The Best Finance Hack We Have Ever Heard (ft. Victoria Devine)

Victoria Divine. Victoria is a multi award winning retired financial advisor, a best selling author of five books. She's a financial columnist for The Age and Sydney Morning Herald and she's host of Australia's number one finance podcast, She's On the Money. Victoria is also the founder of Zella Money, which is an Australia wide mortgage broking and asset finance company.

finance and trying to get myself out of that. And I guess She's on the Money is a culmination of all of that, not knowing where to go, having really bad experiences with males in the industry, being overlooked when it came to being and seriously, when I was like, oh, I want to learn about investing in people, being like, oh, you're a girl, what would you know? So I just it was a lot of things that kind of came

together for me to create She's on the Money. And yes, a lack of financial literacy was absolutely the driving motivator, but I didn't know it at the time. I feel like when you talk to lots of people, they're not like, oh, I had this really great, really clean business idea and it just worked. I didn't know that She's on the

Money would become a business. Like at the time, I was running my financial advice business and She's on the Money was this like love project on the side that I was like, Oh, if I invest a little bit of money, I don't expect it to come back, but I expect to have a good time doing it. And so it was a beautiful experience pulling it all together. And it definitely comes from a lack of financial literacy

in Australia and me seeing that gap. But I guess in hindsight it's a lot clearer than what it was at the time. At the time, I was like, I want to put out content that I would want to experience, and I guess that's where we ended.

It can be something quite small that you think not that much of and it very well may just turn into a big business pun intended.

Like they don't sit down and go to the government website and download the business plan and ride out their formal documentation. And they also don't do the same stuff when it comes to financial planning either. You kind of just wing it. And a lot of small business owners start their business by using their personal accounts, and you know, going, oh, well, you know, I don't know if this will be a thing.

You might, you know, start really small, and you're like, oh, it's fifty bucks here and there, like, Oh, I'm just going to sign up for a website. Oh, I haven't started my business accounts. I'm just going to fund it personally, and it just becomes really messy. So it's really important to start really cleanly. And I do feel like if you're going to start a business, one of the best ways to back yourself is to go, you know what, I am going to get a business banking account. I

am going to separate this. I am going to care about tax from the start because albeit not sexy, like I'm trying so hard to make it sexy, like that's what she's on the money is about, but it's not sexy at the end of the day. But it's those foundations that you need to have a successful business long term, and finance is the thing that becomes the stumbling block

to get from small business to big business. So I feel like if we start cleanly at the start, it doesn't mean you need to go pay for lots of financial advice and you're not paying thousands of dollars to an advisor, but you are going, all right, well, what does my financial planning look like? Am I going to get a business account. Don't get me wrong. You might have absolutely no cash because the business isn't making anything.

But what that does is it means you can transfer personally still over to your business, but you can keep track of that money and pay it back to yourself, but also have a really clean outline of what that business is costing you, what are the incomings and outgoings for this business, so everything is just super clean from the beginning. Because that's going to make your life so much easier. But it's also going to make life easier

when it comes to scaling. It's going to make life easier when it comes to making big business decisions because even if you don't have fancy accounting software, you can go, well, can I afford to make this decision? Like what would adding another product to our business actually look like? And you've got all the numbers in front of you, instead

of going, oh, I need to sort through that. Oh there's a whole heap of vopber eats charges on this credit card as well as oh, yeah, I did pay you know that subscription to my website, and I did pay that subscription to you know, internet security or whatever it is. But like they become messy and messy is not good when it comes to trying to make a successful business.

belief that this business is going to be successful. Whereas if you're just it with your personal bank accounts, you're kind of not backing the business in the way that it deserves to be backed to be successful because you're like, oh, it might not work out, Like I don't want to bother with that, Like that's not the mentality we want to have. No, you want to take it seriously from the get go, exactly serious business, ladies.

That's a lot of responsibility. So for me to take that step and you know, be an entrepreneur and step out and back myself in business, I feel like I need a lot more of a safety net than someone who's like whatever, it's all good. Like I could be a young twenty two year old single female who has absolutely no dependence and I get to live at home. So the amount that you need to save up to

start a business is going to be very different. One thing that I say to a lot of business owners is you can actually do so much research for free before you even spend a dollar. So go and do the research. Like, let's just be really basic about this. You're going to start a product based business and you're

not making the product yourself. You're going to get a manufacturer in China to do it right, So you can go and do the research of what's it going to cost to establish your website, what's it going to cost you to potentially start social media, how's that going to work? And these are fickle things because you might be a wizard at social media on your own, or you might really suck at it and need a whole heap of budget behind paying someone to help you with that. So

the amount that you need to save is different. You can reach out to manufacturers overseas and see what their costs are going to be. You can work out what a product is going to cost you to import. You can do all this research and create a beautiful spreadsheet, but then on the flip side, I need you to look at your living expenses and go, all right, well, if I'm going to start putting my all into this business that's not making any profit yet, how many savings

do I need to the side. And that's where the difference between a twenty two year old single female and then Victoria in a thirties with a kid and a mortgage is going to come into it, because you could be living at home and your mum and dad are like, oh my gosh, slag queen, we'll look after and we'll

look after you go live your best life. Whereas me, I'm like, okay, well I would need to save enough to you know, kick this off for you know, six months, Like how long do I think it's going to take until this business creates enough profit for me to cover myself? So that amount is going to be very different based on personal circumstances. But I guess the answer there is do a budget, have a look at what your expenses

are going to be. For me, like I own a mortgage broking company, right, so profit in my business actually takes a long time to come through, so lots of people don't know this, But from the day that my client settles, it's like three months before I get paid from the banks. So that needs to be taken into consideration. Whereas you know, I might have an online course and I actually get the money in my account every time a client makes a transaction, So those things need to

be considered. Do I need a three month buffer? Do I need a six month buffer? Do I need to be planning to pay my expenses for twelve months while this starts off? Or am I planning on working part time while building a business on the side.

that come into play. And some people have gotten really lucky and just started with two hundred bucks and a small thing that's turned into a billion dollar company. But how often is that going to happen?

is a lie. But I actually owned a financial advice company that was making profit, and I was using that profit to start my podcasting business and pay for production and pay for all of this other stuff. Is the fact that I had a two hundred dollar mic legitimate? Yeah, of course it is, And I mean that makes a really good story. But is it the reality of this situation? And I guess there's just so much that comes into

it when reading into other people's stories. Where I value transparency, but I also think that we need to put our blinkers on a little bit and not look at other people's journeys as an indicator for what success looks like. See it and be like, well, if she can, I can do something too. Be inspired, Yeah, be inspired, but don't be Yeah, don't think that that's going to be your trajectory.

very much a buckets lady. I like having all my income going into one and then I take income out and put it into my tax bucket, knowing that when my bass is coming up, I need to pay that every month. And then when you know, other expenses come up. I've even got an emergency fund for my business because I'm like, well, what would happen, Yeah, if I, you know, for some reason, didn't get paid for a long period

of time. I don't know why that would happen, but if it did, I know that I have three months worth of expenses so that I can cover my team's salary, and that makes me feel really safe. So I feel like not setting yourself up properly from the start and not doing enough research into what things is it going

to cost you? Business is mind blowingly expensive, Like it just adds up, and I feel like so many people go, oh, it's not that expensive, and I'm like I sometimes and just shocked at how much I spend on things, oh like whether that is you know, staff wages and how they add up in addition to like super and tax. And that's not me complaining, Like I am not complaining about this. I am so privileged to be able to

pay all of this. Then I've got, you know, all the insurances I need to pay for my business, which I think lots of people forget to put into the budget. I pay thousands of dollars in insurance. I feel you then you've got rent, and I feel like so many people are like, oh cool, it's listed. I don't know a shop's like fifty thousand dollars. What's your fit out going to be? What are the insurances on that shop? What are the ongoing costs? Because when you rent a shop,

you're taking over every single expense. It's not like renting a house and you know if it's shared water, your landlord's got it.

about the location. I need to pay for a location that's going to allow me to film there and use those videos for commercial purposes. I need a hair and makeup artist. I need, you know, the lighting guy that's separate from the photographer. Oh my gosh, my photographer doesn't do video. I need the separate video person to get the behind the scenes content, Like there's just so many moving parts that you go, oh, I thought it was

about just taking some photos and whacking them online. Like, don't get me wrong, there are definitely cheaper ways to do things. But business is expensive, which means you need to be looking at the bottom line of your business from the start, Like I think consistently thinking about, well, what will the outcome of this product be, Like can I feasibly sell it for fifty dollars or does it actually need to be one hundred dollars to be a

feasible long term business? And I think so many times we forget to look at what it's going to cost us, and we just benchmark ourselves on what our competitors are doing or what we think in our heads these things should cost instead of like, oh, to make this viable, it actually sits here. So I think doing the research from the start and making sure that you're covering all of those bases for me would be the big thing. And it can be overwhelming, but it actually doesn't need

to be Like open an Excel spreadsheet. You don't even need to be good at spreadsheets, there are little boxes. You can put words in those boxes and start putting words down one side, and then how much each of those things is going to cost you down the other side, so you can keep track of it, Like it's all the small things that add up.

into this expansion? What are you looking at when it comes to you know, your financials. Are you sitting down every month and looking at them? They're like, no, I hate that stuff, and it's well, you might hate it, I might not enjoy it, but these are necessary so that you can be creative, so that you can, you know, consistently have all of the good times. Like business sadly is good and bad, like there are things that you

aren't gonna like. And I often say business gets harder the bigger it is because the responsibility becomes more and I feel like the more senior, I don't know if the word senior is right here, but like the higher up we get, the bigger my business becomes, the more meaning all my tasks, like I'm the one having to like, you know, do the banking, going to the post offfice.

do because you're big. But like I think they're the things that the bigger you get, the more you're gonna have to do these things. So if you're not willing to do them from the start, I promise that setting yourself up for failure. Like you need to carve time out to be working on the business. And when people say, oh, you're working on the business, Like I think that that sounds so romantic to me. I'm like, oh, you're thinking about growth, You're working on the business. You're doing some

marketing and branding. Oh so chic, when the reality is like, I'm working on the business so the business can still stand, babe. Like I'm in the background, going, actually, do I need to review all this subscriptions in the business to make sure that I'm not, you know, frittering all.

of nowhere. So I feel like, if you're not willing to do the small things, yes, you might be the most gifted human being when it comes to being creative, and you might be the best designer, you might be the best everything. But it's a compromise you're gonna have to make to be able to shine in that space

as well. Because you know, even if you like, let's say you're an artist and you want to sell your paintings, Like, the bigger you get, the more admin you're gonna have to do, the more you're gonna have to think about shipping costs. You're gonna have to think about packaging, how to get your items overseas. If overseas buyers start to pick up your work, Like, these things are not sexy,

but they're necessary to be known for your craft. So I think that being happy to take that on from the beginning and seeing it as a responsibility of a being a business owner is essential. But it's not fun. Like, don't get me wrong, I don't want to reconcile my amex like I want the points. That's why we got it.

And even though we want to be there amazing entrepreneurs and business owners and fun and creative, we've got to do all the nitty gritties no matter what.

It just becomes so cloudy and messy. Whereas every day, if you have a debit card associated to your business account and it's in your wallet with your personal you can go all right, well coffee personal, but oh, you know, I'm going to office works, I'm just gonna pop this office works charge on my business card. Where so many times when I used to do this, I would just tap my card at office works and be like, whatever,

I'll work it out later. Spoiler, I never worked it out later, and I was using post tax income to pay for business expenses that I shouldn't have been paying for with post tax income, right, Like, all of that is meant to be a business expense. So I'm shooting myself in the foot when it comes to the bottom line of my literal business and what profit I make and what loss I make. So I think mess is

one reason. But then secondly, if it is really messy and you want to do stuff in the rest of your life, for example, you want to purchase your first home brick like, a bank wants to see usually at least twelve to twenty four months worth of clean business expenses and profit in your business, and if it's tied up with your personal stuff, they're like, oh nah, it's not legit. Well we don't want to Like, once you've separated that, come back and talk to us. It is

a nightmare. So making sure that everything's clean is going to mean that the rest of your life can keep going on. If you want to purchase property, if you want to get loans, if you want to, you know, make a business loan, the bank is going to want to see all of your business accounts and make them really clean. They don't care about your uber eats like they don't want to see that, not want restatements and

go oh well, bar, is that a business expense? And you go, oh no, that wasn't business, that was actually personal and they go okay, great, what about this one at the cafe fifty times in one day? Like they're gonna ask. And the reason that you want it to be clean is so one life can keep going on. But also your business accounts are really clean, like you're going to know if the business is in trouble sooner,

if it's not messed up with your personal accounts. You're going to know if the business is successful sooner, if it's not messed up with your personal accounts. Like everything I promise is better once it's separate. Also the stress, Like do you know how good it is knowing that I can just go onto my online banking, download the excel file, send it to my accountant and be like, hey, that's all the business.

they're like, what's this from fate? And I'm like, oh ah, sorry, can you just transfer that over and then you have to fully reconcile it.

your business is going to turn into. So it's best to just cover all those grounds and just set yourself up for success from the beginning, even if you aren't sure where the business is going to go.

for years later you're like, oh, actually, what's this. Oh actually, what's like we just don't want that, Like we want to make sure that we are caring about it. The other thing I want to say here is around the

structure of that business. And I'm sure you've gone through this where it was in your personal accounts and you're like, well, yeah, and then things started to get serious and then you went to an accountant and they're like, oh my gosh, Britt, what are you doing that rating as an individual.

tax rate. So really quickly, if you're paying it at your marginal tax rate, you're being paid into your personal accounts, and you start making bank and you're at the highest marginal tax rate, you'll be paying tax at least forty seven cents in the dollar, which is not that sexy. Whereas the company rate is thirty cents, and like, I know which one I would prefer to pay. Obviously, it's going to be different when you distribute that income or take income out of the business to pay for your

personal life, but that can come later. But at least you're making sure that your business income is maximized. Like that's a difference of at least seventeen percent, Like you are seventeen percent better off. Ye a lot of the time if you're you know that highest marginal tax bracket, putting yourself into a company for that, and it is expensive to set up up, but it pays for itself

over time. It's also meaning that you know, nobody wants to get sued in business, but they can sue the company instead of you personally.

for new businesses? And what would you say? Are there pros and cons? Are you all four people taking out loans?

work out. Whereas if you came to me and said, hey, I've got this really brilliant opportunity, and you know someone selling a business tried, true tested, been around ten plus years, draws a profit, and I'm going to purchase this, That's a very different conversation than taking out a loan. To back yourself, and don't get me wrong, I think we

all should back ourselves, but to back an idea. So backing an idea and taking out debt to me is very different taking out debt for purchasing a pre existing business, and those are different conversations. Am I against business debt? No, I've never had it personally. And the reason I haven't ever had it personally is because I just I don't want to owe a bank money for a business because I know that that's not something that if it's not working,

I can sell it right. Whereas a mortgage. If I go and lend money from a bank to purchase the property, which I have done, I know that if my life goes to shit, I can sell that property, pay the bank back, and we're all clean and good and like in a perfect world we all break even. But you

can't do that with a business loan. That's why the interest rate on them is so much higher because they're like, oh, there's a little bit of risk involved here because it's coming down to you having to put the work in. So I feel like avoiding debt as much as possible

is a good idea. Funding options, there's lots. I think that it is silly of people to not look into business grants, like there are so many grants there are so many schemes, so many like accelerated programs out there now that I think everyone should be putting their hat into the ring for Like what's the worst they say, Oh, no, okay, no worries, thanks so much. At least I put my hand up for that ten thousand dollars grant. Imagine if

I've gotten it, it would have been great. But I think so many times, especially as women, we don't put our hands up for opportunity because we go, oh, they're not going to pick me. Yeah, but what if they did? What if they did pick you? It would change the trajectory of your business. So I think just putting your hat in the ring and going I don't care if

they say no, it was worth a crack. Like so many of the things that I've put my hand up for, I've been like, this is a bit of a joke, right, Like this is wild, Like I don't know why I'm bothering. Have come to fruition and I'm like, oh, holy, holy moly. Like I remember when I got nominated for the Telstra Women in Business Awards and like that was really cool, But that just means that someone had put my hat into the ring. And said, oh, they should be considered. Yeah,

But I then had to do my application. I was like to my team, this is not worth it, like don't bother like you know, not going to do it. We made finals and I was like sorry, what, Like this is insane. So I think putting your hat in the ring is really important when it comes to funding it.

You've got personal you've obviously got loans, and you've also got bringing on a business partner, and I think that you need to really consider what that actually means for you and your business, because that's a bigger decision than just like, oh, brit seems nice, we should do a business together.

We're not doing it. It's not a thing. You are not good at picking business partners. We're done. And I was like, okaying to worry, thank you, thank you. He's like, you need to back yourself more. Like so many times, I'm finding like now again, in retrospect, I look at it and go I picked that decision because I thought it would make my life easier. I thought it would make the business more successful. I didn't back myself enough to know that I could have done all of that

on my own. It just would have taken a little bit more.

it comes down to it. The reason I made those decisions was because I was like, oh, this will turbocharge it and get us ahead, and you know, be what I want. But ultimately it's not because they're not on the same page as me. We don't have the same ideas. We do want to go in different directions, whether that is content creation or it is you know, the size of the business or the ethics of the business. Like, it doesn't matter what it is, We're just not on

the same page. Because the person who knows your business and what you want to create with it, the best person to know that is you. And you can't convince somebody else to love your business idea as much as you do. Yeah, and I think that that is really hard to wrap your head around. And yeah, there's something really satisfying knowing that you know, I started all of this. I've made a lot of very expensive mistakes along the way, and I'm happy to talk about them because I think

that other people can learn from them. But you need to back yourself. And if backing yourself means it takes another year, like that's incredible, because the outcome of being able to say I did this all on my own is amazing. Knowing that I don't owe anybody any money for my business is so gratifying going to bed at night knowing that I don't have to turn a profit in my business to pay a bank Like, it's just so nice knowing that the success of my business is dependent on me or on somebody else.

you going to get into some hot water? And if you are, like, are we going to pivot and change the business name from the start so that we just don't need to go through that jung.

these little things matter. So I think making sure that you're dotting all your eyes and crossing all your te's and kind of keeping stuff internal. It's so hard when you're so excited, but making sure that you're putting yourself first and setting it up for success from the beginning is really good. I mean I suck at instant gratification,

like I'm that kid with the marshmallows. Like you've seen that right where the kid gets offered a marshmallow and said, if you can watch that marshmallow for fifteen minutes, when I come back, you can have two. Yeah, but I've already eaten it, like I just can't. And I think that's what's hard about business because we are so passionate and want it right now, but we know that if we invest slowly and consistently over time, that's where real

wealth comes from. And I mean I'm an ex financial advisor, so I know that. But I also really struggle with instant gratification. So I feel like that's where I connect with my audience because I'm like, I get it, babe. I suck it about it like I suck it with it too. But what we need to do is this, And like sometimes the thing that we need to do is it's not as fun, but that's okay.

going to use that Visa gift card for. You're going to use that for all of your free trials and all of your subscriptions because you have to put in a credit card number to sign up for a Netflix trial or what and then how many times do we

forget about our Netflix trial? Yeah, we are going to get Visa gift cards because not not normal gift cards, but Visa gift cards come with the credit card number in the CCV and the expiry so we can pop that in get our free trial and it not cost us a whole heap of money when we forget trials, and that can see in your wallet and you can use that because we're not going to actually spend the five bucks or ten bucks or whatever we've put on it.

We're going to use it for our free trials to make sure that our credit card details are safe as well. So if there's ever like a website that you need to put your credit card details into too, right hack, that's what we're going to do. So it's like a finance one, but it's like keeping you safe. And I feel like that's worked for me a number of times. And whenever I tell friends, they're like, why didn't I think of this?