My Money Sorted: Ruth

My Money Sorted is our series exploring people's experiences and views about money on their journey to living sorted. Ruth Henderson is a personal finance blogger who runs the website and podcast The Happy Saver. Ruth blogs about her journey to being financially independent and how she uses her income to buy just what she needs, not everything she wants, and tucks the rest away.

What is the best money advice you’ve been given?

Always invest a portion of every paycheque. Don't just save it; invest. To me, this is huge.

I also love the advice of Mr. Money Moustache - I came across him quite a few years ago, and everything I read of his now seems so obvious. Some of his best blogs are about the shockingly simple math behind early retirement and the 4% rule. When we think about being smarter with money, we often get so tied up and think we can’t spend, so the best advice I've got is just to think about it as math. Do some maths and then get on with life.

Are you a spender or a saver?

I am both because I save enough that it allows me to spend. I've created enough of a financial runway that I can say yes to spending that is in line with my budget and values. When I think of savers and spenders, it's so polarising. I probably lean towards saving, but I've realised investing lets me spend in more ways than I ever could have imagined, so now I consider myself both. I find value in spending my money in ways that are meaningful for me.

What’s a memorable money moment?

For us, it was the Christchurch earthquake. I remember walking along the Avon River with my husband Jonny and saying, “I don't know what's going to happen here, but I do know we have enough money”. We have an emergency fund, so we can sort out a lot of our own problems. It was so memorable thinking all of this is out of our control, but we've got this wee bit of control here.

The other one is I work Wednesday and Thursday – that's all these days. I get to go to my job because I enjoy being there, and the money is just a happy by-product. I don't work just for the money anymore.

What makes you feel Sorted when it comes to your money?

I feel sorted when I have an overall view of our money and where it’s going. It’s “the vibe”; I'm not interested in the nitty-gritty details. I track our net worth on the first of every month, and I can see our KiwiSaver, investments, business and bank accounts, the value of our cars and the value of our house.

I know I don't do everything right, but I realise I don't have to optimise every dollar. For me, close enough is good enough, and it takes a lot of pressure off. As long as our net worth is going up, I'm happy. It just takes a lot of the stress and anxiety out of it.

What money beliefs have you inherited from your whānau?

My dad used to say, “money is made round to go around”, by which he means a dollar is round, and you hand it around. He was generous literally to a fault, and as a result, we grew up relatively poor. There was never much to spare, and anytime there was, he would give it away. He once won Lotto, maybe a couple of thousand, after buying a ticket every week for years. I remember thinking, “yes, we've got this sorted”, and then in the next breath, he said I'm donating it all to World Vision.

So to me, it's generosity. When I don't have as much money, I'm generous with my time. I took the good from my parents and added better habits. Knowing where my money is and its trajectory, that’s when I can peel money off to be generous to others, which is what my dad always wanted to do.

What would your bank account say to you right now?

It would say that I’ve got $21,361 between me and drama. Knowing if any drama came our way – most times, I could solve it with money is a calming feeling. I used to worry about having money sitting in the bank, people would say, “your money should be at work for you”. But it is at work because it acts as an insurance policy, and I feel completely calm because of it.

I also see that my many sinking funds are growing in line with the goals I have for them. I have 10-12 bank accounts at any time, which are saving for my daughter’s schooling, my pets, my annual insurance bill, putting money aside for investing, tax, and all those I things I know are going to be happening. I save a little every week for them, and they just tick away in the background.

It's all on autopilot. I think of it as a big machine where you can open the door, look at the workings for a minute, shut the door and get on with life. They say, “you’re alright”, and I'm proud of myself for that.

What’s your proudest money moment?

It's realising that I appear to have the skills to help others with their own money just by talking freely about my money. I always say to people, “ask me anything”. If you want to know what's in my bank account, I’ll share if that's helpful to you. Then, as a result, they tell me all these things that they’ve never told anybody but really wondered about. It blows my mind that people trust me enough to just talk about money.

Another one was paying off our house and realising the bank needs me more than I need them. It gave me instant power in the situation.

When you think about your retirement, what do you see?

A gradual slide into work being optional. We are three-quarters of the way down the slide already, we’ve been working at it for many years. If I happen to still be working at 65, that’s fine, but it’ll be because I choose to be. Retirement for us is having the choice of whether we want to trade our time for money or not.