How do I balance travel, home ownership, and financial independence post uni

Hi Emily,

First of all, congratulations on your graduation and landing a job! This marks an exciting beginning to your financial journey, and it’s perfectly normal to have a lot of questions about personal finance at this stage in your career. There’s a wealth of information to absorb, but the bright side is that you’re starting early, which can be a tremendous advantage.

Here are some broad guidelines to steer you in the right direction:

• Educate yourself.
• The more you know about personal finance, the better equipped you’ll be to make sound decisions. There are many great resources available, both online and in libraries.
• Set financial goals.
• What do you want to achieve with your money? Once you know what you’re working towards, you can start to develop a plan to reach your goals.
• Create a budget.
• This will help you track your income and expenses so you can make sure you’re living within your means.
• Pay off debt.
• High-interest debt, such as credit card debt, can be a major financial drain. Make a plan to pay off your debt as quickly as possible.
• Start saving for retirement.
• Even if you’re young, it’s never too early to start saving for retirement. Compound interest can work wonders over time.

As for achieving financial independence, there are many different paths to get there. One popular approach is to follow the FIRE (Financial Independence, Retire Early) movement. FIRE is about saving a high percentage of your income so you can retire early and live off your investments.

If you’re interested in pursuing FIRE, there are a few things you can think about:

• Live below your means.
• This is the key to saving more money. Spend less than you earn and invest the difference.
• Invest wisely.
• There are many different investment options available. Choose investments that

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Hi there, this is a great question. I’m sure many others are asking themselves the same thing.

Here’s what I’d say…

— One approach is to set aside a certain portion of your ongoing savings for travel, plus for a home deposit. Remember, a paid off home can eventually contribute to FI, so that’s worth keeping in mind.

— Consider which of those priorities is the most important to you. This requires a bit of soul searching and serious consideration. It can be tempting to try to do everything, but often when we do that, it just means slow progress everywhere in life. It’s more powerful to get clear on priorities and do then 1 or 2 at a time vs having a more scattered approach.

— If your debt is a relatively low interest debt like HECS or similar, it can be fine to leave this in the background. But if it’s like a personal loan or car loan, it’ll be more beneficial to get rid of this asap, so you can focus your money on those more important areas.

— The smart move for your finances is to simply work on growing your income and creating a solid savings habit. That will see you through the worst of problems and ensure you’re always making progress to whatever goal you decide to put energy towards.

— The way you reach all of these goals is through earning well and saving a good portion of your income, so try to keep your focus there and don’t get too distracted by fancy sounding investing strategies or tax schemes etc.

Hope that helps give you some stuff to think about. I wrote an article about this on my blog a while ago: https://strongmoneyaustralia.com/how-to-beat-...

All the best.
Dave

I was thinking about this retrospectively. I’m in my late 30s now and I’ve built a house, have good super, and beginning to build my share portfolio. I thought I wasted a lot of money in my 20s (and I did). But I also developed some really good savings habits that enabled me to do things like take a year long sabbatical in Bali.

I had an interest in investing but I just didn’t know how to do anything (my parents didn’t know either).

If I could go back in time I would have learned more about investing and just worked out simple percentages to allocate my money to. Eg. 40% living expenses, 20% fun, 20% debts, 20% long term investments.

You’ve got so much time up your sleeve. It’s important to just get started with lesser amounts over time rather than stress about how much. But you are only young once so you’ve gotta enjoy that. But whatever fun stuff you wanna do, just make sure you can pay cash for it.