Learning

100 People Tell Us How Much Money They Make...

Why is it that people don’t like sharing how much they make? Aren’t people interesting creatures!

Checkout a video below from CUT where 100 People Tell Them How Much Money They Make.

How much do you make?

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

Frequent Flyer Points and Travel Hacking: My top 16 tips

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The only way I can describe Frequent Flyer points is AWESOME!

They allow you to travel around the world for a fraction of the price you would have otherwise.If you are interested in personal finance / FIRE, but also love to travel then “point hacking” is for you.

In Australia there are two main programs:

  1. Qantas Frequent Flyer

  2. Velocity Rewards (by Virgin)

They each have their pros and cons. Qantas points are easier to come by, but the taxes are usually lower on Velocity.

Here are my top tips for acquiring and redeeming frequent flyer points:

  1. Take advantage of credit card sign up’s offering stacks of bonus points at a great cents per point rate

  2. Make sure you are eligible for the bonus points (meeting the minimum spend in the time frame and ensuring you haven’t had a card with the lender for a while (usually 12 months, 18 months for Amex and once only for Qantas Money (booo)

  3. Add to your calendar when you should be receiving the points. More than 50% of the time I don’t receive the points when they are due (bank not keeping their word - how surprising #bankingrc)

  4. After you have the bonus points, cancel the card ASAP. This minimises the time until you can apply for a card with the same bank again

  5. Always pay your credit card balance in full so you don’t pay any interest

  6. If you have a mortgage, refinancing can yield a ton of points (a couple of years ago I received 250K velocity points for refinancing)

  7. Frequent Flyer points expire after a period of no account movements (earning points or redemptions)! Qantas after 18 months and Velocity after 24 months

  8. Follow points sites that post more often than I do. www.pointhacks.com.au and www.ausbt.com.au/ are my top two

  9. Do not redeem the points on anything except flights (unless you work for an airline and get cheap flights)

  10. Always analyse the effective cents per point on your redemption. Look up the real price for the flight and take away taxes on the reward flight. Take this number and divide by the number of points to redeem. This is your effective redemption value per point.

  11. Stay in an AirBnB instead of a hotel to save signifcanly

  12. Book ‘classic’ rewards and not any seat

  13. Book your reward seat well in advance or last minute to get better seat availability

  14. If you want to try business or first class, but don’t want to part with thousands of dollars, points can make this achievable. Business class seats generally cost twice as many points as economy. However as I am sure you are aware, business costs much more than twice economy! I just looked up Qantas First class MEL to SIN. On SkyScanner it is $3,378. Using Qantas Points it is 90,000 points plus $325 taxes. This works out to an effective redemption value per point of 3.4 cents. This then values the 250,000 points I received for refinancing at a whopping $8,500!

  15. Always do the numbers to ensure you are acquiring points at a low rate and utilising at a high rate

  16. Make sure you don’t hoard too many points. The points to redeem rewards go up over time, so your points effectively depreciate or have less buying power (like if you leave money in the bank, inflation will reduce your buying power over time)

What do you think? Do you agree wit the tips? Any tips you would add?

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

Curtin University Interview: Mawer money, fewer problems

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Great to be interviewed by Curtin University

Recent data from the the Australia Bureau of Statistics reveal the nation’s household to debt income ratio has hit nearly 200 percent, a level the UBS has called one of the “highest in the world”.

With the banking royal commission exposing gross misconduct by some of our biggest banks, many of us have been spurred into thinking how we can improve our financial autonomy. One answer could lie in learning ‘financial literacy’.

“Financial literacy is having a well-rounded understanding of all matters to do with personal finance and using this knowledge to make informed decisions,” says Greg Mawer, Curtin accounting and finance alumnus and Director of Mawer Consulting.

“It’s about taking small, consistent and planned actions to reach a desired outcome. It’s about having discipline to not spend the money that has been saved or invested. It’s about being patient and about not feeling the urge to keep up with the Joneses.”

Mawer admits it is increasingly challenging for people to resist comparing their lifestyle when we live in a culture that encourages competition and consumerism. To counter these beliefs, he started the blog Mawer Money in 2017 as a resource for people to learn how to better utilise their finances to enhance their wellbeing.

“I started Mawer Money as a social enterprise to help Australians with financial literacy and empowerment,” he says.

“On the hierarchy of needs, money needs to be spent on safety, food and shelter. After that, whatever provides you with a fulfilling life, allowing you to spend quality time with the people you love. Preventing lifestyle creep (where your expenses increase in line with your earnings) is important.”

Mawer has a rich employment history in accountancy and finance, and after working in senior accountant roles for companies such as BGC Contracting, he took the plunge and started his own consultancy firm, Mawer Consulting, in 2013.

Read the rest of the article here

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Click here to sign up to our Newsletter to receive the latest in Financial Empowerment and Personal Finance.

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

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Five expert tips to make money-talk in your relationship more romantic

Great to be asked to provide expert commentary on money and relationships for mozo.com.au.

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Money and love might not go together quite like strawberries and chocolate or wine and cheese, but loved up couples can seriously benefit from tackling their financial demons before they head out for a romantic date this Valentine’s Day.

With that being said, approaching such a touchy subject can be a little awkward, so how do you successfully tackle such a sensitive and often (unnecessarily) stressful topic without offending your significant other?

To answer that question, Mozo reached out to a few financially-savvy experts who dug up some personal finance gold for couples addressing their money matters this Valentine’s Day.

Click here to read the full article.

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Click here to sign up to our Newsletter to receive the latest in Financial Empowerment and Personal Finance.

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

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NYE Reflections: The best way to achieve your goals in money (or anything else)

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Happy New Year!  This time of year is perfect for reflection on the year that has passed and to make goals for the coming year.

When making financial goals (or any goals in fact), they need to be S.M.A.R.T:

Specific

Measurable

Attainable

Relevant

Timely

E.g.

Specific: A clear goal in mind

Measurable: If you cant measure it, you can't improve it. Whether it be in dollars, percentages, kilos, you must be able to measure it

Attainable: Not unrealistic (e.g. I want to be the world's richest person tomorrow)

Relevant: This one is pretty obvious, but is has to be relevant to what you desire to achieve

Timely: You have to put a time frame on the goal. When you intend to start and when you intend to reach your goal

One final tip: You should also write these goals down and tell others about your goals. This will help to hold yourself accountable and increase the likelihood of reaching your goals.

What are your SMART goals for the coming year? Feel free to let me know in the comments below

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Click here to sign up to our Newsletter to receive the latest in Financial Empowerment and Personal Finance.

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

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Credit cards – drugs for the weak!

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Nearly all personal finance strategies involve strength, persistence, dedication and time.

Why are credit cards like drugs? They are easy to get your hands on, provide a temporary high, but are bad in the long term and will destroy your life.

Credit cards at their best are fantastic tools for managing cash-flow, minimising interest (not a misprint) and acquiring frequent flyer points. At their worst, credit cards lead the weak in a downward spiral to financial oblivion.

You should only use credit cards if you know you can pay off the balance in full when due.

Let’s look at a situation where a household spends $6,000 on their credit cards each month. If the balance is paid in full from a mortgage account (or preferably offset – will back link in future article), the cost (more opportunity cost in this instance) at current mortgage rates of 4% is $240. If the balance is carried (e.g. one month behind where the balance and the where the interest is charged) at 20% is $1,200 a year. This is a difference of $960.

EVERY SINGLE YEAR OF YOUR ADULT LIFE!

Taking into account compounding and inflation (a couple of my favourite topics) over 60 years is $569,909. OVER HALF A MILLION DOLLARS!

Banks love that you carry a balance on your credit card because the above is the income they receive from a large number of the Australian population over their lifetimes. People love criticising banks over their massive profits.

If you can’t beat them – join them. Perhaps buy some bank shares (unless you think Australian property is overvalued on a range of metrics and Australian banks are holding a ticking time bomb of bad debts if interest rates increase, unemployment increases, wage growth continues to stagnate etc).

Take away points:

1.     With discipline, credit cards are an effective interest free tool;

2.     You should only have a credit card if you have the cash (or a 100% certain future cash-flow) to pay off the card in full;

3.     You should never pay a single cent of credit card interest in your life;

4.     You should never pay a single dollar of annual fees (one caveat – if you can acquire masses of frequent flyer points at efficient cents per point rates – I will back link once I write the article); and

5.     Zero interest introductory rates can be used with caution (but please compare the effective after tax hourly rates of the effort).

What are your opinions on credit cards?

You’re welcome.

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Click here to sign up to our Newsletter to receive the latest in Financial Empowerment and Personal Finance.

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

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Inspiration Series: Grace Mugabe

In the inspiration series, I blog about people that inspire me to acheive more than I could ever imagine. These are people that I either know personally or admire from afar. You will realise that a number of these people are either direct or indirect competitors. These people have the same mindset as me that they want to help educate and it doesn't matter where the knowledge is learnt, as long as it is learnt somewhere.

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Introducing Grace Mugabe from Financially Empowered.

I have been inspiring young minds at Curtin University for 12.5 years (it is a long time now I think about it - about 38% of my life so far!). I met Grace around 12 months ago when she came onboard to teach in financial modelling. I invited Grace to my office to catch up for a coffee and a chat to see if she needed any help in her new role. We ended up chatting for a long time about our shared passion for financial literacy and financial empowerment. There are only a few people that I get to chat to about financial literacy and financial empowerment who are on the same page and Grace is one of them.

Grace has achieved so much in such a short space of time. Grace is a fellow of the Leadership WA Rising Leaders Program as well as the Hive Global Leaders Program held at Harvard in June 2017. In Sept 2017, Grace was named one of three finalists in the United Nations Association of Australia (WA) Excellence in Gender Equity Promotion Award. She is also the ambassador for Behind the Brands, a hub for female entrepreneurs in Western Australia.

Grace is an amazing and inspirational young woman and I am privileged to call her both a colleague and a friend.

You're welcome.

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Click here to sign up to our Newsletter to receive the latest in Financial Empowerment and Personal Finance.

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

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Income and Wealth of the average Australian: How do you compare?

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Our friends at the Australian Bureau of Statistics produce statistics on the distribution of wealth and income of Australians each two years. Really interesting data (wish it was released every year!).

People often ask me “how do I compare to others?” Below are the key wealth and income metrics of Australians for 2015-16.

1.     Gross Household Income in Australia 2015-16

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2.     Household Net Worth in Australia 2015-16

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3.     Households by Net Worth Range 2015-16:

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4.     Households by Net Worth Range 2015-16 (showing only up to $2 million as this encompasses 90% of the population):

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5.     Mean Worth by Age Australia 2015-16

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6.     Median Net Worth by Age Australia 2015-16 (interesting to note that the median is much lower than the mean – the exceptionally high wealth of some households brings the average/ mean up significantly):

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A few other interesting statistics that I found:

1.     33,700 households are worth 8 figures (more than $10 million)

2.     135,200 households are worth more than $5 million – this represents 1.5% of households

3.     1.2% of households have a net worth of less than zero

The above is for your information only. You are reading this because you want to be different to the average. You want to save more, invest wiser and achieve financial freedom earlier.

Want to review the numbers in more detail? You can find them on the ABS website:

http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6523.02015-16?OpenDocument

How do you compare? Feel free to comment below.

You’re welcome.

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Click here to sign up to our Newsletter to receive the latest in Financial Empowerment and Personal Finance.

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Mawer Money is a Social Enterprise assisting the world with Financial Empowerment.

www.mawermoney.com

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