Scott Pape has started somewhat of a financial revolution.
His bestselling book, The Barefoot Investor, doesn’t offer a get-rich-quick scheme, or load its pages full of complex jargon about stocks and spreadsheets.
The financial expert has one simple philosophy: You just want enough money to be okay no matter what. At some point we will all face unexpected hardship, whether it’s the loss of a job, your house burning down (as happened to Pape) or a health scare. We don’t need to be rich. We just need to be safe and secure. And Pape offers his readers a clear plan which, if followed, can alleviate the financial anxiety so many of us live with.
In his recent interview with Mia Freedman on the No Filter podcast, Pape said on the first Tuesday of every month, he takes his wife out for dinner on what he terms a ‘Money date’.
POST CONTINUES BELOW: Listen to Scott Pape give his best advice for single women.
Over garlic bread and wine, Pape and his wife discuss what they value, what they want to spend money on, their investments, and just about everything relating to their family finances.
But, what if you don’t have a date?
Freedman asked Pape what his advice would be for single women who want to get a head start financially.
“The smartest thing a single woman can do with her money, is understand that a man is not a financial plan,” Pape said.
“You don’t have to wait around for some event to happen, because Romeo could turn up in a leased BMW and be more shit at money than you…”
More specifically, Pape says that you should find a bank account that doesn't charge you fees. As trivial as it might sound, "it's just a little boost."
"It's small steps," he explained. "And it's building confidence that says no matter what happens, whether I get married, whether I don't get married, whether I get divorced, I can sort this out."
Most of his steps are intended to be done on your own, and at any age.
It works on the principal that you put your earnings into different 'buckets' - some to spend, and some to save. It takes the decision making out of it, and isn't about sticking to a budget.
There are three separate buckets:
- The blow bucket (daily expenses, bills, food, splurging)
- The grow bucket (this is long-term savings, for a house, a car, etc.)
- The mojo bucket (this is for 'safety' - you don't touch it unless it's an emergency)
That way, you have short term, medium term, and long term savings.
The idea is that day to day you have two separate ATM cards. One is for stuff you need, like bills and groceries. The other, is for splurging on whatever you want. Pape advises that 10 per cent of your income goes into splurging on things like clothes, books, tickets to events, scented candles and so on. And the best part is, you can do it guilt free, because you know you are saving at the same time.
Oh. And when it comes to the date night, Pape says if you're single, you're not getting out of that so easily.
Instead, go to a restaurant or a cafe for your money date. And bring his book.
It's about carving out time in your schedule to think about your values and your priorities, and ensuring your finances reflect that.
And we can treat ourselves to a glass of wine while we're at it.
You can listen to the full episode of No Filter with Scott Pape, here.