Young Money

Apr 30, 2017 | Finance, Residential Finance, Wealth Creation

Our education system in Australia is severely out-dated. Whilst students continue to learn conventional proficiencies in reading, writing and arithmetic, there is a persistent shortfall in the teaching of skills that suitably equip young people for the modern world.

These traditional subjects are viewed in many circles as essential in developing the next generation.  But there is an astounding lack of attention placed on financial literacy and equipping students with practical tools to budget, save and build their wealth for the future.

These traditional subjects are viewed in many circles as essential in developing the next generation.  But there is an astounding lack of attention placed on financial literacy and equipping students with practical tools to budget, save and build their wealth for the future.

I’m lucky enough to be involved with Northern Suburbs Rugby Club based in Sydney, which has over 100 players ranging from ages between 18-30. Speaking with the players, many believe that home ownership is not achievable – not just now, but ever! The gargantuan task of saving for the initial deposit, stamp duty and high entry prices in Sydney leads them resigned to the fact that owning a home is unrealistic.

I heard a quote the other day, ‘your 20’s is for investing in yourself, your 30’s are for investing’ – I don’t necessarily agree with this statement. Yes, continuing education, life experience (travelling) and doing your ‘apprenticeship’ is key to being a well-rounded individual. But I believe implementing the right behaviours at an early age (even with limited surplus money), developing financial goals and taking a long term investment view are the key components to building wealth.

With the advancement of technology and the power of ‘apps’, here are a couple of tools which I feel have helped me with managing my finances:

acorns

Acorns Investment

An app that promises to turn small change into an investment portfolio. Acorns links to your bank account and instead of wasting spare change, when using the bank card Acorns rounds up and reinvests.

For example –  if you spend $3.80 on a coffee, this can be rounded up to $4. with the extra $0.20 goes into the investment portfolio. There is also a feature that allows the user to set up recurring investments, being daily, weekly or monthly.

I have personally been using Acorns for over a year now, with this money helping me to buy a plane ticket to Sicily in September. This app costs nothing to sign up to, and has a monthly fee $1.25 for balances under $5,000.

Download the app here.

pocketbook

Pocketbook

An Australian budgeting app that helps you gain control of your finances, budget planner and tracks your money.

A few years back I would often ask myself the question: where is all my cash going?

The best feature of this app is that it connects to your bank so that you can track income and expenses automatically. Most people (not just young) tend to not track their own expenses, which often leads to money being spent outside of income and continuous credit card usage.

Download the app here.

These apps are free and are effective tools to monitor your cashflow and build wealth.

Having a plan, taking a long term view as well as being consistently disciplined with your saving behaviours will ultimately get you to where you want to be in life – but more importantly, start now.

Chris Hall is the Managing Director of Blue Crane Capital.

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