After going on a 25 year journey of discovery, Vanessa Stoykov now believes that to truly grow long term wealth, we need to un-learn everything we think we know about money. As a result of this journey, Vanessa has crystallised this knowledge and experience down to five pillars for creating financial success.
What does she mean by re-inventing yourself and un-learning about money?
Vanessa has collected all of her thoughts and ideas into her book 'The Breakfast Club for 40-somethings'. She talks about un-learning and re-inventing, but what does she really mean by these phrases?
Vanessa explained: “What I mean is, what are the behaviours you have around money, whether they're conscious or unconscious, that may be holding back your financial future? And that's really how the five pillars diagnostic test was born on you know, are you spending too much on credit cards which is the pillar called Desire? You know, is that the thing that's holding you back from long term providing for you to have a comfortable retirement?
“Do you have a deep-seated belief that probably started with your parents or your family that you know, you don't make enough money or money's hard to keep or there's never enough to go around? Because those kinds of beliefs are very limiting on how you spend your money, and how you view money. I've built a guide on our website to show how to identify a good financial planner. Because if you know the right questions to ask, you can find someone very good. So, it's just a matter of knowing what to ask.”
What is the difference between assets and liabilities?
Vanessa talks in her book about assets and liabilities. She claims that if people spent less money on materialistic items such as cars, jewellery and watches, and instead invested it sensibly, they would be making far greater amounts of money.
Vanessa said: “Assets are things that appreciate and make you money, and liabilities are pretty much everything else. Jewellery, cars, dinners out, furniture, all those things are liabilities. And that's sort of a very basic explanation of how people need to view their consumption.”
Is the current generation more money-savvy?
With increased technology, online advice and education about finances and money, the current younger generation may have a head start when it comes to this area of life.
Vanessa explained: “I'd like to think that. I think the super system's been in place now for a long time, so you know, we've yet to see a full cycle of that. But I think this generation is much closer to digital, to information at their fingertips. Does that mean they're better with money? I think they're better at talking about it than previous generations, but I still think they need help. And they need to be exposed to dinner table conversations around legacy, what you want to leave your kids.”
Should parents be providing and sacrificing more?
Two in three Aussie’s believe that parents should be providing more or sacrificing more for their children’s financial future.
Vanessa argued: “It depends on your financial situation you know. There are obviously some families that are doing everything they can and the fact that they get their kids to the point where they can then work is as much as it's possible for them to do. But there's others that spend money in a way that if they had a better plan and a way to use it, they could set up a legacy for their kids that meant that they could have a house deposit, or they could pay for their university. Or you know, things that people would like to do, but don't really know how to go about planning for it.”
Stay tuned for more articles from Real Estate Talk, a trusted source for real estate investors, new and old.