What Do You Need To Get What You Want?

Hey there.

I'm Rachel Corbin, and welcome to another episode of Small Change, the podcast that's all about the small changes you can make that'll make a big difference to your finances. And between cost of living, the pandemic, and wanting to get that nice jacket you saw on Instagram, it seems like there's a lot standing between you and your financial goals. But director of Investors Choice Mortgages and founder of your Property Success online education, Jane Slack Smith is here to tell you a little mindset adjustment could help you get what you want.

Often, when we have a big financial goal, like a car, a computer, a home even, it can seem like it is light years away. Let's just say you have a new $50,000 Tesla on your wish list. It may just seem unachievable. But what if I told you you are looking at it all wrong? And in actual fact, you could get that Tesla just by thinking about it a little differently. What about that new home? The median house price in Australia today is over $1 million. How will you ever achieve that $1 million? Or maybe, like my teenage son, you also dream of a new computer. The $1,700 price tag, when your allowance is just $15 a week, seems years away. We all have been to enough company pep talks to know that the way to eat an elephant is just one mouthful at a time. Well, as much as I hate those rah rah events, there is something in the notion of breaking down big dreams into actionable smaller steps. Often when we look at a big goal, we see that mountain in the far distance. But once you commit to that goal and get closer and closer every day, it's surprising how quickly it appears right in front of you. We've all had that experience with success in this phenomenon. Maybe not when looking at a big financial purchase, but I'm sure there is something you can bring to mind from your past. Like when you booked that holiday six months in advance. Initially it felt so far away until you realized the plane was leaving the next day and you hadn't even packed. It's the same with purchases. Break them down and those big lofty goals can be closer than you think. So let's just see how we can get you that Tesla. So let's consider that Tesla saving $50,000 could. Could take you years. But let's see how you can break that down and get it sooner. Or that home that seems so far away. What do you really need to save to get into that home you want now? Maybe it's just a 5% deposit and the stamp duty costs. Maybe you're a first home buyer and there are concessions and grants that could mean you need even less. The deposit could be just tens of thousands of dollars, not hundreds of thousands of dollars or even that million dol. So it's just how you look at it. So let's get to that Tesla. So we've got a $50,000 Tesla. Now, a three year lease at say 6% interest a year will cost you about $1,500 a month. Compared to $50,000. $1,500 a month seems a lot more achievable. So now how are you going to go about making that $1,500 a month? Now there's two levers that you have that could get you that money. You need to look at your current costs and reduce them, or look at your current income and increase it. So let's have a look at those costs. Maybe could you cut $500 a month out of your current cost? Now that's $125 a week. So what could you do? Maybe you could rent somewhere cheaper. Maybe you could go out less, buy new clothes every other month, take lunch to work. You could even get fitter and walk to work. Maybe you could cut out one of those streaming services that you don't really need, or go shopping with your friends and family at Costco and buy cheaper in bulk. So let's assume that by putting some of these cost cutting and saving actions in place, you could save $125 a week, $500 a month. But let's face it, we're still short $1,000 a month. So how can you go about making that extra thousand dollars a month, that $250 a week? Could you sell some stuff you have laying around? My son packed up his Lego and sold it for a thousand dollars on ebay. I've had mortgage clients Airbnb their couch out to make up the deposit for their investment property. Could you make something and sell it as a side hustle? If you have a side hustle already, could you sell more or raise your prices or add something else into the mix? How about picking up an extra shift at work? Can you jump onto Airtasker and offer a service? Now, you don't have to have a specific skill to be on Airtasker. Maybe you could help someone moving their house. Or maybe you could pick up a parcel and deliver it. Maybe you could deliver some pamphlets on your morning walk. You could even put that new Tesla to work. I personally have paid someone a couple of hundred dollars to drive my friends and I around the Yarra Valley wineries for the day. Just think if you offer that service with a Tesla, how much you can charge more than the $250 a week you're after I'm sure. Just don't be tempted by all those yummy wines if you want a Tesla and it feels so far away you possibly already have the means, now you just don't know where to look or you're looking at it the wrong way. So remember something that you really want, something that you think is out of reach could be as simple as breaking it down into smaller chunks.

It's like they say in the movies, the power was inside you all along and also you just made your goals a bit more manageable because you are a genius. Now if you've got friends who could do with some help hitting their savings goals, make sure you you share this episode with them and I will catch you on Monday for another tip in small change.