GETTING HERE
I have a finance website and a blog that tries to give advice about money. I also teach this stuff to my students in my real job. But I’m not exactly the best example of someone who has always mastered the art of managing their financial life.
We live and learn. And I’ve learnt a lot. Here is my simple story just so that you know who you’re listening to.
The title ‘From Rags To Riches’ may be deceptive at first glance. In fact, it’s definitely deceptive. Though I did grow up in relative poverty, I haven’t acquired what most would refer to as great riches.
(And when I say ‘relative poverty’, of course, I understand now that this kind of poverty is not real poverty. My current salary as a teacher puts me in the richest 2% of the world. So being poor in Australia was very different to living in poverty in the developing world.)
I’ll come back to the riches part a little later.
As a teacher, I didn’t ever expect to become rich. In fact, I don’t recall even thinking about getting rich. I think, throughout my life, I was just happy to get by.
Let’s go back in time a little.
THE EARLY YEARS
I was born in a smallish country town in Australia and spent most of my free time in an even smaller town by the beach where my grandparents lived. My family for generations were mostly farmers or fishermen.
Neither of my parents finished secondary school (in fact my dad didn’t even get to secondary school) and no relative that I knew of ever went to university.
I was determined to at least be the first to get past high school. University was always going to be slightly more problematic.
We never had much in the way of money or stability. I once counted that I had attended eight primary schools. I’m not quite sure why we moved around so much.
I vaguely remember living on a farm when very young. I can also remember living in caravan parks and motels and the longest that I ever lived in one place was three years.
In my eyes, my father had skills, but these were in things like fishing and farming and I can only recall one real job that he had – as a truck driver delivering beer kegs to hotels. When he injured his back, he could no longer work and we had to rely on his invalid pension.
Role Models
My grandparents on the other hand offered more security. They seemed to have always lived in the same house. And the best part was that they had a small business.
It was a bait and tackle store and was where I first saw business in action. I used to dream of one day owning that store myself and I was quite sad when they eventually sold it.
But it still exists in some form and still with the original name, over forty years later, located right across the street from its original location.
After my parents separated when I was around sixteen, I lived with my mum, brother and sister in subsidised housing commission homes in the less luxurious part of town.
Though we moved around a bit in my high school years I was able to at least stay in my final high school for five years.
I was an okay student, though, without many role models or encouragement to do well in school, I probably never really achieved my potential. I worked really hard in my final year and was accepted into a Bachelor of Commerce degree at university.
Breaking The Cycle
Education has the power to change a person’s fortunes. However, without some financial support, it can be tough to get by as a university student, even in Australia. I stubbornly thought that tertiary education was a right. But things didn’t quite turn out the way that I had planned.
My first attempt at getting my degree was a failure. I ran out of money before my government financial assistance was approved. I couldn’t pay my fees and I couldn’t pay my rent. A return to my home town and working full-time was the only option.
I worked in a computer store and as a trainee accountant. I moved to Sydney and worked in a bank. A second attempt at university two years later also failed.
While working in one of my jobs I started coaching a football (soccer) team and discovered a passion for teaching. It was a case of third time lucky and a move to a teaching degree that eventually saw me scrape by and finally graduate, five years older than most of my classmates.
That university degree was hard-earned but probably the most influential thing that I’ve done.
Why is this all relevant?
Bad Habits Are Hard To Break
Without the right environment and without being exposed to the right ways to manage money, life can be difficult. I grew up seeing money as scarce rather than abundant. I saw it as something that could only be earned through having a job, that most of a person’s income was meant to be spent and that if you didn’t have enough to buy the things that you wanted then you just needed to borrow it.
For a long time, I lived paycheck to paycheck, never saved and never owned anything of value. I financed cars and struggled with monthly payments. I accrued credit card debt and used store credit. I once bought a car with my credit card. I was going backwards financially and my credit score suffered. I had no idea that things could be very different if I just improved my relationship with money.
This is important when discussing financial literacy and helping my students understand the power of education, developing good habits and having long-term goals. I speak from a position of knowing what it’s like to feel as though your financial life is out of control.
I speak from the position of knowing what it takes to make changes and to get closer to financial independence and away from financial ruin.
Well, that’s a part of my ‘rags’ story. Now let’s discuss the riches part.
RICHES
I’m certainly not yet what I would call rich financially. Though I am comfortable and heading in the right direction.
Here is the update.
After teaching in Australia for a few years, I headed overseas and into the world of international education. It’s fair to say that my salaries and benefits have generally been better since starting my first international school job.
Through my work, I have been able to travel extensively and live in several different countries in Asia. I have been able to help my extended family financially and have a family of my own. You could say that I’m rich in experiences. I’ve invested in life and invested in people more than anything else.
I’ve managed to fully fund my two daughters through their international university degrees. I’ve also assisted three different family members through high school and college. I have been able to help other family members who have come under financial strain at various times.
These decisions have dramatically affected my ability to invest and to be in a stronger financial position than I am currently in. But I wouldn’t change those decisions for anything. It’s a wonderful thing to be in a position to help others.
My Rich Life
Despite this, I am debt-free and still on track to retire early if I wish. I have a retirement fund that continues to grow. I have invested a little in real estate. I am currently planning a sabbatical year where I will work on some business ideas and plan the next stage of my life. I consider myself to be very lucky and I would call myself ‘rich’ in many ways.
Learn How Rich People Think About Money
Sure, we all mature and change our ways as we get older. But I’ve also learnt a lot about money and how it should be used to work for you instead of against you. It’s not exactly rocket science. But it may as well be. I didn’t learn this at school. But I wish I did. And I’m happy to be able to pass my knowledge on to my students.
I just finished reading ‘Secrets Of The Millionaire Mind’ by T. Harv Eker. Just like a couple of other prominent books on the subject, it clearly outlines the fact that those who acquire great wealth generally do so by having a very different attitude towards money than those who do not understand how to make it work for them. It’s partly in the mind but also relates to some specific knowledge and skills.
Some of this comes from being raised in an environment where money is taught to work for you. I wasn’t. But it can be taught. If it isn’t taught and learnt, then even if a person gets lucky in acquiring great wealth, they are unlikely to keep it. Consider lottery winners who manage to squander it all.
Imagine if you were somehow dropped from a helicopter to the very peak of Mt Everest without the skills required to have climbed there. You would in all likelihood die rather quickly having not acclimatised and having not used your experience and skills to slowly work your way to the top.
Acquiring wealth is like reaching a similar peak. Skills, experience, patience and the right mental approach are all required to reach your peak and stay there for as long as you like.
Good luck on your journey.
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