🤑 How to Get Rich + ⛱🏖 Public Holiday Pay + Is There Any Point Saving?

The money stuff that you wish they taught in school

Before we start, a quick question for you. Money Chats is a written publication. That’s because I like writing. But a few of you have asked whether I’d consider making it a podcast too. I like podcasts (listening to them anyway). But I’m not sure I’d be any good at making one.

But I’m willing to give it a try if enough of you out there would like to hear the weekly newsletter (which I’ll definitely keep doing) in podcast form. Maybe you’d listen to the podcast while going for a walk, or in the car with your parents on the way home from weekend sport.

So here’s a poll to find out. Let me know what you think:

You know when you’re in class and someone asks a question and you go:

• “Oh, I was going to ask that” or,

• “Oh, I didn’t have that question before, but now I want to know the answer to it”

That’s what this is supposed to be like (but with money stuff, not English or Biology).

The format of this newsletter is simple:

• 3 questions from teenagers and young adults like you (and my answers).

• Got your own question about money that you want to ask? Nice! You can submit it here.

• To find out why this newsletter exists (and a little about me), you can read the FAQs.

Now let’s get to your questions…

Your Questions & Answers

• 🤑 How to Get Rich

• ⛱🏖 Public Holiday Pay

• Is There Any Point Saving?

🤑 How to Get Rich

Q. “I want to be rich when I’m older. Maybe by being a YouTuber. How can I get rich?”

-Jack, 12, Qld

Answer

Haha, hey Jack - A lot of people want to be rich. So it’s not just you! I’m going to ask you a question though. And the question is: why do you want to be rich?

Because I think that’s a way more important question.

I think ‘being rich’ and just having money doesn’t really matter. But I like the idea of having money so I can do things that I like doing. And also so that I can not worry about having money if I need it suddenly.

Let me give you some examples from my own life.

• 🏏 When I was about 20 I really liked playing cricket with my friends. But it was kind of expensive. We had to pay match fees every week. And registration. And cricket bats aren’t that cheap (especially cause I always wanted a better bat). But because I had savings from my part time job I could pay for those things.

• 🐶🎄 Last year on Christmas Day, my friend's dog (he’s called Duke) got into the bin and ate a bunch of stuff he shouldn’t have eaten. And he got pretty sick. So they had to take him to the vet. I don’t know if your family has pets, but vets are expensive. And on Christmas Day? They’re REALLY expensive. But my friends had worked hard and saved up money. So when they had to take Duke in to the vet, they didn’t worry about the cost. They knew they had the money so they could go and get the little guy looked after.

In both those stories we weren’t ‘rich’ (we still aren’t). But we had enough money to do the things we really wanted to do. 

So maybe instead of wanting to know ‘how to get rich’ maybe you could think about ‘how to have enough money to do the things I like and want to do’.

There’s 2 simple steps: 

1. Work hard (money comes from working).

2. Save a little every time you get paid. 

Seems too easy right? But that’s the basics.

Keep coming back and reading other people’s questions (especially those from kids your age) and you’ll learn lots. So by the time you start working part-time, you’ll know plenty about how to earn and save so you can do the things you want to do.

⛱🏖 Public Holiday Pay

Q. “Why do people get paid to work more on public holidays? How much more is it?”

-Kenna, 17, NSW

Answer

Hey Kenna, it’s weird isn’t it? It’s because of something called ‘penalty rates’. I’ll show you how they work with an example in a second. 

‘Penalty rates’ might just be the most confusing thing that they could be called. They mean the higher rates of pay that employees get if they work weekends or a public holiday (which doesn’t really sound like a penalty to me).

The reason penalty rates exist is because about 80 years ago someone decided that if you worked outside what people thought were ‘normal’ hours, then you deserved more pay. 

So what are normal hours then?

You might be surprised to learn that until 1992 in NSW, shops were all closed on Sundays. It took until 2002 for Queensland to start Sunday trading. And after visiting Adelaide for the first time last year, I’m pretty sure that Sunday trading still isn’t a thing down there. It’s a bit of a weird place. Anyway, I’m getting sidetracked here…

Ah right, your example. 

So, here’s how much extra you might get paid above your normal rate for working on certain days. In the following example:

• The base wage rate is $20 per hour,

• the industry is hospitality / retail, and,

• the employee is a casual.*

Penalty Rates and Pay

• Base wage: $20 per hour

• Saturday penalty rate: 125% of base wage = $25 per hour.

• Sunday penalty rate: 150% of base wage = $30 per hour.

• Public holiday penalty rate: 225% of base wage = $45 per hour. 

Hope that answers your questions, and feel free to write back in if there’s anything else you want to know.

*Your hourly rate will be different depending on your age, the industry you work in and whether you are employed on a casual or part-time basis. Employment law is annoyingly complicated. But the example is just there to give you a practical idea of how it all works.

Is There Any Point Saving?

Q. “I’m not earning very much at my part time job. My parents say I should save. But I still want to be able to spend some of it. What’s the point of saving if it’s only going to be a tiny amount?”

-Elly, 18, NSW

Answer

Hey Elly, this is a great question, and I’m pretty sure most people have it when they are only working part-time, so thank you for asking it 🙂.

Earning decent amounts one week and then small amounts the next is also really common when you are a teenager / at uni because your hours worked (and your pay) can be really up and down with heaps of shifts one week and none the next.

So here’s the thing. It’s not about the amount you save. It’s about the habit of saving.

And you only build that habit by doing it over and over, every week. I’ll share with you how I did it when I started at my part-time job. It’s literally 2 steps.

• I opened a totally separate savings account to my ‘main’ account. So I had two accounts. My ‘main’ one and my ‘savings’ one.

• Every time I got paid into my ‘main’ bank account I transferred 20% of it to my ‘savings’ account. No variations. No ‘off weeks’. Every single time. If I got paid $400 one week, that was $80 to the savings account. If I only got paid $100 another week I still transferred 20%, even though that was only $20.

And you know what? I never stopped doing that. Right through until now, when I have a full-time job. Doing it automatically, every single time meant that I didn’t have to ‘think’ about it and make a decision to save every time. 

I just did it.

It meant that I always had savings to spend on things I cared about or really wanted to do. Things like

• Buying an engagement ring.

• Spending on an incredible European holiday when I graduated university.

• Having enough for a house deposit to buy a house with my wife (without any help from anyone else). 

You can do the same thing. It works. It’s an incredibly powerful habit to save a percentage of what you earn, every single time you are paid. 

• Making this a habit is how this works. The amount you save doesn’t matter. The habit of saving does.

• Making it hard to access that savings account (by having a totally separate account and not using the card for it) is how to make easier for yourself to stick to your saving habit (you don’t get any extra points for using more willpower so you may as well make it easier for yourself).

Hope that helps answer your question and gives you something to think about!

Thanks for Reading

You made it to the end! Congrats. I hope you got something useful from the newsletter this week.

Got your own question you want to ask? Can’t wait to hear it! You can submit it here.

See you next week,

-Ry

P.S.

Last week in response to a question about Sam Kerr and women’s sport I introduced the idea of the gender pay gap. ‘Part 2’ of the answer was meant to be this week. But it’s a big, important topic, and I wanted to get it right. So I’m doing some more research and also want to get it fact-checked by someone who knows way more about the topic than me. It’ll be ready for next week’s newsletter.

In the meantime, if you know anyone else who might also like the simple, practical way we talk about money stuff here (teenager, young adult or a parent) feel free to share the link below with them or just forward them this newsletter.