Money with Jess. Jessica Irvine
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As my career blossomed in my late 20s and early 30s, I thought nothing of dropping $400 on a new designer suit jacket, a meal at a posh restaurant or a night at a fancy hotel.
I remember spending about that much to have my childhood copy of The Lord of the Rings rebound in an expensive, fabric‐clad hard cover by a specialist antique book store.
Pretty cool, right?
But then, one day, you find yourself pushing 40 as a divorced single mum who doesn't own a home, has never invested in shares or property and has no idea if she's on course for a comfortable retirement.
I'm the classic example of someone who knows a lot about something in theory, but was pretty crap at applying it in practice.
Looking back, I can see that at the time of my colleague's book‐writing suggestion, I was still drowning in deep shame and sadness at the failure of my marriage and my single parenthood.
But, as the dust began to settle on my new life, I did start to slowly pick myself up and put my financial life together — perhaps for the first time.
I bought my first home as a single mum aged 38 (I share all my best hacks for navigating that gruelling process in chapter 6 — stay tuned!).
At about that time, I began writing a weekly personal finance column for the ‘Money’ sections of the Sunday Age and Sun Herald newspapers. In it, I finally began applying all the economic theory I had learned to overhauling my real‐life finances — and sharing all the gory details with readers.
My Instagram account, @moneywithjess, began to grow rapidly and I pitched the idea of a weekly email newsletter of the same name — Money with Jess — to share the results of my one‐woman mission to budget, save and invest.
You name a crazy money‐saving experiment, I've tried it!
I once kept a spreadsheet to calculate the precise cost of every meal I cooked for one week to figure out a realistic food budget (it worked out about $85 per week for me and my son). I used another spreadsheet to tally the cost of buying the same basket of groceries from two different supermarkets to find out which was cheaper (spoiler alert: Aldi).
I kept a handwritten tally on a sticky note stuck to a bottle of dishwashing powder to figure out the per‐wash cost and whether it is cheaper than using tablets (it is, mostly because you can just use less detergent).
I didn't buy any clothes for an entire year. I cut my own hair. I gave up getting blonde foils (you can just see the remnant of my former colour on the tips of my hair in the cover photo for this book).
I began meticulously tracking my spending and in one article published the details of every single dollar I spent in one financial year (I know you'll want to know: it was $88 379.84 in 2020–21).
Bigger picture: I embarked on an epic hunt for the best mortgage deal, locking in my interest rate in for two years at 1.84 per cent and scoring a $4000 ‘cash back’ for my efforts.
I began making regular voluntary contributions to my retirement savings account.
And finally, in May 2021, I did something I had never previously dreamed of. I began investing directly in the share market for the first time — something I continue to do on a regular monthly basis and will tell you about in chapter 10.
How I found financial freedom
Underpinning all my progress, I believe, is a budgeting system I created to sort, organise and track my money: the system this book is ultimately designed to teach you to use yourself.
I've divided this book into three parts that roughly correlate to the personal journey I've been on with my money.
Part I is all about getting you in the right ‘money mindset’ to succeed. I share some of the details of my own therapy journey, where I learned about the critical role of emotions and thoughts in ultimately driving your behaviours and outcomes. Getting into a healthy ‘money mindset’ requires ridding yourself of some unhelpful beliefs you've probably picked up about money, namely that it's too boring or too complex. To assist, I've outlined seven ‘money myths’ you'll need to ditch.
In part II, we put together an annual budget to show you where your money is going. Whether it's planning for retirement, applying for a loan or deciding what size emergency fund you need, having an idea of your individual spending is critical.
When I first attempted to do this for myself, I quickly realised how useful it would be to have a comprehensive checklist to work through of all the things people can spend money on.
Being the self‐confessed ‘numbers nerd’ that I am, I began trawling through statistical surveys of household expenditure from Australia and other advanced nations — a search that would lead me all the way to the United Nations — to find the ultimate budget categories system.
None suited my purposes, however. So I decided to create my own. In chapter 6, I run you through what I believe to be a complete checklist of all the purchases you will ever make in life, sorted neatly into my unique 10 budget categories.
Dog treats, garden hoses, charity donations — I know where they all go! I truly believe I have identified every possible expense you need to consider when putting together a household budget. I found the process so satisfying and I hope you do too.
Of course, once you begin to become aware of where all your money is going, you'll want to begin trimming and saving where you can. So I've sprinkled part II of this book with over 300 money‐saving hacks to help you (you'll find them in green boxes throughout). You're so welcome!
Finally, part III of this book is all about the system I personally use to regularly budget and track my money. It contains information about how to access and use all my free, downloadable resources, including my Annual Budget worksheet, Spending Tracker, Monthly Budget worksheet and Future Fund worksheet. I am regularly asked to explain how they all work, so this has been my chance to explain in full!
Why I wrote this book
My deepest desire is that the information you're about to read will help alleviate some of the suffering so many people feel when they think about money. Undeniably, many people suffer real, actual financial deprivation, unable to make ends meet on meagre incomes, with severe repercussions for their mental and even physical health and wellbeing.
But I'm also talking about a different kind of suffering — one that is perhaps even more widespread.
It's the suffering people endure when they simply don't feel in control of the money they do have; when they lack the confidence to make empowered decisions about money on a daily basis, let alone save for their future selves.
Studies have shown that, beyond a certain point, a person's level of income is a much less important driver of their wellbeing than the sense that they have of being in control of their financial situation.
For two decades, the authors of the Australian Unity Wellbeing Index survey have asked Australians to rate, on a scale of 1 to 10, how satisfied they are with their life. Their clear conclusion is that it's not money, per se, but ‘financial control’ that matters most. ‘People with lower income can actually achieve higher wellbeing than those on higher incomes, so long as they have a higher perceived control over their financial position’, the