Nursing My Debt

Hi there,

I know you are probably sick of hearing this … but thank you so much. Four months ago I picked up your book.I am a single dad who works as a nurse, owns his own home, and works three jobs to make ends meet. I was $3,000 in credit card debt, had $750 of my rates outstanding, and a measly but annoying $220 of my car insurance still to pay. Well, today I domino-ed the last of these debts as I paid off my credit card. I jumped around my bedroom listening to the song ‘Celebration’ by Kool & The Gang … I was so proud of myself! 

Sam

Hey Sam,

How impressive are you?

You’re working three jobs -- including one of society's most important jobs -- just to get ahead for your kid.

In my book Barefoot Investor for Families, I encourage parents to do a family backyard ‘bill burning ceremony’ -- literally setting fire to a paid off bill, credit card or loan.

They’ll likely remember that night 30 years from now, and the underlying lesson: work hard and get out of debt.

Celebrate good times, come on! Thank-you for reading

Scott

How a Teenager Works 5 Hours … and Gets $1,500

Hi Scott,

I am an 18-year-old and have been laid off from my job at a swim centre because of the coronavirus. The company had applied for the JobKeeper payment, which I have tagged along on. I just found out that, even though I only worked five hours a week, I will be getting $1,500 each fortnight! How do I go from managing $150 to managing $1,500? I was thinking of keeping the $150 I normally make and saving the rest. What would you do?

Sabrina

Hi Sabrina,

Now that’s what I call Corona Cash!I have to tell you, as a taxpayer, I’m a little peeved about this.

But, as the Barefoot Investor, I’m proud of the fact you’re contacting me to do something smart with it.

Most 18-year-olds in your situation would go to Bali!

(Oh actually, you can’t do that, can you? Ha! Well, at least you can go take a trip on Bendigo’s world-famous Talking Tram, so long as you adhere to social distancing ... only four people per carriage. Rock on!)

Still, you’ve got the right idea: keep living off the income you’re used to, and use the rest to set yourself up financially.

My advice would be to stash away $2,000 in a Mojo account, for when it’s time to move out of your parents’ place.

Then, set up your buckets (including one you nickname ‘Sabrina’s House Deposit’) and start saving for your own place.

You may feel that’s a long way off, and it is.However, each time you flick open your banking app you’ll see it slowly growing.

Thanks for making my tax dollars actually do something productive!

Scott

Pilot Gets Grounded

Hey Scott,

Last time I emailed you, I had a well-paying job as an international pilot, the share market was at a record high, my super was doing brilliantly, I was investing every month and we were planning a holiday to Greece. I wrote to thank you for changing our lives. Now the share market has plummeted, my super has been smashed and, thanks to COVID-19, I have no job. Now I am writing to REALLY thank you. Healthy Mojo, no credit cards and low-fee banking have prepared us well. More importantly, this is an opportunity to show our three young adult boys a real-life example of living within your means, and that the world does not end when hard times hit!

William

Hi William,

Dude, you’re facing your own financial fire with all the Alpaca attitude you can muster!(Non-Barefooters won’t have a clue what I’m talking about, but you will.)

You may be down, but you’re not out.

The thing I’ve learnt as a parent is that kids don’t always listen but they always watch:

And they’re watching you rise to a challenge.You Got This!

Scott

I Lost My Job This Week, But I Got This

Hi Scott,

I wanted to get in touch with you to say thank you. I lost my job this week. Previously this would have been a devastating blow for our finances. However, thanks to reading your book three years ago, my husband and I are now in a very strong financial position. We have paid our mortgage down by half, and we have a good amount of Mojo in the bank. Now we are able to focus on our kids in this scary time. Thank you!

Jill

Hi Jill,

What a strong position you’ve put yourself in. Congratulations!

You’ve also made a really important point about focusing on your kids.

Don’t think your kids aren’t watching you very closely.

Generational attitudes to money are being forged around the family dinner table right now.

So let them know you’re in a decent financial situation because you sacrificed in the good times.Drill it into them.

You’re sorted, Jill, but what about all the parents reading this now who are really stressed about their financial situation. What should they do?

Well, some parents will try to shelter their kids from the financial reality of this situation.

Yet kids are smart: they pick up on what’s going on.It’s okay to be worried. Just channel that fear into something that will serve your kids, like saying to yourself: “Things may be tough now, but we’ll get through it. And never again will this family be financially vulnerable. It starts today.”

You got this!

Scott

There’s Always Someone Doing it Tougher

Hi Scott,

I’m a flight attendant who has just been laid off. It’s a bit scary not knowing when or if I’ll get my job back, but thanks to you we’re okay for now — we have Mojo enough to last us for several months. I also watched your bushfire doco, ‘The Road to Recovery’, the other day. It’s a really good dose of perspective that there are a lot of people doing it tougher than me. So I just wanted to thank you for all the good work you do.

Kaye

Hi Kaye,

You’re absolutely right … Now is the time for some much needed perspective. I got mine last week, before the lockdown came into place, when I travelled to the fire-affected community that I’ve been volunteering as a financial counsellor. 

Think about this for a moment: it’s been three-months since the bushfires. We know from experience in previous disasters that it’s at around this time that mental health issues start to surface … and now they have to socially isolate and stay home alone. 

The locals I met with told me they (quite rightfully) feel like Australia has forgotten about them.

It’s a disaster in the making.

Scott

How to Blow $50,000

Dear Scott,

My fiancé and I work in hospitality, earning around $55,000 each. We love the industry we work in, but unfortunately it does not pay well. We are saving to go to Vietnam next year, but after that we need to save for our wedding and honeymoon, which will be about $50,000 in total. After that we need to save for a house deposit. We have a baby, and my fiancé works days and I work nights so childcare costs are minimal. But getting a second job is out of the question. What is a good way to save as quickly as possible?

Emma

Emma!

Are you on drugs? Or …  are you planning on supplying drugs at your wedding?

You can’t be seriously considering spending an entire year’s wages on one day!

Fair dinkum, I’m tapping the keyboard so bloody vigorously right now that I’ve woken up the dog, and she’s moving gingerly to the back door. (She knows the score.)You wrote to me for my advice, so I’ll give it:

I think you’ve got your priorities completely out of whack:There is zero correlation between how much you spend on your wedding and how long your marriage will last.

There is, however, a high correlation between money worries and divorce.

If I were in your shoes I’d first use that money to build up your Mojo, then put the rest towards a deposit on a home.

What about the wedding?

Well, you’re in hospitality, so why not ask your workmates to help you plan a rustic, authentic backyard wedding?

Years from now it’ll become your family legend: you started with nothing, and created something amazing. 

Scott