"Do what you love: Value can't be bought"
Christopher Walsh, founder of MoneyHub.
Money. It's the driving factor behind many life choices, but is it the be-all and end-all?
'Me and My Money' is a regular feature that investigates Kiwi attitudes towards money and what drives the choices they make. We also explore if COVID-19 has changed peoples' money habits and how.
Newshub spoke to MoneyHub founder Chris Walsh about the power of investing over spending, comparing credit card deals and how forgoing a corporate salary to start a business made him happier.
1. Are you a saver or a spender?
A saver and investor. Knowing the value of a dollar earned is something I learnt when starting my own business.
Dollars compound and earn dollars, whereas spending extravagantly without having the assets to absorb the cost is dangerous.
As you build assets, you have more choices.
2. Has COVID-19 influenced your attitude towards money?
As the costs are disproportionate to the value received, I've always been fanatical about eliminating personal debts.
When COVID-19 arrived, the media coverage made it clear having readily available cash was vital for functioning in such an unprecedented situation. I was happy to see New Zealand households pay down their debt during lockdown.
My attitude remains firm: grow assets, not liabilities, day after day.
3. Post lockdown, have your spending habits changed and if so, how?
I'm increasing the frequency of spending at local businesses as well as travelling more regionally (once the alert level lifts).
As I'm naturally cautious and foresee turbulence in equity markets, outside of property, our assets are now mostly in cash.
4. Your mobile phone dies: what do you think is a reasonable amount to spend on a new one?
I made the mistake of buying a new cheap phone and getting something that crashes all the time.
I then bought a second-hand Nokia with the latest Android system. It cost around $200 and it's great!
5. Give an example of a recent purchase that you consider great value for money
Winter in Queenstown: NZSKI offered a great season's pass and mountain storage deal.
The Swiss-Belsuites Pounamu offered attractive long-term stay rates with arguably the best lake views making for a perfect winter set-up.
Despite zero international visitors, it was warming to see Queenstown so energised.
6. What was your last impulse or 'fritter' purchase and how did you feel about it afterwards?
Aside from a trip to Somalia with friends in December last year, I recently bought a couple of bottles of Mt Difficulty.
The total bill was around $90. That's about as indulgent as I get with impulse spending.
7. If you have spare cash to invest, what's your preferred form of investment?
In 'normal' times, I prefer low-fee index funds and actively-managed funds with a solid history, homeownership and term deposits.
In uncertain times, my view is that cash is king.
8. Do you use a credit card and if so, do you pay off the entire balance by the due date?
I don't have a personal credit card. Instead, I use a debit card and POLi to make payments.
Every month, MoneyHub is slammed with people looking for balance transfer credit cards.
When it comes to interest rates, fees and benefits, if people are struggling, there's always a better option than what they're currently getting.
9. Does having more money increase happiness?
Although hard to answer definitively, I know people who have annual household incomes well above a million dollars and struggle financially. It's mind-boggling but true.
Unusually, I'm probably the happiest when I start a new business and forgo a salary for the first one or two years.
Life is too short to chase money. Do what you love: value can't be bought.
10. The best money advice someone's ever given you?
Save up and buy it!
Incredibly simple, but it means you'll never worry about taking on bad debt.
I only buy things that I can afford. That keeps life simple.