Smashed Avocado

 

Smashed Avocado: the fuel a generation needs to get into the property market.

How to stop pissing your money away and get ahead

How to stop pissing your money away and get ahead

As much as it pains me to say it, Bernard Salt had a point when he said that we're not getting into property because of our spending habits. We're definitely precious little snowflakes that have chosen the smashed avocado lifestyle. But that's not to say old mate Bernard got it all right.

In the 70s, our parents stayed home and 'responsibly' hosted dinner parties, enjoyed the delights of $5 packs of cigarettes and saved on taxis because they drank and drove. We go out for brunch because our rental properties are shit and $22 seems like a small price to pay to eat outside out crumbling rental walls, Bernard.  

But we can get angry, or we can get even.  

When I resolved to buy, not only did I have no money, I had credit card debt and I was still paying off my degree. So I gave up on the idea of a home and set my sights on an entry level investment. That was do-able if I was prepared to make the sacrifices. 

Decide what to give up 

Choosing not to save isn't the same as being genuinely unable to afford to save. I know many millennials that are truly doing it tough. But if you've got a reasonable salary and you're just making poor choices, take a look at your bank statements and see where all those potential savings are going. I found that I was drinking my deposit. With that realisation, wine bars were immediately off the agenda. 

I moved home with my parents to save. Before you roll your eyes, I didn't freeload. I paid rent and other expenses. I contributed the same amount that I'm spending in my rental now that I have a tenant in my investment. I didn't do it because I'd save faster, I did it because it gave me focus and stability. 

I worked a second job. I didn't get a haircut for a year. I stopped buying clothes and going out for big nights. I spent about $100 per week on socialising and continued to manage my credit cards. Sometimes I went out for brunch and happily devoured my smashed avocado, but it was the exception, not the rule. 

Seriously committing to saving meant quiet nights with friends, sharing cleanskin wine, taking lunch to work every day, working in the evenings and spending more nights on the couch than I would have liked. I was putting away more than $2000 per month and I went from zero to application-ready, fast. 

Work out where you can invest 

My investment ain't fancy. It's an entry-level two bedroom unit 20-kilometres from the city. If I hadn't been able to afford that, I would have looked at properties in other cities, invested with someone else or put my money into another venture. Saying 'our generation's screwed so I'm not even going to try' is a bullshit excuse. You're kidding yourself if you think we're all in this together. It's like the smart kids saying 'I didn't even study' and then nailing the exam. They were studying then and they're saving now. 

First home buyers are snapping up properties like they were in 2012, despite median house prices in Melbourne and Sydney doubling in that time. If you don't get something – anything – sooner rather than later, it really will feel impossible. But it's not yet. When you do get in, a wise investment will start making money faster than you can and you'll soon have enough equity to take the next steps towards something better. 

 

The real cost of borrowing from the bank of mum and dad

The real cost of borrowing from the bank of mum and dad

You need a 20 per cent deposit to buy a house #lies

You need a 20 per cent deposit to buy a house #lies