Onboard today is Nicholas G. Muscat, who might be better known as the Aussie Money Man. The forecast today: Financial literacy and online entrepreneurship.
For those unfamiliar with the Aussie Money Man, Nick has been fiercely independent from a very young age. Nick saw his parents work tirelessly just to scrape by with the hope of eventually making it to retirement. He knew that wasn’t the life for him and there must be a better way, which led him to become interested in educating himself on finance and entrepreneurship.
As a teenager he began learning about personal finance and online business, and started researching investing opportunities such as peer to peer lending. Armed with this knowledge, he has started multiple online businesses and eCommerce stores, written eBooks, invested in the stock market and Peer-to-peer lending, as well as made thousands per month in affiliate marketing.
Nick created ‘The Aussie money man’ website as well as a YouTube channel to help spread the powerful message of financial literacy, and now has over 7000 subscribers on his channel, with some of his videos having over 25,000 views. He now has over $100K invested in ETFs, and has been able to produce $10,000 income per month using eCommerce all by the age of 20.
Episode 5 of the CaptainFI podcast is a quick domestic hop to chat to another Sydney-sider, Nicholas G. Muscat – the Aussie Money Man! Nick has been fiercely independent from a very young age; at the incredible age of only 20 years old he has been able to produce an income of $10,000 (AUD) per month using multiple online businesses and eCommerce stores, investing in the stock market, peer-to-peer lending, and affiliate marketing. Nick has even written eBooks, and started the YouTube channel ‘AussieMoneyMan’ to help spread the powerful message of financial literacy, and now has over 7000 active subscribers to his channel. Today we chat about his upbringing, hobbies, education and what started him on the path to Financial Independence. We explore his income earning strategies, his saving strategies, and his investing style and strategy. We also delve into his YouTube success, and his experience starting multiple channels. Finally, we discuss some of the most powerful lessons he has learnt on his journey so far, alongside his top reading recommendations and the tips he would go back in time and tell himself! So sit back, relax, grab a beverage and enjoy the flight!
- Check out Nicholas’ AussieMoneyMan website here
The Aussie Money Man’s Top financial tips
- Don’t worry about working as much – live below your means in order to make it happen and give yourself free time.
- Start a business and become your own boss – Find a scale-able niche and give it a go!
- Go full time with your business EARLIER – Take the leap of faith in yourself and work to build your dream, not someone elses.
The Aussie Money Man’s top three Books
The Barefoot Investor by Scott Pape
Check out my detailed review of the Barefoot Investor HERE
Rich Dad Poor Dad by Robert Kiyosaki
Check out my detailed review of Rich Dad Poor Dad HERE
The Slight Edge by Jeff Olson
The Slight Edge proposes a new way of thinking to its readers. This method of processing information helps you to make small daily choices that build on each other to create a positive spiral, leading you to the success and happiness you want.
Olsen explains why some are able to constantly succeed and make their dreams a reality, whilst some get stuck either dreaming their lives away, or only making other peoples dreams come true.
The fundamental principle explained by Olson in the Slight Edge is the power of compounding actions. This can take place both in a positive or negative manner, either building or destroying a happy life.
A positive mindset turns into a positive attitude, which in turn leads to positive actions and positive results. This positive spiral leads to a successful lifestyle.
The Aussie Money Man YouTube channel
- Check out the AussieMoneyMan YouTube channel here
Captain FI 0:07
Ladies and gentlemen, this is your captain speaking. Welcome aboard Captain FI the Financial Independence Podcast.
Good day. Welcome to an episode of Captain FI, the Financial Independence Podcast where I open the copy to some of the best and brightest in personal finance, as well as those who have reached or are on their way to financial independence. Before we get started today, remember anything on the show is provided for general information only, and should not be taken as constituting a professional advice. You should always do your own research when making any financial decision.
On board today we’ve got Nicolas g Muscat who might be better known as the Aussie man, our focus today financial literacy and online entrepreneurship. For those unfamiliar with the Aussie money man, Nick has been fiercely independent from a very young age, Nick saw his parents work tirelessly just to scrape by with the hope of eventually making it to retirement. He knew that wasn’t the life for him, there must have been a better way, which led him to become interested in educating himself on finance and entrepreneurship. As a teenager, he began learning about personal finance and online business, and even started researching investing opportunities such as peer to peer lending. Armed with his knowledge, he’s now started multiple online businesses, ecommerce stores, written ebooks invested in the stock market and peer to peer lending as well. realise making thousands per month in affiliate passive marketing. Nick created the Aussie money man website, as well as a YouTube channel to help spread the powerful message of financial literacy. And now has over 7000 subscribers on his channel all by the age of 20. So Nick, get a welcome to the podcast.
Aussie Money Man 2:24
Hello, hello. Thanks for having me on. So first up,
Captain FI 2:28
can you tell us a little bit about yourself?
Aussie Money Man 2:30
Yeah, sure thing from the Blue Mountains but I lived in Canada for 12 months. Last year, I was between gamma Canberra and Sydney so yes, I’m originally from the Holy Spirit. But look when it comes to what I do in my downtime and all that I’m pretty into physical fitness. Since about 15. Before that, I did nothing. I was very inactive kid. I got really really into fitness. So the last five years of my life I’ve been really into so your military military style fitness eating your big testing cadence push ups, pull ups. dips in all that stuff. I’m quite into science. So in it. So that’s sort of how I sort of approach my financial and business sort of approaches in life. And you know, it’s probably something we’ve talked a bit about later. So I look a lot into psychology and Science, ICT mostly chemistry, that sort of stuff. I try to make time to learn a lot of piano theory. So rote learning all these songs over my lifetime, but I keep going back and forth from learning the theory and forgetting it. So that they tend to be sort of my hobbies. And obviously, finances is probably a huge hobby as well. I mean, I’m always researching different investing opportunities and things like that as well.
Captain FI 3:38
Yeah, well, Blue Mountains. I actually I really love the Blue Mountains. I often get opportunities to fly around them. Absolutely stunning. Really good to see the green returning back to the land. Obviously, there’s some devastating bushfire earlier in the year. Look, let’s get stuck in so the first question I have for you
Aussie Money Man 4:00
Nicky’s, I guess just trying to understand your journey. Did you have some kind of defining sort of lightbulb moment, when you knew that you sort of didn’t want to pursue a conventional working career stay like your parents did. There’s an interesting one for me, because I don’t think I’ve ever sort of had that moment. And it’s something I’ve discussed with my friends quite a lot. Because the thing is, is I actually am not against the tuition, tuition working career, you know. So there’s a lot of careers that I actually would want to do simply because you can’t do those sorts of things yourself. So I’m talking things like you know, your military, your firefighting, even policing. They’re all things I’ve actually been interested in, since I was quite young. So I would dare say, I’m not actually it’s not I don’t want that. I think it’s, for me, it’s always just been a case of wanting to have the option not to have to work or create or it’s always just been about have that choice. Even if I never use that choice and found a career lab. It was just having the option to go You know what, I don’t want to do this anymore. So Yeah, I think I think it’s a bit of a unique one. Yeah.
Captain FI 5:04
Maybe that’s actually like I think that’s one of the core principles of this whole fire movement is you know, will they call it the the if you money having that, you know that backup that choice media trade? Yeah, you don’t have to trade that time for money like you know you’re doing the job because you love it. Talking about creating that option with investing, you need to start somewhere. Look, it’s pretty amazing that you started so like, I mean, some people might even be intimidated by that. You told me just before we started recording that you started your YouTube channel when you were 13. Like, holy when I was 13. I was. I can’t even remember what I was doing. I’m pretty sure I was trying to blow things up and ride my bicycle around at night time. I had no idea about money. And what were the first sort of steps that you took towards financial literacy and self education?
Aussie Money Man 6:07
Sure, sure. So I will met in theYouTube channel I started isn’t the one I’m running now, you can see my first video I’m about the money man was uploaded, like a year and a half ago. But it was sort of gaming and tech review channels are reviewed, like microphones and talked about a set up there, you know, microphone setups, and all that. And I think the first because when I was 13, and I’ve thought about this quite a lot with my friend, because it’s interesting, because your mind really is nothing like what it is, you know, in your adult under 13 1617 not so much. I haven’t changed much since then. But at 13 it was more so I was just trying to make money. You know, I didn’t I didn’t understand the concept or investing anything yet. When I got into investing and all that that was when I was 1617. So once I finished school, and that’s when I realised I have all this time and I can get into investing and I think the first thing I read was actually from Norway, Dhaka and it was basically talking about compound interest. And when I found out about it, I was like holy crap. You know, like only ever there was all these articles and all these people saying, you know, imagine if you started at 18. And I was sitting there thinking, Well, I’m 17. So I don’t need to imagine I can do that. And that’s when it was that sort of when I started and that’s when I started researching, you know, namely p2p lending. As you mentioned, that was the first thing I sort of jumped into. And from there, it just took off, you know, I just found myself just watching so much content, you know, reading, you know, asking people questions, reaching out to anyone I knew that might have a knowledge of this sort of stuff. And then that’s sort of that’s sort of how I started really.
Captain FI 7:34
Yeah, it’s everyone’s gonna have a hard time quote, like, the best time to start investing is 50 years ago, and the second best time is today. It’s like a bit of a superpower that you started so young, then a lot of people might feel Oh, you know, I might have missed the boat. You know, it’s too late for me. But the most important thing to remember is, you know, the second best time to start investing Is today and it’s never too late. If you’re listening and you feel like you’ve missed the boat, definitely Haven’t you definitely haven’t listened to you talk about discovering compound interest. It almost sounds like you know, that’s when the penny starts when I personally discovered the fire movement and realise that it was a thing you could actually do. You know that you could earn some money, live below your means and invest it and eventually the passive income returns off that portfolio could actually cover your cost of living. I was like, wow, you know, blew my mind. When you do actually, you know, choose to leave your job or not. The fact that you’ve got that backup option is a massive thing. Again, we talked about that if you money, it gives you so much freedom and ability to determine which career path like you mentioned earlier, you No against a traditional career, and having financial freedom would allow you to pursue, you know, like a military career or a career in some other form of service. Yeah, it just opens up so many doors. So, have you read much on the fire movement? Or is that is that something you’re interested in?
Aussie Money Man 9:17
You know, a good question. So I have read a fair bit like I wouldn’t say a huge amount because I think I think for me because I’m not even 100% sure there isn’t. But I think perhaps because I started too early. It’s always just been something that I’ve just sort of expected to happen and and therefore haven’t felt maybe perhaps a requirement to read a lot into but it’s definitely something I’m like I’m interested in like, it’s definitely something that I suppose I’m striving for as as an option, if that makes sense. But like I definitely haven’t gone as sort of full into it. As you know, a lot of other people have
Captain FI 9:49
your main goal. With respect to investing. You would like to build up a form of passive income to supplement you to allow you tufin work, a career that you’re passionate about without having to worry about the finance.
Aussie Money Man 10:06
Yeah, well, that’s that’s one. Like, that’s definitely one huge part of it. Yeah. And the other part is perhaps I choose not to work it, then I want to, you know, have the ability to do that, too. So yeah, pretty pretty much that or, or anything I want to do, because the fact of the matter is, is that there’s so many things I want to do that I’m not sure which one I’m going to take. So obviously, if I’ve got my financial, you know, side set up, well, that allows me, as you mentioned earlier, to take a year off and, you know, go through the recruitment process for something that takes a year or perhaps just I don’t want to go for a different business venture in startups. So yeah, basically, just leaving my options open. I just don’t have a specific goal, I suppose that I’m aiming for I think I did a one point you know, I was like, Oh, you know, become a millionaire by 25 or whatever. But, you know, that’s not really what it’s about. You know, it’s just about having the freedom to change your mind. Really,
Captain FI 10:54
freedom is probably the big word, their freedom and choice. I guess arguably a core step in investing? Or the the first step really is to generate some capital, right? You need some money to start investing in the first place. How did you start out earning money to start investing? And how has those How have those income streams changed over time?
Aussie Money Man 11:20
Awesome. Yeah, that’s a really that’s a really good question. So the first way I made money was when I got my first part time job. So I was working. I started my job at 13 and it was just sort of cash it was eight bucks an hour. So I did hates a shift of that. And I eventually started working at McDonald’s and I did that for like three years sort of part time at school. And so essentially initially I was working jobs and obviously I did have that you know, YouTube channel, which is making some income as well although it was definitely you know, very small amount right so I got my like, first sponsorship and stuff and it was seemed like a lot at the time, but it really wasn’t. So I suppose itself, primarily employment. I don’t want to get out of school. Obviously, I took up some, you know, different jobs with different governments or state and federal and that paid, you know, more than that was like, you know, a big step up. And then obviously, I had my businesses ramping up in the background because I was wanting those part time in the background for all of this. So, today, obviously, it’s purely business. So essentially, you know, I started with jobs when I was 13. And the weights changes, it’s gone, essentially, from employment and content to business income. And also another big change is being active to passive income. It’s gone massively from you know, 100%, essentially, active income, you know, packing fruit, packing potatoes was a big thing I did to basically, you know, for example, you know, like writing and releasing an ebook, and letting that get a sale even, you know, once a week and paying me that way. So that’s probably been the biggest ways it’s changed.
Captain FI 12:51
Fantastic. So I guess you started out, much like everyone else, you know, young in school, part time job. earning some cash, you know, being careful stashing away working your way up to a high paying job. And then working on your side businesses and hustles on the side, right? Yeah, that’s, that’s great. It’s a pretty good. Great, so like with the, the the passive income. So how does that work? I’d obviously like to talk a bit more about the YouTube stuff in a minute. But, you know, is it is it enough to live off yet? Or what’s your goal with passive income? Do you is your goal for to support your lifestyle?
Aussie Money Man 13:41
Um, yeah, good. Good question. So fortunately, yes, it has reached a point where I can live off it quite comfortably, particularly because I don’t, I don’t spend much money so I people do need to know that when I say I can live off my income. I don’t spend much money at all like I’m very very frugal, like many of you wanted likely to follow the fire movement, but it’s something that Take your account. And my goal with that real, I’ve got a specific figure in my head that I’ve always sort of run a direction that was $10,000 a month. And I’ve upped that now to 30, sort of long term debts in the next five years. And yet it is to sort of, to greatly exceed my expenses. And the reason for that, again, is just choices. And having the ability to even you know, at one point go, I want to, I want to pursue another piano full time and do that for a year, and be able to do that, because, you know, the amount of money I’ve made has exceeded so much, and I’ve saved so much, and I’ve invested so much that I can afford to do that. So really, it is just sort of been in excess of what I’m, you know, reasonably going to spend by a decently large factor to again, allow me just to have those options. So that’s basically my my goal, and it’s ambitious, surely, but
you know, I think, I think it’s so not unrealistic. So
Captain FI 15:00
May I think, you know, $10,000 a month passive income at 20 is pretty bloody amazing. And from what you’re talking about, you know, having that freedom and time to pursue you. It sounds really similar to the sort of philosophy behind the fire movement. It’s just pretty amazing that you’ve, I guess, being able to use online commerce, entrepreneurship and business skills to achieve that income much, much quicker. And say, your traditional fire plan of working and active income for you know, for 567 years investing 80% of index funds and then living off the dividends. You’ve actively created businesses and products, and you’re able to use that to to fund your early retirement if you want to call it that. So that’s pretty that’s pretty impressive. Um, I guess one You’ve earned the income and you sort of alluded to it earlier. The next step is to actually save it. So this is where a lot of people tend to go wrong, and they can lose it pretty quick, right? Easy come, easy go. I’ve seen you produce a lot of really great content on essentially stoicism or minimalism might be called as well when it comes to one’s personal life and spending habits. Such as why you downgrade it to the Google Pixel one, some frugal living arrangements and just generally being very mindful about one spending and acting quite mindful and deliberately. What are some of the motivations for you to live below your means? And what a couple of your top tips on how to do so?
Aussie Money Man 16:46
Yes, so yes. So they hit the nail on the head with all those it’s definitely, you know, definitely where I’m coming from, you know, from minimalism and all that and definitely my mindset and look so my big motivations for doing it. So the first Once the obvious one, which is, the less you said, the less you spend, the more you can save, the more you can invest, and the quicker you can reach that sort of point of freedom or financial independence, which really go hand in hand, you know, in a lot of ways. And so there’s that. And then there’s a big one for me is, is simplicity. You know, I do tend to overwhelm myself with a lot of different things. So I do find the less things I have the less clutter, I have the list, you know, time I’m spending, you know, going on made 100 bucks, I can go buy a new jacket, or whatever it is. It’s just a thing I don’t have to worry about. So it’s simplicity. It’s gratitude. A big one for me is being grateful for what I already have in and the truth is I’m truly satisfied with with what I have, whether that’s my Google Pixel line, or my $700 car, I’m happy with it. So for me, it’s just a matter of, if I can be happy with that. That’s great for me, and obviously it has all the other benefits. I think, just being grateful for, for what I have is a huge thing for me, really. And yes, I think that’s it. Some of them and there’s probably a lot more I’m forgetting about here. But yeah, so there’s a lot of motivations to live below your means. I think it’s huge. I think another one actually is, is you avoid the common mistake of buying things to sort of fill a hole. So a lot of people buy things to feel, you know, the holes that everyone has in life, right and everyone’s always chasing something and we need to do that I think that’s human nature. Right? And as I mentioned, I’m quite interested in psychology and all that as well. So for me it’s just sort of avoiding that issue because I think once you do it once you keep doing it you want more and more and before you know it, you’re trying to get a Rolls Royce which by the way, I do love but you know, you can you can see the message there. Now when it comes to the top tips on how to do it something the best thing I think, you know, the answer really would be only and this is something something I said quite a bit in my youtube channel was probably be only buy things if you know they’re going to offer great value or tremendous value and then you Okay, well what’s tremendous value, and I think the answer that is gonna save you money or is it going to make you really bloody happy in Long term and I think in the long term, it’s important because buying, you know, if I were to go buy the latest phone, I’d probably be pretty happy with it for a week. But then after that, it sort of like, you know, so I think there’s a lot of other things you could do with your time with your money to make you a lot more happy in the long term. And that usually is things like learning a skill or, or doing something you’ve always wanted to do. One breakdancing or something, you know, whatever it is that you’ve always wanted to do. So that probably my biggest tips is before you buy something, run it through that test. I mean, that’s what I do. And that’s something I have to sort of come up with and I’m sure 1000 people come with better ways. But that’s that’s what I do. I read an article from mister money moustache, I think it was called hacking, hedonistic adaptation. And he talks about exactly what you just mentioned with the iPhone. You know, you buy the latest iPhone, it’s great. You really like it for a week or two, and then it just becomes normal. So he talked a bit a little bit about some tips and tricks in there about how you can make sure you’re getting the most happiness out of Your purchases. And you did, right? You want to make sure either it’s really good value, or you know, it’s gonna make you quite happy. I know personally, like, I’ll sit on a purchase for sometimes months, or even years. And if I still want it at the end of that period, then Hey, I’ll get it.
Captain FI 20:21
But it’s just buying things for the sake of it. It just doesn’t make any sense, does it? So, yeah, no really, really good advice there. And, you know, if you’re doing that, and you’re being very mindful with your purchases, there’s almost no need to have a budget or even track your expenses, because you’re just going to automatically do it properly.
Aussie Money Man 20:43
That’s it and that’s brilliant. I’m so happy you brought that up. Because people ask me all the time, like, what’s your budget? Like? Surely you have a budget right? Because knowing me, you know, you’re you’re the money man, and sometimes I feel bad about it. Sometimes I think crap should have a budget. But you’re right. That’s the conclusion I eventually came to was exactly that. You don’t need a budget. Thank you. You’re doing it automatically anyway. And you know, having a bug is one of the things that people hate having because it is it’s complicated spreadsheets. No one wants that. And so if you can avoid it by doing that, it’s a win win win, you know. So yeah, I’m glad you said that.
Captain FI 21:14
Absolutely. So I guess the final piece of the puzzle, or in this, in this finance loop, is investing. So, you know, we talked about the earning the money, we talked about some ways to save it. And the final step is to invest it. So I know you’ve written extensively about peer to peer lending, you’ve reviewed a lot of the different platforms. And you’ve also been actively investing in the stock market, since you’re a teenager. So what, what led you to start investing? And I guess it’s a it’s a massive question, but what is your investment style and your investment strategy at the moment?
Aussie Money Man 21:57
Yep. Awesome. Again, great question. I’m I’m actually happy to talk about that because it’s something I haven’t spoken about much at all. And I, I really, really do want to start talking about so look how I started was made pretty much from you know that reading about compound interest. I read a another one after the Norwood Aiko one was called like the magic train or something. And it’s based off the latest book and it was just this little article about him talking about compound interest and the power of you know, putting money on this train each time it goes around each year. So the analogy for it and once I, you know, sort of read that I had that light bulb moment emerging, and so like, wow, and then you’re like, I need to get involved because I don’t want to wait a day, you know, I don’t want to wait a minute. So that’s sort of what made me start and my investment style and strategy. So essentially, it’s changed a lot. Okay, and you let me know if you want me to run you through at all, but I’ll just quickly tell you what it is now. So this doesn’t go on forever. And I can elaborate you know, if that’s something you recommend offer value to all the listeners here. And essentially what that is now is I’ve got my sort of speculate what I call my speculative investments. So they’re your PvP landings, and you’re sort of micro investing apps and everything like that. I’ve considered them a bit more speculative. And my sort of main investment at the moment is actually just investing in low cost index funds, and the International low cost index funds with 50% of my holdings. hedged. 50% of them not hedged. And and when I say internationally, I’m talking emerging markets and not emerging markets, and I’m talking small mid cap. And large cap stocks are everything. So basically, I’m not investing with dividend investing, I’m tracking my money in the entire stock market. And that’s basically that’s basically my strategy. Now, when it comes to my style, my style is investing for the very long term. So when I invest, I’m putting it in, at least at the moment for what I like to think is 40 years. So I think I’m gonna put it in there, and I’m not going to touch it for 40 years. And the other part of I guess what would fit into style is my aggressiveness. I’m very aggressive up so I’m 100% stocks, besides Aussie Mae on p2p lending, and things like that, but I don’t, not no bonds, nothing like that. It’s on basically what you consider highly aggressive investors. Obviously the most of Have, we know, you know, from the data that what that means is you’re a lot more likely that huge downs, you know, 40 60% we’re seeing that right now with the 40%. But you’re also over the long term and from what we know, you know, statistically and historically will return, you know, bigger returns, you’ll also experience a lot more volatility than someone who has, you know, 40% bonds or 60 cents doctor or something like that.
Captain FI 24:24
Yeah, well made. I think we possibly have a very similar investing store and approach them. I am similar to you in that I’m also almost 100% stocks. I do keep a small cash cushion like an emergency fund. It definitely be 90 or 95% stocks at the moment, including superannuation, which of course is is invested in stocks and stock annuities. But on the site, I love ETS, particularly I love the ultra low cost ETFs you mentioned you invest primarily in, in the sort of index funds. What’s, what portion? Do you keep that in then between your index investments and your speculative sort of stock picking fun investments?
Aussie Money Man 25:18
Sure thing. So a few things that I will mention, I do have an emergency fund as well. And I, again, not financial advice, none of this is financial advice, of course. But yeah, I’m big on that. So I personally, I’m pretty frank about I just kick $10,000 savings you because I consider myself to have relatively stable income and therefore doesn’t need to be too big. But that’s what I keep in cash always no matter what. So that’s a high interest savings account. I think it’s with the, with the budget. So I keep that. Now getting back to your actual question. Yeah, it’d be like 95%. So just want to do the math in my head real quick. Which I’m not the best at this say like, yeah, I’m gonna say about like, 95 95% index funds.
Captain FI 25:58
Yeah, okay. You know, I actually started trying to stock pic. And, you know, I had some really awesome ones and I had some not so awesome ones I was, you know, following the Barefoot blueprint, I think the Motley Fool. And when I consider all the gains and the losses, and you know, then I pay tax on obviously the capital gains and that kind of crap. I underperformed the index, not by a lot, but I certainly realised that hey, for me, personally, I’m just going to stick my money in this index fund and these lscs and just let them churning out dividends for me. And when dividends Come, I’ll rub my hands together, probably investment reversed. But yeah, awesome. So speaking about other forms of investments, obviously, you are quite self invested in your businesses, which are a fantastic return for you. But what about classes? So you mentioned the You don’t have any bonds. And I agree I don’t either. We’re both very aggressive investors in terms of pretty much all equities. I kind of get the impression you probably wouldn’t own precious metals then. So what about property? Are you interested in real estate at all?
Aussie Money Man 27:18
Look, I think my opinion on real estate is essentially that if, if you’re investing in such a way that you are taking out your mortgage, and you’re essentially leveraging it, and you do your research, it’s brilliant. It’s brilliant, because it’s cheap debt. That’s the only real advantage to property, every other advantage to property, at least in Australia almost, right almost is basically a fallacy as far as the research that I’ve done. So if I were to invest in property, it would be invest buying, you know, I’d go buy five properties and put, you know, 40 grand deposit on all of them or, you know, lower a little bit higher perspective, obviously, to the price of the property, but I wouldn’t invest in property in the sense that, you know, with the plan to sort of pay it off, you know, sort of in that sort of way so so the only way I would do it is to sort of get cheap debt. And sort of be super aggressive in my investment approach? So, yes, and
Captain FI 28:05
yeah, I think you absolutely nailed it there. The cash on cash returns due to gearing or, you know, taking debt for a mortgage for an investment property is really, from what I’ve read from my research is the only real winner. I’m still learning more about property investing. I’m currently building a duplex project on the East Coast with the intent to have an interest only loan and have it cashflow positive. We’ve, you know, any capital gains as sort of the cherry on the top so to speak. Yeah, I agree. You really need to do your your research. With that being said, Do you have any plans to to go out and get some rentals?
Aussie Money Man 28:54
Yeah, sure. Good question. So it’s something I’m torn between mostly because I do a plan on moving overseas. So that has obviously a lot of impact on your tax residency, which is a huge reason I’m leaving. So most people think their biggest expense is accommodation, I quickly find out that it’s actually taxed for a lot of people. So, so for me, you know, trying to get rid of that biggest expense is okay, well, let’s go, let’s go live somewhere else. Right. And, you know, there’s nothing stopping you from doing that sort of beyond being still being a tax resident here. So it’s definitely there. But if I were to decide to stay in Australia for whatever reason, 100% I probably would, because, again, property is actually worse than stocks when it comes to its overall return and less if you’re taking leverage and you can’t take leverage in stocks in the same way you can improperly by any means. There is no practical way to take the leverage in stocks like you can in property. So maybe interesting.
Captain FI 29:50
That concept of moving overseas or geographic arbitrage I think some people Yeah, well, yeah, it’s it’s really I’ve got friends all over the world, Southeast Asia and Europe, mostly. And I mean, herpes can be quite expensive but particularly Southeast Asia, it can be incredibly cheap to live and I spend a lot of my time when I work I travel the world flying off to airports all around the world and is amazed by just how cheap the cost of living can be when you know when you are in places like Indonesia, Thailand, Vietnam, the Philippines, you do get a lot of value senior dollar there absolutely. And even Eastern Europe I mean basically your options essentially are when once you can set a standard of living is essentially you know, your your Southeast Asia and Eastern Europe and and the thing is it’s not just cost of living you go look at tax you know, a lot of these countries have really favourable
Aussie Money Man 30:53
taxation systems, you know, something businesses something individuals, some for boat, some for none, but yeah,
Captain FI 30:58
well, so what’s up What’s on your short list of potential destinations? Ah, Jesus, he’s
Aussie Money Man 31:04
something a video that I made. I made this video Like, wow, I never retire in Australia, which was obviously, you know, as you can imagine, quite controversial. And I said I’d make a video talking about the country. So I’ve got to do that. But for me, I was more interested in a few countries in Eastern Europe. So there’s some pretty attractive places there. But, you know, like, there’s a few countries you mentioned as well. So you obviously Indonesia and stuff as well better attractive. Even Malaysia is really good for business. So I will say,
Captain FI 31:33
awesome. I will, definitely came to watch the video when it comes out. Yeah. So look, I guess that leads it leads perfectly into my next question, which was going to be retirement accounts. So most countries, you know, have a form of tax sheltered investment account to cover your cost of living in retirement. So, in Australia, we have superannuation Kind of like the American 401k scheme? What are you? What’s your opinion on superannuation? And do you do contribute more or maxing out your
Aussie Money Man 32:10
concessional cap? Sure, they’re really, really good question. And the answer is, yes, sort of make it short and sweet. I maxed it out every time I hit every way I possibly can. I think that too, in order to be able to out before the tax savings, right, depending on your obviously your marginal tax rate and all those other things is very unlikely. So it’s very unlikely you’re going to you know, be able to beat that 15% tax rate versus you know, the 3040 50% you might have depending on again, which tax bracket you fit into, so yeah, I’m a big fan of of what they can offer for most people,
Captain FI 32:43
superannuation, you know, you put, you start contributing a bit extra now, you get a benefit from those tax savings and that compound interest turns out to be a lot of dollars in your retirement. Now, we mentioned earlier, we going to talk about your YouTube channel. I’m a massive fan of easy money, man, you got a lot of really great videos, and actually was a bit of part of the motivation behind me posting these podcasts up on YouTube, by the way, um, you know, you mentioned you started early doing the gaming review channel. So, can you talk a little bit about how you actually got started and what your first few steps
Aussie Money Man 33:27
were? Absolutely, um, firstly, I appreciate you saying that, that’s very humbling. And that motivates me to sort of keep at it. regarding how I actually started, I think I just saw other people doing it. So those other people, you know, you know, pewdiepie how he got started was was gaming. And then I eventually realised, you know, gaming was decently oversaturated It was also a gamble and a business as in, you know, if you become successful making money from it. So then I moved into tech reviews because I knew that I was really into you know it and I was doing these at the time when I thought as a 13 year old to be complicated, you know, setups and things. Got microphones and how to record the Xbox One without buying an Elgato. Because, you know, a lot of people can’t afford to buy a $300 Elgato when they’re a kid and wanting to record their gaming, I’ve started doing videos like that. And I realised that that was getting a lot of attention. People weren’t really doing that. And then throughout high school, I always knew I wanted to sort of get back into YouTube. The only reason it stopped I stopped around 16 because I broke both both my wrist on a motorbike. So I couldn’t record five year and by the time it was back, I was in year 11. And I was really into school academically. So I was otherwise sort of occupied. But the second I left school like literally the second I finished, I think it was November 6 2017. I got straight back into YouTube. So the way it’s I got back into it is I did all my research on p2p lending, I was reading all the PDFs. So that’s product disclosure statement. I was renewing investment fund managers and asking them questions and I figured I’ve spent three weeks doing research on this. I’m going to make this into a blog post. I’m going to make this into a YouTube video and that’s how Ozzie money man started as I shared that research and didn’t get a lot of views but the people who are Dude, watch it appreciated it, I think it’s 50,000 views. And so then I started just sort of doing that with pretty much. That’s pretty much what all my videos are. It’s just me sharing my research and my journey and that’s essentially how I started so I guess firstly it was copying other people were then it was sort of how can I differentiate myself to actually make this profitable because the gaming part was not ever profitable? And yeah, that’s essentially my bed My turn.
Captain FI 35:23
What are some of the biggest challenges you face with youtuber content creation?
Aussie Money Man 35:29
So, um, there’s quite a lot, I think a big one a face is you know, CG usual quality versus quantity. So a lot of people even in the finance space will upload you know, daily every two, three days, because of the nature of my you know, channel where, you know, I’ve got these really strict values and all that of being holistic. So basically what that might mean is I’m going to cover investments, I’m gonna cover bloody well like I’ve got to have done my races I’m gonna have read the studies I’m gonna have read all the PDFs is, for example, your new product disclosure standard. So terms and conditions, which meet basically means, you know, do Do I want to sort of tone that back a bit and upload more into the builder? Essentially, business quicker? Because that’s what YouTube is, you know, depending on how you treated, or at least it can be that the potential debate, or, you know, should I keep up what I’m doing and you know, upload not not too often because obviously, uploading once a week is 52 videos a year, and that’s difficult when I’m going up against people at like, $250 a year. So I think that’s been a huge issue, you know, do I upload more or do I, you know, there’s been, there’s been quite a few, but I think that’s probably been one of the big ones.
Captain FI 36:27
I’ve heard you can monetize YouTube, and actually get some get some revenue back. For the time that you spend creating those videos. Has that been a part of your sort of online entrepreneurship strategy? And is it worth it? Like, just how much time do you spend preparing the videos? And then how much does it make?
Aussie Money Man 36:52
Yeah, a great, great question. It’s it’s sort of something that has to be unravelled. It can be quite complicated, but like the short answer is yes, yes. You can make Money, yes, you can make a lot of money. The long answer is it depends, you know, what niche Are you in? What sort of videos are you making? Are you relying on YouTube income directly? So what they call YouTube, AdSense, the money, YouTube’s paying you, are you relying more on affiliates, you know, which again comes back to your niche. And it can be quite complicated. In my personal situation, I’m lucky. So essentially, the highest paying niches or topics or areas that you’re talking about, you know, your love, or makeup or finance, in my case, is finance. So essentially goes law of finance and everything else. So basically, what that means is that YouTube will pay you are making to, in order to run videos on run ads on your videos, is quite high. So it can be as high as $200 per thousand views, although that’s not common. But yeah, I’ve got a few videos that get that right. And again, that is a lot of views, but there’s a potential to right so this is what I mean when I say it can be done. The other way that you can make income off and make a lot is what I mentioned earlier, which is affiliates. So that’s part During so let’s say I do a video about a bank, I could, you know, in teaming partner with that bank and that bank could pay me to make that video or pay me based on how many views I get or pay me based on having sign up and all things like that. So it’s definitely doable, and it’s definitely something I’m trying to work in. So I’ve spoken about that a bit on my YouTube channel, which I’m trying to make Ozzie money, man, more of it, you know, huge part of my business journey, because I bloody love doing it. It’s a lot of fun, and it’s essentially allows me to do what I was doing anyway, as my business, you know, I mean, I’m, it’s a win win. Really, it’s, it would be awesome. So that’s, that is what something I’m trying to do. And it’s something I am doing. I mean, it does make money, not a huge amount. Now, I think the last time I uploaded my updated my viewers on YouTube with my income, it was about $250 a month, which is not a lot of money. Like that’s from ad revenue only. I’m not including affiliates. And now it’s doubled to about 500 over the span of two months. So so you know, it gets there and I think there’s a YouTuber called Ozzie wealth creation, and so he’s named Brandon He’s a lot bigger. So he started about a year or two earlier than me. And he at one point was saying he was making $3,000 a month passively from ad revenue. So, yes, yeah, that sort of shows you the potential and there’s big YouTubers out there, and American ones that are making 170 grand a month in ad revenue alone.
Captain FI 39:18
So it can be done. I’m just running the numbers here. And if like $500 a month is pretty bloody good. And the equivalent to if you were to earn that income from an ETF portfolio dividend, you know, or using the safe 4% withdrawal rate that’s equivalent to $150,000 worth of index funds stock. So Wow, it just goes to show how that online entrepreneurship can really accelerate your your passive income. And look I just ran the numbers for Brandon was he willing Creation, if he was making $3,000 a month, that’s equivalent to $900,000 worth of stock of using the 4% rule. That’s very close to a lot of people’s five number or five goal. Wow, hey, maybe I should start making YouTube videos.
Aussie Money Man 40:23
Yeah, well, I mean, like, that’s the thing I’m in like a, the potentials there. And I tell people all the time like, and it doesn’t have to be like a lot of people go I don’t know a lot about finance. And I’m like, Oh, you can look like anyone can learn it. Right? So there’s that but there’s also the fact that everyone already has an interest or he has an area that they know more about than most people. So I always say to people don’t go talk about like, if you love tennis or or tanks or, or cars or whatever it is like you can bloody do it like yeah, sure, you might need a bit of a differentiating factor or, you know, some sort of, you know, something that makes you different. An economic moat, you know, we’re not saying the investment community, but that’s doable. I mean, like me My biggest difference was just, you know, there’s already fine as you do, as opposed to be like, well, I’m an Australian finance YouTuber, and I actually read studies, you know, so that was my trying to be different thing. And, you know, that’s worked relatively well, so far, we’ll see how we go. But it’s definitely doable. And pretty much everyone can do it, you know, because everyone has something, they’re good at cooking. You know, there’s a lot of people out there that are really into that and really good at, okay, so it can be quite lucrative.
Captain FI 41:22
It’s probably also worth pointing out that, you know, quality videos can take quite a bit of time to produce. How long would it take you to produce a video?
Aussie Money Man 41:35
Fantastic question. Yeah. So absolutely. And, again, this greatly depends on your niche, which is why one of the many reasons I mentioned that so if you’re one of those YouTubers that go out there, and you know, you know, I think a good example is a company whose name the one that just throws eggs and stuff is this Australian guy, how to basic you know, if you’ve got a YouTube channel like that, it’s gonna take you a few bloody hours. So but if you’re someone like you know me who doing You know, days weeks of research and literally reading through, you know, academic studies of how the stock market’s performed, it could take longer. So it depends to me personally, if it’s a, you know, a directory search video, it might take me many days many weeks of research, although the actual recording of the video and the editing of it will take me three hours, the research aspect of inviting people but if I’m just making a video and I have done this in the past, explaining how I saved money personally, that might take me five hours Max, all we’re gonna do is sort of write down and you know, take a bit of time to think about all the different ways I actually said money you know, because sometimes you do a lot of things subconsciously, you know, in life, obviously, and write those down that might may take me a lot longer. So basically, it varies can be a long time can be you know, a short time, and some of them pay off a lot better. So I might do a video it takes me five hours and somehow it gets a lot of views and I make a lot of money. And then there’s all the videos I put a lot of research into and get 1000 views and no one no one really enjoys it to the extent that they’re you know, getting the money for it or whatever. So
Captain FI 42:59
yeah Fair enough. So it’s, um, it certainly strikes me as something you have to be passionate about. You can’t you’re not gonna, you know, become a millionaire overnight. But if it’s something that you are passionate about creating and spreading the word in the content, the lessons, there is the ability for you to be sort of compensated for your time and, you know, if you if you are doing it really, really well, then you know, you can make a living out of it. So, yeah, okay, interesting. I think that’s a really good, dumb, really good description of how it all works. I’ve kind of heard like in websites, SEO is kind of the name of the game. For people that are wanting to sort of build a blog or a website. What kind of SEO can you use on your Ozzie money man blog and YouTube channel to sort of help build its ranking?
Aussie Money Man 43:53
Sure thing. So I started the website for the YouTube channel and it was my initial thing, but when I found out that there You know, saying that by like 2021, or something like 80% of me is going to be on video, I sort of ditched it in a sense, and I still have the website there clearly, and you guys can check that out, should you wish, but I’m more moved to YouTube now I was into SEO at the time, you know, so things like get backlinks are huge, you know, you know, your keywords, you know, what’s in the header, Virginia, different areas and all that. But right now I’ve actually I’ve just got someone doing it for me, fortunately. So I’ve got an agency doing it now. But yeah, when it comes to blogging, SEO is huge, you know, there’s still a lot of people making money from blogging, it’s certainly not dead. But getting into it as a start by now is very, very, very, very difficult. And because, you know, I believe in the end of the data seems to indicate and therefore I believe that we are moving to video I have moved away from it, so I definitely wouldn’t. I definitely don’t have all the information I used to have in my head about SEO and all that.
Captain FI 44:52
So okay, what are some parallels to YouTube? Like, how would you how do you increase your viewership,
Aussie Money Man 44:59
so if there was Yeah, you’re right, you know, as that YouTube does have SEO just in the same way, I mean, all it is, is Search Engine engine optimization. And I think YouTube is the second biggest search engine search engine at the moment. So yeah, you think that keywords and all that used to be important, from all the research I’ve done, the biggest, most important things seem to be your title and thumbnail. So you know, capturing, you know, enticing interesting, and your descriptions, your description essentially acts, you know, as the place for your keywords now, so your actual keywords don’t seem to matter too much. YouTube keeps changing their algorithm. So they’re the big things essentially, for SEO from from what I can, from what I can find that now YouTube’s pretty quiet about their algorithm, you know, as as his Facebook, Instagram and Tiktok and all of them. But yeah, that’s the sort of information that they’ve at least alluded to that, you know, the general consensus seems to sort of point to.
Captain FI 45:49
okay. Well, clearly you’ve, you’ve read a lot of information and books on entrepreneurship, business, investing, and self development in general. Yeah, um, if you boil it down to probably your three most powerful or influential books or even lessons, what what would they be?
Aussie Money Man 46:15
Brilliant question. Okay, so I do tend to find on reading a lot more sort of self development books in anything. So I did read a few business books initially sort of got off that finance books, I’ve read a lot on value investing. And that’s something we’ll talk about it and if I get a chance as well, and I got off that so probably self development look like now when it comes to finance if you’re sort of new to finance and all that, you know, obviously you’re barefoot investor. Your money made simple or by no way aka your Rich Dad, Poor Dad or really good to start. If you want to do self development, I really like unlimited power by Tony Robbins. The slight edge is a really bloody good one. That is basically the philosophy that I think I’ve used to achieve everything. I’ve been able to which is essentially the what’s talked about in the slight edge, which would lead me then to say, if I want to say sort of biggest lesson, as you mentioned, I’d probably be just the fact that the same spiral that we’ve all unfortunately seen, you know, happen to others, or maybe even ourselves in our life that leads people to a really bad place in their life, you know, they lose their job, and then they start drinking and you know, they start spending money, and they have no money or hardly any money, so not their job and leads go into spiral works in the same way in reverse, meaning once you start to do those little good things each day, you get up early, you read in the morning, you exercise each day, etc, that compounds in the same way in the reverse direction. And before you know it, you’ve achieved things that a year before two years before whatever it has to be, you just thought were impossible, because, you know, I wasn’t a very confident kid, for example, and like the changes that are in the bounds of my short timeframe, like Obviously, I’m quite, quite young. So you know, maybe this will be even bigger to me when I’m older. And has this been, you know, monumental because of that simple fact that the reverse It’s true that that negative spiral happens on the upside as well. So I think that’s a huge lesson that if people see that like wow, because for a lot of people, it’s like how am I going to get to this whether it be financial, whatever it is in life, but they don’t realise that a compound it compounds just as it does in the opposite direction. And I think as humans it’s a lot easier to see the opposite side of it and see how quickly you can find your life tumbling than it is to see how quickly you can see yourself to shooting for the stars. So that’s probably my biggest sort of lesson I think.
Captain FI 48:28
Okay, and all right. So so the slight edge and I think you mentioned as well the Barefoot investor in there
Aussie Money Man 48:35
Yes. Yeah. barefoot investor so that’s that’s obviously great for you if you’re new define it. And you know, you’re not you’re not an expert, by any means that you’re good to get yourself started and really jump into the financial sort of literary literacy space yet.
Captain FI 48:49
Yeah, awesome. And another one I heard you mentioned which is one of my favourites. It’s a bit of a bit of a contentious choice now. Some people either in some people Hiding. But that’s of course, Rich Dad, Poor Dad by Robert Kiyosaki, Nick, fantastic recommendations that are on. Yeah, it’s actually that pulls us borrow. And the slight edge you mentioned, I have actually read that book before. I’ve actually written it down right now. And it’s something that I’m going to be putting on my list. So I’m excited been an absolute pleasure chatting to you today. What are the three tips? If you could go back in time and tell yourself,
Aussie Money Man 49:29
Phil thing? All right. I’m going to say one of the big ones I’d probably do firstly is just not to worry about working as much as when I was a kid, so but then in the future, so that that’d be a big one. The second one would be to start a business early and concentrate on that more earlier because again, I the whole reason I wasn’t doing that is to concentrate on academics, which partly was in a judo job in partly good interest. Either way, either way, I probably should have been doing that. And the third one would be to go full time with my business. Earlier, so I kept, you know, I was a huge issue I had where I was just like, even though Yes, I was enjoying the job and all that that was a big reason for staying, amongst others was sort of the whole Well, this is this incomes guaranteed and my business income isn’t but now I realise obviously, more so than ever, that the sky’s the limit when it comes to business, you know, depending on the industry, as long as it’s scalable, you know, the your chances of getting a pay rise, so to speak, when running your business is a lot bigger and likely to happen a lot quicker than it is in a job. So they’re probably the three gates. So don’t worry about working the job now and in the future as much at least start a business earlier and start running that business full time earlier.
Captain FI 50:38
Is there anything else you want to have a chat about today that we we haven’t mentioned? If I
Aussie Money Man 50:42
could I don’t like this too long. But those three things that sort of came up during the little chat here that I wanted to mention. So what the what those are first one is I’m completely on board and like you said, I didn’t want to make a comment earlier and sort of interrupt the flow. But when you mentioned you know about you know, starting now feel bad about that. That’s so true. And the When I looked at it is it I saw this thing once was on Facebook of all places, you know, and it was a lot of crap on Facebook, but it was essentially something like if you had like 100 grand, and someone stole, you know, five grand of it or something, are you going to sit there and be depressed about that? And the answer is no. So I think that the same thing applies there. When it comes to investing. It’s like, if you thought now you’re gonna have something and if you just keep waiting, you’re just got to have less or nothing is, you know, you ultimately voted best. So I’m completely on board with that just start now, like don’t feel bad about there’s 1000 things that I could feel bad about, not that everyone could feel bad about in life, you just got to go for it.
The second thing I want to mention is about five because obviously when we went back and forth about fire quite a bit, I think the reason for that is because I never found fire so much as fire found me. I think what happened essentially is I was doing these things thinking I was like, you know, all amazing and innovative. And there was this whole community of people doing it anyway. So I think essentially, I even maybe today don’t realise how much what I’m doing is just fine. Because, you know, I’ve sort of, I suppose forge my own path, you know, to something that already was created. So I think that’s something Interesting to mention, I think it’s sort of found me if that makes sense. And the last thing I wanted to mention was about value investing, as you mentioned, or of fundamental investing or basic investing on fundamentals. I mentioned my investment style has changed. And the interesting thing about value investing his There seems to be a lot of empirical evidence that shows quite clearly that value investing is basically impossible. And your chances of consistently outperforming and performing the market eating using people like Charlie Munger is Warren Buffett’s investment methods is essentially statistically almost impossible. So basically, due to that, my old reason for not investing in stocks, it was the same as yours, which was that garbage takes all the time in the world and sort of defeats the purpose of fire and I might as well invest in index funds to Wow, that’s not even statistically possible. So that’s something that people might want to look into. You know, I understand it incredibly, incredibly controversial, etc. But if you look at the data, you’ll find that That’s essentially what it what it shows. So that’s something I want to talk about and something I’m going to be talking about on my channel youtube channel a lot too. Because essentially evidence based investing, you might think, Well, everyone does that. But if you look at what the evidence does and look at what majority of people are doing with their investments, Eg managed funds, you’ll quickly find that that is not true. And that’s essentially with everything in life. You know, we all like to think we’re all very scientific investing and have evidence, but there’s a lot of reasons why that doesn’t end up happening. And often it’s not due to the individual often it’s due to people at the top making more money from selling you things that aren’t in your best interest.
Captain FI 53:33
Nick, thanks so much for making time to come and have a chat with me today. For the listeners if they want to check out your content or get in touch with you what’s the best way they can find you?
Aussie Money Man 53:45
Probably the first way is obviously just raising money man on YouTube. If you’re typing Ozzie money, men on Facebook, there’s a page you can message me there and I respond to every comment on the YouTube channel. Every message was the money man on Instagram. So essentially all the money on everything you can get me on LinkedIn Nicholas J MOSCOT. Yeah, and I will respond. Obviously, you can hit me up on the forum on the website as well, and I will respond.
Captain FI 54:08
Thanks for listening to another episode of the Captain FI Financial Independence Podcast. To read the transcripts, or check out the show notes, head over to www dot Captain fi.com for all the details. If you have a question for the captain, make sure to get in touch. You might even make it on the airwaves. You can reach me online through the captain five contact form or get in touch through the socials. I’m active on Facebook and Instagram as well as a number of online finance and investing forums. And finally, remember the information presented on the show and the links provided for general information purposes only. They should not be taken as constituting professional financial advice. You should always do your own research when making any financial decisions and make sure it’s appropriate for your personal circumstance.