An Australian financial guru has revealed an easy trick to save money every time you receive a paycheck.
Queenie Tan from Sydney highlighted the importance of paying yourself first to build savings faster.
The 27-year-old mother, who has a net worth of more than $500,000 and is known for sharing helpful money tips online, demonstrated the tactic using colored water.
In a video, Queenie admitted that she used to manage her finances by spending money on what she needed and wanted, and then putting the rest of the money into savings.
However, now you do the opposite and set aside a fixed amount for savings and live off the rest. This practical change means you are more likely to save money in the long run.
“So, I first set aside some money for my savings and investments and then I pay for my needs, then I pay for my wants,” he said in the clip.
‘Even Warren Buffet, one of the richest people in the world, is a proponent of the pay-yourself-first budget, saying, “Don’t save what you have left after spending, spend what you have left after saving.”‘
Previously, Queenie revealed her seven sources of income, including collaborations with brands on social media, stocks, YouTube earnings, selling digital products and speaking at events.
Every time she receives a paycheck, Sydney financial guru Queenie Tan (pictured) always puts a set amount into savings and lives off the rest. This handy change means you’re more likely to save money in the long run.
Queenie Tan, 27, and her fiancé Pablo Bizzini, 32 (pictured right) have a net worth of $800,000
The enlightening video has since been viewed over 31,000 times, with many thanking Queenie for sharing the helpful tip.
“I love it! We’re on track to pay off our mortgage in two to three years and then we’ll actually be able to invest more,” one wrote.
“Kill! I love how you used colored water to explain it,” said another.
“Paying yourself first, I love it,” added a third.
Earlier this year, her fiancé Pablo Bizzini, 32, welcomed daughter Gia into the world on March 19 and has already opened an investment account.
The revealing video has since been viewed more than 31,000 times, with many thanking Queenie for sharing the helpful tip (pictured with her daughter Gia).
When Gia was born, the Sydney couple invested $1,000 in her and will continue to do so every year on her birthday. Any cash gifts they receive from friends and family will also be invested.
By the time she’s 18, Gia will have $41,000, and by the time she’s 65, she’ll have $1.8 million, assuming an eight percent annual return based on the portfolio they’ve chosen.
“Investing is a great way to ensure our money is worth more over time rather than being eaten away by inflation and rising costs of living,” Queenie told FEMAIL.
“That’s why I started investing for her, so she’ll have a head start when she’s a young adult.”
Queenie noted that living in Australia is expensive, especially as the cost of living and the property market continue to rise. Saving money for her daughter will hopefully allow her to obtain other assets later in life, such as higher education or a home loan.
So far, the couple has chosen two exchange-traded funds (ETFs), including a US ETF (called VTS) and a global ETF (VEU). The annual returns used are an example and not a forecast.
Most ETFs have provided investors with returns of between 6 and 12 percent annually over the past ten to 20 years.
When Gia is a little older, Queenie said 50 percent of the cash gifts will be spent, not the full amount.
