoria Devine
Speaker 3: or Scomo if that sip thing on Instagram, you may
Speaker 3: have seen her kicking up a bit of a fuss
Speaker 3: in the comments over this proposed new legislation. Ah, yes, sir,
Speaker 3: I regret nothing. Yeah, look, it was very funny. I
Speaker 3: will not lie to you.
Speaker 1: But there is a very big difference though, between She's
Speaker 1: on the Money, which is a platform that exists to
Speaker 1: educate you and provide as much information as possible, and
Speaker 1: sometimes our personal opinions do trickle into that because obviously
Speaker 1: we'll be like, oh, we love that or we don't
Speaker 1: love that. But this is a line that I think
Speaker 1: you know, I've discussed with them, and I'm like, I
Speaker 1: don't care who you vote for. I care who I
Speaker 1: vote for, and I will share my opinion on my
Speaker 1: personal Instagram. But you don't come to Sheese on the
Speaker 1: Money to be told who to vote for. Like that
Speaker 1: isn't it. We are so deeply grounded in you guys
Speaker 1: having your own values and your own opinions, so it
Speaker 1: just seems really counterintuitive for us to then turn around
Speaker 1: and be like, okay, cool, so this is who we'd
Speaker 1: vote for. But over the weekend. Yes, Jess, I did
Speaker 1: kick up a bit of a stink in Scott Morrison's
Speaker 1: comments section on his recent post, and it wasn't because
Speaker 1: of who posted it. It was actually the policy they
Speaker 1: were posting about I felt like was a relatively cheap
Speaker 1: grab for vote that does not put any of our
Speaker 1: community in the best possible position.
Speaker 3: Yes, And just to be really clear, because I think
Speaker 3: some people were a little bit confused. When you see
Speaker 3: something scary online you kind of go, oh my god,
Speaker 3: how's that going to impact me? It is just proposed legislation.
Speaker 3: It's in effect, and even if his party were to
Speaker 3: be elected, there are no guarantees.
Speaker 1: But they actually do what they said Originally pretty.
Speaker 3: Common that in you know, right now election run up.
Speaker 3: They just want your votes, so they're telling you what
Speaker 3: they know the experience. Whether or not that does come
Speaker 3: into effect remains to be seen, but regardless the policy
Speaker 3: Victoria to.
Speaker 1: Talk about it. So the Liberal government have come out
Speaker 1: and said that they are proposing that people will be
Speaker 1: allowed to take up to fifty thousand dollars worth of
Speaker 1: their superannuation out to purchase property. And I find this
Speaker 1: incredibly detrimental for a couple of reasons. So firstly, they're
Speaker 1: saying that it will push property prices down. No, it
Speaker 1: absolutely will not. It will push property prices up, and
Speaker 1: it will make you more reliant on welfare if you're
Speaker 1: not properly structured in the future. So they've said it's
Speaker 1: up to fifty grand, which is forty percent of your
Speaker 1: super which is massive, and I find that to be
Speaker 1: It's very different to the first time super savor scheme,
Speaker 1: which is where you can put money into superannuation and
Speaker 1: you're able to then access it later for property.
Speaker 3: Because that's an additional contribution, not your mandated ten percent,
Speaker 3: and from your employees.
Speaker 1: So this would be digging into your pre existing superannuation balance,
Speaker 1: and from my perspective, that is so bad. We as females,
Speaker 1: especially as females, are already so behind when it comes
Speaker 1: to super that to then take that and put that
Speaker 1: on steroids is terrible And I don't want a stereotype.
Speaker 1: But the people that would be most reliant on this
Speaker 1: potential legislation are the people who are most at risk.
Speaker 1: They're the people who don't have enough financial literacy. They
Speaker 1: see it as a really easy ticket to get into
Speaker 1: the property market. Because I had so many conversations over
Speaker 1: the weekend in my DMS of me posting, Okay, this
Speaker 1: is what that means. So fifty thousand dollars of your
Speaker 1: super Jess, let's say you go and do this scheme.
Speaker 1: You are young, so you'll go. It doesn't matter. I'll
Speaker 1: make it back later. But that fifty grand and an
Speaker 1: average return of seven and a half percent, which is
Speaker 1: our market average when it comes to predicting potential increases
Speaker 1: in income, that becomes five hundred and seventy five thousand dollars.
Speaker 1: That is more than what the average female retires with.
Speaker 1: That's pretty crazy. What that's far more than what the
Speaker 1: average female retires within super? How is that normal?
Speaker 5: Like?
Speaker 1: How is that not putting you in the worst possible
Speaker 1: position ever? Yeah, that's wild.
Speaker 3: And like to put it in perspective, I'm gonna generalize
Speaker 3: a bit and say first home owners between you know,
Speaker 3: let's say twenty and maybe thirty five. That's kind of
Speaker 3: our approximate age in the podcast. I fall squarely within
Speaker 3: that bracket. As you guys know, I'm a first home
Speaker 3: or hope for a first home buyer. The average person
Speaker 3: aged between thirty and thirty four in Australia has fifty one,
Speaker 3: one hundred and seventy five dollars in their super. So
Speaker 3: that is like almost every dollar that you have in
Speaker 3: your super at the age of thirty four. And obviously
Speaker 3: you can be older or younger, or you might have
Speaker 3: more or less whatever, But I don't know that many
Speaker 3: people who would enough.
Speaker 1: To take the full fifty Yeah, the fact that they're
Speaker 1: like fifty seems like a good number. How many people
Speaker 1: have that at our age? But not many unless they've
Speaker 1: really prioritized it or are super high income earners, which
Speaker 1: would really make me wonder why they're relying on superranuation
Speaker 1: to buy a first property, because they probably have enough
Speaker 1: disposable income, again generalizing to purchase a property. But I
Speaker 1: did the maths because obviously not all of us can
Speaker 1: rely on that fifty grand right, they said forty percent
Speaker 1: of your super up to fifty thousand dollars at a cap.
Speaker 1: So let's say that you know that twenty five to
Speaker 1: forty four year old bracket is what we're talking about.
Speaker 1: If you're twenty five to thirty four years old, which
Speaker 1: is about what our She's on the money demographic is,
Speaker 1: you only have thirty one thousand, eight hundred dollars in
Speaker 1: your superranuation. And then if we said, all right, well
Speaker 1: what's forty percent of that? That's twelve and a half
Speaker 1: thousand dollars. What house are you buying with a twelve
Speaker 1: and a half thousand dollars deposit to make taking that
Speaker 1: amount of money off you in retirement actually worth it? Like,
Speaker 1: twelve and a half grand is not a deposit on
Speaker 1: any property that I'm allf.
Speaker 5: So are we thinking that this is maybe then just
Speaker 5: a bit of a ploy for votes more than anything,
Speaker 5: and that people are going to read the headline only it's.
Speaker 1: Insane because then if we look across the country, we
Speaker 1: know property prices in Melbourne and in Sydney are well
Speaker 1: on average, well above a million dollars, But across Australia
Speaker 1: the median house price is eight hundred and fifty one
Speaker 1: thousand dollars. But that means an average twenty percent deposit.
Speaker 1: We're not getting into the semantics of what a guarantry is.
Speaker 1: Or if you have less or more but a twenty
Speaker 1: percent deposit on that median house that's one hundred and
Speaker 1: seventy thousand dollars. So how is this strategy that's going
Speaker 1: to put us so far behind when retirement comes, actually
Speaker 1: putting us in a better possible position to purchase property.
Speaker 5: It's not at all.
Speaker 3: And I kind of want to unpack this in two places,
Speaker 3: going back to what you kind of said at the start,
Speaker 3: where the most common responses we're seeing are people saying,
Speaker 3: oh my god, it's going to push the property prices down,
Speaker 3: and then oh my god, what is that going to
Speaker 3: mean for a tirem So let's talk about property first,
Speaker 3: because I feel like that's what people care about.
Speaker 1: I would just like to carry on about super for
Speaker 1: a really long time, but this is a very good time.
Speaker 3: We could talk about it all day. But obviously there's
Speaker 3: a bit of back and forth. The people who are
Speaker 3: in support are very much saying this is going to
Speaker 3: be great, like you can afford a house sooner, better, wonderful.
Speaker 3: Why is that not the case? What impact is this
Speaker 3: potentially going to have on property prices?
Speaker 1: So let's pretend for a hot second that everybody was
Speaker 1: able to get out fifty grand and then magically have
Speaker 1: their house deposit. They might already have some savings, or
Speaker 1: it might actually take them to the point where they
Speaker 1: have enough for the house of their dreams. Right, there's
Speaker 1: more people in the market, and the property market is
Speaker 1: driven by supply and demand. Are we building a whole
Speaker 1: heap of other houses to now keep up with the
Speaker 1: increased demand that is going to exist because there's going
Speaker 1: to be more people like Jess who have money to
Speaker 1: spend on property now because they've pulled it out of
Speaker 1: their subernuation. So Jess, you who has saved fort literally
Speaker 1: years to afford your first property, and you're now in
Speaker 1: this position where we're looking for one, and it's very
Speaker 1: exciting if this goes through and it happened, and let's
Speaker 1: be honest, none of that ever happens quickly. That will
Speaker 1: take a very long time. But if this happened, you
Speaker 1: now have more competition. There's no more houses, so that
Speaker 1: would increase property prices, not decrease them, just because people
Speaker 1: have a lower deposit amount.
Speaker 5: And it's also for that more affordable demographic. Right, it's
Speaker 5: all the same first home buyer is going for the
Speaker 5: same property, so that they're those practically driven up exactly.
Speaker 1: And we're not just talking about the property market across
Speaker 1: the board, like we need to talk about accessibility and
Speaker 1: what types of properties are actually being bought by millennials
Speaker 1: because I think everyone goes, wow, the averages million dollars.
Speaker 1: I'm like, well, not every millennial is buying a million
Speaker 1: dollar property like that is a ridiculous amount of money
Speaker 1: to be spending. And lots of you are looking at
Speaker 1: like four hundred or five hundred thousand dollar property purchases,
Speaker 1: and that seems quite normal in our community. They're the
Speaker 1: ones that are going to increase significantly in value because
Speaker 1: they're the ones that are in demand. What another four
Speaker 1: hundred thousand dollar property is going to be popping up anywhere. No,
Speaker 1: because we don't have the capacity to do that. So
Speaker 1: I just think that it's a bit flawed in that
Speaker 1: if they're saying, oh, it'll make property more aft.
Speaker 3: How yeah, let's say it works. You get your property,
Speaker 3: you have your house, stoked on life. Forty years goes by,
Speaker 3: when now sixty five and ready to retire, what does
Speaker 3: that potentially now look like with the impact of what
Speaker 3: we've withdrawn.
Speaker 1: So they're talking about how this is actually a good
Speaker 1: system because you'll put the money back in your super
Speaker 1: real you know. Apparently apparently, So let's pretend for a
Speaker 1: hot second that was mandated and you had to put
Speaker 1: your money back into super if you sold. Why are
Speaker 1: you selling your family home when you're retiring? Where are
Speaker 1: you planning on living? I guarantee the type of person,
Speaker 1: and this is not me stereotyping or being rude about
Speaker 1: at a promise, but the type of person that needs
Speaker 1: to rely on their superannuation to pull money out buy
Speaker 1: their first property. Is not buying a house you can
Speaker 1: downsize from. You're not buying a five bedroom mega mansion
Speaker 1: that you can and then go down to a cute
Speaker 1: little two bedroom apartment like. No, you're actually buying the
Speaker 1: two bedroom apartment as your home you're going to get
Speaker 1: all the way through to retirement. You're going to retire.
Speaker 1: And most people who invest in their first home as
Speaker 1: their actual investment, which I don't believe it is. And
Speaker 1: I've said this a million times, your family home is
Speaker 1: not an investment. And I say that because I don't
Speaker 1: want you to be reliant on what your family home
Speaker 1: is worth when you retire to have to survive. We
Speaker 1: want to rely on investments and subernuation and things that
Speaker 1: actually put us in a position where how good is this.
Speaker 1: We've bought our two bedroom apartment and Let's pretend we
Speaker 1: never buy another property again, we never sell it. We've
Speaker 1: lived there forever, we've now retired, we don't have a mortgage,
Speaker 1: were completely rent free, and we now rely on our
Speaker 1: super How good is that?
Speaker 3: But that't the fact that you got rid of half
Speaker 3: your stupid to get the house in the first place for.
Speaker 1: Not half, not half. Don't be so dramatic, Jessica. Sorry, sorry,
Speaker 1: Let's say that you did that. You're putting yourself nearly
Speaker 1: half a million dollars more than half a million dollars
Speaker 1: beyrend in retirement by making that decision. And if we
Speaker 1: look at the property market as a bit more of
Speaker 1: a whole, I think that there still seems to be
Speaker 1: this bubble of people who are like property is the
Speaker 1: only option when it comes to investment, because it's so powerful.
Speaker 1: Look how much, jess it's increased in last thirty years.
Speaker 1: You go, okay, but that's actually completely unsustainable. Yes, property
Speaker 1: is increasing, but it's definitely not increasing in the way
Speaker 1: that it has historically. There was obviously that bubble during
Speaker 1: COVID where regional properties increased significantly because we could work
Speaker 1: more remotely, and that made a lot of sense because
Speaker 1: that was related to demand, but our incomes have not
Speaker 1: increased in line with property growth. So how on earth
Speaker 1: is the average Australian going to actually afford a property.
Speaker 1: I think there's going to be a cap point. And
Speaker 1: when I say that, I don't mean oh my gosh,
Speaker 1: property is going to cap out it's going to be
Speaker 1: so reasonable.
Speaker 4: No.
Speaker 1: I think what's going to happen is there will be
Speaker 1: a point at which property won't increase that much. So
Speaker 1: if you buy a seven hundred thousand dollars house in
Speaker 1: ten years, it's probably going to be worth seven hundred grand. Again,
Speaker 1: it doesn't mean it's going to be more affordable, but
Speaker 1: will mean that there's not an increase in demand and
Speaker 1: therefore an increase in what your purchaser is willing to
Speaker 1: pay for that because they don't have the income to
Speaker 1: support that.
Speaker 3: Yes, that mean it's growing at the pace that it's growing.
Speaker 3: At some point, surely it's just going to get to
Speaker 3: a place where it's like no one can afford it.
Speaker 3: And I mean it's obviously approaching that point now where
Speaker 3: first home buyers like myself are finding it harder and
Speaker 3: harder and harder and stract further and further to get
Speaker 3: there if it kept growing at the rate that it's
Speaker 3: growing out, literally just no one would buy houses because
Speaker 3: they literally couldn't afford that exactly.
Speaker 1: And I mean there's so many dimensions that come into
Speaker 1: play here. People will be like, oh, well, interest rates
Speaker 1: have never been lower in this and that and the other.
Speaker 1: Let's take a step back. When my dad bought his
Speaker 1: first property, real cool guy bought it at like twenty
Speaker 1: one water bawler my dream, it was three and a
Speaker 1: half times his annual salary. Today, for the average Australian
Speaker 1: to purchase a prop it's a minimum of thirteen times
Speaker 1: their annual salary. Yeah, tell me how property prices are
Speaker 1: staying in line with rage growth? It's not so how
Speaker 1: is that sustainable? We are now bending over backwards to
Speaker 1: get into properties that we arguably can't afford anymore. For
Speaker 1: what for the you know, ability to say, oh my gosh, Yess,
Speaker 1: I own a house and like, please, guys, I'm not
Speaker 1: throwing Jess under a bus. We've done some pretty significant
Speaker 1: financial planning for that woman, like we know that's the
Speaker 1: right decision for her. But looking at a lot of people,
Speaker 1: and it's a very hard reality to swallow because it
Speaker 1: is really sad for a lot of people in our community,
Speaker 1: buying a property is not the best decision for them financially,
Speaker 1: because it's actually going to put them further behind because
Speaker 1: what they would pay in mortgage or payments impacts their
Speaker 1: lifestyle so significantly, and it impacts their ability to generate
Speaker 1: wealth so significantly that even if they got to retirement
Speaker 1: and they paid their entire home off in that thirty
Speaker 1: year mortgage period, they have nothing else to show for
Speaker 1: their wealth. They might own that apartment, or they might
Speaker 1: own that home, But what do you have in super
Speaker 1: that can support you in retirement? Do you have any
Speaker 1: other assets? Do you have savings? Do you have any
Speaker 1: type of investment outside of super? If you are stretching
Speaker 1: yourself so thin when it comes to mortgage or payments,
Speaker 1: you're probably going to find yourself in that position. And
Speaker 1: that's why I'm so pro education and so pro talking
Speaker 1: about other investment types, because you know, we could invest
Speaker 1: in shares thirty forty years ago, but the world has
Speaker 1: completely changed since then, and we need to look into
Speaker 1: other avenues of wealth generation and wealth creation so that
Speaker 1: we end up in the position we hope we end
Speaker 1: up in because it's not as easy as it used
Speaker 1: to be.
Speaker 3: And there's no guarantee either that the education that needs
Speaker 3: to be there will be because a lot of people
Speaker 3: are saying, oh, well, you know we pulled money out
Speaker 3: during COVID. You could pull money out for super then yep.
Speaker 3: And I mean, I would argue that it's a very
Speaker 3: different place when you know, pulling money out to survive.
Speaker 1: That's it's a very different circumstance versus purchasing a property,
Speaker 1: which arguably is a one.
Speaker 3: But we actually spoke about this at the time because
Speaker 3: we felt there was an anywhere near the level of
Speaker 3: education or awareness generated that needed to be. There was
Speaker 3: none people recognizing the impact of pulling out money out
Speaker 3: if you needed it one hundred percent, if that was
Speaker 3: the difference between you putting food on the table or
Speaker 3: losing your house or being homeless or whatever, of course
Speaker 3: that was a good decision, But there was no education
Speaker 3: about the long term impacts of that, and we spoke
Speaker 3: about it, and v You personally campaigned about it really
Speaker 3: strongly to make sure that people knew.
Speaker 1: It angered me because too many people thought, wow, or
Speaker 1: just take that out, then if I can access it,
Speaker 1: it's my money. I know someone who used it to
Speaker 1: buy a car, and I'm sure even start any person
Speaker 1: that why. I was having a rant obviously on Instagram
Speaker 1: over the weekend, but I ended up in a very
Speaker 1: good DM conversation with one of my friends who's a
Speaker 1: sex worker, and she says she knows a guy who
Speaker 1: took out of Super twice twenty grand and blew it
Speaker 1: all on sex workers.
Speaker 5: Wow.
Speaker 1: Like, if if you can do that, yeah, anyone can
Speaker 1: lose money. And we're not talking about what he spent
Speaker 1: the money on, but the fact he could access it
Speaker 1: to then have no accountability of where that money went
Speaker 1: like that, I promise you what he spent his money
Speaker 1: on wasn't a need that was an absolute want, and
Speaker 1: it didn't put him in a better financial position, and
Speaker 1: it didn't keep food on his table and a roof
Speaker 1: over his head, which is what claiming that should have
Speaker 1: been for.
Speaker 3: Yeah, and I mean obviously, because this is just a
Speaker 3: theoretical campaign run proposal. There's no real information on, you
Speaker 3: know what, the situation we're making.
Speaker 1: All of that. But I just Jess George, I find
Speaker 1: it so irresponsible of them to say things like this,
Speaker 1: which they know are going to be relatively inflammatory. And
Speaker 1: when I say inflammatory, I don't mean they're trying to
Speaker 1: start an Instagram fight, which is what they got from me.
Speaker 1: But what I mean is people are going to pick
Speaker 1: it up and be like, Wow, that's so helpful. Yeah,
Speaker 1: I'll vote for him like that. It is a shameless
Speaker 1: grab of votes. And it makes me feel really icky
Speaker 1: because I'm like, we're not talking about the education around here,
Speaker 1: Like imagine if instead they were talking about a school
Speaker 1: financial literacy program, or let's be a little bit brutal,
Speaker 1: let's talk about stamp judy. Why are we still spending that?
Speaker 1: If you guys flipped that and said, do you know
Speaker 1: what first home buyers don't have to pay stamp duty?
Speaker 1: Do you know how many more people would be able
Speaker 1: to afford houses? Do you know how many more people
Speaker 1: wouldn't be compromised in retirement? Millions? So I just think
Speaker 1: that there's a lot they could do, a lot they're
Speaker 1: choosing not to do, and they're trying to market themselves
Speaker 1: so well, so they look like little angels. I could
Speaker 1: go on and on. I got a lot to say.
Speaker 5: Oh, there's so much to say, and Souper is just
Speaker 5: such an interesting conversation to have, and I think before
Speaker 5: I worked here, I didn't know anything about it. And
Speaker 5: now to all of my friends, I'm like, make sure
Speaker 5: you were paying yourself super if you're self employed.
Speaker 3: Exactly every time one of my friends gets they're paying
Speaker 3: into your super while you're not working.
Speaker 1: You guys must be nightmares like I do you want
Speaker 1: to come to my house and talk about super Laba.
Speaker 1: I was holding the one you bring the goodbbe.
Speaker 5: Hi bear. Have you got a money dilemma you just
Speaker 5: can't solve? The Sheese on the Money Team is here
Speaker 5: to help. Every week, we tackle your dilemmas, both big
Speaker 5: and small, to answer your most burning money, career and
Speaker 5: life questions. To get involved, simply head to our website
Speaker 5: and leave us a quick voice recording and you may
Speaker 5: just find yourself on the show. Now, let's take a
Speaker 5: listen to today's money dilemma.
Speaker 4: Hi, guys, just wondering what your thoughts were on the
Speaker 4: salary sacrificing. To sum up, I've been salary sacrificing since
Speaker 4: I started working three years ago. It was pretty much
Speaker 4: sold to us at orientation, and it seems like it's good.
Speaker 4: Like I salary sacrifice three hundred and forty dollars a
Speaker 4: fortnite to my rent, which covers my rent for the
Speaker 4: fortnite I live in a sharehouse, and one hundred and
Speaker 4: eight dollars to a meal entertainment car, which I find
Speaker 4: worthwhile because it's money that never comes into my account
Speaker 4: that I can use for like a night out or
Speaker 4: a brunch. But in saying that, it's like so much
Speaker 4: conflicting information, and I just don't know if it's actually
Speaker 4: the right thing to do financially.
Speaker 1: All right, Salary sacrificing has been a relatively spicy topic
Speaker 1: in the She's on the Money community, and I'm glad
Speaker 1: someone's asked the question because it's good and bad, right, Like,
Speaker 1: I obviously don't know your personal circumstances, so I can't
Speaker 1: be like, oh my gosh, you should be salary sacrificing X,
Speaker 1: Y and Z, because that makes the most sense. But
Speaker 1: I found the point in your question really interesting because
Speaker 1: you said it was basically sold to us at orientation,
Speaker 1: because that's how it works, right, and it sounds so good. Right,
Speaker 1: you can salary sacrifice stuff and it's pre tax money.
Speaker 1: So for those of you who don't know what salary
Speaker 1: sacrificing is, or it can be called like salary baggaging.
Speaker 1: It's basically to enable an employee, usually someone who works
Speaker 1: for like the government or in healthcare, to receive a
Speaker 1: combination of income and benefits in a super tax effective manner.
Speaker 1: The reason they do this is because they can't usually
Speaker 1: afford to pay even more salary to people, but they
Speaker 1: can use their tax structure to make sure you can
Speaker 1: access some pre tax benefits. Right. So it's usually in areas,
Speaker 1: as I said, like government and healthcare, where they don't
Speaker 1: have the ability to be like, oh, Jesse, you've been
Speaker 1: performing so well, like here's a massive pay rise, because
Speaker 1: it's usually government mandated or there's some reason why. There
Speaker 1: are also a lot of other employers who are like,
Speaker 1: this is a great benefit to our employees, like we're
Speaker 1: just going to add it on. But the background is
Speaker 1: that's why it basically exists. But essentially what happens is
Speaker 1: you take some of your remuneration in the form of
Speaker 1: concessionally taxed benefits instead of taking it as fully assessed income.
Speaker 1: This process is called salary sacrificing, which our listener she
Speaker 1: mentioned before, she's been sacrificing three hundred and forty dollars
Speaker 1: in rent every single fortnight, and one hundred and eight
Speaker 1: dollars in meals and entertainment. So that's about eleven thousand
Speaker 1: dollars a year, or about eighty eight hundred dollars just
Speaker 1: for rent, which you go, all right, well, rent is
Speaker 1: a cost that you're going to have to pay regardless.
Speaker 1: Kind of cool that she can, you know, not pay
Speaker 1: tax on that amount, because think about it, marginal tax
Speaker 1: rates are pretty high. That means she's saving at least
Speaker 1: twenty five percent at a minimum on her rent. A
Speaker 1: bit of a money win. But essentially what you do
Speaker 1: is you salary sacrifice money and it gets paid back
Speaker 1: to you in a different way. So it could be
Speaker 1: paid back to you in the form of an entertainment
Speaker 1: and a meals card, or it might be paid directly
Speaker 1: to your rent, so you don't personally see that money usually,
Speaker 1: which is kind of cool because it can be like
Speaker 1: a little bit of making sure that your rent's paid
Speaker 1: in a forced saving sort of way. There are a
Speaker 1: fair few things you can salary sacrifice, so rent obviously,
Speaker 1: meals and entertainment obviously because our listener mentioned it, but
Speaker 1: you can also salary sacrifice car costs. You can salary
Speaker 1: sacrifice car parking, which is kind of cool because Jess
Speaker 1: and I look about how much costs to park at
Speaker 1: a time. You can obviously salary sacrifice superannuation, which is
Speaker 1: my favorite kind. But there are number of advantages which
Speaker 1: you guys probably have already alluded to. But I'll give
Speaker 1: you a very good example. So say our listener, she
Speaker 1: didn't tell us how much she earned. I always love
Speaker 1: knowing what people earn if they call up. So you
Speaker 1: just call up, be like, Vie, I earn this amount,
Speaker 1: and I'll be like, heck can Yeah. But let's just
Speaker 1: say someone earns one hundred grand a year and they
Speaker 1: want to buy a new car for work, and that
Speaker 1: car's worth twenty two thousand dollars. Had they entered into
Speaker 1: an employee salary sacrifice scheme, the twenty two thousand dollars
Speaker 1: would have been taken out of their pre tax income.
Speaker 1: So instead of being paid and then buying a car
Speaker 1: with the money that you've saved, it comes out of
Speaker 1: that before, which means actually decreases your marginal tax rate
Speaker 1: because you go into potentially not for everybody, because you
Speaker 1: might stay in the same salary bracket but they would
Speaker 1: have ended up in a lower tax bracket because it
Speaker 1: decreases their taxable income to seventy eight thousand dollars a year.
Speaker 1: So there's a number of benefits there obviously, But what
Speaker 1: that means is you can make the most of your
Speaker 1: pre tax dollars. But the trippy thing here is that
Speaker 1: people get really caught up in it. They'll go, oh,
Speaker 1: I should buy a new car, Like my friend, did
Speaker 1: you need the new car or was it just a
Speaker 1: good idea? Like just because you're saving money, and this
Speaker 1: goes for anything, right, just because you're saving money doesn't
Speaker 1: mean that you need to spend it. Like you're spending
Speaker 1: money to save money, Like that's taking you backwards if
Speaker 1: it's actually something you didn't need or didn't actually plan
Speaker 1: on purchasing. And the same happens. And I do see
Speaker 1: this happen a lot. Is the food and beverage cards
Speaker 1: or the food and entertainment card that was mentioned that
Speaker 1: seems to get out of hand. Now I have absolutely
Speaker 1: no judgment how much you spend on food and entertainment,
Speaker 1: but a lot of people will be like, oh, I've
Speaker 1: got this like food and entertainment card through work. So
Speaker 1: let's just go out for dinner. Yeah, okay, you need
Speaker 1: to use it IP, yeah, I need to use it up.
Speaker 1: It's like not this mentality of well, actually that's my money. Like,
Speaker 1: it's a very different mentality. And I think we have
Speaker 1: to be really careful of that because our listener just said,
Speaker 1: I salary sacrifice one hundred and eight dollars per fight,
Speaker 1: which doesn't seem that much, but over a year that
Speaker 1: adds up to be a couple of grand Like, that's
Speaker 1: not a small expense. And if she's going, yeah, just
Speaker 1: doing it on groceries and that's actually what my budget is,
Speaker 1: I'll be like great. But if you're just going out,
Speaker 1: but you're trying to stay for a home or you're
Speaker 1: trying to be more budget conscious, like, it's still your money,
Speaker 1: regardless of whether you're you know, making a good tax
Speaker 1: saving on it or not. So I think the main
Speaker 1: thing with salary sacrificing is yeah, great, it makes a
Speaker 1: lot of sense. And if you need to buy a
Speaker 1: brand new family car because you're having a baby and
Speaker 1: there's all these other things, like, it might be a
Speaker 1: strategy that you make use of. But I do think
Speaker 1: that it can be a little bit of a slippery
Speaker 1: slope for people because they justify their spending because they're like, ah,
Speaker 1: but I've got this card, and I'm it's basically free money.
Speaker 1: It's actually not.
Speaker 5: So it's a very personal thing. Yeah, absolutely, But for
Speaker 5: anyone who is interested and wants to know more. We
Speaker 5: did do an episode all about salary sacrifice. He did
Speaker 5: That was April last year. Thank got your so scroll
Speaker 5: buck in your feed and we go really deep into
Speaker 5: that one.
Speaker 3: It's called nice Salary Package. I'm pretty sure I came
Speaker 3: up with that name of my own.
Speaker 1: That's an episode a year ago. You've just been sitting
Speaker 1: on that as like the best episode you've ever NATed.
Speaker 3: I think it's one of the best names I've ever done.
Speaker 1: Well, we've covered a lot in today's episode, but unfortunately, guys,
Speaker 1: I think that is all we have time for today.
Speaker 1: But just before we head off, miss Georgia King, could
Speaker 1: you please wrap the boring but very important stuff.
Speaker 5: It would be an honor. Alrighty, guys. The advice shed
Speaker 5: on She's on the Money is general in nature and
Speaker 5: does not consider your individual circumstances. She's on the Money
Speaker 5: exists purely for educational purposes and should not be relied
Speaker 5: upon to make an investment or a financial decision. And
Speaker 5: we promise Victoria divine and she's on the money. Are
Speaker 5: authorized representatives in Focus Securities Australia Propriety Limited ABN four
Speaker 5: seven zero ninety seven seven nine seven zero four nine
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Speaker 1: You got I fear
Speaker 5: H