0 to 100k: In pursuit of the Australian dream by @thedollarwizardry
A lot of people say the first $100k is the hardest.
Well, they ain’t lying.
Our 100k milestone was four years and four months in the making. It didn’t take as long as we had anticipated, but it certainly wasn’t a walk in the park. If anybody were to tell us on the first day that we would share a six-figure net worth not long after we finish uni, we would have laughed them off.
But before we get any further, let us introduce ourselves.
We are the husband and wife duo from @thedollarwizardry, Mr H and Mrs R, and this is our story from 0-100.
Note: We started combining our finances after we got married in 2020, but all numbers in this post were shared between us for simplicity sake. I.e. the 100k was from our combined net worth.
$0 | FEBRUARY 2015
The start of it all
Seven hours after waving goodbye to our parents in the airport, we had arrived in the Melbourne Airport as fresh, young international students, ready to conquer anything thrown in our way.
Well, that wasn’t exactly the case. (and we will get to that soon enough)
We were very privileged to be sent here on a full-tuition scholarship, and a $1200/person monthly allowance meant to cover all our monthly expenses throughout the 4-year course. On top of that, we were each given an extra $2000 for the first month to “kickstart” our voyage into the unknown. As life-changing as it was for us, we were thrown into the deep end to settle in a new country with very little money on hand.
Don’t get us wrong; we knew our parents would have gotten our back if we needed money from them. Still, we were very determined not to add any financial burden to our families, so we had made up our mind since day 1 – we were going to live a very frugal life, we were going to rent the cheapest place to live, we were only going to buy Woolworths “Homebrands” (back when they were still called that), we were going to…
You know there is only a fine line between being frugal and being cheap. Looking back, we had definitely crossed the line.
Our $1200 monthly budgets looked a bit like this:
Not to dwell into the details, we did everything we could to scrape by but luck was not always on our side. When we were researching a cheap place to rent, we were scammed by a listing on the Facebook marketplace. We lost about $900 that day. Then, we each bought a bicycle to save over $1400 per annum on public transport until both of our bikes were stolen one day. As a result, we resorted to walking half an hour back and forth to our uni campus every day for a year. Things like these really pushed us to the extreme of frugality, not very far from stupidity.
$2,500 | SEPTEMBER 2015
We needed to find a job, somehow
Living with $1200 a month as an individual in Melbourne CBD turned out to be possible, but it was not pretty. Lucky for us, we still kept most of the extra $2000 allowance given to us in the first month. That brought our combined net worth to $2500.
However, that quickly depleted right after our first budget trip to Adelaide, which cost us $750 in total.
We knew we had to get a job. And we did. With a student visa, we weren’t allowed to work more than 40 hours per fortnight. Also, without a car, finding a part-time job turned out to be the hardest thing we had ever done. We finally got a casual job as a waiter in a local restaurant that paid us $13 per hour, 3 hours per shift, 2-3 days per week, with no superannuation contributions.
It wasn’t much, but boy, were we happy with getting extra money every month. That was $300-400 on top of our $1200 monthly allowance. Hold on. Wow, we were so ungrateful for not realising that any sooner. That $1200 was our passive income. We were paid $1200 without having to work for it. When we thought of it that way, it opened our minds to a new possibility: What if there is a way to keep living with a passive income like this beyond the end of the scholarship? But how? We haven’t come across the idea of Financial Independence Retire Early (FIRE) back then, but deep down, we know there has to be a different way of life than working 9-to-5 until 65 – we just didn’t know how yet.
$17,200 | DECEMBER 2016
Work hard. Play hard.
With no intention to stay in Australia after finishing uni back then, we knew we had to travel as much as we could around the country before leaving. So we did. We worked different jobs from time to time to save as much as we could, and we travelled to Brisbane, Gold Coast, Sydney and Tasmania in one year. We had worked in pharmacies and restaurants, and we had even found a side hustle – reselling second-hand phones on FB marketplace and gumtree.
It came to my attention that many people were selling their recently bought phones online, and a handful of them would sell at a bargain just to get rid of them as soon as possible. Knowing that the prices of second-hand phones don’t depreciate very quickly in the second-hand market, we started buying them when we saw one. We gave them a good clean, we changed their screen protectors or put a new case on, and we would sell them online at a profit. That’s right, who would have thought that buy-low-sell-high applies just the same in a second-hand phone market.
To be honest, we couldn’t believe what we saw. Not only were we seeing some pretty poor money habits in those who acquire the latest-released phone every single year, but we also saw how this first-world problem would contribute a hella lot of electronic waste to the environment if the majority of these used phones end up in the landfill instead of being sold to those in need.
Having learned more about the environmental impacts of heavy consumerism, we started to adopt a minimalistic lifestyle, which turned out to be a significant saving boost for us.
$51,000 | JANUARY 2018
The halfway mark: Buying our first share
Don’t put all your eggs in one basket. Well we did exactly that for the past three years. We have saved $50k in cash deposits by the start of 2018. That was when we first dipped our toe into stock investing. We bought our first share, and we were finally in the game, not knowing full well about the compounding effect. We started investing and that’s all that matters.
Around the same time, we started to see our tiny superannuation grow as we worked part-time for a little while. One thing came clear to us; our net worth was finally well diversified into investments and super for the very first time.
$75,000 | OCTOBER 2018
Owning our first car
The seed of compounding effect was planted during the start of the year and all we did was watching it grow. However, we weren’t investing very regularly. Most of our savings still ended up in the bank.
This was how our assets allocations looked like when we hit $75k net worth:
- Bank savings: $ 65,782.89
- Shares: $ 6,193.00
- Superannuation: $ 2,767.98
As we approached the end of the year, we didn’t make any significant adjustments to our lives, it was all about juggling between working a part-time job and studying for our final exams as our uni life came to an end. Eventually, we bought our first car – a 2013 Suzuki Alto from a friend of ours for $5000. That allowed us to cut down our daily commute time.
Eventually, we secured a full-time position as interns in our workplace at the time right after we graduated. Without wasting much time, we dived right into the 9-to-5 lifestyle. It seemed like a reasonable thing to do at the time as we were eager to save a ton when we finally had the opportunity. Plus, we had travelled to most cities in Australia in the past years, so we were ready to hustle hard.
$101,000 | APRIL 2019
Living the dream
Before we knew it, we had hit six-figure in combined net worth around April 2019, and this is what it was made up of:
- Bank savings: $ 84,049.03
- Shares: $ 15,108.00
- Superannuation: $ 5,286.15
And… the rest was history. Having discovered the power of the compounding effect at a young age, we did the right thing to keep investing our savings. On top of that, we enjoy the simple lifestyle of minimalism which goes hand in hand with the principle of living within our means. Because of that, we are able to sustain a 60-70% saving rate even today.
So what have we learnt from our journey?
Everyone’s journey is unique.
There is never a one-size-fits-all method to reach 100k. What worked for us may not necessarily be applicable in your journey; for the same reason, your priority in life might look vastly different to ours too. So never compare yourself to others around you. Only treat others’ stories as a source of inspiration and never a benchmark to compare your progress.
Life is a journey, not a destination.
No one is born with all the know-how in managing personal finance. Rarely anyone is taught about financial literacy in school. Therefore don’t ever beat yourself down for not knowing what to do. It is all about adopting a strategic way to get to your goal. It is about fine-tuning your lifestyle 1% at a time to slowly get there rather than hoping for a lucky lottery ticket to change your life.
Embrace the community
Money can be taboo to talk about, especially with friends and family, which is why many give up even before starting to do anything. But fret not, there are countless online communities around the world that are filled with financial stories from all walks of life. Know that there are people who are supportive and open to discussing money matters with you. Having benefited from the community ourselves, we @thedollarwizardry are now doing the same thing – sharing our money journey in the hope of inspiring more people to gain control of their financial lives.
We wish you all the best of luck!
Mr H & Mrs R