Tag Archives: money

Financial vampires: Is there one in your life?

Financial vampires - cut them out of your life

Have you ever had a financial vampire in your life?

Some people are just financially toxic. They are in the shit moneywise, and by merely being present in your life, will drag you down too.

You may feel obligated to help, or they may explicitly pressure you to do so.

Whatever their situation, do not risk your own financial wellbeing on their behalf.

When you step into the role of the money martyr, odds are you’re not just damaging your own financial health but also doing a number on your emotional and physical health as well in the process.

Those who truly love us and have our best interests at heart will not expect this of us.

I mean, it feels good to be selfless, if you can afford it. Not to get all The Secret-y on you, but I swear little windfalls have correlated with times that I’ve given more.

And yet.

Beware of giving up too much to the people closest to you.

There’s a difference between supporting someone through a temporary rough patch, vs enabling consistently poor choices and habits. The trick is making that distinction and it’s not always easy to see where that line falls, particularly in a newer relationship.

I’ve spoken to so many people recently who’ve been in relationships where a significant other has taken advantage of their financial goodwill. In some cases it’s been about subsidising their slacker partners; in others it’s been about taking responsibility for a partner’s debt, or even incurring new debt on their behalf.

We all agreed on one thing: we’d be much better off today if we’d wised up earlier. Sexually transmitted debt – it’s a thing, and in the worst cases can take years to bounce back from.

We only get one shot at life, and it’s okay to put your own financial wellbeing first. Start by helping yourself and securing your own needs, then you can turn your attention to helping others.

When it comes to financially toxic relationships, it’s best to cut those losses earlier rather than later. As a wise friend said, we aren’t just hurting our current selves by staying – we’re also hurting our future selves.

Give generously. But never, ever sacrifice your own financial stability for anyone else’s sake.

When it comes to money, ALWAYS put yourself first.

Disease Called Debt

How the young and broke make car-related decisions

Is it worth buying a manual car? You can push start them in a pinch if they won’t start.

How long should we register it for? It’s cheaper overall to buy a full year’s registration upfront … but what are the odds this car is going to last that long?

How much should we put in the tank this week? If this is the week it dies….

(Seriously, I swear every one of our past clunkers gave up when on a relatively full tank, or was put out of action for an extended period of time with lots of petrol in the tank, such as after that one big accident…)

I do NOT miss the constant stress of owning a beater – rattling around with multiple things falling apart, only ever being about one repair away from scrapping the whole thing. When just one more would be the last straw tipping it over the edge to not-worth-it.

This may as well have been our anthem.

One of the best things about earning more is being able to afford a much better vehicle that doesn’t give us cause to worry.

I’m not happy that we needed to replace two tyres this month (are our wheels just magnets for nails?!) but very grateful that we passed the WOF check (our 2nd in this car!) with no drama, and are good for another year.

In a perfect money world…

In an ideal money world...You would never be unemployed.

Or ill, injured, depressed, disabled.

Have to support dependent family members.

Deal with the gender wage gap.

Struggle to understand a finance document.

You would earn a living wage for the area that you live in.

Be able to support a household on one average income.

Receive pay rises every year that match inflation, plus merit raises.

Have reliable transport and decent housing from day 1.

Smash through glass ceilings and class barriers without flinching.

 

We all have financial blind spots. These are mine

What are your financial blind spots?

Every experience we go through – good and bad – shapes us, makes us who we are.

The flip side of this is that we have somewhat of a blind spot when it comes to things we haven’t experienced. For me these include:

Unemployment

I graduated into a recession. Yet I haven’t struggled with unemployment so far and I don’t think I’ve interviewed for a job I didn’t get (career wise, not counting the part time jobs I held before starting my career!) I know it’s not easy and have seen others around me deal with unemployment but I have not personally been through it, and thus am probably not as understanding or empathetic as I could be.

Lifestyle inflation/mindless spending

I’ve never been much of a shopper. I worked in journalism for a few years, so pay rises weren’t exactly a thing. When I changed paths to make more, I had an unemployed partner, so we weren’t exactly rolling in it. These days we spend a little more on groceries (hummus, fruit and cheese ain’t cheap) but it’s really just having pets that I would put under the ‘lifestyle inflation’ bucket for me.

Student loans

Student debt isn’t as insane here as in some countries, but student loans are still a significant burden for many of my peers. Thanks to my scholarship, I simply don’t know what it’s like to graduate with a huge debt load knowing it would follow me through my twenties or beyond.

Golden handcuffs

The notion of being stuck in a lucrative job simply for the paycheck is not something I have experienced. I don’t imagine I will, either. It’s worked out so far that I have loved all of my jobs and I hope to maintain that to a healthy degree going forward. Earning more is a goal – but not purely at the expense of maintaining balance in other aspects of what makes a good job to me. Will I retire early? Don’t imagine so, but that doesn’t worry me.

More money than time

Time is absolutely a constraint at times. But money has always been the bigger factor. That’s my reality, and the reality for most people around me.

Supporting parents

My parents are ageing. Luckily they seem reasonably healthy so far and they are not financially struggling. Rather than me needing to worry about their retirement it’s more a case of them worrying about my financial future in today’s world.




So, what DO I know about, then? (For any of the above, there are many blogs that cover each of these subjects – bloggers who are reformed shopaholics, bloggers who are financially responsible for extended family, bloggers who have jobs that pay very well but which they loathe, etc.) I guess the stuff I cover here includes:

Being a female breadwinner

Not a position I thought I’d be in, but it’s one I’ve found myself in. See: here and here. And another post is brewing…

Financial opposites

What happens when a saver meets a spender? It’s been a process, through various iterations of joint vs separate accounts, paired with sporadic employment, etc. Probably got another on this in the pipeline, too…

The struggle to find balance

I am terrible with balance. I tend to get obsessed with things for a little while and burn out. Right now it’s balancing my mortgage against other financial priorities. In the near future it may be next career moves: making more money vs work I enjoy that isn’t too stressful.

In relation to the saving vs earning more spectrum, you’ll find me leaning toward the latter. As a naturally frugal person I’ve never really come across any groundbreaking saving advice. What’s dramatically altered my financial trajectory and pumped up my financial security is making more money. I still worry about the future, all the time! But I am less worried than I have ever before.

What about you – what are your areas of financial expertise and weakness?

brokeGIRLrich

Simply Wall St – a helping hand for your investing portfolio

It’s funny how things work out sometimes. A couple of months ago I was part of a Twitter convo about finance apps/platforms for New Zealanders – and although it wasn’t yet available to us, Simply Wall St came up. And what do you know … just the other week I received an email informing me of their NZ launch and inviting me to try it!

Simply Wall St is one of the new breed of fintech companies making stuff simple and visual. Essentially, it’s designed to help you understand how publicly listed companies are performing in order to make better investment decisions. Is a business undervalued or overvalued? In a solid financial position? What might you expect in terms of future earnings and dividends? Simply Wall St can offer some insights to help you reach a conclusion on questions like these. There is lots of delicious data to feast on, served up in an accessible and digestible way.

For NZ investors, Simply Wall St links up with Sharesight, which is handy. This integration didn’t actually do much for me as I only invest in funds (not individual stocks). After connecting my Sharesight and Simply Wall St accounts, only one of my Sharesight-tracked funds was in the Simply Wall St database but as it’s comprised of ETFs Simply Wall St couldn’t provide much analysis on it.

That said, one of the two example portfolios served up to me was the Harbour Australasian Equity Fund, which invests in local companies and that I actually have a small holding in!

Here’s what Simply Wall St had to tell me me about the fund:

simply wall st value chart

Value

A look at the value of the portfolio based on price relative to market and future cash flows – are you paying a fair price? Looks at metrics like PE, PB and PEG ratios.

Simply wall st future performance chart
Future performance

A look at average expected growth in earnings.

Simply wall st past performance chart

Past performance

A look at metrics like Return on Equity, Return on Capital and Return on Assets over the past 5 financial years.

Simply wall st dividends health chart

Financial Health / Dividends

A look at debt levels and the stability of the company.




All of this gets distilled into one neat overview graph: The Snowflake. You can see it below – top right and in the left hand nav too. It’s a visual summary of the areas described above. The shape and colour of the snowflake is meant to give you a snapshot reading and enable easy comparison against other investments.

simply wall st nz snowflake chart

I was also able to see an overview of the individual companies this fund holds.

Simply wall st holdings chartPlus, you can use Simply Wall St to find new investment ideas. For example, you might mine the database for stocks that are potentially undervalued, stocks with room to grow, or for stocks in certain industries. Grid views serve you up collections based on criteria you set.

simply wall st grid chart

I’m definitely a hands-off investor. That said, if that were to change, I would absolutely want Simply Wall St on my side – I can imagine making full use of it to research companies and guide my decisions.

Are you a more active investor than I am? Keen to try Simply Wall St for yourself? Sign up for a free trial here.

The little things in life are so worth it

I’ve been thinking lately about how little I’m actually doing to optimise my financial life on a micro level. Like, if I really wanted to hold on to every possible cent of my money, we would never buy produce at the supermarket. I would have my savings accounts organised differently to take advantage of the absolute best interest rate (still pretty abysmal, in today’s low rate environment). I would have a more complicated credit card set up to maximise rewards. I would catch the bus more to take advantage of bus ride mystery shops.

I don’t. And I’m okay with that. I’m choosing to focus my headspace on the bigger picture and the choices that result in larger returns. Realistically, I can’t do both right now, and given the choice between macro and micro, I’m at the stage where it’s a no brainer to put time and energy toward the macro.

I may not be optimising every single dollar these days, but I am trying to optimise my home life, even if it means spending some money.

Seriously, I’ve been sweating the small stuff on some things that I really just need to get over. Sometimes it’s little things that make life so much more efficient and enjoyable. Yet it’s taken me over six months to suck it up and buy:

Forks

We’ve got enough knives and spoons to manage comfortably but for some reason, we’ve been getting by with only 3 forks. Finally, a 60% sale at The Warehouse prompted me to remedy this. And seriously, $6 for a bunch of new forks has been so worth it.

Toilet roll storage rack

I feel like such a grown up now. For real. Until now, they sat up on the windowsill – bit rugged, really.

Coat rack

Okay, this one isn’t quite done. Needs a little help from a friend (we don’t own a drill) so it’s still sitting on the dining table. But I got so sick of leaving jackets lying around everywhere, it was a no brainer!




Still on the list of things I need, though:

Shower caddy/rack

Having bottles sitting on the floor isn’t ideal. But it’s just so clearly a want rather than an absolute need, I could keep putting this off indefinitely!

Bedside lamps

So I can stay up and read for a bit before bed without needing to have the full blown overhead light on.

Photo montage frames

I’ve still got a bunch more photos I need to get printed and stick on the wall … but they also need frames to go in.

What little things improve your home environment?

5 awesome books about money – for women, by women

5 must read books about money for women

I’ve been on a bit of a roll lately devouring books about money and career as I get closer to exiting the 20-something age bracket and ponder what my 30s could be like.

In particular, I’ve been focusing on personal finance/career books by women. Here are some of the best I’ve read:

Secrets of Six-Figure Women: Surprising Strategies to Up Your Earnings and Change Your Life by Barbara Stanny

Things Barbara Stanny and I have in common: We were female writers who didn’t earn huge amounts. Things we don’t have in common: Rich families, trust funds.

That aside, this is not a book about Stanny, it’s about the many high-earning women she interviewed and the insights she has distilled into 11 chapters in Secrets of Six-Figure Women. Even though she began writing it before the GFC, her foreword notes that these women either survived the recession well, or were able to rebuild despite knockbacks. And as we find out, resilience is a key trait among high earners, among others. They aren’t groundbreaking secrets, but they are important reminders, and I suspect this is the kind of book you could come back to over the years for a fresh dose of motivation.

Read it if you: Struggle with underearning (want to earn more, and are capable of earning more) and having belief in yourself.

Gold Diggers and Deadbeat Dads: True Stories of Friends, Family, and Financial Ruin by Valerie Rinds

I had a bit of a wakeup call in 2015 when I realised I was putting other people’s happiness ahead of my own, and making myself miserable. It was also severely damaging my own financial situation. I really needed to read this book back then – if only I had known about it!

Gold Diggers and Deadbeat Dads mixes Rinds’ own story of financial hardship with other true tales of people who faced financial ruin thanks to the wrongdoing of other people. It’s entertaining, engaging and educational. And it’s a cautionary tale – choose your partners wisely, because they can make or break you financially. Rinds plays it straight – there’s no judgement here, just real stories told by real people.

I think there’s often a fine line between victim blaming and accepting responsibility for your own choices; it’s definitely one I have struggled with myself. If you have caretaking and enabling tendencies, you may very well find loved ones taking advantage of you financially. It may not seem like it at first, it may not feel like it, and it’s an ugly, painful thing to wake up to.

Read it if you: Struggle with financially supporting other people in your life and have trouble saying no.

The Art of Money: A Life-Changing Guide to Financial Happiness by Bari Tessler

Caveat: The Art of Money is a little hippy dippy, particularly to start off with. It’s not everyone’s cup of tea, but if it doesn’t put you off, then you might just find this a refreshing read.

What spoke to me was the heavy emphasis on the emotional aspects of money. The first half is devoted to untangling your relationship with money, and the second tackles more practical aspects of money management, interwoven with the values and emotions that are all tied up in what we bring to the table when it comes to personal finance.

I came to this book with a certain amount of regret and baggage that’s been weighing me down, and somehow I felt lighter for having made my way through it. Tessler’s incredibly compassionate approach and frameworks are the polar opposite of tough love – more like a warm bath or sustained hug. Sometimes, that’s just what you need.

Read this if you: Struggle with bad money juju that you need to get past and let go of

When She Makes More: 10 Rules for Breadwinning Women by Farnoosh Torabi

It sucks that books like this exist, but IMO they are a necessary addition to the landscape. I will say right now that I didn’t find any new practical strategies in here, but it was at times thought provoking and most importantly, it brought voices to the forefront that are otherwise stifled.

In an ideal world, it WOULDN’T matter who earned how much. But we live in the real world, with flawed workplaces and human relationships. How we feel about these things matters, just as much as how we deal with them.

And that’s where I got the most value out of this book: reading stories of other women struggling with inequality, resentment, and navigating complicated dynamics. The emotional turmoil, I would argue, is the hardest to reckon with, and this book is a reminder that you are not alone.

Read it if you: Struggle with being the breadwinner (there’s no shame in that)


What Works for Women at Work: Four Patterns Working Women Need to Know by Joan C Williams & Rachel Dempsey

I am not in law (or finance, or consulting, or any of those types of industries) and this book is definitely more targeted toward women in similar fields. I also count myself fortunate to not really have personally encountered sexism in the workplace so far. However, I know it exists and I have seen others run into it. And as I progress in my career and start thinking about how having a family might mesh with that, I found it interesting to read about the extra tightropes that working mothers walk. After all, career progression underpins finances, for most of us.

What Works For Women At Work identifies the four main issues women encounter in the workplace – Prove It Again, the Tightrope, the Maternal Wall and the Tug of War – backed by research. It’s non judgemental and tries to take a big picture view as much as possible: it’s not just you, the system is actually broken. The advice on actually dealing with those biases is a little light, but as we all know, there are no quick and easy fixes in this area. We can do as much as we can as individuals, but real change and real solutions go beyond that.

Read this if you: Struggle with progressing in the workforce and wonder why you aren’t getting ahead




brokeGIRLrich

I like big bucks and I cannot lie

Money stress? No thanks

“Money is the biggest stressor in Kiwis’ lives, and it is the young that are feeling it most.” – Stuff

Man, do I know that feeling. Money was the number one source of stress in my life for the majority of 2014 and 2015, and it was THE WORST.

We spend most of our lives working for money, and you can’t get by in the world without it. My life has only improved as my income has risen. It is not the #1 factor in my career decisions, but it is a significant factor.

I’m no longer ashamed to proclaim that I like, nay, LOVE, money. Like Bianca Bass, I’m taking a stand and putting it out there. She sums it up wonderfully in these three sentences.

“Money is wonderful. It’s the difference between having choices and having none. It’s the difference between worrying about bills and having the mental space to think about more creative things.” – Bianca Bass

Being broke is a time suck, and an energy suck. Things like navigating public transport in many cities, bargain shopping and researching every single purchase to save every possible cent takes up a huge amount of your time.

They say wealth is the ability to fully experience life. Hell, even a modest existence requires money – and in New Zealand, quite a bit of money, actually.

It’s not very PC to say that you like money and want more of it. People like to argue that money doesn’t solve all problems, that having too much money is just as big of a problem, etc… Which I just find so hilariously out of touch with most people’s realities. More of us than not are worrying about how to make ends meet, how to support a family, how to afford a comfortable retirement. Your average person is never going to have #richpeopleproblems – myself included.

“I think about how much money I’m making and how I could find more of it, not out of greed but out of a pressing need to know that regardless of what happens, I will always be able to take care of myself. I love money for the security it represents. Worrying about money has been a defining characteristic of mine for as long as I can remember.” – Megan Reynolds

Preach it… To me, money means options. It means peace of mind. I spent a solid chunk of time feeling panicked about money on a day-to-day basis. Downgrading that to mild worry has been awesome. I want to accumulate money, not for the sake of it, but for the security and freedom (ha yes, two slightly contradictory words) it brings.

brokeGIRLrich

Why millennials need to save for retirement

Why millennials need to save for retirementIt’s safe to say I never really gave retirement very much thought at all until this year.

But now that I’m not deathly worried about bouncing from cold damp rental to cold damp rental for the rest of my life, I can focus on other things.

Also, some of the things work has sucked me into lately are all about retirement savings and planning for the future. Heavy shit, in other words.

All around the world countries are struggling with the affordability of supporting retirees.

In the future we probably won’t be able to rely on superannuation, and will probably have to pay more of our own living costs and health costs.

Currently NZ has low levels of elder poverty – our  high levels of home ownership, and NZ Super being universal, non-means-tested, and pegged to 66% of the average wage play a role in that. But soaring house prices mean home ownership levels are falling, and I can’t imagine NZ Super will be immune to the kinds of pension reforms that are underway around the world.

Seeing and hearing some of the things people say on this subject makes me shake my head.

I can understand indifference and inertia. I know it feels hopeless. You need to save so much for retirement and it seems like your money isn’t going very far. Hell, I know *I* should really be saving more. But something is better than nothing.

What I don’t understand is all the ignorance and paranoia out there around KiwiSaver. Seriously. 1) Take the free money, the rest of us are! 2) Your KiwiSaver funds belong to you, not the government. Let go of those tinfoil hats, people.

Save for the futures, dudes. It’s one thing to pay for the less fortunate – the non-able, whose who don’t earn a living wage – those who aren’t able to take care of themselves. It’s another (and kinda immoral IMO) thing to be a drain on the system because you simply didn’t plan ahead.

As soon as you can, get started. Even if you start small, you can always ramp it up. Every little bit helps. Time, at least, is on our side. Just do it.