This is how superannuation helped a highly educated woman save... big time!
Let me preface this blog by assuring you that I’m a highly educated woman. I was in the top 5% of the state when I finished high school, I polished off a double degree at university, and I raced into a six-figure salary.
And yet despite all that, I’m absolutely hopeless with money. Simply shocking. I spend it like it has an expiry date. I have no notable savings – just whatever is left over from my last pay cheque.
It’s not like I had bad role models. My parents are the biggest penny-pinchers you’ll ever meet. My brother, too. So while they’re living high off the hog now with a portfolio of investment properties and regular vacays to the Maldives and other exotic locations, I’m still renting a pokey little flat and paying off a massive debt I accumulated in my 20s, when I maxed out not one, not two, but three credit cards.
When my salary lands in my bank account, I immediately start thinking about how I’m going to spend it. What stupidly expensive thing can I buy just for the thrill of being able to do so?
My theory is that it’s because I was denied so many things when I was a kid, and I went a bit over the top when I could buy things for myself. It’s an excitement I never quite got over, despite the fact that it’s been almost 20 years since I moved out of home.
The thing is, I have actually owned investment properties before. My parents set it all up – they guaranteed the loan, organised the sale, contracts, etc – all I had to do was pay off the mortgage every month. It was a one-bedder in Potts Point, which would probably be worth a fortune now, but I sold it off before they gentrified the area, and I made about $20K on the sale. Which I then proceeded to blow on expensive camera lenses (I was heavily into photography at the time). Yep, the folks at DigiDirect know me well.
This is why superannuation is a fantastic system. It’s designed to save people like me from our worst impulses, essentially forcing us to put money aside for retirement. I don’t have a choice when it comes to the mandatory super contributions that come out of my wage, and I’m good with that.
“I don’t have a choice when it comes to the mandatory super contributions that come out of my wage, and I’m good with that.”
Recently, staring down the barrel of my impending 40s, I’ve become more aware that I need to stop being so frivolous with money. But I’m wary of investing it into anything where I can take the money out on a whim. I still don’t trust myself with money. Saving for a house deposit is definitely top-of-mind for me, but I’ll be tipping the rest of my money into super. I earn more than enough money to sustain me in the here and now, but what will happen when I retire, given I don’t have any savings?
The real eye-opener for me was finding out that women over 55 are actually the fastest growing group of people experiencing homelessness in Australia. As it turns out, mandatory employer contributions aren’t enough to guarantee a comfortable lifestyle – especially for someone like me, who was self-employed for nearly 10 years and didn’t pay a cent of super during that time. I had no idea I was supposed to be doing that – paying my own tax was hard enough.
The key for me was finding a super fund that automated the process of saving so that I didn’t have to think about it or make a conscious effort. FairVine Super matches this requirement perfectly, with a bunch of clever features that take the pain out of saving by prioritising small, regular contributions.
The ‘RoundUps’ feature rounds all of my everyday purchases up to the nearest dollar, and sweeps the loose change into my bank account. TopUps is another feature that enables me to transfer $500 to my super fund whenever I get paid – since it’s automatic and happens as soon as I get paid, I never actually see that money come into my bank account, so it’s like it was never even there.
FairRewards is another cool feature that FairVine Super offers. I have yet to set it up on my dashboard, but basically it gives you a rebate of up to 15% off purchases you make at major retailers like The Iconic, Lorna Jane and Menulog - so even when you’re shopping or too lazy to cook dinner, you’re saving for your retirement.
There’s still hope for me. Getting older does mean getting wiser, and despite my best efforts to the contrary, I’m trying to be more mindful about my spending. I’m grateful that no matter what happens, my retirement is sorted now that I’m making regular contributions and I can’t touch the money until I retire. I know my future self will thank me!