Episode 111 | Homelessness, Housing Affordability and Protecting YOUR Future | Sharon Bradley, Good Weekend

Today we look into the impact of skyrocketing property prices and the societal issue when individuals' financial future are in jeopardy.
Taking a different turn from the usual episode, our hosts talk to Sharon Bradley, columnist and writer for the Good Weekend. Her recent article in the Sydney Morning Herald “Having to ask for somewhere to live, it’s difficult indeed”, caught Veronica and Chris’s attention. Our hosts want to open the conversations on rising property prices, increasing unemployment, and where it leaves you and financial stability.

In today's episode our hosts discuss how securing your financial future with the appropriate financial advice can safeguard you and your family from the uncertainty of current housing prices, and economic stability.

Here is what we covered;

• Changing our perceptions of homelessness.

• Why is a particular demographic becoming homeless at an alarming rate.

• How to protect yourself and your family from severe unexpected circumstances.

• What factors are forcing this increase in homelessness?

• How long is the public housing list?

• Building more social housing.

• What can the government do to curb the housing crisis?

• Bridging the gap with impact investing?

• Gambling with your own home?

MENTIONED EPISODES:
Episode 66 | Michele Adair
Episode 89 | Ownership Crisis
Episode 95 | Craig Bigelow
Episode 104 | Adam Hirst

GUEST LINKS:
‘Having to ask for somewhere to live, it’s difficult indeed’

 CHARITY LINKS: 
https://sharethedignity.com.au/
http://steppingstonehouse.com.au/
https://www.ozharvest.org/
https://www.benevolent.org.au/
https://orangesky.org.au/

HOST LINKS:
Looking for a Sydney Buyers Agent? www.gooddeeds.com.au
Work with Veronica: info@gooddeeds.com.au 

Buy the book - AUCTION READY How to buy property at auction even though you’re scared s#!tless:
www.getauctionready.com.au
Use the coupon ELEPHANT for your 30% listener discount.

Looking for a Mortgage Broker? www.wealthful.com.au
Work with Chris: hello@wealthful.com.au

EPISODE TRANSCRIPT: 
Please note that this has been transcribed by half-human-half-robot, so brace yourself for typos and the odd bit of weirdness…
This episode was recorded on 20 February, 2020.

Veronica Morgan: You're listening to the elephant in the room property podcast where the big things that never get talked about actually get talked about. I'm Veronica Morgan, real estate agent buyer's agent, cohost of Foxtel's location, location, location Australia and author of a new book called auction ready, how to buy property at auction. Even though you're scared shitless.

Chris Bates: And I'm Chris Bates, financial planner, mortgage broker and together we're going to uncover who's really making the decisions when you buy a property.

Veronica Morgan: Don't forget that you can access the transcript for this episode on the website as well as download our free food or forecast report. Which experts can you trust to get it right, the elephant in the room.com.au.

Chris Bates: Please stick around for this week's elephant rider boot camp and we have a cracking Dumbo, the weight coming up

Chris Bates: Before we get started, everything we talk about on this podcast is general in nature and should never be considered to be personal financial advice. If you're looking to get advice, please seek the help of a licensed financial advisor or buyers agent. They will tailor and document their advice to your personal circumstances. Now let's get cracking.

Veronica Morgan: This is an episode with a difference. What I hope it turns out to be is a call to action in two respects and more about that later. We're going to talk about homelessness. Now, please do not choon out. This is a property podcast. I know, and we have both altruism and self preservation in mind as we discuss this today. Do you know who the fastest growing cohort of homeless people in Australia is right now? Are you aware of how easily it can happen if something unexpected trips you up and the right foundations haven't been laid early in adulthood?

Veronica Morgan: We've touched on this in a previous episode. That's number 66 if you want to go back. When we interviewed Michelle Adair from the housing trust, she told us a story about how a nurse in a good job had a run of bad luck that left her homeless and it was frightening to hear this. So in this episode we're going to get a better understanding of what's actually happening. And as 2020 progressors, we'll interview experts to help us educate and empower young people so that while enjoying your youth, you're still investing wisely for your future. Of course, we want you to ultimately be able to achieve the dream of home ownership and potentially becoming a property investor as well. At a minimum, we want to ensure you avoid becoming homeless yourself. In this episode we're discussing the current situation with a journalist who has spent a lot of time researching is Sharon Bradley is a magazine writer who has spent an international career listening to people. Some of them famous, some of their not, and she's been listening to these people tell these stories. Until recently, she was the associate editor of good weekend, a magazine too, which he still contributes regular long reads. And she's here today to talk about her February eight cover story about Australia's fastest cohort of homeless

Veronica Morgan: People, women over the age of 55. It makes her very sobering reading. Indeed. Welcome Sharon. Thanks. Good to be here.

Chris Bates: Hi, Sharon. Love to have this conversation because it's it is very interconnected to the, to the property market. And you know, when we talk about the property market, there's always people that are get marginalized, whether it's renters, whether it's homelessness, whether it's young couples trying to get into the market. And so there's always consequences of, of potentially the market going up or down and et cetera. And this is one cohort that you know, is forgotten about and it's kinda hidden under the, you know, behind the scenes and we don't really know. And I think that's why the state government is actually starting to try to count how many people are homeless cause we actually don't know. So your interest in the story you know, cause there's always probably a light bulb moment I imagine for a journalist and they're like with maybe something I want to talk about or look at. How did it start? And what got you interested to do this?

Sharon Bradley: It was a subject that I think had been discussed in the good weekend office. So in the end it was, I'm the editor of good weekend, Katrina Strickland who contacted me and said, look, this alarming statistic has come to our attention and we really, really want to dig deep behind the statistics. I mean, there had been a 51% increase in women between the ages of 65 to 74 who were homeless. That's a 51% increase between the 2011 and the 2016 census. Wow. That was enormous. And so that had grabbed everybody's attention in the office, but what she wanted to do really was kind of go behind the statistics and talk to women who had enjoyed very conventional housing arrangements up until a hideous sudden unexpected life destruction, life disruptor, sorry, tip them over into destitution.

Chris Bates: Yeah. So I think, you know, before we kind of go about the you know, the reality is we've all got, I mean, that's why that show on SBS, I think it is where the, you know, they take people from different walks of life, throw them on the street and you see them in 24 hours. They blow away all their misconceptions of homelessness. I mean, I, I would in London have it in Melbourne, in the city, you know, I've seen a lot in different countries and traveled and things like that. What's the biggest misconception you found that you had before you started doing this article that once you very quickly realized you had it wrong? Well,

Sharon Bradley: I think as a society generally we marginally, we like to marginalize the homeless because it makes us feel comfortable ourselves. We think that's not going to happen to me because the homeless people that we see on the streets are an educated, eh, mentally unsound, eh, addicts. And they're not me. I think that's what we think because we, we are praying to marginalize a very uncomfortable demographic. But the reality is of course, that homeless people aren't always rough sleeping in parks or sleeping in cardboard boxes on our streets on a rainy evening. They are often invisible. They're sleeping in a relative spare room or on a friend's sofa, but they're still homeless. And so older women, we tend not to see them on the streets. There as I say that, that, you know, they, with friends or with all day with relatives, so many, many misconceptions really.

Sharon Bradley: Well I guess there's also the definition of homelessness. So I guess, you know, maybe we should clarify that first. Yeah. It's someone with no fixed abode, someone who doesn't have an address. And actually I think for women who are rough sleeping that age tends to be much lower. They tend to be in their mid thirties. This story focused very much on women over the age of 55 and they tend not to be sleeping rough. Right. Because it's very, very dangerous. Mm. Yeah. Yeah.

Chris Bates: And that's, I think, danger, right? Like not only do they have to worry about food staying warm. Yes. And you know, all those things that basic human needs at the end of the day night comes and you know, they've got to worry about their safety and if their five positions that they've got are going to get stolen that they need, you know, and it becomes, it's not just, you know, and for women to defend themselves, I guess against a big man. It's, you know, who wants something.

Sharon Bradley: Horrific. So one of the women I spoke to, her name is Maria, and she actually moved into her car when she crossed that unimaginable threshold. She realized that she, she knows she was offered a job, it didn't work out and she realized very quickly that she was not able to afford to carry on renting her apartment in San CC. So she moved into her car but she said she was, she would often be so frightened at night, she couldn't have the windows down so she would crack the sunroof open a little bit. But she became so frightened that she would often just park her car in a beach car park and she would catch the train into central and she would find people who were rough sleeping in the parks and they weren't her friends, but she said she felt safer with them than she did staying alone in her car overnight even though she was able to lock the doors. So unimaginable horrors, unimaginable. It's

Veronica Morgan: So isolating and there's so much shame around this as well. And that makes it even worse. Cause you know, you feel shy. You would, you would feel shame. I imagine a society is basically, I mean, I know when I'm walking on the street and I, and I'm, I'm pulled to help it, you don't know what to do and you don't, you don't want to feed someone's addict chin and you know, I'll go and donate to, to a charity to help. But yeah, it's a very conflicted, you don't want to and there's a lot of fear from the point of the non-homeless person in interacting with homeless people as well. I mean that SBS show was quite amazing because it really did lift that. But however, how do you identify even the people you can engage with? And so society wise, we've got real challenges with this as well. You know what I mean? So so you've got, you've got a cohort of women that it's not just, I guess what I'd like to be, I don't like to understand, I guess what led them to this point. How did they get there? What, what decisions and what turning points in their lives has had these unexpected outcomes? Cause you've interviewed a lot of people, haven't you?

Sharon Bradley: Well I've spoken to quite, I've read a lot of stories and I spent a lot of time with the three women who feature prominently in the story because they had such compelling stories that were incredibly relatable actually. And the first lady is called Reanan and you know, she had a very high flying successful career in television. She was on first name terms with Michael Parkinson. All our most well known TV chat show hosts in the UK and in Australia. And for her it was a diagnosis of glaucoma. So her parents had been diagnosed with it. There was a family history, but they had been late. Life suffers. Whereas for her, she was diagnosed at the age of 49 or 50, and it was very severe. So she became unable to work and she had been making a lot of money during the 1980s during the heyday of the TV chat show.

Sharon Bradley: But she was from England and she had a family in Oxford share that she was extremely close to and she spent so much money jetting backwards and forwards to the UK. And at a time when she could have bought a property, she was actually traveling and staying in touch with her family and where,

Veronica Morgan: What's with the family now?

Sharon Bradley: So her sister is still in Oxford show and she visits regularly. She goes, still goes back and forth. But Raeanna now has two sons who are grown up in Australia. So perhaps if it were not for them, she would be thinking about going home. But you know, she has her found her boys here and also a grandson Billy.

Veronica Morgan: And it comes back all the way to, I mean, we didn't it an episode with Craig Bigelow, I can't remember the exact number. He's an insurance expert really talking about insuring yourself for these sorts of things, you know. Um and, and I guess if you don't, and I've got some clients in fact that one client, I think she was in her thirties, maybe early forties, she had a stroke and she had all the appropriate income protection insurance and trauma policy and all the rest of it. And she get, she was paid out and, and she's been able to buy an apartment and live an independent life. So there are, there are way, not everyone has to have this happen if they have something awful happen to them, but you, but we have to protect ourselves.

Sharon Bradley: I think one of the key learnings from this from this harrowing subject really is that, you know, women have to engage with their super in their twenties, in their thirties. As soon as they start earning money, they have to engage with their super. And you know, when they're choosing the right fund for them, they have to ask, you know, does it offer insurance? So life insurance, disability insurance, and also income protection, insurance, all of these things become exponentially more important as we get older. But we don't think about this when we're 20 and I've got no, yeah. When we're in our twenties and thirties because we think tomorrow tomorrow's going to come, but it's going to come in 40 50 years time. I'm going to be, you know, I've got bags of time.

Veronica Morgan: Were you saving your deposit for your first home and you haven't got the cash?

Sharon Bradley: Yeah, that's right.

Chris Bates: Yeah. I agree 100% that the insurances are a big part of a limb. Limiting your risk to this. Unfortunately for women just generally there's already a pay gap, which yeah, it's getting better. No, it's not. It still is. Pay gap. Yeah. I grew up with very strong mother and you know what's hard, I've got a very strong sister and I've kind of, I look at this stuff a lot strong, but I'm, you know, that's kind of where I grew up and I've kind of insight, you know, I sit on that side of the fence to be honest. And you know, so there's still that gap wage gap. Secondly, I'm more likely to take care of the child if there is to leave the workforce while the husband stays in the workforce. So yeah, your soup is not being topped up while that's happening. Exactly. And so I'm more likely to go back to part time, which then potentially could inhibit 

Chris Bates: Promotions. And so not only a wage gap, but you're not going to earn as much generally cause you're only going to work part time and you're not going to get offered that bigger job. Even just having maternity leave. So the super balance for women over men is much, much lower, like, like ridiculously lower. No matter whenever I chat to a couple and I ask what a guy's gotten, a woman's got, it's dramatically different. And so at all ages, so then you go and I'll get the insurance and insurance unfortunately gets more expensive as you get older. And by the time you get to your, let's say your 50s, when you get in this real vulnerable stage and if you do lose your job or you do go healthy, you stop your premiums. Generally speaking, the cost of the insurance is wiping out your super funds.

Chris Bates: And so the insurance companies here, you've got a lot to answer to because the way that they structure their policies is that they, as you get older, you have to cancel your policy cause it gets too expensive. Yeah. And then what ends up happening is someone in their 50s get home as well and they go, I canceled that policy three years ago. And so it's really about, there's no easy way. There are ways you can do level premiums and things like that when you're younger to stop that risk. But unfortunately it's, it's a real hard one insurance because unfortunately people can't afford to keep it when

Sharon Bradley: That's so true. That's so true. And I think this is why, you know, women in super is an advocacy group around, around women and, and superannuation and they, that that platform is it's a three pillar platform. Essentially, they want to see super rise from 9.5 to 12%. They want to see compulsory employment, employer payments of super during the 18 week paid parental leave time and they importantly want to phase out the $450 a month eligibility threshold for super. So a lot of women. Yeah, that's right. A lot of women might be going back to work part time after they've been looking after their children or their aged parents. They go back to work part time in a lower paid position. And you know, the way things stand currently, if you earn $450 a month or less, your employer is under no obligation to pay super.

Veronica Morgan: You might have a couple of casual jobs. Yeah. And both of them aren't as fresh shoulder three of them under threshold.

Sharon Bradley: Yeah. So you know, they want to see a lot of work around this. A lot of policy change around the earlier years that will help set women up for financial and retirement security.

Chris Bates: Yeah. One thing I recommend any females listening to this is a new company, a friend set up. It's called super rewards and it's for women mainly targeted for women. It's can be for men, but you know, it's basically, you know, when you go shopping and you buy anything from flights to clothes to groceries employer, the person, the people you're buying from will top up your super fund. And so like a lot of women are doing the household shopping. You know, yes, it's pretty democratic in my household, but you know, we keep it pretty even. But you know, in terms of lots of households, the women are, and what this does is allows them to keep topping up their super fund. So you know, that problem, you know, there's lots of things that need to get solved there. Cause I think soup is the big part of it because the other big part of it though is home ownership. And if you got a home and you are likely to end, it's got equity in your loan market to become homeless cause you can have that security paying your mortgage. Yeah. But unfortunately, what are some of the biggest reasons why we sell our home? It's divorce, isn't it, in relationship breakdown. And so have you found that in your research that a lot of the reasons why homelessness has come about is because of like divorce and marriage?

Sharon Bradley: Totally. you, you become extremely vulnerable if you are not a home owner. And you know, I think the research shows that being in a marriage, being in a partnership is an absolute insurer of economic stability as you move into later years. But, but, but absolutely home ownership is, is something that it's, it's critical, critical as is being in a, in a relationship. Yeah. Interesting. So let's just, I'm curious, you know, we've touched on some of these things, but why is it so dramatically difference between men at the same age and women at the same age? It goes back to it goes back to what we were talking about earlier. Women are retiring with 47% less super than men. Wow. This is the critical issue. And the pay gap, which you know, has hovered between, I think it's, Oh, I think it's between 17 and 19% in the last 20 years going anywhere, which is the equivalent to a woman of working the last 60 days without paying something ludicrous. So

Chris Bates: Amy, you look at boards of ASX companies, you know, they think, Oh, I'm making progress. You know, we still look at the boards. They're not much just changing. Right. Which is very frustrating, I think. So like a lot of it comes, if you think about like that story there, she was spending all their money on going back to the UK. But one way you have a marriage breakdown is there might be a payout, right? And so you've got a family home, but the only way to split the money is to sell the home. And so then you go the, the husband and the wife or the husband, husband, wife, wife. But whatever it is, you know, new marriages the, that person, if, let's say the, the wife has got $500,000 from a payout. If she's not working because she's taking care of the kids and she can't borrow money. And so all she can do with that money is potentially put it into a bank account. Yeah. Because she's not working and if she is working, she's working part time. Cause you've got two young kids, let's say. Yeah. She might be getting a bit child support, which can help borrow money that's nowhere near enough income to borrow any meaningful amount. And so what ends up happening is

Veronica Morgan: Pressure to stay in the area that they were living before. So the kids got continuity, the schools and all that sort of thing. Yep.

Sharon Bradley: And this is what we see women are cycling through that asset pool incredibly quickly, spending it basically to keep a roof over their heads. I mean you know, I think the median weekly rent on a unit in Sydney at the moment is 520 a week. And in Melbourne it's, I think it's four 20. Yeah. and if she's not working as a lot of them, if she's on new start, she's in her late fifties. I mean, you know, that's 278 a week and that's for a Singleton with no kids. So I'm not quite sure what it is for, for someone who has, so there is impossible mathematics at work there as well.

Veronica Morgan: Um and in the queue to get some social housing is 10 years long or something like that.

Sharon Bradley: That's eight to 10 years long. Yeah, I mean I think there are currently I think there are currently 116,000 people. 100, sorry, it's 140,000 people on that public housing list and they could be on it for eight to 10 years.

Chris Bates: Yup. So that's our, it's 200,000 homes. That's called a hundred a hundred thousand homes that we need to build for that list alone, let alone the people who aren't on that list that don't want to put themselves on that list.

Sharon Bradley: So to absorb the current need and the backlog it is projected that we need to be built. We need to build 433 or 133,000 new social housing dwellings over the next 20 years.

Chris Bates: Yeah. And so the state government needs to do something right. And 

Veronica Morgan: Is it's all, sorry, you got to STEM the tide. You know, cause that's sort of dealing with what we have, what we know is have it happening and then you know, we've got to educate. We've got to make sure that women in that situation have better options really.

Sharon Bradley: Because there is what, what, what is waiting behind the wings. We've got a very, very acute crisis right now. But waiting is what one expert has social ventures Australia. Coby Macklin called a tidal wave of women who will be adding to this crisis because they are age between 45 and 65 and they won't be able to carry on renting the places that they're living in now when they were tiny. When they yeah, when they become eligible for the age pension. So they keep crisis right now and then, you know, so many 300,000 more women waiting in the wings too.

Chris Bates: Yeah. Cause the pensions that, you know, we've, you know, you look at the numbers of the pension, the pension, you don't get that much more if you're a non homeowner versus a homeowner. So let's say you do retire and you, you know, you eligible for the pension cause you've got no other assets but you've got a home, you still get, you know, it's like 400 bucks a fortnight or something, right? I maybe more before nine bucks a week. And, but you know, if you, if you haven't got a home, you maybe get 500, right? And so it's a little bit extra to cover the rent, but it's nowhere near enough to actually cover rent. And so pretty much you, you're already negative. You can't even afford to pay for the bills and still and pay for your food and things like that. So I think there's a yeah, a complete lack of, you know, housing, but I mean the reality is they could do something about this, but the problem is that they make the state government makes way too much money. Allowing developers to build for investors. Cause that's where they can make all their taxes. They don't make any money if they build, you know, and they sell it for affordable housing. That's the problem. That's the problem right there. Yeah.

Veronica Morgan: Mmm. Well it's one, I think one of the problems definitely. I mean, I mean that, that's, that's a problem in terms of the stock levels, you know. And while we don't, I mean, what labor had a policy going into the last federal election, which was something about getting a tax incentive to investors to build more social housing. But I think even that was only like 20,000 dwellings or something, wasn't it? It was a really low amount of money. A low amount. There was just a drop in the bucket.

Sharon Bradley: Hmm. I thought bill shorten had quite a good platform, wasn't it? Something like 250,000 new social, was it doing for you to drop to zero?

Veronica Morgan: Yeah, yeah, yeah. News. Right. So he was going to get there halfway. Yeah.

Chris Bates: Yeah. But then in 10 years we'll have another population rise of X. It's

Veronica Morgan: Actually, it was a shocking, it was actually shocking though, for property investors, of course, not a great policy for them. But yeah, look, because it is complicated and this is, I think the awareness of what actually is happening is the reason we want to talk to you. Because you know, I've no, Oh, I know you personally. So therefore I knew you were researching this and also sort of waiting for the article to come out because we need to understand that this is happening. We need to understand it's getting worse. We need to understand who the, who is greatest at risk. And we also need to understand that average, ordinary, normal run of the mill people are finding themselves in this situation and are going to continue finding themselves there. So as a society, as a country, we need to help help them, but also individually, we need to actually start putting in places in our own lives prevention so that these sorts of things don't happen. And that's one of the reasons for this podcast is to help people actually get, you know, get some wealth out of property. And, and, but if you don't realize it can happen, you're not going to take it too seriously. I, you, and I think this is the most alarming thing about this, your research

Sharon Bradley: Surprise and I think it's, it's human nature unfortunately, just to, if something is unpalatable or if something is difficult or if it's boring, you know, it's human nature just to say, well, I'll take care of this, you know, and all the time. And of course tomorrow never comes. You know, and meanwhile, you're getting older and your needs are becoming, your needs will become more acute the older you get. So it's absolutely vital. I think this has been one of the principle learnings that, that, that people, and especially women who are so vulnerable in their later years particularly if they're, you know, running away from an abusive marriage has so many are.

Veronica Morgan: Yeah. We haven't even talked about that. But that's obviously would be a different course. Yeah.

Sharon Bradley: That they really do need to engage with their super. And what's encouraging is that financial fitness, financial capability of seminars, seminars are starting to spring up. Yup. I know that MLC had a big, they organized a big webinar on international women's day last year about full women with a panel of women, all of whom are working mothers, but find experts in the financial field talking about money and how to understand it, how to get on top of it, how to prepare for your future. I think that's hugely, hugely important. You know, because when we're at school, nobody talks to us about this kind of snow, you know,

Chris Bates: And maybe this is why I love Scott Pape. So he's a good mate and he's the barefoot investor, so Hey has, you know, probably decided, avoid coming on the podcast twice now. Nobody's, come on, it'll be on here soon. But the reality is he's sold over 1.5 million books now. And those books are all about, you know, financial one Oh one how to empower yourself around money. And there is, he's kind of, a lot of his philosophies are paying off your credit cards and don't go into personal debt and have conversations with your partner around money and have these date nights and things like that. Because, you know, if you don't solve the money issues while you're together and if something does go wrong and you've got nothing or you're in credit card debt, the problems get bad pretty fast. So you know, and it's all about, and, and also in a lot of financial advice, a lot, it's very heavily male dominated. Like a lot of investments. You know, in financial verses a lot of younger women who are really making big inroads with kind of profiles and helping women

Chris Bates: Managing your money is kind of becoming a bit sexy. Like before it was like, do you know, before it was, you know, if you're being a bit frivolous, you money, you're living a high life, that was quite cool. But now it's boring. It's actually, you can see there's a movement behind it. But I think unfortunately a lot of people, it's in their fifties now. It's kinda too late. A lot of them for them to make a lot of beginners.

Sharon Bradley: That's right. And, and I think it's, it's sad to say, but a lot of older women have been entirely dependent on their husbands, not only financially but to sort all this stuff out. So suddenly they're on their own and you know, the stakes are very, very high and they have very, very little financial, financial literacy. What's also when they're actually going through the divorce process and the assets.

Veronica Morgan: Yeah. Giving up assets and which has its Kate, which, you know, those decisions around, you know, family home, he said, et cetera. It's like, you know, the divorce lawyer mean they've got one is going to give certain advice, but in terms of financial advice, it's almost like they need a coach in there as well. Totally. you know, and I think too on the property side of things, you know, understanding which are the good assets to keep, which ones,

Sharon Bradley: Honestly your husband one, you know, you know, while we're on the subject of family, I think we also have to talk to our daughters as well. And I had a really lovely conversation with Laura Menshevik from WLM. A few months back for different story I was writing, but she said, you know, she has an 80 10, 10 rule, which she has, you know, been talking to her children about and now she talks to her grandchildren about, which is that, you know, with your first wage packet you spend 80% of what you earn and 10% must go into an account that you never, never touch. And that is for your first house or to start a business if that's what you want to do. And then the other 10% is for a treat like a car or a holiday, something that's going to do value pretty immediately. But it's really important that you do the 80, 10, 10 from, from a very, in the beginning, from the beginning, get into good habits.

Veronica Morgan: It is that 10% that you actually start saving, getting the habit of that. You never see it. You never get your spending just

Sharon Bradley: That's right. Yeah, that's right.

Chris Bates: So the elephant in the room is 100% for you.

Veronica Morgan: The reason that Chris and I do these podcasts is because we passionately believe that property buyers can do it better. We really want to help all of you understand all the risks, but also the ways in which you can avoid your elephant making the decisions.

Chris Bates: Or what we would love for you to do is just to share this episode and share other episodes with people around you that are going through the property process.

Veronica Morgan: Give us a review on iTunes. Fivestar please would be very appreciated because this is about making sure that we all benefit from the wonderful information that guests have been sharing with us.

Chris Bates: I love this topic because all babies do any minute. And I think about these sort of parenting things. The reality is it's, you know, to train these sort of things in, you've got to be trained. And the reality is most people don't understand financial concepts. There's no training for them. And then they've got the key. And so it's kind of like, it creates inequality just creates inequality, you know, like, and so and this is the big thing with society and this is the big thing that lower interest rates are causing right now is that we are creating the haves and have nots inequalities getting bigger and bigger every year. You know, homelessness in Australia is a problem, but if you go to the, say the U S homelessness is a much bigger problem and you'd argue there's a lot more wealth over there. Because it's basically this inequality just keeps getting bigger and bigger. And so while there's you know, we can all do little things. There are structural things at play that, you know, basically are causing this problem. If you, if you get what I mean, like it's basically society's kind of self fulfilling this. And so I think you've got to yet we can all take ownership of our own personal situation, but unfortunately not everyone's got that same opportunity to, cause they don't even know themselves. You know what I mean?

Sharon Bradley: I think that's why we need to really address these sort of deeply entrenched systemic failures that have to do pay gap, that have to do with, you know, the French ility of women's superannuation accumulation. All of these things are really, really important. So, you know, you have that life disrupting event on top of these, on top of these systemic failures and prejudices, and then you've got a life disruptor, you know, and so it's a downward, it's a, it's a really acute downward spiral.

Veronica Morgan: Yeah. We, we took, we actually just before we started, he, we, we started talking about ageism and the difficulty in actually getting another job if you are over certain age. So one of these life changing things can be, you may redundant or you know, business goes right or you actually have a real bit of a shock and you weren't very good at your job and you get the sack or you leave because it's an abusive environment. You know what I mean? Or, sure. But whatever reason you've, you've left, you're not in a, in a job. And was it you, Chris was saying something or was it you Sharon that was saying about the the statistics of women over 40 at 55 who go for a job interview?

Sharon Bradley: They, so, yeah, it's, it's horrifying. You know, this will have women all over the country waking up in a cold sweat at three o'clock in the morning. But yeah, the women over the age of 55 are the least likely of any demographic to receive a callback after a job interview because of, you know, it's horrible, but it's employer. And what's the perception? And it's really tragic, isn't it? It's really tragic because you know, these women in many cases are at a point in their lives when they are finally able to really lean into topping up their super and to getting their teeth stuck into something, you know, their kids have left home they no longer are taking care of aging parents perhaps. And they can really lean in. They've got a lot to contribute. And you know, you hear a statistic like that and you think, gosh, that's, you know, tremendously depressing.

Veronica Morgan: It's really alarming. And because I'm at this point of recording this, I'm 51 so I go, ah, four, years' time, I don't feel any way used up. Just kicking, kicking in, just finding a strike. Exactly. Right. And, and you know, I'm, I'm energized, I'm interested. I'm lapping it up on learning. I'm, I'm trying new things. You know, there is absolutely no slowing down for me. And, and yeah, in a way that I don't think ever I thought in my forties or in my thirties, even, definitely not my twenties or miss. And, but I do, I was in recruitment in my twenties, in my late twenties. I was in recruitment and, and I said, look at the age 40 on a resume and think, ah, past it, used up use by no fresh ideas, you know, and, and that's absolutely what I thought back then. And Chris you was saying, you know, that it's not necessarily, it hasn't changed.

Chris Bates: Well, yeah, I mean my wife's in recruitment and you know, her, you know, stories talking to her around that you know of. Yeah. I mean, exactly. It's, I use them is obviously very common, but it was also just even it's also for men as well. Like there's a lot of industries you know, for example, we're going through a bit of a tech like Holden shutdown last week. That's 700 jobs gone. Like, yeah, maybe there's, I ate 95% of them are probably men. You know, generalizing, but, you know, that's jobs and there's a lot of industries that are going through this. And there's offshoring, you know, a lot of jobs, for example, where women are, are doing, you know, now it's a virtual assistant say in Philippines and there's lots of jobs out there are getting they're gonna get taken out.

Chris Bates: And so I guess that's you know, and a lot of jobs actually aren't getting wage rises are, et cetera. So, you know, you get to a point and one of my clients is a CFO and he earns really good money. He made a really good point to me. He's like, look, I've seen what happens to people who are 10 years older than me lose their job. You know, it was sort of worked hard for and they're there. All of a sudden they get made redundant and I have to take you know, they can't get another job. 

Veronica Morgan: Well the more senior you are, the less potential jobs are out there for you. Makes it even harder. Yeah. Yeah. No one wants to take you on a lesser job cause they just feel like you're going to be just always on the hunt for something better. And you know, the competition to get those very few senior jobs acute, you've got a lot the hungry, you know, people climbing the ladder and then you've got potentially a lot of capable people. But you've also got the Peter principle. I'm not sure how many women actually, the Peter principle is basically you rise to the level of your incompetence. And to be honest, you know, we sort of joke about it a lot when I was in recruitment. You know, there's a point at which mostly in regards to men, by the way, because I think IBM was an IBM, that they can heal a packer that conducted that study some years back about men will go for jobs that they can do.

Veronica Morgan: 50% of women won't need to have 100% of the, they will 100% of the boxes before they'll even apply. The Peter principle comes in because men will actually go for promotion. They'll probably get it. Whereas the woman's like sitting there going, yeah, I could do, Oh, I did 90% of it. Oh, can't do that last thing. I won't apply. Yeah. So probably women don't suffer from the principle quite as often as men do. But you know, this is, there's all of that going on underneath as well. So therefore, if you're not going to push yourself in your career, you're not necessarily going to go for those promotions. You're going to be earning less in potentially you could be, you know, it's a real knock on effect and societies you know, in the way we all think is contributing to these. And the way we think about ourselves as well, obviously. Mm. Yeah.

Chris Bates: The rental thing is the big theory. So you get to 65 and you're retired. You haven't got a house in Sydney because of whatever reason. Can't afford to pay rent, but your kids are in Sydney, your friends are into your life, your identities in Sydney. And you know, sometimes the government will come out with these stupid comments like, Oh, why don't you move to Tamworth? Oh, favorite place

Sharon Bradley: Such an out of touch thing to say. Yeah. just chose a complete lack of understanding

Veronica Morgan: If if just connect. Yeah. Community.

Sharon Bradley: Yeah. It is so important. I mean the research is showing that women who do find themselves in this awful situation that their mental health deteriorates really, really quickly as well because it's also, they described this feeling as like being suddenly catapulted out into space and there are no coordinates, you know, they, they have nothing to hang onto as they're going down. So just, yes, completely out of touch.

Chris Bates: Well, that's the thing, like a lot of people will say, Oh, people on the streets, for example, sleeping rough or whatever. You know, it is, you know, Oh it's mental. It's, it's drugs. Well maybe, maybe not. Was it the streets or cause that, you know as mental health, well was this, was it cause they were homeless in the egg, isn't it? Yeah. Mental health problems. Like Oh it's relationship breakdown. Well that happened to anyone. You know, why haven't they got their kids? Well they might not have any

Chris Bates: Kids. They couldn't have kids or they didn't have, you didn't want kids or not all families are close families and closed arguments or don't want to get on with it. I don't want to impact their brothers or sisters and they've only got their own families.

Sharon Bradley: One of the women I spoke to, she has got four brothers and a married daughter, but she just didn't feel that she could contact any of them for help, which you know, is staggering. But it speaks about us. So social alienation can exist even in big families. Okay. So I just don't think we can afford to make any kind of assumptions about why someone is sleeping in a box on the streets. And, you know, I think we should reach into our wallets and gives them, you know, 10 bucks for a burger, you know, and, and, and let's just not judge because we, we don't know what has brought them to this, this point.

Veronica Morgan: It's actually interesting. I've taken recently when you, when you asked her money on the streets and you know, feel free to judge me or feel free to send me messages and what I could do better. But to say, look, I'm not going to give you any money, but are you hungry? Yeah, those are buy you some food. And there's actually a really good litmus test because some of them will go, yo, I am, and I'll go and buy him something. And others will go, no, no, no, no, no. I just want the money. I'm like, well, that's cool. I'm not going to give you the money. So is, that's actually my way of actually trying to help, but also sought through. I don't, I just don't want to give you money for your next hit. I really don't. And I'm not going to. But you know, if you are hungry, yeah, absolutely. But you know, do have you actually through this actually found a favorite charity. And I'm just hitting you with this question. I didn't prep you for these at all, but I mean because there are so many organizations that help, you know, there's is people that feed that, you know, there's organizations that feed them.

Sharon Bradley: There's, I mean, I can say that, I mean, I've spoken to people at mission Australia and S and st Vincent DePaul and I have been absolutely blown away by the dedication and the compassionate care that these caseworkers bring to the, to the women who are walking into their offices and they all say the same thing, that they are seeing more and more and more of them single week. Wow. And do you know what is really, really hard is that often for these women, they, they, they can't discern the pathway, the correct pathway to social services. They, it's all just an amorphous confusing mass and they don't know where to go for help. So these women are really holding their hands figuratively and metaphorically and helping them negotiate this incredibly tangled labyrinth, fine procedure. That requires everybody to be online. You know, you can't speak to a human being 100%. That's bizarre. Is it adding to their sense of alienation. You have a woman who's sleeping in a car and she's expected to be able to log on to settling. Yeah.

Veronica Morgan: Chris is a conspiracy theorist. Okay. And I tend not to be, however, I am all leaning in the direction of thinking that maybe it's been structured that way to minimize payments.

Chris Bates: Sure, exactly. I mean the reality is, isn't it? So you know, there's, what were these bushfires seeing that happened? You know, there's an argument that the money's not going through to the people who were affected and you know, these donations are going through and things like that. Well now that really are great idea. Got proposal, the ATO has got all their bank details. Why can't the ATO, the government's straight away, you know, help by, you know, putting money in all their bank account. Right? Like if you wanted to make the money go through, the problem is to get the money, you got to call the call center, then you've got to jump on the phone and your, there's the fee, the power's out. I've got no phone, I've lost my phone charger. And so you know.

Veronica Morgan: Like if you're not on ready traumatizing enough things to do.

Chris Bates: Yeah. And so the system is actually smart enough where people are smart enough to do this, I guess through.

Veronica Morgan: Are they smart enough or they just basically so disconnected cause that's just the top personality that might be really good at developing these systems and.

Chris Bates: People are going into politicians isn't really, I think the people who, I know it's unfortunately the people who go into politicians, but by good heart unfortunately end up in an area when they're in an area where they've got to win votes and then you become like who you're surrounded by. So I think that's the problem. I think a lot of things we charge and do you know clients and friends who work in this space and things like that. A lot of people just think it's money. You can just throw money at the homeless. But it's not money. What did the homeless people think are the solutions to the problems? Because they've got the real insight on what they need to fix things and what support they need. But what were some of the things that you think that they really wished

Sharon Bradley: They want? And they all said this, all of them, they want to sit down with some shiny boots in Canberra and show them exactly how quickly their money evaporates. They want them to, you know, come out of their polished offices and, and see how it works. And that's what they said. We want to show Scott Morrison just how inadequate new start is. We want to, we want to show him that, you know, this amount of money has been the same since 1994 or 1995. It, you know, that is indexed to new starts is indexed to CPI. It's indexed to CPR. Is CPI when in fact not to wages. Is it not, not wages. Exactly. Uh but, but rents are in flight. Yes. Double the rate inflation. Yeah,

Chris Bates: Yeah. No, it's doctor. Right. And CPR is such a stupid figure. It can be yeah, it's not actually the reality, you know? And you know, a lot of we've, our salaries are going up, so a lot of the things that we spend money on, you know, food and, and then things like electricity and you know, I don't think CPR, cause we don't all buy that same basket of goods and a lot of things are excluded. And so yeah, if you look at what CPI was and you did house prices versus CPI ball, you'd be like, wow, you look at wages, et cetera. So I think yeah, more money's potentially a problem, but then they still have to pay for these things. They still haven't got a house. So was there anything else that they really think that they really want besides just increasing how much of the money they want? They want,

Sharon Bradley: They want more dwellings, you know, they don't want to be on waiting lists for 10 years. They want, they want solutions in terms of affordable housing.

Chris Bates: Yeah. Yeah. So the, the big thing that government could do, and I think they should do is like, so when they sell a new apartment, they probably make $500,000 or $400,000, maybe like 40% of that million dollar apartment actually goes in government taxes. And so the developers of that million dollars that they make, they have to give $400,000 that to the government. Now these numbers not about me hundred percent correct, but let's just assume it is, the developers only got 600 grand to play with now then they've got to pay for the building, then they've got to make their profit and the risk and things like that. If the government said, look, you can still make that same amount of profit but you don't have to pay our taxes. Yeah, the developer wouldn't build for the investor. The developer would build for more affordable housing. That's cheaper, that subsidized, but the government doesn't want to give up all this cash. So that's to me, that the problem is developers won't build it because there's literally no incentive for them and their business. And so, and the government doesn't want to build it.

Veronica Morgan: What's one of the challenges of the build to rent model that we spoke to Adam, what was the surname from Hurst? Yes. Back on a few episodes ago. Yeah. I mean they move back you know, I guess leading the charge in that space in Australia, but there's massive hurdles and a lot of them is around tax and who's who Atlantic's for instance. But yeah, cause the D the structuring of it is, is a challenge for the government to say, well, I'm, I don't want to forgo tax in certain way in certain areas and I don't want to give tax breaks because there that actually adds up to something unfair that you have a burden that you have. It would not be there if you were building in selling these apartments in the traditional way. I mean, there are some lovely pockets of innovation around not for profit, affordable housing. The Nightingale project know, and we tried to get them on the podcast and I kind of say they, they refuse. Can we, can we say they refused?

Chris Bates: No, probably. All right. I mean there is, I guess we can, I guess, I mean it's probably a good point. It's all about weight. Yeah. You might notice some of our guests aren't wearing hats. I'm in some of the our elephant rider hat. So when Veronica Ross set up the podcast over 18 months ago, we had this discussion. We, we named it the elephant in the room and we just had a bit of a play on this elephant in the room. Why don't we make it a bit fun? Let's have the Dumbo segment and let's have the elephant rider bootcamp. Maybe we should throw a hat for our guests. Then we talked about maybe is that misappropriation as well of and Verona, can I buy the call? The, you know, it's, we're not, we're just having a bit of a fun. We're taking the lot side of life and we're not in that client at all as people. And anyway, Nightingale wouldn't come on because of that reason. Because of the hats. Yeah. So

Veronica Morgan: It says your shame because you know, we'd like to discuss or we love what they're doing.

Sharon Bradley: I mean, and, and, and, and the thing is, I think what we, it is a very grim outlook, but there are these lovely pockets of innovation that you have to, that we have to water and give publicity to when the next silly hat involved. They don't have to wear it. That's the women's housing corporation for instance. All of these things are fabulous, but what we need is involvement from our federal government to, to really, you know, bring it off, bring it off. We need something that's scalable. Essentially we need, we need volume. I'm talking about, you know, 430, 3000 new affordable dwellings wide in order to cope with the current need and backlog. And so that's not even forecasting to take into account the tidal wave that you've mentioned. Yeah. Right. That's right.

Chris Bates: The solution I think cause I thought about this a bit as well. Like there's the government, I've got money but also super funds. I've got money and so, and the stray is super fund called future fund, or if the government's got, that's got a lot of money, hundreds of billions that they could, the reality is the super fund needs to get returns for their investors and we're all putting money into super. And that's just getting bigger and bigger every year. It's like $3 trillion. You can build a lot of houses with, you know, $100 billion. So a portion of super funds could be solving this problem. But the reality is the government doesn't want to, you know, give the super funds or free kind of tax exemption or anything like that. And so what a lot of super funds are starting to do is look at this thing called impact investing.

Chris Bates: And so it's, we get a social outcome and we also get an investment return. And so all the government would have to do is basically give the super funds or subsidies, additional rent for investments. And so they basically subsidize the rent for all the homeless and they don't have to build it. They don't have to let the developers get off for free or they need to do is pay these subsidies to the super funds to allow these renters to rent it a lower rates. And so I do think that is probably one of the better solutions I've seen where, you know, the super funds can get any investment return. This government doesn't have to build them, developers don't have to do it, the super funds will do it. And then the government, all they have to do is pay subsidies. So I think some of those things have been talked about as well too, to really bridge that gap.

Veronica Morgan: Fantastic. So do you have a, a bit of a dream of, you know, you wrote this article and in doing so did you sort of think, okay, well this is really what I'd like to see happen.

Sharon Bradley: Well it's interesting that you mentioned that because I just got a an email late last night actually, that the government has just launched in the, who has just announced an inquiry into homelessness in Australia. So that, I was alerted to that yesterday. And I think the committee is accepting written submissions in the beginning of April. So I think that's, I think that's a start. Yeah. I think that's really, really important. And of course, like so many people I would like to see more pressure on the government in terms of new start. Hmm. Yeah, yeah. Yeah. And yeah, I think, you know, our social housing stock has to improve. Yep.

Chris Bates: Yeah. If you wanted to, I was reading your article is that you ended it. Which I think was actually something that I tried to talk about. You said the choices you make now are your debt. Oh, this is one of your quotes of, you asked one of your people you were speaking to, to give advice to their themselves when they were younger. And this is one of the things I sometimes say to clients is you need to kind of write a letter to yourself or think about your future self and do something today for what you're going to thank yourself for in the future. And that's all you're really doing with finances. All you're doing is sacrificing a bit today, taking control. So in your future you've got a bit more certainty. And and that's what you're basically, and so this person who was obviously struggling it was amazing.

Chris Bates: The choices you make now are your destiny. Keep a strong eye on your future. You can't see it now because you're busy and having fun, but it'll be here before you know it. Make sure you're ready. That's right. Yeah. To me that, that is amazing cause that really hits home. People are busy, you know, we are kind of guy on in life and things are just taking over. And I think a way to really think about that I think opens people's eyes up is if you think about age today and then you say you're going to retire at 65 yeah. And they say you're 45, so you've got 20 years. But if you change that to how many paychecks you've got, so you times that by 12, that's only 240 paychecks.

Chris Bates: And everyone takes over. And so that's what I think salamis and me think of it that way. Wow. Yeah. It changes your view on things cause then you think actually a month is actually important. Yeah. Rather. And otherwise a year just flies by. So I think if you think about your life in pay cycles you'll start to actually get a bit of feeling that time's running out. And that's what the urgent, that's usually what you need to take action is that urgency there. And unfortunately people don't really realize that till they get five years before retirement and they go, I've only got five years left. Well, you've always only, you know, you could've thought about that 20 years ago.

Veronica Morgan: Oh, I get people coming to me saying they suddenly want to buy a property and investment property. I mean these people obviously have their own home and and able to do it. You know, and when you, when you thinking about retiring in four years, I'm like, well, it's like, can you go and talk to a financial planner please? Cause I think there's other things you should be doing. And buying a property,

Sharon Bradley: They advise young women to start really envisioning their future. What kind of, what kind of later years do they imagine they will have? You know, it, they need to engage with that vision and then take the steps to make it happen. Because without doing that, it, it's not going to eventuate. It's as simple as that. You know, you really have what kind of old age do I see for myself? You know, do I still want to be able to afford to go overseas? You know, do I still want to do some travel? And, and you know, the fact of the matter is that you really have to engage with that vision and take the steps to yeah. To make it happen. Yeah, you do.

Chris Bates: Well, no matter even if you are single or you're in a couple, I think it's I've got quite a few like single, say young women and you know, in their save really hard, maybe a bit of gift from parents and they're buying their first little apartment or something like that. And it's amazing. You can see how engaged they are. And really taking ownership over and I love it. But even still, when you're in a relationship, you know, you've got to be a just not allowing, just time fly because you know, if something does happen, something goes wrong. So you got to be having those money conversations. You know, if something does rise, should she be, it does break down like some relationships do. You're not going to be left in the lurch.

Veronica Morgan: 50% of marriages do. And then that doesn't include all the ones that didn't get married.

Chris Bates: Yeah. 50% stay in marriages because of finances. So actually argue 10% percent of people married are happy.

Veronica Morgan: Yeah. But anyway, I'm not married so I'm just I'm free.

Sharon Bradley: You're out of the fray.

Veronica Morgan: I'm proof that it doesn't work. Every week we, he incredible stories of the dumb things, property buyers do dumb things that end up costing them a lot of money and or creating a whole lot of stress mistakes that can be avoided. Now please Sharon, hope is out here. Give us an example of a property Dumbo. We can all learn what not to do from these stories. Sorry. You have a go on for us. Sorry. Oh, that's right. If you got one forest, Chris today.

Chris Bates: Oh gosh. I would just say I think the Dumbo with homeless around homelessness and where you can get itself is is gambling with your home, own home. And so, you know, a lot of people with property think it's an asset that you, you buy and you sell and you just transact. And I've got a client just literally this morning who I've stopped selling their home. And another financial advisor referred them to me and it's a young couple and it's this, they'll probably be okay, but they were feeling the home was getting too much maintenance, having to spend too much money. Things are really tight financially for them in terms of income and three kids and schools and all that sort of stuff. And so they felt the only option they had was to sell the home and they haven't got another home to move into yet.

Chris Bates: And technically they went to a broker and the broker said, you're going to, you have to sell before you buy. And they didn't really want to sell cause they know where they're going to go. And so I got the call this morning at eight 30. And the reality is they can read, they can buy before they sell. So there is a way to do it because if they go down the other option and they sell, and then for example, the husband loses their job before they bought another property. They wouldn't be out to borrow any money and then they wouldn't be out to buy something. And so they're out of the property market. And then I so you've gotta be really careful when you're buying and selling homes that you're not out of the market. And you've gotta be very careful if you do, which is what some people did in the last couple of years, got freaked out with the housing market crash.

Chris Bates: I've got to sell, it's going to keep falling. And they put the money in the bank account and then they go, well, I can't buy anything because I haven't got the money or the income. It's a lot of people gamble with their home and they try to say, try to play the investor market. You've just gotta be really careful selling your home because you've got to be really confident you're going to be able to get back in because if you lose five years, you can just sit on the sidelines. And this problem of not having a home ownership can really get bigger on you. So like, I think that's where the Dumbos are, is people gambling with their home. That's a good one. Yeah. Well, Sharon, this has been a really great chat.

Veronica Morgan: I really enjoyed it. Thank you. Yeah, thank you for having me. And forgiving you know, putting the focus on this hugely important issue. Yeah, well it is important and I guess even more important than even, I thought when we talked about you coming on when you said this tidal wave is just, I mean, the language that they're using is mutual logical, you know, it's, yeah. Idle wave tsunami. It's, it's really worrying. And when you get these, these these anecdotes from people working at mission Australia for instance, saying that more and more people, more and more women coming every week. So really as a podcast, we want to shine light on this and hopefully you know, maybe we should pick a charity and at least put link in the, in the show notes. We will as somebody that we, you know, that we think that come on or maybe a list of a few, just please, you know, let's just get involved. But also on the prevention side of things. So we want to agitate for, want to help, help if we can. We want to agitate for change. We want to edge agitate for government to take action, but we also want to educate people and give them the opportunity earlier in life so that they can make these decisions for themselves. Take responsibility and actually not find themselves in this situation. That's really my vision.

Chris Bates: Yeah. And even the people around them look. So you know, it's the people around you that need help with their finances or you can see that being just, you know, give a bit of a nudge. Don't be afraid to let them know that I, you know, maybe you should go and ask for some advice or we thought about maybe I think those people usually will do better because there's always someone watching out for him. So watch out for your friends and your family around you as well. Cause I think people are sometimes just don't have that. No one telling them no one was supporting them. There's no one in their life to say to them, you know, have you thought about maybe, you know, buying your first property? Have you thought about maybe looking after your finances? Sometimes people need that nudge.

Veronica Morgan: Absolutely. Cool. Thank you.

Sharon Bradley: Thank you for having me.

Veronica Morgan: We want to make you a better elephant rider and this week's elephant rider training is

Chris Bates: The most important part of protecting yourself or your from your future, I guess is starting early and the earlier the better. But I mean starting now is usually the best time but or yesterday. But I mean the reality is you know, it's actually getting rich slowly where you will actually make wealth. It's not actually getting rich fast. It's not about buying something today that all doubled. It's buying something that will grow at a good rate and perform well and that will compound over many years. The big thing is people get a lot of very frustrated with things like superannuation and because it's not making that much money, it wasn't as much more than I had last year. That's not when the returns will come. The returns will come in 20 years time when it compounds on itself. And so you really need to kind of understand compounding interest, stop playing around with, you know, if you saved $100 a week and you did that for, you know, 30 years, just look at how much money that will be.

Chris Bates: So it's not, you know, you have to save a lot of money. It's just putting money away every month. Being consistent with it as early as possible because, and then waiting and keeping invested. So really get on board with compounding into the sooner the better.

Veronica Morgan: And I mean the analogy for compounding for me is that of a snowball. You know, you start at the top of a really big long Hill and tiny little ball at the top and as it rolls down the Hill, it's got more surface area and therefore it gets bigger and bigger and bigger and it just becomes huge at the end of the Hill. Whereas if you start that snowball in the middle of the Hill, it's never going to be as big.

Chris Bates: Yeah, exactly right. And it's compounding both ways. So you can compound a lot of the time you're doing the heavy lifting in the first say 10 to 20 years, you know, you're the one who's saving hard and you're putting the money in after a certain point in time though that money flips and the money starts doing that work for you.

Chris Bates: The money's growing every year and that's working harder for you than actually you saving. And so technically you just got to keep focus on doing the hard work. Keep putting the money away. Forget about how much is in there. It's the same as paying a mortgage off. It's actually reverse works. The reverse. If you keep paying your mortgage off, you think, well it's not really going down that much. Well it is because after a certain point in time why he drives. As you start saving more, the mortgage starts compounding on itself and you keep paying off more and more. So compounding actually works both ways. Paying debt off and saving.

Veronica Morgan: Please join us for our next episode when we are talking all about building defects all over again. This is a topic we do not want to die because it's very, very important that the focus remains to be on apartment building at quality and we are interviewing the author of a very, very important report. Dr. Nicole Johnson comes in to talk about building defects, her research into 212 buildings across Victoria, Queensland and new South Wales. Some very interesting findings as to where the causes were, what the solutions are, and whether or not we can relax and or get stuck back into buying off the plan or brand new apartments or not.

Chris Bates: Don't forget, we're on all the social channels. We're on Facebook, we're on LinkedIn, we're on Twitter,

Veronica Morgan: Or you can connect with us on the elephant in the room.com today, you, the links are all there for you.

Chris Bates: Please connect and send us a message we'd love to hear from you.

Veronica Morgan: The elephant in the room property podcast is recorded at the Sydney sound brewery. This week's podcast was recorded by John risk editorial by Gordie Fletcher. Until next week, don't be a Dumbo

Veronica Morgan: Now remember, everything we talked about on this podcast is general in nature and should never be considered to be personal financial advice. If you're looking to get advice, please seek the help of a licensed financial advisor or buyer's agent who will tailor and document their advice to your personal circumstances with a statement of advice.