A young Australian management consultant has shared his tips on how he’s managed to buy an apartment, a car and shares and still be $178,000 in the black – and says others can do the same and get on track for an early retirement.
Josh and his partner Bridie, both 27, from Brisbane, say tracking their spending and being disciplined savers has them on track for a life of financial freedom.
‘I don’t want to have to work a standard job until I’m 65, call it quits and go sit on the beach. I’d love to get to a position where work is a choice,’ Josh told Daily Mail Australia.
‘It’s very unlikely that I will ever stop ‘working’ completely, but it’s more about reaching the point where I can choose exactly how I spend my time.’
Josh told Daily Mail Australia the prime end goal is to achieve financial freedom, rather than retire early with a high superannuation fund
Josh and his partner Bridie, both 27, from Brisbane, have always been proactive savers who say it has taken years of hard work and dedication to reach their astonishing economical achievement
Josh and Bridie have $178,000 in net worth – the figure arrived at when deducting all your debts from all your assets.
For this young couple, their assets are $96,000 in home equity produced by a 10 per cent rise in the value of their $1million apartment despite still having a mortgage to pay off, $87,000 in superannuation, $40,000 in savings and a car valued at $17,000.
They consider their only liability to be $62,000 in HECS student loan debts, not counting the mortgage which could be negated at any time by selling the apartment due to the appreciation in its value.
In recent years the pair had been investing in the stock market, but decided to sell their portfolio to put the downpayment on the three-bedroom Queensland apartment they bought in December.
In recent years the pair have been investing in the stock market to build their portfolio, but they decided to liquidate the shares to put towards purchasing their first home in December 2020
Josh’s net worth broken down:
The current net worth is approximately:
Home Equity = $96k
Superannuation = $87k
Cash = $40k
Car = $17k
HECS Debts = $62k
Josh’s top tips to save money:
Track your spendings
Make use of spreadsheets by using excel or phone apps
Popular phone apps to use include WeMoney and Pocketbook
Consider what you need to purchase against what you want
For Josh and Bridie, their assets include their home equity, superannuation, savings and car with the only liability being their HECS debts worth $62,000
Investing in real estate is often considered to be a safe, steady option, but Josh warned that it could go wrong.
‘Purchasing a property is one of the biggest financial investments that you’ll ever make, so ensuring that you’ve done enough research is critical,’ Josh said.
‘Even if you’re just starting to think about looking for a property, going to open homes is one of the best ways to do your research.
‘Pretty quickly you’ll start to get a sense for what your money will actually get you, what’s good value versus what’s not, all of which can then inform some of your other choices like what and where you want to buy.’
While Bridie is a junior accountant, Josh said he has learnt most of his investing knowledge by listening to podcasts as he doesn’t have a financial background
While Bridie is a junior accountant, Josh said he has learnt most of his investing knowledge by listening to podcasts as he doesn’t have a financial background.
‘I’ve always just had an interest in personal finance – I enjoy learning about the different strategies that you can employ to put yourself in a better position financially,’ he said.
Josh turned to podcasts including Aussie Firebug, My Millennial Money and Barefoot Investor to gain a greater understanding of investing.
To gain financial independence and build a net worth, the individual must not have any debt, grow an income, increase their savings rate and invest regularly
To track how much they spend and save each month the pair use the phone apps WeMoney and Pocketbook
To track how much they spend and save each month the pair use the phone apps WeMoney and Pocketbook.
‘Tracking your saving and investing journey forces you to regularly think about what you’re doing (money-wise) and how you’re progressing with regards to the goals that you’ve set. It’s a way to hold yourself accountable,’ Josh said.
Josh said he believe it’s vital to trace how you spend your money rather than just ‘hope for the best’ and avoid the thought.
When asked ‘what’s next’, Josh said he and Bridie plan on continuing to focus on hitting savings targets and making consistent monthly investments into the share market to slowly grow their portfolio over time.
‘I’m a self-professed personal finance nerd, so the idea of constructing the plan for our share portfolio from the ground up is super exciting to me,’ he said.
Josh has also been sharing the financial journey on social media via his page Save With Josh in hope to inspire others to choose a similar investing path towards financial freedom.
INVESTING PLATFORMS IN AUSTRALIA AND NEW ZEALAND FOR BEGINNERS
Spaceship Voyager is an Australian financial services company offering investment and superannuation products, specifically designed to engage younger people
The platform is fee-free for balances less than $5,000 and will cost 0.10 per cent per year over that
In only three years, 100,000 Australians have begun investing with Spaceship
Raiz is another platform that allows Australian customers to micro-invest the remaining round up of everyday purchases in exchange traded funds
‘If you put your money into an index fund, then you’re spreading your investments across lots of different companies from the very start, which is something most experts recommend,’ Frances said
‘Don’t feel bad about starting with only a little bit of money – it lets you get a feel for what you’re doing, and you’re less likely to panic when the market inevitably goes down.’