If you can’t pay cash, you don’t deserve it
National Australia Bank head of wealth management Andrew Haggar was recently quoted sharing a disturbing statistic: half the population lives from pay cheque to pay cheque. This column offers the foundational elements of personal finance that may not only plant the seed of future financial security for many, but also satisfy the germinating demand for financial literacy and competency.
Click on the image below to read Roger’s Australian article.
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Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
wade smith
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I enjoy reading your article.
jimbo james
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Thanks for the good old fashioned advice there Roger. There are so many who either missed the lesson or need the reminder. I see yet another story about cost of living pressures driving families to the wall in the mainstream press today and in light of ABS inflation data close to all time lows, conclude one of two things. ABS inflation measurement is flawed or domestic financial management skills, coupled with this new age sense of entitlement are a seriously problem. Perhaps it’s both?
Great to listen to your work with Tony Delroy. Keep it up!
Wayne Robinson
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Roger that is a ripper of an article! I know your advice to be true because my partner and I are examples of people who have employed those habits. Even with the conservative approach of “paying ourselves first” and putting regular savings into a savings bank account each week from our 20s to now our early 40s, combined with compounding interest over that time has put us in a very financially secure position. I don’t tell this story to brag, I just want to confirm that these principles work if you have the patience and discipline to follow them through. It’s also true you don’t have to be the smartest of your peers. Any kid with resilience and a good work ethic is ahead of the pack these days as these are qualities are lacking in the young and not so young. Too many people are giving their kids things that they haven’t earned, often purchased with an ever growing dependence on credit. Finally, I think habit 6 ‘Choose carefully’ is extremely important. Having a lovely partner with a similar financial ethic is paramount to a happy successful relationship and life. Your free article is better financial advice than most of the financial subscriptions that many people buy.
Scott T
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That’s really a great article Roger. This afternoon I sat the 18yo and 14yo down and asked them to read this piece. Their comments both reflected how simple yet compelling your lesson is. I hope the kids in your sons class get as much out of your talk, as mine did from your article.
All Best
Scott T
Roger Montgomery
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Thanks Scott.
Ghazi Ali
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Thank you so much for this Roger. These are truly words of wisdom. Your son is very lucky to have you as a father. I was never educated by my father or by my school on finance or investing and even studying Business at university now not a lot is being taught in regards to value investing so in my free time I do a ton of reading on the subject and follow your blog. Thanks for everything you have done, you’re an inspiration to someone thousands of miles away from you and whenever my dad tells me that reading books won’t get me anywhere and the stock market is a casino… I just visit your blog and read up even more :)
Thanks!
Roger Montgomery
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Keep it up Ghazi.
Tristan Harrison
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I really like reading all of your investment analysis Roger, but your advice/habits are the things that most Australians could learn from the most. If people lived within their means then hardly anyone would go bankrupt. Your article should be on every newspaper’s front page/website.
Tristan
Roger Montgomery
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Thanks again for your encouraging words Tristan.
Dan Baillie
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Hi Roger,
Regarding the benefits of financial literacy personally I believe this should be recognised as an essential life skill and therefore included as standard curriculum in schooling. Bad habits are passed down through generations eg. Living beyond means & gambling. My family unfortunatlely suffer from these traits and it takes an external means for learning new habits. Funnily enough my path of learning comes from my youth playing computer games like railroad tycoon which included balance sheets, investing in growth & interest payments.
Roger Montgomery
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Good tip Dan, Thanks. Is this the correct version of the game
Dan Baillie
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Hi Roger,
The version I was referring to was a pc computer game from the 90’s.
The boardgame looks like a bit of fun might give it a try… Thanks.
This medium of learning i think is under recognised, without realising it the old games I was playing were developing knowledge and establishing interests. Eg. Carmen Sandiego taught geography, Civilization taught history & Railroad Tycoon taught economics. All these things I am interested in as an adult