How much money did you save and bank by the age of 25?
Just looking to see if im doing pretty good for myself on the overall average.
How Much Money Did You Save and Bank by The Age of 25?
Ltechguyau on 06/04/2017 - 22:03
Comments
I blame Ozbargain for making me broke, obese, single and having no friends.
I agree.
Class action lawsuit against ozbargain?Ozaction?
Unrelated post: deals on class action lawyers?
I'll be your friend you otherwise broke friendless single fat bastard.
Would you lend me money?
The mutual annihilation of our respective friendless status isn't enough for you?
Well i could make you non-broke i suppose.
We could get married at first OB exchange.
I could pay for your liposuction.We can make this happen.
Take my hand and join me on this journey.Thanks but no thanks.
The last time I took someone's hand where there was money and suction involved didn't turn out all that well.
@Scab: we dont need to lend you noney. I know of a nigirean prince that is more than happy to give a share if his wealth in return for a little assistance.
He doesn't happen to work on an offshore oil rig somewhere does he? I've invested so much with him and he's telling me it's compounding hourly! Can't wait for the payout…
and add to that to that having 'scabs'
I think it's due to your ears, personally.
But Ozbargain is supposed to save you money! :/
Not when you spend unnecessary money to save money.
About $150,000. Started by investing my income in the share market when I was working part time at uni in my teens and early 20s.
Mostly bought BHP shares for $12, they went to $40 a few years later. And Rio Tinto bought for around $40 and sold when they hit $150 on rumours of BHP-RIO merger :)
Did you have any guidance when you first started investing on the stock market or did you teach yourself how everything works?
Of course. I had expert advice from a stockbroker on the process, my goals and the stocks to invest in.
Trying to pick stocks as a rookie or an amateur is a big mistake.
Have money to invest at the right time…
There is no guidance to picking stocks that triple…
ie Those billion dollar fund managers get paid millions to get your investment 2-3% past the market/CPI
I was lucky. I was also living at home still at uni and had few expenses so my income went in to shares.
@Skramit: Good on you. Do you mind sharing which bank / broker you used when you were starting out? Do you recommend them as a good broker to start with for someone who never tried stocks before (which is me, but I've been dreaming of trying)?
/r/thathappened
Yep. He/She's full of it. Somehow managed to pick both the bottom and top for both trades.
Heh, think what you like. I rode the mining boom based on stock advice from a professional broker and got lucky….
Hi, how do you actively sell and buy stocks when you have little to invest and the brokerage fees are like $10 a trade?
I use a stock broker. Fees are higher than $10
So you had enough invested that the stock broker fees didn't really matter or how did you manage this?
Correct. I would save up say $5000 after a few months. Buy $2500 BHP $2500 RIO. Fees would be 1% on each trade.
Repeat.
Considering on those two companies in particular I made 200% or more over 5 or 6 years during the mining boom, the fees are insignificant.
I blew almost all my savings on an extravagant honeymoon when I was that age. About $18k. I think I had maybe $25k all up. No other assets at the time except a HECS debt and a $1000 car. So pick $25k or $7k depending on whether you think the honeymoon was a good spend (although still married, so maybe worth it?)
If you are still married only because of the honeymoon, then maybe…otherwise, maybe not :p
Pick $25k or $7k?
You spent $18k so you can't say $25kBut I had the money when I was 25, then spent it. It's a different question to say what is the lowest your savings account balance ever got after you were 25.
The thing I was saving for then was a honeymoon.And to answer my question. I have drawn my savings down to zero or negative many times (mainly when buying a house and needing the extra bit to pay costs, but it has been absolutely negative!). Why have savings unless you intend to spend it? - unless you are a money collector.
That said, I recommend the pleasant sleep having 6 months pay on hand brings, and I look forward to the day when my mortgage is zero and my biggest risk is how I make dinner (I make a mean pasta for about 30c a serve so don't feel much risk as long as I have a roof over my head)We forget how lucky we are in this country where we can literally ignore our healthcare - medicare will take care of the essentials, and ignore our retirement - default super will give us an ok retirement, and the age pension as a back stop. And if we get sacked, Newstart will stop us starving no matter how long it takes to get another job, and the disability pension will keep us going if the worst happens and we are left vulnerable.
Don't begrudge a bit of tax, people.
Very well said mskeggs. :)
Sometimes people here lose sight of why they're accruing money.
We forget how lucky we are in this country where we can literally ignore our healthcare - medicare will take care of the essentials, and ignore our retirement - default super will give us an ok retirement, and the age pension as a back stop. And if we get sacked, Newstart will stop us starving no matter how long it takes to get another job, and the disability pension will keep us going if the worst happens and we are left vulnerable.
I always get a sharp reminder of this when I read threads on reddit where folks from the US have been driven to dire straits because of healthcare costs for something we're not even think of.
A recent example I can think of, was of a fairly financially "challenged" chap who went to the ER for a relatively ghastly laceration on his shin. He consulted with the doctor who informed him that it would cost him about a grand+ for stitches; so he refused treatment and went home. His hospital bill: ~$400… for a consult.
I'm 22 with one apartment (about $70k in equity) plus about $20k in liquid assets. This is with zero inheritance or assistance.
I plan to have at least 3 properties by the age of 25 and around $150k worth of equity.
I am slowly starting to explore the stock market so anything could happen.
I plan to have at least 3 properties by the age of 25 and around $150k worth of equity.
The apartments might be worth nothing by the time you're 30, though.
I've got more equity in my home than rambutann has, so definitely not jealous. Real estate just isn't a viable investment strategy in the mid to long term.
People that are leveraged to the hilt are going to be in for a bad time when the market turns sour. Suddenly the apartment that is definitely going to "pay for itself in the long run" is worth less than the outstanding mortgage, rental yield has dipped and without the prospect of capital gains, the investment was a shocker.
You can't lock generations out of the market in perpetuity and expect capital growth. It's just not sensible. We're primed for a correction and the guy with a whopping 150k in equity against three properties in a capital city are the first that have to grip their ankles while the market does its thing. Suddenly we're like the Irish that learnt our lesson that the meme of "property always increases" is just (profanity) stupid.
@pais: and which alternate reality did this happen in? Apart from small blips eg. GFC everyone who was able to hang on is making an absolute killing, and it's mainly over leveraged people who buy mcmansions in cheap areas that are sent to the wall
Have been hearing this for 30 years. Sydney and Melbourne may take some slight corrections like in 2004, but this is the kind of crap that market and equities guys have been saying for 30 years.
There is not going to be any bubble, not until our other capital cities reach a point like Melbourne and Sydney.Have been hearing this for 30 years.
Oh yeah, you totally heard talks of a bubble when the house price index tracked in line with CPI. Totally.
The explosion has largely been 2001 onwards, and if you think a bubble that "only" impacts Sydney and Melbourne won't have broader consequences then I've got a 40sqm apartment with no windows to flog you.
Sorry, I wrote 30 years instead of 20. When house prices doubled in Western Sydney in 1996 people said the same thing. 5 years later after the Olympics and those same houses jumped another 25% the same thing was heard.
House prices in Sydney and Melbourne correcting by 5% is going to have zero effect on the other capitals too.
As long as there is an under supply, a basically open market for foreign money that purchases 15% of these assets, there will be a demand.Give us your prediction of when this bubble will occur and we can revisit in 10 years and see your new guess.
ah property investment these days … the textbook example of a ponzi scheme and equity "paper value". Pity the days of investing for things like rental income are gone.
Some "experts" (or just council moneygrabbers) reckon my place has gone up $200k since I bought it. I doubt people would pay that much, nor do I ever plan to sell it to (attempt) to realise that.
I have a couple of friends big into property too. If it works out for them then good on them, but I'm not getting into that gamble. I actually laughed when some "expert" said property values dropping on investors will hurt other economies - the huge loans at purchase have already done that!
How did you manage to afford all of that?
I'm 22 and been working since I was 17. I've probably made a net amount of $45-50k over those years but I've spent most of it.
Hi Kevin, not sure if you are aware but he answered your question below.
Thank you Hirolol. Such a thoughtful thing to notify me :)
Equity is debt unless you own it outright
Going to answer all 3 questions in one.
First up, I didn't say I was going to get 3 apartments. Unsure how they would be worth 'nothing'.. At the end of the day my current apartment will pay itself off in the long run and it will be a revenue generating asset. I'm really only looking at buying in Melbourne and potentially Brisbane.
Kevon, I had 5 casual jobs throughout my first two years at uni plus I was on centrelink as I was living interstate - I declared all income and often found myself receiving very little from the government. Third year at uni I started working full time on like $32k per year plus still working casual jobs, by the end of that year I had saved about $35k all up (at least $20k from this year alone). I then went and worked for 6 months in a job paying about $80k per year which mega boosted my savings - tax returns also majorly helped. I had about $55k at the time of purchasing the apartment. I got it at a mega cheap price, with one identical apartment recently selling for 20% more than what I paid for mine. How I did it - living in a share house, riding a motorcycle instead of a car or public transport, budgeting $100 a week for food and shit and not eating out.
As for debt/equity. At the end of the day it is an enabler to purchase more property. I could also sell out to access the funds.
"Equity is debt"? How does that work in the current housing market?
Just saying don't rush into buying properties just cause you want to reach 3 properties by age of 25. History always repeats itself and some time soon the property market will deflate (by how much no one knows). Set a goal of having 3 blue chip properties over the next 25 years
@chumlee: too true. The apartment won't really be much of a revenue generating asset either. Rates, insurance, stamp duty, service fees, subtract these from the annual revenue and you realise owning a rental property isn't all that great. It's better than nothing, but if you have a loan to pay on the property and stamp duty, it's nothing special. Especially considering the volatile market, most affordable apartments are going to be high risk in the future. Most wealthy people won't buy anything far from the city and most people can't afford to purchase apartments in these areas, especially younger people with no inheritance money.
The market can't keep going up. So many people can't even afford housing in outer areas, as the older population begin to die, many houses will enter the market, with few people able to afford to buy them. The prices will be forced down. This won't affect every area, rich areas are going to remain full of rich people, always, but outer suburbs and cheaper areas are going to go down.
At the end of the day my current apartment will pay itself off in the long run and it will be a revenue generating asset. I'm really only looking at buying in Melbourne and potentially Brisbane.
This hinges on the assumption that the apartment value will either increase or stay the same. The alternative scenario is that the apartment value decreases, and with it the rental yield. Suddenly the investment that "will pay for itself" is worth less than you actually paid for it. Worse: less than the outstanding mortgage. These are all scenarios and ones that most property investors gloss over, because we have simple mantras like "property always goes up" and "it will pay for itself" to rely on instead.
The Irish property investors all said the same thing. "Property always goes up", "it will pay for itself", "if there's population growth, there's property growth". The market sorted them out, too.
@pais: though the problem in Ireland is/was very different for a number of reasons - (1) it's not the best place to live -winter sucks. (2) the Irish economy is not that great - Australia has industry + primary production + low unemployment, (3) the demand for real estate was mostly domestic (Ireland + the UK), where as Aus has a lot of external demand.
Ireland didn't have the building boom that Australia can have (ireland is small as well). of course I'm not saying Australia's housing market is going to expand and property prices will keep increasing as they have been. there will be a point where prices drop, but I'm extremely doubtful that they will plummet like in Ireland.
Pretty sure the building boom works against the favor of the market, saturate supply and you decrease demand, eventually.
All marks go bust eventually - just depends how much you are willing to gamble in it.
@Jackson: not always. for work I have to look at historical sale prices of houses. prices wax and wane. though over the last 10 years they have mostly increased dramatically however there have been brief periods of stagnation durring that period - it appears that some individual sale prices were excessive for their time and when they the property next sold the sale price was then in line with the suburbs average for similar properties..
@altomic: If you draw a square, then graph the prices between 1900 and now, basically it's a straight line from the bottom left corner to the top left corner. If it wasn't there would be a big issue. Of course there are outliers, but they are just that, outliers. Same goes for the stock market, everyone who lost money on blue chip stocks in the GFC made it back and then some, the issue is hitting the wall and not being able to ride those bad times, and of course with stocks it could be you or the company you invest in hitting the wall, with property it will always have a value
So you'll die with no childhood nothing to say you've experienced life
Sad to read
Maybe now start living a little since you've already got a property
This comment is probably the most likely to mislead people who don't know anything about property investment. Equity will offset your debt when it's time to sell, which is the complete opposite
Well done. I think stock market is not a bad idea.
Risk management is vital to be profitable in stock market. Do some reading about this. Look at aussiestockfourum if you are more interested.
Take your time to learn about the market before you put your money in.
Good luck
Maybe this is more relevant to short-term trading, but perhaps starting with Paper Trades would be a good idea before you invest.
If you are still saving and not quite ready to invest, you could be practising in the meantime.
none, I had spent all my earnings on booze, entertainment and moving to London.
…the rest was wasted.
Same. $0. Had been in London for about a year. Spent every pound travelling. Came back a year later with a fair whack on the credit card.
Spent every pound travelling.
Can't be anything better than that.
I know it may not be financially the best, but how do we know we won't be hit by a car (or whatever) tomorrow? I'd rather have a life well lived and have some savings for a rainy day as opposed to slogging it out with no life experiences.
My $0.02
You should have done a poll.
I would have voted for $0I got negative balance in my credit card.
I can't even have nothing
nil
started working at 15 full time job. owned 1 unit no help from parents. thought I'm set for life then the next 10 years in a downward spiral, blew every cent after that. lol…..life
I like that you can brush that off as
lol….life
Monthy Python : The lol….life
Haha the next time the boss puts a stack of papers on my desk I'll look up at the sky and be like… lol…life
then the next 10 years in a downward spiral, blew every cent after that. lol…..life
You met a girl didn't you? Lol
Got around 25k
got or had?
Must have bet it all on red. See always bet on black.
Thanks Wesley
I spent all of my money when I was 23 on a 12 month holiday in Australia. I only really started saving properly when I was 25.
You exchange that money for travelling experience that somewhat broaden your vision (hopefully)
read as 'broden your vision'
nothing
probably would have had about 80k if i had saved, but i had 2 investment properties and around 30k cash
Had 100k and a new SS Commodore Wagon by age 23. Used most of that as 20% down payment for our townhouse in Melbourne.
Now 25 with 35k in cash.
Where the hell in Melbourne do you get a townhouse for $500k?
Reservoir. There's heaps around the 450-500k mark.
Townhouses aren't all 20+ squares, mind you. :P
That's a suburb? I thought that's where we keep all our water.
Rezzaaaaaa
$4.20
Yolo swag
$180k+
You win.
:p
Full house deposit, purchased at 26.
Around $70k
Assume this house isn't in Sydney :P
QLD :)
Currently 22 and studying, have 12k banked.
Would be 14k if not for OzBargain.