What I’ve learnt in five years of personal finance blogging.
1 Aug, 2021
To my surprise, I’ve chalked up five years of writing this blog! And I can’t quite believe it.
My first post was in June 2016 and since that time I’ve written over 200 posts. Of course, I then started the podcast and that has 50+ episodes and counting (the new series starts on September 1st 2021 by the way…)
To those of you who have been reading this blog since the beginning, you should receive a gold medal! For those of you who have joined me more recently, well, if I can do five years, chances are I’m going to be around for some time yet!
I could quit this blog at any time and by not putting that pressure on myself to ‘have to blog’ I know I have the option to quit. Conversely, that inspires me to keep going. Good old reverse psychology - it’s because I don’t HAVE to do it that I HAVE to do it!
People are looking for help and information…
I thought I’d blog today about what I’ve learnt, observed and what it’s like to write a blog because there is not a single day that has gone by that I’ve not emailed or spoken with someone about what I tend to refer to with my whanau and friends as ‘blog stuff’. Today is a good example, I was up early to answer some emails, I wrote this very blog post and I went for a walk with a friend who wanted to chat about money stuff. The Happy Saver is ever-present on my mind and my inbox has a constant stream of messages coming in which I read and flag for follow up. Currently, I have 29 awaiting follow up. So, it’s busy! And if you are awaiting a response, you will get one soon!
It’s so busy because there are a lot of people out there looking for help and information that they don’t want or need to pay an advisor for, they just have a money related question or two (or ten) to ask. My inbox is a steady stream of confidential conversations to any number of people all at the same time and I love that I’ve been writing for so long now that I’ll get an update from someone who emailed me three years ago telling me how their situation has changed for the better since we last connected.
It continues to amaze me how much people trust me enough to share information that they tend not to share with others and one of my proudest achievements I think is to have won the respect of my audience. I have surprised myself too I think that even after all this time I’m genuinely excited to answer every email or talk in person with someone about what’s going on with their money. I would have considered myself someone with a bit of a short attention span, but not so when it comes to blogging and helping people.
The most common thing I still hear once people have taken proper notice of their finances is “why didn’t anyone tell me about this earlier”. Because with a few suggestions and a bit of encouragement and a bit of effort on their part it’s not that hard to be a good manager of your own money. You just have to want to change.
My favourite emails are the ones where people have an epiphany, having completely mismanaged their money for their entire lives due to lack of knowledge and they have a wake-up call (Covid has been good for that) and within the space of just a couple of short months they completely transform their entire life. No matter their age, people always surprise themselves at the rapid progress they can make financially if they put in the mahi and pay attention. It’s an incredible thing to be on the sidelines of and I’m delighted for every one of them that I played a part in that. I often say that inside every person who thinks they are terrible with money is someone excellent at handling money just screaming to get out!
In saying that, a key thing I have learnt along the way is that you can lead a horse to water but you can’t make it drink. And because it’s them that is thirsty and not me, well once I’ve shown them the way, it’s entirely up to them to act. I used to try to nudge and push those people, but I no longer do, you have to take personal responsibility for your financial situation. At least I offered to help should they need it and they know where to find me if they ever want to.
People just want to talk about money.
People just want to talk about money. They really do. They wonder a lot about what other people are doing with their money. And they don’t want to know out of greed or envy, they just want to be shown some examples that they might apply to their situation. I can categorically say that after five years of sharing my financial situation not a single person has ever asked me for money, which is the one thing that people are afraid will happen if they talk about finances. People learn by watching others, so please do share the things you have learnt. Nor are people judging you and if we did more openly share our journey with money we would be less inclined to call someone ‘lucky’ if they are successful and instead see that they attained whatever level of wealth they did by both mahi and luck over a long period.
Why didn’t anyone teach me this?
Because we don’t get a decent education about money I’ve noticed that people invest in specific categories at the exclusion of all others. If the only thing we hear about building wealth is ‘buy a house’ then lo and behold, there is a mad rush to buy a house! And because we know of nothing else, how about we buy some more? I talk to many people who are house heavy and heavily indebted with no other investing going on. But when they learn about simple things like KiwiSaver or the simplicity of a passive index fund or ETF investment using the share market as a way to grow wealth and I explain how it works they pretty quickly want in on that action too. And then they say “why didn’t anyone teach me this”? They genuinely never realised there is an alternative to housing, many of them don’t even LIKE being invested in housing, so when they find an alternative they grab it and run.
Connecting People
This blog connects people. I can’t be everywhere at once which is why you don’t see much from me on various social media channels, there is just not enough time in each day, so I connect mostly via my blog. But I also put a lot of people together as well and if I have received an email from one person and a question from another, I’ll often connect the two which is so rewarding! It comes back to people just wanting someone they can talk about money with and if I can make an intro, then that’s awesome!
Imposter Syndrome
After five years of blogging my feeling of “imposter syndrome” has worn off. I used to feel like a bit of a fraud because what on earth could Ruth from Alexandra possibly know about the crazy complex world of investment? Well, as I said to a lovely woman I was speaking to just last week on the Phone A Friend calls I do, we don’t have to know everything! I was reflecting on that call later in the day and I decided that 95% of the information out there is surplus to requirements! I need to know enough to help others and be an investor myself and for anything I don’t know, if someone asks me a question, I just go and find the answer for them.
Low Cost Investing
In the last five years, the low cost investing industry has become much more simple and accessible yet is getting increasingly complex as well, so refer above and remember: you don’t have to know everything. When I started blogging, my low-cost passive investment options were: Smartshares, Superlife and Investnow. Simplicity had just come on the scene as a low-cost KiwiSaver provider. So, it was pretty easy for me to pick a path and follow it because it was slim pickings. Now we have those same companies and more: Kernel Wealth, Hatch, Sharesies, Booster, BetaShares and many more that have slipped my mind as I write this. They are all good variations on the same theme and it’s just a matter of choosing the best fit for you and getting on with it and not spending forever angsting over your choices. While choosing an investment provider is important and needs consideration, you are not planning a trip to Mars here, so in many instances, close enough is pretty darn good too! Because, as you acquire more information in the months and years ahead, you can tweak your investments and make changes. So, my advice to others is to not overcomplicate a simple thing like just choosing a KiwiSaver provider.
Slow and steady investing. Boring yet effective.
I’m surprised I’m still blogging because in all reality, once you have set up your banking and investing and put it on autopilot, it gets pretty boring! No day trading here, just slow and steady investment over a long period. Boring yet effective. And I know this because I’ve been tracking my net worth over all these years and by gosh, it freaking well works! The self-doubt about our investments that I used to feel is now gone, when I used to say to Jonny, “but what if I’m wrong about all this”? But I’m not wrong, this 47-year-old woman from Central Otago has managed to grow her family wealth and contentment with life year on year.
Have an Emergency Fund
Having an emergency fund is the easiest thing you can do to put a safety net between yourself and a crisis and countless people have told me this is true for them. Those new to having a stash of cash set aside try to get all fancy on it and “invest it so it can make some money”, but time and again I remind people that the purpose of an emergency fund is not to make money, it’s a pot of cash that you can immediately deploy in a crisis. If you lock it up in an investment then you are more likely to reach for a credit card or mortgage extension to handle your crisis, because you don’t want to break your investment. Taking on debt in a crisis is the worst thing you can do, so please remind yourself that money sitting patiently in a bank account “doing nothing” is doing so much more than you realise. It’s giving you peace of mind and is pretty much like having an insurance policy that you can use at any time. I’d never be without it.
Budget. Budget. Budget.
People, you gotta budget! No excuses. Rich, poor, or you simply have no idea, the key to getting ahead financially is knowing in detail where your money is coming from and going to. My Mum hates the word budget, to her, it sounds restrictive and penny-pinching. To me, it sounds freeing because it gives me a plan and freedom to spend. After all, I know where my money is at. Knowing your daily, weekly and monthly income and expenses will bring a large sense of control to your life and the longer you do it, the easier and more useful it becomes. Budgets are awesome and hands down - after many years of trying various ones - PocketSmith is my go-to now.
The clouds parted when I read this book.
As far as investing goes, the day I read the book The Simple Path to Wealth by JL Collins, the clouds parted and growing my wealth by using the share market suddenly became the easiest strategy in the world. Picking individual companies to invest in might work out once (I did well with Meridian Energy), it might even work out twice, but you can’t maintain it over the long term. Nor can active fund managers. So, don’t even try. Steadily and consistently buying, in my case, just two low fee passive ETF or Index Funds (NZ Top 50 and US 500) over a long period which is made up of incredible local and global companies works. It’s not a gamble, it’s not “putting money in the share market I can afford to lose”, it’s a legitimate way to invest and grow your wealth over time.
KiwiSaver is not a scam.
KiwiSaver is not a scam. For those who think it is and have never signed up, you better have a backup plan. And that backup plan better not be your partner’s KiwiSaver scheme which they diligently invested into their entire working life while you kept your head in the sand! For those who think it is a scam (and let’s be honest, they won’t be reading this anyway), do your research and you will soon realise that it’s one of the most heavily regulated investment types out there. I can’t wait to turn 65 and check in on my balance: Best retirement gift ever!!!
Banks
I have a healthy scepticism of banks and have zero loyalty to mine even though they do provide a good service. The sooner you can become debt-free and use your bank purely as the place you store the cash you need in the short to medium term, while you send the rest to investments, the better. Banks are debt machines and the sooner you are done with debt, the simpler your relationship with your bank becomes.
First Time Investing
Here is a tip. If you are looking to invest for the first time and are confused and have questions, just phone up the company and they will talk to you. My former opinion of an investment firm being full of staid old boring white men could not be further from the truth when it comes to the wave of new companies who have swept into the market to try to make investing easier. I’ve never met a nicer bunch of people and none of the people I have contacted has ever made me feel like an idiot. Emailing or talking to them does not cost you and nor will you ever get a heavy sales pitch.
Educate Our Kids
We don’t educate our kids about money enough (or at all). Come on people, you know you should! Don’t let your child get to the age of 30 and be writing to a blog like mine, learning stuff about money for the very first time and be saying to me “why didn’t my parents ever teach me this”? If you are confused about money and wonder just how you might pass some useful information down the family tree, then get excited about learning yourself and a great place to start is with The Barefoot Investor by Scott Pape or The Total Money Makeover by Dave Ramsey.
I'm not a financial advisor…
I’m still not a financial advisor and I have no plans to become one. Martin Hawes, who I greatly respect and whose book Twenty Good Summers was what kicked me into action in regards to money, came and had a coffee at home a couple of years ago and in his very contemplative thoughtful way he said “Ruth, you should think about becoming a FA, you would be alright at it”. But I think that the way I’ve gone about it, by just being conversational and approachable I’ve in a way been able to help far more people than if I took the FA path. And I’m having a really good time, it’s not overly profitable to be fair (an authorised independent financial advisor gets paid pretty darn well), but I’m happy! So, while I’m mindful to stick within the FMA guidelines at all times about not giving out dodgy advice, I think I’ll just keep doing what I do because on a daily basis I see such a thirst for knowledge from a group of people without the means to pay.
Everyone is on their own journey.
In this blog I write about investing and money, it’s not about the dollar figure. It’s about the feeling of control having a grasp on your money gives you. So, whether financial independence to you comes at having $100,000 invested for retirement or $10,000,000 is not the point, it’s finding out what arrangement makes you sleep well at night. Everyone is on their own journey.
Do I make money out of blogging?
And finally, a common question I get is “do you make money out of blogging”? The answer used to be no, but now it is yes. Jonny and I started the blog with one purpose and one purpose only, to help people. Because when I needed help all those years ago, it was hard to find and I struggled to find impartial useful information that would help me manage our money. Jonny prompted me to blog about the things that I learnt as a way of helping others, to save them the hassle of reinventing the wheel. And it had to be free.
Today we have affiliate relationships with companies who have products and services that in most cases we use ourselves and in all cases, we genuinely believe in and this income helps run the blog and podcast. I offer Phone A Friend calls where I chat to people one-on-one and added a Buy Me A Coffee link because people I’d helped for free often asked how they could support me. I’m always genuinely surprised when people donate and it always makes me smile and think that if people are allowed to be kind, they generally will be.
All these things combined mean that we now make one good part-time income but if we boiled it down it would in no way cover the actual hours we put in. We said at the start and it remains true today that if the primary purpose of the blog becomes about making money, then we will fail. So after five years of blogging and podcasting, I keep at it because it’s extremely personally rewarding to do so, I get immense satisfaction out of helping people get on a better financial footing and if there are downsides to putting myself out there through my blog, I’m yet to think of any.
I love what I do…
I love what I do, it’s enjoyable helping others and it’s been a project that has helped Jonny and I find a way to work collaboratively. I very much get the praise for it because you only hear from me, but this is a genuine team effort with him having all the tech skills and me being incapable of stopping talking and writing! The blog and podcast are pretty big now, with a large audience but I pretty much fly under the radar in Aotearoa, which is just the way I like it. My audience always know I’m happy to help if they ask and they seem to enjoy my common sense and down to earth advice where because I’m independent I can pretty much just tell it straight.
But there is one thing that I’ve always struggled with all these years and that is how to work out how to write a shorter blog post! I fail every time. So, apologies for that, if one day you notice them getting shorter you will know that we have made enough money to afford an editor. Haha!
Thanks for your support and encouragement for all these years, I’m genuinely grateful to every person who takes time out of their increasingly hectic lives to read our blog and listen to our podcast. I’m privileged to have met so many everyday Kiwis who are taking ownership of their financial lives, it’s awesome and I couldn’t do what I do without you. So, thank you.
