What I’ve learned about money: Matt Schultz

Adelaide web developer Matt Schultz dove into investing couple years ago and found a new passion. Now he’s focused on making it easier for people to find the right super fund for them, with his new startup Superverse. As part of our MoneyLife series, we spoke to Matt about what he’d learned about money on his journey so far.

My relationship with money is a little old school. I’ve never owned a credit card or been in any kind of debt (aside from education). To me, money is like food: I keep more than a day’s supply and if it’s running low, I start rationing.

And it has indeed run low at times. I lived with my partner in Berlin for a few years on a single, low income. So we rationed our money. We stayed in a flat that developed mould because we could save money on rent (not recommended!). For heating, we dragged bricks of coal through the snow for a few kilometres on a borrowed children’s sleigh. Even more extreme: I used the same flip phone from 2004 to 2015!

My first pay cheque was when I was 17 years old, and was from a tattoo parlour. But I wasn’t working with needles or ink. I made them a website, which wasn’t a commonplace marketing tool back in 2001. It was a little nerve-wracking to write and deliver that first invoice. But I priced my services reasonably and the client was happy with the work. It was a great learning experience. I even went a little overboard and registered my business for GST!

I love money because it can provide peace of mind like few other things can. It’s liberating to not worry about food, water or shelter. And buying insurance means we can spend less time preparing for disasters and more time enjoying life. I’ve always had a moderate emergency fund, so I’ve never needed to sweat individual expenses.

I dislike money because it requires so much effort to manage in modern societies. While our standard of living is better than ever, it’s a new phenomenon that we need to manage so many insurances, utilities, services, investments, and financial accounts. I just attempted to count all of mine but ran out of fingers! Luckily, technology can help us with this.

The person who taught me the most about money was my Mum. She never worried what the neighbours were doing. If we couldn’t afford something, we didn’t buy it. Easy. And the margarine container better be scraped clean before we throw it out! Occasionally I might have wished for more, but we got over that quickly and it gave us great tools for the future.

My behavioural quirk with money is that when it comes to budgeting and planning, I’m either all in or all out. I’ve spent months planning investments and days researching energy providers. Is a store charging $15 for a simple phone cable? I’ll order from eBay and wait weeks for it to arrive!

However, I’ve never stuck to a strict budget and I don’t chase up who owes me for split expenses. When it comes to important services like dentists or mechanics, I look at things other than price.

One thing I continue to learn about money is the importance of planning for the future. Simply staying out of debt has not helped me build a retirement nest egg. When I decided to learn about super and investing, I found out my account was quite small and that I was in a balanced fund throughout my 20s instead of high growth.

Luckily, it’s not too late for anyone to make improvements! I now have a financial plan in place, including well-researched investments. But it’s a process of continual learning. Over time, my goals will change and the world will change, so my plan will need to adapt.

The money lessons I will try to teach my nieces and nephews are:

a) It’s okay to talk and think about money. Sometimes we consider it improper to talk about money, but I don’t think it has to be. In some countries, everyone’s wages are public! The earlier kids learn how money works, the more they’ll learn. And that will give them a great head start in life.

b) How to invest and the power of compounding. This might be a hard sell, but I’m sure going to try! Compounding and youth are a perfect match. Even $100 invested per year at a 7% return will compound to nearly $3,400 by age 18. And there must be some fun companies on the ASX for kids to invest in, right?

My favourite books about money

1. The Millionaire Next Door (Thomas J. Stanley, William D. Danko)

A classic book that explains the differences between people who appear wealthy and people who are actually wealthy. Reading it increased my confidence in what I could achieve.

2. Why Smart People Make Big Money Mistakes And How To Correct Them (Gary Belsky, Thomas Gilovich)

Some of our intuitions about spending money are irrational, and the authors describe why. My biggest vice is ‘anchoring.’ If I see an item was $100 but is now $60, I get excited! But $60 could still be expensive. I’m more aware of my behaviours thanks to this book.

3. The Investor’s Manifesto (William J. Bernstein)

A great introduction to investing. There are no get-rich-quick or stock-picking secrets here, just the history and facts about investing explained clearly and concisely. It is written from a U.S. perspective, but everything applies equally to Australia.

Matt Schultz

Matt Schultz is an Adelaide web developer focused on making it easier for people to find the right super fund for them with his startup Superverse.

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