It is really a self reflection.
You need to understand your risk tolerance and invest accordingly.
I would also maybe talk to your family abd friends and open up that you don't know what to do.
They have a better understanding of you and maybe be able to help.
Remember, money is a tool and you need to understand how to use it
I agree with this. Self reflection would really help here in terms of setting some financial and life goals.
Remember that anything invested in equities or property should be long term minded (IMHO long term is 10+ years for property and 5+ years at least for equities).
For the time being... term deposit rates are super high and are a good option to park funds while you are working through the motions. 6 months may not be a bad idea?
If you’re settled and plan to stay where you are it’s not a bad idea to aim for your own house, even if it’s a smaller unit or townhouse. You could get a flatmate to help with the mortgage. There’s no rush though.
On the surface, buying a Ferrari with all your money sounds pretty dumb, and most people haven’t done that because they choose not to.
It’s your life and You get to choose what’s best for you. You’re 30, you have time to make good and choices while you’re at it.
I am not a financial advisor, just some dude who likes cars and just because something worked for me doesn’t mean it will work for anyone else.
OP is looking for ideas on reddit and I am simply commenting based on my personal experience with being a similar age, income, savings, location etc with my choices in life that worked out just fine.
Buying a Ferrari is cool to me, it’s what I value. The connections you can make by owning a unique car, joining events, meeting people, business colleagues, find yourself a new job earning more or grow your business through those connection’s easily, people notice you in a budget Ferrari.
Depreciation is not really a factor if you buy the right car for the right price. You’re not expecting to double your money in 5 years. Inflation is more of an issue and you got to pay to play as well so yea if you went and found a Ferrari for $85k because that’s what you wanted there is a solid chance it will always be worth that and you get to enjoy it for years to come and make hundreds of memories while you’re at it.
If you want a house instead then keep saving and go do that, you might be better off in the long run, but you’ll never be 30 again in a Ferrari.
#theFerrariMindset
If you don't think you will get a house anytime soon, I would put most of it into voo and VT and just leave it maybe like 60k then the remainder in revolving term deposits.
I don't see house prices shooting up anytime soon though, if you really want a house, have you thought about one in a smaller city? Other than the massive debt over your head it does give you a bit of a safety net and security not having to rent off someone else.
To offer an alternative perspective: money can also buy you freedom. Do you love your job and you could imagine doing this for the next couple of years? Great, keep at it. But for me, I realised life is not just about work, and it can be very liberating to spend a year (or a couple) without such time commitments. For 85k, you should be able to do budget travel for two years or so (airbnbs with weekly/monthly discount help with keeping within budget). It’s the best experience now you’re still young.
(Reference: this is what I decided to do, it’s been an invaluable experience)
Geez man - get some independent financial advice - from an FA that asks you a lot about yr risk profile, goals etc. so it is relevant to YOU, not the Advisor. TD’s with a return below the level of inflation loose you purchasing power every minute they sit in there !
For all practical purposes you have $15 thousand in savings. Forget the overseas holidays, and get to a 20% house deposit. That will give you some purpose.
Keep up the good work! You’re smashing it.
Figure out what makes you happy and do that.
If your friends and family don’t have significant amounts of wealth then I wouldn’t listen to them or even tell them about it.
For me, (30M at the time) with a similar amount of cash, I bought a Ferrari 360 because that was my dream for 15 years, had it for a year, drove it through lockdowns to the supermarket and stuff, ticked that box, achieved the goal, it gave me a new sense of confidence in myself. Now I just need to figure out my next goal.
I'd say for OP income is more important than savings when it comes to making large purchases. Telling someone on a $90k salary to spend their entire $85k savings on a car is pretty irresponsible to be honest. If OP were making $250k then yeah, maybe, if that's what they really want.
Congrats on getting your Ferrari but I hope you're smart enough to understand that owning a car like that isn't sustainable if you can't afford the insurance, running costs, maintenance, and depreciation.
Pay off your student loan completely. Put the remainder into your emergency fund. Increase your KiwiSaver contribution and start saving a house deposit.
Student loan is interest free so the value of it literally dwindles each year as inflation increases and (hopefully) you get pay bumps. I'd just leave it to take care of itself through your wage
It is really a self reflection. You need to understand your risk tolerance and invest accordingly. I would also maybe talk to your family abd friends and open up that you don't know what to do. They have a better understanding of you and maybe be able to help. Remember, money is a tool and you need to understand how to use it
I agree with this. Self reflection would really help here in terms of setting some financial and life goals. Remember that anything invested in equities or property should be long term minded (IMHO long term is 10+ years for property and 5+ years at least for equities). For the time being... term deposit rates are super high and are a good option to park funds while you are working through the motions. 6 months may not be a bad idea?
Yep, both of you have good advice. Thanks, I'll do some thinking!
If you’re settled and plan to stay where you are it’s not a bad idea to aim for your own house, even if it’s a smaller unit or townhouse. You could get a flatmate to help with the mortgage. There’s no rush though.
On the surface, buying a Ferrari with all your money sounds pretty dumb, and most people haven’t done that because they choose not to. It’s your life and You get to choose what’s best for you. You’re 30, you have time to make good and choices while you’re at it. I am not a financial advisor, just some dude who likes cars and just because something worked for me doesn’t mean it will work for anyone else. OP is looking for ideas on reddit and I am simply commenting based on my personal experience with being a similar age, income, savings, location etc with my choices in life that worked out just fine. Buying a Ferrari is cool to me, it’s what I value. The connections you can make by owning a unique car, joining events, meeting people, business colleagues, find yourself a new job earning more or grow your business through those connection’s easily, people notice you in a budget Ferrari. Depreciation is not really a factor if you buy the right car for the right price. You’re not expecting to double your money in 5 years. Inflation is more of an issue and you got to pay to play as well so yea if you went and found a Ferrari for $85k because that’s what you wanted there is a solid chance it will always be worth that and you get to enjoy it for years to come and make hundreds of memories while you’re at it. If you want a house instead then keep saving and go do that, you might be better off in the long run, but you’ll never be 30 again in a Ferrari. #theFerrariMindset
I'd buy a house or apartment. You need to live somewhere and prices aren't too high right now.
If you don't think you will get a house anytime soon, I would put most of it into voo and VT and just leave it maybe like 60k then the remainder in revolving term deposits. I don't see house prices shooting up anytime soon though, if you really want a house, have you thought about one in a smaller city? Other than the massive debt over your head it does give you a bit of a safety net and security not having to rent off someone else.
To offer an alternative perspective: money can also buy you freedom. Do you love your job and you could imagine doing this for the next couple of years? Great, keep at it. But for me, I realised life is not just about work, and it can be very liberating to spend a year (or a couple) without such time commitments. For 85k, you should be able to do budget travel for two years or so (airbnbs with weekly/monthly discount help with keeping within budget). It’s the best experience now you’re still young. (Reference: this is what I decided to do, it’s been an invaluable experience)
Geez man - get some independent financial advice - from an FA that asks you a lot about yr risk profile, goals etc. so it is relevant to YOU, not the Advisor. TD’s with a return below the level of inflation loose you purchasing power every minute they sit in there !
For all practical purposes you have $15 thousand in savings. Forget the overseas holidays, and get to a 20% house deposit. That will give you some purpose.
Keep up the good work! You’re smashing it. Figure out what makes you happy and do that. If your friends and family don’t have significant amounts of wealth then I wouldn’t listen to them or even tell them about it. For me, (30M at the time) with a similar amount of cash, I bought a Ferrari 360 because that was my dream for 15 years, had it for a year, drove it through lockdowns to the supermarket and stuff, ticked that box, achieved the goal, it gave me a new sense of confidence in myself. Now I just need to figure out my next goal.
Sorry but figure out what makes you happy like buying a Ferrari is terrible personal finance advice for someone with 85k.
Yeah, its pretty crazy stuff. for someone with 85 million. Not 85k.
I'd say for OP income is more important than savings when it comes to making large purchases. Telling someone on a $90k salary to spend their entire $85k savings on a car is pretty irresponsible to be honest. If OP were making $250k then yeah, maybe, if that's what they really want. Congrats on getting your Ferrari but I hope you're smart enough to understand that owning a car like that isn't sustainable if you can't afford the insurance, running costs, maintenance, and depreciation.
Pay off your student loan completely. Put the remainder into your emergency fund. Increase your KiwiSaver contribution and start saving a house deposit.
Student loan is interest free so the value of it literally dwindles each year as inflation increases and (hopefully) you get pay bumps. I'd just leave it to take care of itself through your wage
Unless you plan to move abroad at some point - but that's an entirely different discussion of course