Season 3 Episode 15: Dual Incomes, Good Money… So Why Are We Still Struggling?
This week, we’re discussing a common situation we see: dual-income households earning great money but still struggling to get ahead.
Most of us believe that earning a better wage will help us achieve financial wellbeing. But in reality, it’s about knowing your numbers, being in the driver’s seat when it comes to your money and spending according to your values.
In this episode, we cover:
Mel and Darlene’s money truths: the reality of installing solar and the challenge of holding firm in the face of financial pressure from a teenage daughter
Why so many dual-income households are struggling – and our top tips for putting yourself in the driver’s seat when it comes to your finances
What financial wellbeing actually means
Why it’s normal for your financial focus to change at different stages of life
The trade-offs that come with every financial decision
How not knowing your numbers can prevent you from making confident decisions
Our TMC take is that earning more doesn’t necessarily equate to improved financial wellbeing. In fact, as we often see in our one-to-one chats, people navigating tight financial circumstances are often more informed and deliberate with their money.
We love talking about money – and we believe that the more we have these conversations, the more we can reduce the shame and stigma surrounding a topic that plays such a significant role in all our lives. We hope this episode resonates with you.
ABOUT THE MONEY COLLECTIVE PODCAST
Financial Wellbeing with The Money Collective brings together the stories and experiences of working with thousands of Australians when it comes to money, this is no holds barred, honest podcast. Darlene and Mel have been working in banking and finance for over 50 years and break down the barriers that we face everyday when it comes to our relationships, families and finances.
READY TO GO ON THE JOURNEY OF FINANCIAL WELLBEING?
Know your cost of living by listing your expenses with our handy spending review spreadsheet: https://www.themoneycollective.com.au/resources
Book a time with us to ask questions and talk all things financial wellbeing, home loans, and more. Email team@themoneycollective.com.au
Take action and uplift your own level of financial wellbeing with our online course: https://www.themoneycollective.com.au/onlinecourse
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Welcome to The Money Collective podcast. We're here to uplift your financial well-being. I’m your host, Mel Pearce and Darlene Neu. We are the co-founders of The Money Collective, and together we have 50 years of finance and banking experience where we provide the tools, information and guidance to better understand your money and feel confident making money decisions.
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So welcome back to another episode. I'm Mel Pearce.
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I’m Darlene and we're here, as always, to talk about financial well-being and funny and funny, funny, funny money.
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Funny money. I don't know.
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It's funny, funny.
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Sometimes money is funny, sometimes it's usually not. We spend a lot of time thinking about it.
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Yeah, we certainly do.
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Yeah. We think a lot about it. Only from a perspective of hopefully we can add some value of maybe, you know, to put it in its place.
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Yes, yes, that's it. So I don't want to be talking about it and thinking all the time. You don't want it taking up your brain space, but you don't want to put it so far ahead that you haven't thought away. We don't want to pack it away so that we don't know how to talk about it or work with it.
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Exactly. And what sort of outcomes that does or the emotions that it brings up. So we normally start with a true yes with today.
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Okay. So we recently had solar put on a house and we had it put on in the middle of winter and we just bit the bullet. We had no idea what we were doing and we didn't know anything about solar panels. And we'd had a few people come around before and then we just cancelled at the last minute and this time we just went kind of, Oh, well, let's do it, sign the paperwork.
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We had some young sales guy selling us stuff. Oh my gosh, the sales pitches on these.
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We could hardly make sales calls. I still get like, you know, I make at least five sales calls a week on sale.
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I would say I do, too. But then, like, we've had a couple of guys that come around and sit at our kitchen table and talk us through it yet. And they're young and they like, I'm like, I couldn't. That was just like a whole experience of its own, like where I'm going. And when I challenged him on, you know, the way I'm like, just tell me the details.
00:02:18:23 - 00:02:35:21
Like, tell me how much it's going to cost, tell me how much it's going to save us and what the deals are on the finance. And then he's like, Oh, you don't need to know that. We just it's like when I got there's an episode that I did around the car where I'm being gaslit the whole time.
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And I'm like, just tell me the details, put it on the house.
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And they and they say, Oh, we only need 40 minutes of your time to sign this up. And I'm like, Fine, well, you turned up 10 minutes late. And it actually, in fact, is an hour and a half. And I've got a meeting I've got to leave here with my husband. Literally. We sat there at the kitchen table and I had all of our bills up and I said, we average paying, you know, $550.
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I don't know. And he's telling me that we pay less.
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And I'm like, I've got the numbers here. I have a calculator, I've added it up. And then he and my husband proceeded to tell me that I'd had the numbers wrong, like the whole time because, like my husband Percy's is just like trying to make the guy feel comfortable. And I'm like, Anyway, I've got a good guy sorted out.
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Percy signed it all up and then like for the first few months, like we've got our app and we're watching it right, but it's the middle of winter.
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And like the sun.
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Hasn't come out and we get our first.
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The electricity bill was on Percy's right and I said we were going to save.
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Money and he's calling him on the phone and then the guy's answering anyway. So we're like, probably, maybe we started in June, so we had June, July, August, and then we've the last bill was only like an actual electricity bill coming down and it's like 150 bucks and sun. Yes. And I can see it and I'm like, dispersive, we need to see more data.
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We'll be okay that's made all the seasons.
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As I was relaxed into it, let's just say that way. But it is a bit of a thing. Like, yeah, it was interesting.
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It is interesting because we did this with a couple of you, Scott, and it's I'm a bit out there. Any listeners, there's so many people that can relate to this. I am guessing. I am guessing because I can relate to that. We did a similar thing and it's like the journey of solar. Yeah. So we looked at the years and years ago and thought, Oh, that's just too much money for it.
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And didn't do it. Yeah. And I kept revisiting it a couple of times. I can relate to that. And then we decided to bite the bullet because we bought an RV and we thought, okay, we're going to put the battery and do it all at once, and I don't know how much it saves. So I remember getting the calculator that day.
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It was a kilowatt automobile doing exactly what you're saying. And then we did it anyway because I let up and leap all at the same time. So it's really hard to know actually what it is and what it does. Yeah, because I'm an analytical person. I wish we had put the solar on, seen what that did, and then bought the car and I'd be able to tell actually the savings.
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But you know, what does it really matter? Probably not. You know, it's another source of energy in your house other than it's okay.
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Oh, overall, I'm happy with your decision and I put it on at the same time. I think they paid less and got more power.
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And I'm like, Oh, it's a bit weird watching that. I can relate to that. And then eventually I don't even have the upper anymore. It's like it's like it's not like.
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We're still getting higher. We're like, What do you think about the batteries that got to that.
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Oh my gosh, it's so funny. And then it's like a game.
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Is like, Oh, should I put the washing machine on it? Or like, did.
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You leave the oven? Or whether you do it during the day or not, just more different happiness that you put your dishwasher on during the day and like during the day, but not literally. Actually, I don't even think about it. But yeah, it's a thing. Yeah. Anyway, very funny that yes, it is something that costs us money, we repay and we don't really understand whether it's while or not, but you know, it seems to be the trend.
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Yeah.
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I'm happy with that decision. I can say it's going in the right direction. Yeah.
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Same site. Not just more cost effective. That's a good opinion anyway. Yeah. Fascinating one. Yes, I am definitely. You know, we see a lot of people putting solar and have solar on their homes and I'm sure the benefits are much greater than monetary. My truth is my daughters have mobile phones. Funny device. People like that. I'm this is where I'm at.
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So Lily, she is 15. She bought her phone actually out of, you know, a birthday. My niece and stuff like that for grade. It was the beginning of Right seven. I'll be integrating six around Christmas time so that everybody gets their money. Then she went and she bought an iPhone 11 I think she's got and so she's had that and now she's in grade nine.
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Maybe she's angry. Yeah. Three years. Three years in all for five. Anyway, that's a thought. I think it is what she thinks it is. So she wants to upgrade her phone. Look, she's dropped it a few times. Said to replace the screen. I've helped to pay for that along the way, but it's cracked again. It's like food that I said.
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It's gone nuts. Yeah, it is not worth it. I'm not putting a screen on you that you can do in order to do whatever. And so she's been pushing me to pay it by her and your phone. I said, No, no, no, I'm not doing it. So the thing is, though,
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I love the pressure. They're so good that it's like an art form.
00:08:07:17 - 00:08:32:20
Oh, my gosh. So he has how many rolls, right? So my mom was over a few weeks ago for the holidays and mom kept it to her and it was only what she needed and so she knew to manipulate me and raise this topic while mom was there. Yeah. And you know, Come on, Mom, why won't you give me money, you know, for the phone?
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I only need $150, and I've got enough. I said and she said, I'll do some jobs if you give it to me in advance. I'd feel for that for not doing that.
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Yes, we've been there. Yes.
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And then it never happens. I never get the job done. So I said, no, no, not doing that. And also with her part time job, it's only very selective when she works because she's got a social life and she chooses social life over working. Yeah. So I'm digging deep. So they're my reason for digging deep. The problem is I'm consistent because I just took her away for a week, inspiring for four days and she's going to the Northern Territory for a month and she needed some clothes and some things for that trip.
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Yeah.
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And so I've splurged.
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Yes.
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And she's saying, well why do you do all that? And you won't give me the 150 for the phone. Yes. So my feeling is, and I, I had a chat with her all those away when we were in good stead that hopefully she heard me a little bit more. I know how much this phone means to her.
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Yeah. So if you work hard for something, then it's something that's meaningful that you really need then you might appreciate.
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But also the phone isn't meaningful to you either. So the letter you have signed up and use it to her education and to close. Yes, basically. So you're like, I am committed to all of those things in your mind. Yep. And then this is an extra thing. So the extra things I want you to have are those. Yeah. That mentality of that's your extra thing.
00:10:18:09 - 00:10:23:20
That's right. And independence. Yeah. Well like I need it because these days we all seem to need a phone.
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It's just Andrews. It's like you've got this area of what's included, what's in and outside of.
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That, of that, I need to do that. So I said to her, I've been on the phone, you said, Really? You know, she does put it.
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Your own phone.
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Night.
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She does not.
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And I don't know if it really got bad. Maybe I can. And you find you can have my old ones that otherwise. Yes. Do you? She's a hundred.
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And 50 bucks away, surely. Right. Just do a few.
00:10:45:18 - 00:11:06:17
Shifts, do you? So I'm holding State, but man, she's coming at me from every which angle. The other thing I haven't mentioned is we bought Logan. A new phone is the only phone we've ever bought him for Christmas as a gift. A complete while for then. Yeah. And he was like, Oh my gosh, he hates it. I reckon he nearly fell on the floor.
00:11:06:18 - 00:11:22:18
Yeah, because we don't do that. But you know, he's a, you know, he doesn't have a lot of money, you know, I didn't know what to get him anyway. He's a very practical and very practical gift and she has held that. But you got him one less. But it's not Christmas, it's not birthdays.
00:11:22:20 - 00:11:24:19
You know, I say hold steady.
00:11:24:21 - 00:11:29:09
Steady, hold steady. Oh, my gosh. The whole phone dilemma. But I think.
00:11:29:13 - 00:11:41:03
The more you talk about it is also good as well, like the reasons why and like that, what's in and what's out. So, like, these are the things, you know, like we've committed to and we've signed you up for the school excursion and all of these.
00:11:41:03 - 00:11:42:12
Things, all the things that.
00:11:42:14 - 00:11:53:03
Make sense and, you know, but the extra things that you want to do outside of that, when it comes to social life, all the things that we think are in addition to those needs. Yeah, you know, I think about it, you know.
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Right. And you know, if you do it, you'll feel better that you actually did it yourself. Yeah.
00:11:58:22 - 00:12:01:23
I think they're telling somebody that it doesn't.
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It doesn't help that.
00:12:02:18 - 00:12:06:20
You're like just telling somebody to suck a sorry Andres.
00:12:08:03 - 00:12:15:23
Yeah. It's just like yes or no. Figure it out yourself and how you actually feels about that. We can't determine that.
00:12:15:23 - 00:12:17:17
No, that's true.
00:12:17:19 - 00:12:20:04
So she has to. That's her journey.
00:12:21:18 - 00:12:41:18
So it's like how it makes you feel. Mm. And I think it's very obvious that you don't want to buy her the phone, So we shouldn't, like, change our way, right? Like, we were having a very recent conversation before this podcast started around how changing you were saying how you change to match other people. Yeah, because you think it's going to be helpful.
00:12:41:18 - 00:12:54:22
Yes. It never is. It never is. It never is. Yeah. So we're going to stick to this like we're doing excellently. And she needs to face those feelings of like how am I going to get.
00:12:54:22 - 00:13:22:07
A not so good problem in or, you know, giving her something. And actually the external validation mail and I've been talking about a lot too, and kids want that. We all do. And then we were trying to get more from an inner, you know, in not needing external validation for us, so forth. But it really is very much there, you know, like but we know inside your head that she thinks that's going to make her feel good, but it's what, for a millisecond?
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A millisecond.
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Yeah. Well, I want my mom.
00:13:25:06 - 00:13:29:02
So she has a fancy phone. Whatever. Yeah. Yeah.
00:13:29:04 - 00:13:31:07
Okay. Not buying the phone. Stand strong.
00:13:31:07 - 00:13:35:09
Sorry, Lily. Love you. Love you lots. You get that phone, You will.
00:13:35:09 - 00:13:43:06
I know she will go. She wants that. She. It'll happen. It always does. Yeah. That. Yeah, yeah. This way. Okay.
00:13:43:12 - 00:14:14:10
All right. Well, today we want to get into a bit of a case study around what we've been seeing a lot recently. So we have had another bazillion conversations since we last recorded the podcast. And I know that what came up a lot this week in some of my calls was like having people in dual income households going, I should be doing better than what we are right now.
00:14:14:11 - 00:14:26:17
We've got this money coming in, but we are not getting ahead like we are. What comes easy is going out or even people saying we are spending more than what's coming in. We don't understand what is happening. Yeah.
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Why, why, why.
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It shouldn't be like this because we're on.
00:14:30:10 - 00:14:31:16
A good wicket.
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We know that our incomes are good.
00:14:33:12 - 00:14:51:01
Yep, we say yep, same thing. We've had lots of calls this week and direct and that was probably half the ones I had. So it is definitely a really common feeling. So if you're out there and you're feeling like that, you know, alone, hell no. But it's like, What are you doing? Yep, Change it.
00:14:51:04 - 00:14:58:08
That's right. And so I would say good on all those people who jumped on a call with us this week, you know, to talk about it, because.
00:14:58:12 - 00:15:18:09
That's a huge courageous step. Right. Acknowledgement taking action because what can we do? Think about it. I have good money. I'm not saving. I'm crap with money. I'm you know, I don't know why. And you can keep wallowing or, you know, feeling those thoughts. But until you actually take action, yeah, nothing's going to change. Yeah.
00:15:18:11 - 00:15:38:17
Because, like, we can see in, like, shame, it's like I should be doing better, so then we don't even talk about it at home and we just roll on and it's like easier to not bring it up than to do something about it. And the other thing that we know statistically is that people don't know the next thing to do, Like they actually don't know what the action is to take.
00:15:38:18 - 00:15:41:16
Definitely. Right. It's do? What do we do?
00:15:41:19 - 00:16:06:06
You know, like it's like I have to pay for these things. It's a bit like the Lilly thing or when you're out and about, it's just like, come on. And so, like, we've signed up for solar. We've got repayment on that now, right? That's why now you go to the factory. Yeah, that's actually a really good example. So because I followed the system right when we put the solar packages on, I cancelled Hellofresh because you knew where I knew that I looked.
00:16:06:07 - 00:16:07:23
In some way I got to come.
00:16:07:23 - 00:16:18:10
I didn't want to sacrifice the extra payments going into my home life. Yep. So cancelled Hellofresh and another and the toilet paper. What's the type of code.?
00:16:19:14 - 00:16:21:07
Yet. Don't give a crap.
00:16:21:12 - 00:16:27:16
Yeah that like yeah like yeah I'm sorry toilet paper paper.
00:16:27:18 - 00:16:38:17
Anyway, it's cheaper to buy it from a supermarket and we've been fine like our kids were over the meals at that stage anyway, so we need breaks from that.
00:16:38:17 - 00:17:07:11
It is all about your money and understanding your money and knowing your numbers. But you know what? Melissa's saying is like, if you know them, you can make deliberate decisions and to very prioritise, you know, for it. But what we generally do is we, we just leave. Confusion is the word that comes to mind. We just, we just go along, pay for things and then have that feeling of we should be doing that.
00:17:07:13 - 00:17:10:01
Yes, you know, Yes.
00:17:10:04 - 00:17:13:19
And it all just creeps up on us. All of these commitments that we have. Right.
00:17:13:19 - 00:17:28:10
And it just goes. And particularly we've got kids, you know, there's so many variables and, you know, things that need to be spent and they come out of left field and there's so much or you can argue, do they come out of left field? But, you know.
00:17:28:12 - 00:17:29:02
That's right.
00:17:29:02 - 00:17:48:03
You know, it feels like I just bought more piles on top and on top and on top. But, you know, I would argue that it's not you being in the driver's seat. It's letting things wash over you. I happen to.
00:17:48:03 - 00:17:48:10
Yeah.
00:17:48:12 - 00:18:09:22
Where it needs a stained Yeah. To make that shift you know, and to begin with how much we earn doesn't equate to financial being. No. It is two very different things. There's a view that the more we earn, the better off the better financial well-being will have.
00:18:10:00 - 00:18:10:11
That's right.
00:18:10:11 - 00:18:11:01
But that's not true.
00:18:11:11 - 00:18:29:00
No, no. So, you know, financial financial well-being, just as a reminder, is how you feel. But if you're feeling overwhelmed, you can't say what you have. You've got the least you should be doing better. Your financial well-being is, if not feeling great about it. It's not financial well-being.
00:18:29:01 - 00:18:54:11
No. And just to remind people, like what the definition of financial well-being is. So there's three components to it. The first one is being able to meet everyday expenses with some money left over. The next one is being able to enjoy our everyday life. So with that leftover money, we're able to enjoy our life. But then the third part is feeling secure for today, but also the future.
00:18:54:13 - 00:19:15:18
Like am I? It's those three elements. So sometimes it feels like we're trying to do it all, and sometimes it's very hard to get all three of those working simultaneously, and that can be a stage of life thing at the moment. And what so and I see them in levels. It's like, first of all, we want to meet our everyday expenses, right?
00:19:15:20 - 00:19:43:08
Then if there's money left over, it should inform how much we can and what choices we make to enjoy our life, like the type of holiday that we might take or the discretionary spending that we're able to do. Yet on the daily. Yeah, and but I think we kind of mix it all in together. We always say, like, I cannot tell you how many times I heard this phrase, Where's my money gone?
00:19:45:08 - 00:19:49:23
Well. Great question. That's right. Where did it go? Where did it go? Great question. I think we should.
00:19:50:00 - 00:19:53:08
But we can find out, right? We just have to do the work.
00:19:53:08 - 00:20:15:15
And so we really need to know what that cost of living is. And we say the cost of living is going up and up and up and up. But look, I couldn't even tell you real off what mine is. I have no idea. But I know that by the time I've done that work and I've set up a system that makes sense for me that I can work with in my everyday life, that I'm optimising my money.
00:20:15:15 - 00:20:38:23
That and I know in the moment like the way that it feels for me is that we're not doing a lot of extra things and I've probably prioritised the future part in lieu of that, enjoying that every day because that is actually what's making me build my financial resilience and my how I feel like going, because that's my stage of life as well.
00:20:38:23 - 00:20:47:06
At the moment I'm starting to get like I'm 43 and Percy's 53, is he? So I think he could be 52.
00:20:47:08 - 00:20:52:02
Think of the seventies as something that's good.
00:20:52:04 - 00:21:06:10
Yeah, 52 anyway, So like, we can see that, like we can't work forever or, you know, those things. It's easier for me to look at how much we've got to go. I'd rather prioritise.
00:21:06:15 - 00:21:38:00
Yet that future. I think that's a really good first and around goals and priorities is is to because you want to be decisive and deliberate and it does it's okay to change like if you're in the, in the situation where you're earning good money, you feel like you should be doing better, but you've got teenage kids, for example, then maybe when you look at your numbers and you get really deliberate with the priorities, maybe for a while you accept that you just not going to build as much financial resilience as you want to.
00:21:38:02 - 00:21:44:12
But it's a moment in time. Absolutely. You're still in the driver's seat. You'll still make that decision.
00:21:44:15 - 00:21:45:07
That's right.
00:21:45:07 - 00:21:52:07
Deliberately about where you are going to put your money for the now or for the future or a bit of both, whatever.
00:21:52:09 - 00:22:08:08
Yeah. Like if you're in your early thirties, for example, like I am not, it might be that with the money that we have, we are just going to make minimum repayments on our home loan right for now and we are going to go on an annual holiday.
00:22:08:08 - 00:22:12:09
It makes sense to try to make memories for that kid's writing. Maybe that's fantastic.
00:22:12:12 - 00:22:24:13
And then we know that there's going to be and I think that that's where I'm at. I've changed that trigger point where my kids are now on the verge of becoming independent. And so like, it's like the time has come. It's so weird how that happens.
00:22:24:15 - 00:22:46:09
Even though I think it's, hey, I don't know how Ed just how we might as well, you know, different focus and focus has happened at different stages in our life. And as a human being, you know, you want to be able to protect yourself and maybe, you know, when you're older or, you know, maybe you might have the feeling that I don't have to be there as much.
00:22:46:09 - 00:23:09:02
So I can be more free when my kids aren't there because they can look after themselves now. So I can be because I get a feeling a bit of that, like definitely me because the way we feel and think about money is made up of all day night, so to speak. And our experiences, a combination of that.
00:23:09:02 - 00:23:25:04
So I'd say naturally, I'm a long term thinker, a saver, and when I was definitely younger, I wanted to always put everything away for the future long, long term. But what is the trade off for that? I reckon, you know, I didn't live enough.
00:23:25:08 - 00:23:25:17
You're not fun? No, I'm bored. You know, I was.
00:23:29:11 - 00:23:31:18
I'm not saying you're not fun, but maybe you were less fun.
00:23:31:20 - 00:23:53:01
Yeah, Yeah, exactly. You know, so, you know, really buckle down, you know, trying to put savings away and think about all the things, you know, for the future, which means you fucking. For me, it was focusing less on making memories. Today they're not spending as much quality time. I mean, I do love what I do for a living and work, so it doesn't feel like work.
00:23:53:01 - 00:24:16:14
And I do love that. So but it's always right to do that versus staying at home with my kids as I grew up, for example, I didn't do that. Yeah, right. So because I was all in the future now, I don't know if I went back or changed anything. Actually, I don't think I probably would. But, you know, that happened because I was a very, you know, future.
00:24:16:14 - 00:24:43:02
Yeah. In saying that I think that natural life stages for me. So as I've learned more about this and more about work, our youngest is 15. I really do want to spend more time with her right now. I just went to Byron Bay, as I said, for a four day weekend and it's probably dropped five grand. Yeah, that I have never done in my life.
00:24:43:04 - 00:25:06:15
I would have never done it before. But right now I felt like that's what I needed to do because I feel my kids are growing up. I got engaged recently about going and, you know, yeah, you know, it's a different feeling. And Lilly is trying to work out where she wants to be in the world. You know, she's hopefully doing the exchange next year.
00:25:06:15 - 00:25:29:23
She's going to London. She's doing a, you know, leadership off campus program. She's really, you know, really entering into those stages of life to find out what she wants to do. So I actually feel really quite free. Yeah. So what am I saving it all for? It might be that I think after myself, my husband's not working, but I don't want to sit on the couch and get all.
00:25:30:02 - 00:25:40:12
But don't you feel like you've done the hard yards like when you were younger and you were career focussed and you were squirrelling away and putting it away for the future that is, you're in the future.
00:25:41:04 - 00:25:51:12
That is now? Yeah. You know, it's like you've done the hard yards, you sacrificed a heap to get to this point so that you had some freedom of choice at this point.
00:25:51:15 - 00:26:13:10
True, true. And then I did feel like I was in that situation though younger where we were earning good coin. Yeah. And I didn't know where the money was going. So I do have that feeling that, God, I could have been better with it. I do have that feeling. Wow. Yeah, that is. I don't wish I knew and I wish I'd been more deliberate.
00:26:13:14 - 00:26:24:18
Not so I can have more choices today. I actually think for me it would have been actually creating more memories with the money at that time. Yeah. So rather than.
00:26:24:18 - 00:26:25:20
I can only guess.
00:26:25:20 - 00:26:26:16
Went on in a way.
00:26:26:16 - 00:26:27:13
Fancy clothes.
00:26:27:18 - 00:26:47:13
Probably. Yeah, definitely. High heels. Definitely. You know, work trips definitely, you know, rather than actually we could have done one European holiday. I mean I love to travel for those, but you know I love culture and travel. We could have done a holiday. Yeah.
00:26:47:19 - 00:27:04:12
Yeah. You know, so when I was younger I didn't work as much and I didn't focus on earning money, right? I didn't care. All I cared about at that time was making ends meet yet and paying the bills and doing whatever we had to do to do the basics. And I didn't care. I was literally rolling in the mud with the kids.
00:27:04:12 - 00:27:30:05
Like I didn't even think about it. But then I would have liked and I've always liked, we compared myself to you. I'm like, Oh, I. But then do I regret what I did? No, not at all. Would I have done that differently? No. Do I think that and then and then I don't know. It's really good saying this out loud because now I think I've got to do the hard yards, too.
00:27:30:05 - 00:27:33:11
It's just like where we place those things. Yeah.
00:27:33:11 - 00:27:39:18
It's not just a hard matter. No, like right now it doesn't. But so this is the thing.
00:27:39:18 - 00:28:00:08
Like if you're feeling like this and your money's going in and out, I think it's liberating talking about it. And if you want to change it, it's like, are you? This is a very values based conversation that we're having right now. It's like, are you living aligned to your values and are you okay with that? And also, if you're spending all your money today, are you okay with that?
00:28:00:13 - 00:28:24:03
Because what does it mean for your future? Yeah, like, are you prepared to roll up the sleeves later or if that doesn't matter, are you happy just to whatever that looks like? Think about that longer term journey because that can give you financial resilience. It's like meeting that last checkbox of Do I feel secure for my future, which is knowing what that might look like and what you want it to look like yet and what you need to do to get to that place?
00:28:24:03 - 00:28:55:05
Yep, yep. And if we get back, you know, just to what you can actually do to maybe change those fears and beliefs in a practical sense, the first thing to do is, understand where your money's going and I am. It's if you want to make a change. Well, yes, if you're feeling this way and you hear the voice, you've come to a call or, you know, don't like nice people and not feeling good about it away from.
00:28:55:05 - 00:28:59:19
So yes, you are trying to, you know, build more resilience.
00:28:59:21 - 00:29:04:11
I need emergency funds. I'd like to pay down my home loan. I'd like to invest in other things in my future.
00:29:04:11 - 00:29:31:23
You feel like I don't know where that money's coming from and I'm really, you know, need to make a change if you are at that, if you've acknowledged that, then the very first thing you do is the most powerful thing you can do is put a number on what your mandatory cost of living is for the year. And I don't mean guessing and we've talked about this a lot going back through your bank account statements and what does it cost to, you know, keep the roof over your head, food on the table, the lights on.
00:29:32:00 - 00:29:33:12
Health care, clothes.
00:29:33:12 - 00:30:03:11
Right. You know, those things that will also matter, you know, in the future if we work on them today. So if you can put a number on your mandatory cost of living, the gold in it, though, is yes, being able to prioritise whatever's left over and where you want it to go deliberately, because that if you want to build resilience, some of it can go towards that emergency funds paying up the high sooner reducing interest because that will create future opportunity or whatever that is for you.
00:30:03:12 - 00:30:26:19
Or it could be like you saying, I just want to give the kids and us the best memories ever. And so I'm just going to focus on more of the now, but doing it deliberately or a combination of the two. But what it also does is knowing that number is not about what I have to save necessarily. It can be secondary.
00:30:26:21 - 00:30:54:19
What it does is the power in the decision making for whatever comes your way moving forward. Mel gave the example of this whole, and I know that is a small example, but just being able to deliberately decide on where that fits in our priorities and what we're going to do to make that work, rather than just either taking apart and making it work afterwards and feeling, you know, stretched or I'm not doing it at all.
00:30:54:21 - 00:31:17:12
So is it stopping not knowing the number can stop your decision making? If you're an avoider with money, you just won't make decisions and won't do anything. Maybe. Or if you're a saver, you might just, you know, keep going and, you know, squirrel everything you can away. If you're spending, you might just go hard, do it, and hope for the best.
00:31:17:14 - 00:31:43:07
You know, for example. So knowing the number for future decisions is so, so powerful. You might be considering a change in job if you don't know your number. How do you know? You know what you need to earn to make life work, for example? And it could be, you know, I definitely see a lot of people in, you know, late forties and this is a generalisation, but, you know, I really want a change in their life.
00:31:43:07 - 00:32:02:18
Like it's like, you know, work forever. And I see these young guys, you know, they've worked forever but they feel stuck. They feel like they have to do that job to support the family to make life work and that they can't go and explore or change a career. Maybe. Yeah, but if you knew your number, yeah, maybe you could.
00:32:02:18 - 00:32:28:01
You could make them forge a plan about how you could make that work. Yes. Normally in a financial position, we know what we, you know, assets, the things that we own, we know loans, we know our income, but we don't know our mandatory cost of living. Yes, that's the most. The missing link. Yeah. If you know all those things and that power and that number, it can really change your behaviour and your outcomes.
00:32:28:01 - 00:32:34:07
Yes. So that is the one thing practically you can do. Yeah. I mean have communication content.
00:32:34:09 - 00:32:59:13
Like I just want to overlay that with actual like some numbers. So like, like let's just say you've got a household income of like $200,000 and you've got a home loan repayment. This is for the year of $50,000 and that is your mandatory cost of living with $70,000, that leaves you with $80,000 left over. And so people go, well, where's that $80,000?
00:32:59:18 - 00:33:03:02
Yeah, no, it will not get it. Yeah, right.
00:33:03:04 - 00:33:26:04
So that is the choice that we have. So we could and this is where you can protect it, you go right. Well we can spend 40 and save 40, you know, like it's like becoming an informed decision where. And then if you set up a system and a structure around it to protect it and you're having these conversations where this is how we want to do it, you know, and then we have to become a little bit, you know, have a system around this.
00:33:26:04 - 00:33:46:15
We can't just leave it to luck. So, I mean, it moves us out of operating, out of our belief system that may or may not be serving us and our emotions and into like just an informed decision of and being much more in the driver's seat and being able to turn the wheel when we need to, if we want to or whatever.
00:33:46:17 - 00:34:01:14
It just moves that feeling. And so that's what we're trying to do is move that feeling where we go to bed at night and go, Well, at least I did the best I could. You know, I'm moving towards my goals instead of the feeling of just like, Oh my God, where's it going? Yeah, I'm working so hard.
00:34:01:15 - 00:34:16:18
Yeah, exactly. And I think that feeling like I use the term driver's seat. Do you feel financial being is feeling like you're in the driver's seat and driving your destiny? This is happening to the system or whatever it is just doing.
00:34:16:18 - 00:34:25:09
To you you know you've got windscreen wipers on. Yeah. In. Yeah. Off road, full driving. Yeah. Oh we cruising down the highway on cruise control.
00:34:25:10 - 00:34:49:16
You know which one. Yeah. I really feel like that's the definition of an actual being is when you're being, you're in the driver's versus everything just being done to you. Mm hmm. So if you're feeling like it's just outside your control and everything's just been done to you and you want to get more in the driver's seat, red flags, then that is the time to work on your financial wellbeing here.
00:34:49:22 - 00:34:56:16
So that's why it isn't necessarily linked to income, because salary doesn't automatically create financial wellbeing.
00:34:56:16 - 00:35:30:21
No, that's the next thing we want to move into. Like the team says, take on something at the end of these podcasts. And today we want to talk about because people say this to us, they are so like, you're here to help people who are in low salaries because they've got financial stress and we're like, No, no, it honestly doesn't matter how much money you're earning your financial wellbeing is not determined by how large your salary is.
00:35:30:23 - 00:35:43:23
No, and I know that you've got certain thoughts on this that people who are struggling straight like, well, who we might perceive to be because they're low income earners, particularly single parents, can manage their money particularly well.
00:35:44:00 - 00:36:04:06
I do have that because you've got less to work with. So sometimes when we are on a higher income like that, the belief of we just should be doing better, we were talking about or it should just be 1:00 am on a good income. I should work, should be. I'm not. I don't need to do any more than that. Yeah, because I've got good incomes, extra work where I think.
00:36:04:06 - 00:36:16:03
Like just on that too. Like we create these careers on these career ladders where we just go because going to give me financial security and then we never feel like we're.
00:36:16:05 - 00:36:42:22
Now you never reach it. Yeah, yeah. And we like that thought like it's not about it's not about building wealth. It's about resilience and having choice. But, you know, because what's your number? What do you need? Why do you need that? You know, there's so many questions around that and we're all really different in what we need. So yeah, because salary is not creating financial wellbeing.
00:36:43:02 - 00:37:05:11
In fact, I'd say, you know, back to our case study, it's a very common thing for you not to feel in the driver's seat and that everything's just happening and you're just, you know, doing and, and then you have the feelings like, you know, we said, Why don't I have more? I'm on a good income. It doesn't work. We're just coming back to that initial question.
00:37:05:11 - 00:37:16:09
If you've got less money to work with, generally there's a lot of the time that what we see is that you're actually more in the driver's seat because.
00:37:16:09 - 00:37:17:09
You have to make it work.
00:37:17:10 - 00:37:27:20
To make that work for the mandatory requirements you have of shelter and food and lights on. That's right. You are much more deliberate and in the driver's seat with what you're.
00:37:27:20 - 00:37:29:01
Making and you get you can.
00:37:29:05 - 00:37:31:07
He has better financial wellbeing.
00:37:31:08 - 00:37:52:02
That's right. And like you like you have to then let's say there's no money left over to do fun things. I was speaking to somebody this week who is in this position and she definitely would not have explained it like that. She goes, I've got three hobbies, like I love art and painting and walking, and her eyes lit up.
00:37:52:04 - 00:38:01:12
She's doing her living aligned to a valued right. Gosh. And she's trying to know I wow, I like it.
00:38:01:14 - 00:38:20:00
It's inspiring, honestly. So like if we think about then somebody on a higher income and we just go, I should be out to have all these things because I've done the hard work and I'm doing the things I was supposed to do in my career. I'm bringing in this. Julie: But then we have fancy cars and all the things like that.
00:38:20:00 - 00:38:20:21
I made that.
00:38:20:21 - 00:38:21:20
Social comparison.
00:38:21:20 - 00:38:27:03
Like I was just like I'm more materialistic, way more materialistic goal or our own line to working.
00:38:27:03 - 00:38:36:18
We need to. So imagine if you were the first person and your income steadily increased, but you could still live a life that resonated your truest values.
00:38:36:22 - 00:38:38:05
Oh my gosh. Where you put the blinkers on and you didn't care about what other people were doing because you were running your life and building your life like that. Doesn't that feel different? Diffused hits are different to me.
00:38:49:06 - 00:39:05:07
A completely different feeling. Yeah. If, you know, living the life you want and doing the things you want to do rather than doing what everybody else is doing because you feel like that's just what you do. And this again, everybody, it's just happening to me.
00:39:05:09 - 00:39:28:18
This brings me back to what we were talking about of air, internal and external validation like this. Like if you get your internal validation from your self, like your, your self-worth comes from your self instead of externally trying to prove things to other people. We don't even think this is subconscious, by the way. Of course, we don't walk through the world thinking we have to prove things to people.
00:39:28:19 - 00:39:29:21
But we do.
00:39:29:23 - 00:39:30:19
Like how.
00:39:30:19 - 00:39:32:14
We behave. And lately.
00:39:32:15 - 00:39:33:15
I am admitting.
00:39:33:15 - 00:39:38:13
These are the same. Yes, you know, lift off. Yeah. So, so true.
00:39:38:14 - 00:39:42:07
I think it's so linked to financial wellbeing that Yeah.
00:39:42:08 - 00:39:47:03
Rather than that external about universal inner validation maybe or inner self worth.
00:39:47:03 - 00:39:47:17
Yes.
00:39:47:17 - 00:39:49:14
Is very much linked.
00:39:49:16 - 00:39:50:05
Yes.
00:39:50:08 - 00:39:58:05
To financial wellbeing. Yeah. And then getting deliberate about the things you can do to be in the driver's seat as I say so now.
00:39:58:06 - 00:40:16:22
Oh yes. You know, I was going to say the thing that's popped up a little bit for me this week to having conversations is the expectation of education. Like, you know, like we have free Education Union Australia. Yeah, but the amount of people who put so much pressure and burden on themselves to educate their kids.
00:40:18:13 - 00:40:23:18
Because they think that I have to give my kids the best education. And I assume that.
00:40:24:00 - 00:40:26:00
Well, I think and that's.
00:40:26:02 - 00:40:30:00
I actually had somebody who said I might sell my house to educate my children.
00:40:30:02 - 00:40:51:16
MM. Like it's a really fascinating ask in can somewhere completely different way I have but it's a really big topic and I think we need to delve into it deeper in another episode. But oh my gosh, I would. If you come back to what we're talking about, if I'm on a bigger salary, I should be doing better. Yes, I would say why?
00:40:51:18 - 00:40:57:05
What your value of education would be the first question, why do you want to send your kids to private school?
00:40:57:05 - 00:40:58:01
Yes.
00:40:58:03 - 00:41:07:03
If you ask truly and honestly, is it for a better education? Maybe one for or is it ego driven?
00:41:07:05 - 00:41:07:22
Yeah. Is it status driven? Yeah, because I, I'm saying to be cool.
00:41:13:03 - 00:41:13:14
Yes.
00:41:13:14 - 00:41:14:11
Got it sorted.
00:41:14:11 - 00:41:15:02
If that's right.
00:41:15:05 - 00:41:31:14
If my kids go and have those opportunities, my, my, my kids have gone through private school, I can I say I went to a country public school and I got a fine education. I was okay, like you said. Yes. Again, I have no regrets. I'm happy with that.
00:41:31:14 - 00:41:40:05
You can't tell, I reckon. Or maybe you think you can tell me. But there's also nepotism and this is a whole another thing. Let me not divert.
00:41:40:06 - 00:41:55:14
I don't know. But I think the thing I would also challenge is why? Why are you doing it? And is it for the true values you have and is again challenging that thought and is it serving?
00:41:55:14 - 00:42:09:22
And the very last thing that I would add to that as far as why you're doing it, is you are doing it for your kids because you think you need to solve your kids problems to give them a leg up in life, right. When you're not giving yourself the leg up first?
00:42:10:00 - 00:42:37:22
I've just got to say. So I think, gosh, if I really unpacked while I taught when I was young, I grew up in northern Tasmania and I went to a public school which I was happy, like the best fun I had the best friends that are still friends now, but I always wanted to go to this to private schools in Launceston and I always wanted to go to one of the Scotch.
00:42:38:00 - 00:42:45:18
It was Grandma actually Grandma. I always thought when you'd see those kids at school sports and stuff, I wanted to be more like them.
00:42:46:00 - 00:42:59:02
There was definitely because I'm Tasmanian as well, this is coincidental, but I went to the Catholic school and there was a level, it was like Scotch were the richest then grandma, then. Yes. And then there were the public school kids.
00:42:59:02 - 00:43:03:09
Yep. And did you ever have that feeling? Yes. That you want to be more like them?
00:43:03:15 - 00:43:05:18
I just knew that they were richer and more well-off.
00:43:05:21 - 00:43:19:05
Yeah. If I'm funny because I'm thinking about this now, I reckon that is one of the key drivers. Why? My kids go to private schools and have gone to private schools and then once you're in the system, it's too hard to pull out.
00:43:19:05 - 00:43:20:11
Because they get friends.
00:43:20:14 - 00:43:23:14
They get friends, and particularly my daughter, Logan.
00:43:23:17 - 00:43:26:21
And if you do want to do it right and you got to do it for the others.
00:43:26:21 - 00:43:47:19
And she loves it. Yeah, she loves it for the social scene. Not the school, not the classes, because they probably, you know, the same curriculum doing the same things. But she loves it. What I can say is again, actually it'll be a topic for another day. There are so many extra things you can do, but you know what?
00:43:47:21 - 00:43:55:04
You can do lots of extra things outside of school. It doesn't matter. Like this is overseas trips and there's leadership programs.
00:43:55:04 - 00:43:56:07
Could spend time with the kids.
00:43:56:07 - 00:44:04:19
Sure you could. You know, all these other avenues. You can do that. That's really what I'm doing. So that style school doesn't, you know.
00:44:04:20 - 00:44:06:00
Take all the boxes.
00:44:06:01 - 00:44:33:17
It doesn't and it can put you in a bubble with the people that you're mixing with. This is getting a broad view of all of society. Yes. Yeah. Interesting. On what I would just to talk a little bit more about the team. See, take the other practicals that we've talked about. Obviously knowing you manage cost of living helps out teams that you take for all the conversations we have and the correlations that we make.
00:44:33:17 - 00:44:41:21
Well when we join Dots is if you do not have say, you're doing life with a partner.
00:44:41:23 - 00:44:43:15
And you don't have to.
00:44:43:15 - 00:44:54:11
And you're feeling like, you know, you're going good coin together, but money's not we don't know where it's going. Have you got complete visibility of your money? Of course. Who's controlling it?
00:44:54:12 - 00:44:55:00
Can you act?
00:44:55:00 - 00:45:09:20
Together to do it separately? What we know is if you don't have complete visibility and that you likely have less financial wellbeing.
00:45:09:20 - 00:45:15:01
That's right. Then if you do, because you're less likely to have shared goals or be on the same page of how that money's operating.
00:45:15:01 - 00:45:42:09
Right. So checking goals matters, but also, you know, it's power in numbers. So if you've got two people and an income in the household, you've got more opportunity to optimise that. And you can, by working together, working together and having individual joints. Now that depends obviously on the relationship and the situation at home. But if everything is good and you're feeling like you should be doing better as you check, that's a really, you know, a great starting point.
00:45:42:11 - 00:45:50:09
Our bank accounts together. Can we say all the money? Are we making joint decisions on where it goes? Yeah. That would be.
00:45:50:11 - 00:45:54:06
You know, and if the relationship didn't work out, what would we do? Yeah, cool.
00:45:54:10 - 00:46:04:05
That's fine. That's good. That's healthy, too. Yeah, that too. Yeah. Cool. Yep. Anything else? More to add on the team? Say, no.
00:46:04:06 - 00:46:07:06
Not today. But, like, look, it's endless. Let's admit it.
00:46:07:06 - 00:46:09:20
So I think we've got lots of opinions.
00:46:09:22 - 00:46:14:08
That's history. So thanks for joining us and we'll catch you next Sunday.
00:46:14:10 - 00:46:25:02
At The Money Collective. We provide financial wellbeing, premium coaching, mortgage broking and workplace financial wellbeing programs, which we couldn't do without the seamless support of our fabulous team.
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