New Features Introduced for Money SMARTS!

Good day, Ben Kingsley here, Managing Director of Empower Wealth and I am thrilled to be able to share with you one of the latest features we have on our MyWealth Portal, which is free for all of our customers and in fact, free for the public to use. And that is our Money FIT section.

(Sign in to MyWealth Portal here: www.ew.moneysmarts.com.au)

 

Now you probably got a question mark and what is Money FIT?

Well, the backstory here is really one of, “How do I compare?”. This is a question that I get asked and all of our advisors get asked in our business many, many times throughout the course of the years that we’ve been doing this work. And what happens is, people come in and it’s a nervous time for them right? They’re looking at their financial situation. They’re coming and sharing some of their concerns and worries and opportunities and excitement about how we might be able to take them on a financial transformation journey to financial peace.

And in the early stages we’re going through the fact find and we’re asking questions. But as the conversation gets warmer and people start to relax and they realize that we’re there to help them, the number one question by far that we all get asked is…

“So how do we compare? Compared to people like us?”

And it’s always been a difficult question to answer because it’s not easy to see all those numbers rattling around your head and also, based on the thousands and thousands of clients that we look after. Well guess what? Now we’re in a position through the Money SMARTS and also the Money FIT where we can actually show you how you do compare and I’m delighted to be able to show you a quick little demo in regards to how we do that.

If you don’t have an account in MyWealth Portal, just fill in the form below to set up a free account!

 

So let’s cut to the demonstration piece now.

Here we are and we’re on the dashboard here. Now you can see down on the menu bar here, we’ve got Money FIT. I click over to that and this is the new area that’s been part of the Money SMARTS system. So what’s happening here is you can see some numbers coming through. Here are Brett and Sally, aged between 26 and 30 from Victoria.

We’re going to start looking at the Income Comparison first.

Green is money coming in. We’ve got their age range and we’re going to compare them across Australia. Now what’s happening here in this histogram is we can see that their range is $73,500 to $98,000. They are based on the surveyed households here are 5,238. They sit at around 42.2%. So that’s just giving them an indication across Australia where their income sits compared to everybody else.

Now remember, creating wealth isn’t always about income. It’s also about expenditure.

 

That brings me to the next graph… Expenditure.

Now I can compare them against all age groups. So we can have a look here and you can see what’s going on.

Where do they sit against all age groups? 47.9 and you can see the number of households above and below that area. And then of course, I can even compare them across different States. Now this is you comparing yourself. Remember now when we come down into expenses, we’re looking at total expenditure into their household. So again, I’m going to start with their age range cause I think it’s only fair to look at age range brackets to get a fair comparison of your situation. And now you can also see from an expenditure point of view, in terms of their age range, their total expenditure across the household is actually only 12.9% so that’s very, very good.

There are 2,892 households that are above them, but only 535 households below. Now you’ve gotta be happy with that if you’re in that bottom 25% quartile because from an expenditure point of view, that’s where you want to be. And of course, from an income point of view, you’d love it to be high.

But really the most important thing is how you’re trapping your surplus.

As we scroll down more and this is where I’m really excited. This bit here for me, is where we think we’re going to help with changing behaviour. Again, coming back to the thousands and thousands of consultations that have had, it’s one of the big questions that I get asked all the time. “How do we compare to others who spend on their kids? How do we compare to spending on household? How do we compare to spending on groceries, electricity, entertainment, hobbies, et cetera, et cetera.?”

This is where you can do that. So I’m going to start off by going to all ages. I’m doing a national search here and I’m going to select my expense item. To start with, I’m going to do groceries. And you can see here with the groceries, this is where I can compare. Now what this is telling me is that I’m 91.8% of all households. So.. “I spend a lot on groceries” is the message for this particular couple here. We’d like to see that come down. We’ll look at what they are spending on that’s essential versus discretionary, even though it’s in the grocery side. There can be no arguments. Now if we go down into people of their age group, what does that look like for them? Does their situation improve? And we can see that we hover over again and they have improved a little bit.

So there are older households potentially that are spending more than they are, but they’re still very, very high in that expense range. Let’s try one more. Let’s go and have a look at electricity in terms of how they compare from an electricity point of view. We can see them sitting at 61. I’d prefer them to be sub 50 so maybe they’re spending too much on electricity. Maybe the deal that they’ve got with their electricity provider is a little too high and they need to shop around.

So again, just bringing it back to context in terms of what their overall situation is. And again, you can go into Victoria because remember some electricity costs in some cities are more than others. When we go into the state, we can also see that it’s at 69.3 based on their age range as well. So really there’s no excuse for them not to start looking at how much they’re spending on electricity and to trap more surplus because the more surplus we trap, the more we can put that money to work for us.

 

Let’s now look at the gold section, which is really about out trapping surplus and then building wealth.

And we can see here in terms of their surplus, it’s looking pretty good at $37,000 so they might be spending a lot on electricity and a little bit more on groceries, but maybe they don’t have as much expenditure on discretionary items like holidays or things like hobbies and food takeaways or what have you.

So that’s why you don’t just look at a couple and say, right, that’s it in isolation. You need to play around here. Get familiar with the insights that you’re learning here. Because you see, for this particular case, this household sits right in the middle at 50.9%. So there’s 1,828 households above and 2,155 households below. That’s based on a survey of 4,231. Now as more people come on to the MyWealth Portal and checkout their Money FIT story, that number is going to grow.

 

But also remember that we’re only getting the aggregate data. There is no personal information that makes its way into these here. So your privacy is protected and we’re only looking at the state level. One day in the future as we get tens of thousands of people using the platform, we might go down into city level and we can have a look at, you know, the Sydney area or the Melbourne area or have a look at the capital cities and see what the spending that’s going on. And then ultimately the final story here is really your net worth and what’s going to be happening in regards to where you sit currently compared to your particular age group or right across Australia for all of the age groups.

So you can then also start to get a sense of where you’re at in terms of your wealth creation journey. Now we’ve got some further enhancements to do. As I said, we were beta testing this, kicking the tires on, but I’m delighted to say it’s now LIVE and available and there will be more features that we’ll be adding over the course of the next 12 months. That’s an exciting thing. I hope you can compare yourself and scratch that itch of curiosity around your circumstances. Have a little bit of play in term of your money matching. How do you compare? That’s really a big part of what Money FIT is all about. So get in there, kick the tires on it. How you do that is really simple. You go into the expenses area, you fill in the details and your bills and spending and you also your income which comes into your income story.

That’s all we need to play with Money FIT.

And I encourage you all to debate it amongst your household in terms of what you think and how you’re tracking and get in there and compare yourself. Because ultimately our goal is to showcase to you based on the aggregate data that we’ve collected and continue to collect, exactly what households are spending state by state and certainly by age ranges. Because that will give you a guide. It’s obviously not precise and everyone’s household’s circumstances are completely different. But it will give you some opportunity to sort of say…

“Hey, we’re a little bit over when it comes to overall household expenditure and these might be the areas in terms of the expense items that we may want to focus in on. And also, to be able to reduce that number of expenditure happening in our household, trap more circles and then put that money to work.”

So hopefully you’ll enjoy it. Tell your friends about it. Maybe it’s a little bit of a competition in regards to checking out your money matching skills around how you do compare the Money FIT service. And let us know how you go.

We’re really delighted that we’ve been able to release this to you and there are going to be future enhancements coming to this part of the MyWealth Portal as well. So get in there, update your information and we look forward to seeing how you compare.

 

p.s. If you don’t have an account in MyWealth Portal, just fill in the form below to set up a free account!