What is your net worth? $1,980,000
At what age did you become a net worth millionaire? 37
What region of New Zealand do you live in? Wellington
How did you accumulate your net worth, what are you invested in? We are mainly property investors who are diversifying into managed funds. We chose property because it allowed us to leverage highly and clearly increase wealth over time. When we were starting out 20 years ago index funds were not able to be accessed easily and for small amounts of money. We bought our first property at age 21 and became accidental landlords when we had to move cities for work. Over our 20s we bought four more investment properties. Almost all of our cash went into paying for these and we lived very frugally. In hindsight we had well over a 50% savings rate, but it didn't feel like it because we were always paying property related expenses. Our journey was helped by an inheritance that we came into in our 20s of about $100,000. The house we lived in cost $230,000 at the time, so this was a fairly sizable boost. By age 35 we were able to sell most of the rentals and own our house outright. This gave us a house to live in worth roughly $600,000 and about $400,000 in other capital.
What was your highest average household WEEKLY income after tax? When we were building wealth it was $1,000 a week, these days it is $3,500 a week.
What is your career? I'm in HR and project management, my wife is a school teacher.
Do you have children? YES
Do you have a tertiary qualification? YES
Did you inherit any of your money? YES
If YES, how much did you inherit? $100,000
What's the approximate value of your house? $980,000
Are you debt free now? NO
If NO, how much debt do you have and what is it for? We have $2,200,000 in mortgage debt over investment properties.
Are you in KiwiSaver? YES
Were you taught about money? NO
If YES, how were you taught? In my late teens and early 20s I set out to learn everything I could about personal finance. This involved talking a lot to friends and family members about how to set up investments and things.
What is the most enjoyable thing you do with money? Money isn't enjoyable in and of itself. We use it to buy time.
Do you use your money or your time to help others? YES
If YES, can you please elaborate. We have a strong public service ethic and use our time (provided by money) to set up and work in stuff that supports our local community.
What is your greatest financial win? Buying houses in Auckland that more than doubled in value over 10 years.
What is your worst financial mistake? In hindsight we sold some of our property investments too early in order to be debt free. If we had kept the debt for longer we would have had twice as much net worth now - but we would also have been a lot more stressed.
What advice do you have for others? Make a long term financial plan when you start your first job. Save 50% of your money and work hard to avoid lifestyle creep. Try to avoid advertising in your life.
What is the point of having a net worth above $1,000,000. What does it mean to you? For us it means financial security. It allowed us to have one parent at home when our kids were small and if we lose our jobs or suffer poor health we don't need to worry.
Finish these sentences:
If you want to build wealth do this… Save at least 50% of your income, set up your finances to do this automatically (pay yourself first), take the risk and invest, wait to buy things.
If you want to build wealth avoid doing this… Consumer debt is a nightmare, also be careful to avoid over buying on your house - live in only the space you need.