What to do with disposable income

[Philip]

At the moment I have AUD$5000 (and slowly growing) sitting in my bank. There are several things that I would like to do with this money such as buy clothing (duhh), books, move out, go on vacation, and just general frivolous spending. However I'm at a point in my life where I can really say to myself I don't need any of these things right now...well except moving out which is probably the one thing that could make me happy right now but I'm quite accustomed to dissatisfaction so no biggie. Apart from that I'm happy wearing the same old thing again and again and as for books I can always just try my luck at the library.I'm an undergrad right now (no loans because I'm not studying in America) and have no financial commitments,so what I'm wondering is how do I make the most of this money investment-wise? And when I say investment-wise I mean both in making more money, and in progressing my potential career.

I have no business sense and am very unfamiliar to the practical sort of things that most people deal with, but what I lack here I make up for in sheer effort and learning. I'm sure I will get several short answers such as develop a business idea or start a stock portfolio but seeing how I'm a marsupial you'll have to inform me about the bleeding obvious before I get anywhere.

As for my current goals career-wise I have none. I really have no concept on what I should be doing apart from the fact I seem to be heading towards professional writing/academia and this is fine, all i really care about is that I'm doing something and my aptitude for it is anywhere above mediocre. So what kind of things could I put my money towards to help me out with this sort of profession if I'm going to pursue it?

 

[javyn]

First thing, reject the whole concept of "disposable income".

Sorry I can't give you any advice though, it's hard enough for me to decide to do with my own money, let alone advise someone else. I'm sure someone more helpful will chime in.

 

[Biscotti]

Travel...invest in experience; those you will always have, and you are not tied down by anything or anyone at this point in your life. Such may not be the case in the future; I also feel traveling, experiencing different people, places, etc. strengthens a man. Speaking from my own life, I've just never found clothing, books, whatever to really make me all that happy. Five grand spent right really can go far.

 

[Philip]

travel interests me a lot but I don't see anything under 20 grand getting me that far. I don't like the idea of a 'vacation', I'f i'm going abroad I would like to go continuously for as long as possible (i'm thinking years here). This is something I actually intend to do after I graduate and before i go back into postgrad.

Antarctica alone is going to cost at least four grand and I'm already living in one of the closest countries.

 

[stevent]



First thing, reject the whole concept of "disposable income".
Sorry I can't give you any advice though, it's hard enough for me to decide to do with my own money, let alone advise someone else. I'm sure someone more helpful will chime in.

+1

Although I'd say invest it in something depending on how much risk you want to take

 

[imschatz]



travel interests me a lot but I don't see anything under 20 grand getting me that far. I don't like the idea of a 'vacation', I'f i'm going abroad I would like to go continuously for as long as possible (i'm thinking years here). This is something I actually intend to do after I graduate and before i go back into postgrad.
Antarctica alone is going to cost at least four grand and I'm already living in one of the closest countries.

That's ridiculous .. if you're going to try and save up $20k and try and do everything at once .. I highly doubt you'll ever go anywhere.

If you want to do something .. take a few months to do SE Asia. Probably do it for next to nothing from Australia - 3/4 months for like $2k. Live/work in the hostel's and just experience the traveling/backpacking lifestyle. Meet some amazing people (even more amazing women) and don't forget to have a few drinks.

 

[Philip]



That's ridiculous .. if you're going to try and save up $20k and try and do everything at once .. I highly doubt you'll ever go anywhere.
If you want to do something .. take a few months to do SE Asia. Probably do it for next to nothing from Australia - 3/4 months for like $2k. Live/work in the hostel's and just experience the traveling/backpacking lifestyle. Meet some amazing people (even more amazing women) and don't forget to have a few drinks.

Hmm why would you doubt that?

 

[Canadian]

I have never had more than six thousand dollars in the bank. I keep 3900 in a tax shelter and the rest I've wasted. I make about 1300/mo.

Although I'd like to move out, my parents are very good to me. I'm 28 and at the point in my studies that I can suck it up for a few more years in order to complete my grad school coursework. I've lived on my own and had a terrific job, but working for my father is good right now. Basically I make peanuts for money, and I get a jeep, all expenses related to my jeep, the odd vacation and some spending cash.

There is absolutely nothing called "disposable income". I put some money into a fluid tax shelter every month. Basically I put aside 300/mo and can access it at any time, while not paying taxes on the capital gains (the shelter is callled a TFSA and is designed for investments where you pay income tax solely on the initial funds). There is another shelter called an RRSP which is less fluid, although you can borrow against yourself for your first house.

Instead of "disposable" income, I break it down like this.
-Entertainment/discretionary
-School
-Phone bill
-Debt
-Investments

Stuff like that. Instead of thinking of your savings as something to be plundered, keep adding to them and only spend money on things which make sense. Tonight I went out with a friend for dinner and a movie. Last week I went out with a girlfriend. That comes out of discretionary funding. But my tuition, my phone bill, my textbooks etc are all taken care of because I pay them second.

I pay my assets first of course. If I owe 40 dollars for a phone bill and I need 40 dollars for a textbook, I buy the textbook first. Credit rating aside, buying a textbook translates into better grades, while a phone is just a tool. When my phone plan expires, I'm switching to a different plan (pay as you go).

As for investments, learn while you're young. If you lose 10% off a thousand dollar investment, that's a lot better than losing 10% when you're dealing with retirement money. Take advantage of any shelters the government has available.

And as for travel? Go camping in a state park? Go hop on a Greyhound and head around the country. Instead of thinking travel means a year in South America, travel can be four weeks hostel-hopping in your own country.

Tom

 

[imschatz]



Hmm why would you doubt that?

How many people do you know who have finished school, started work, saved up $20k+ .. then taken 2 years off to go traveling? I don't know any. Most people I know, start their careers, and it's often years before they even take a week off. Once the rat race starts .. that's it.

 

[Philip]



I have never had more than six thousand dollars in the bank. I keep 3900 in a tax shelter and the rest I've wasted. I make about 1300/mo.
Although I'd like to move out, my parents are very good to me. I'm 28 and at the point in my studies that I can suck it up for a few more years in order to complete my grad school coursework. I've lived on my own and had a terrific job, but working for my father is good right now. Basically I make peanuts for money, and I get a jeep, all expenses related to my jeep, the odd vacation and some spending cash.
There is absolutely nothing called "disposable income". I put some money into a fluid tax shelter every month. Basically I put aside 300/mo and can access it at any time, while not paying taxes on the capital gains (the shelter is callled a TFSA and is designed for investments where you pay income tax solely on the initial funds). There is another shelter called an RRSP which is less fluid, although you can borrow against yourself for your first house.
Instead of "disposable" income, I break it down like this.
-Entertainment/discretionary
-School
-Phone bill
-Debt
-Investments
Stuff like that. Instead of thinking of your savings as something to be plundered, keep adding to them and only spend money on things which make sense. Tonight I went out with a friend for dinner and a movie. Last week I went out with a girlfriend. That comes out of discretionary funding. But my tuition, my phone bill, my textbooks etc are all taken care of because I pay them second.
I pay my assets first of course. If I owe 40 dollars for a phone bill and I need 40 dollars for a textbook, I buy the textbook first. Credit rating aside, buying a textbook translates into better grades, while a phone is just a tool. When my phone plan expires, I'm switching to a different plan (pay as you go).
As for investments, learn while you're young. If you lose 10% off a thousand dollar investment, that's a lot better than losing 10% when you're dealing with retirement money. Take advantage of any shelters the government has available.
And as for travel? Go camping in a state park? Go hop on a Greyhound and head around the country. Instead of thinking travel means a year in South America, travel can be four weeks hostel-hopping in your own country.
Tom

Hmm will defs look into this thanks for the advice

 

[ter1413]

....

 

[Philip]



How many people do you know who have finished school, started work, saved up $20k+ .. then taken 2 years off to go traveling? I don't know any. Most people I know, start their careers, and it's often years before they even take a week off. Once the rat race starts .. that's it.

Quite a few but none of them work careers that are really considered part of the 'rat race', as for myself I don't even have the qualifications to work a typical office job.

This is exactly what i do not want. I do not want to rush out of school to simply rush into a career.

 

[Biscotti]



Quite a few but none of them work careers that are really considered part of the 'rat race', as for myself I don't even have the qualifications to work a typical office job.
This is exactly what i do not want. I do not want to rush out of school to simply rush into a career.

This is what you may say now, and this may very well be the case; however, this is also the typical ideal of so many undergrads. Gauging what the future may hold is extremely difficult - you don't really know yet what opportunities may come along...you may get offered a job too great to pass up upon graduating, or fall in love, etc...

 

[Fuuma]

Buy a Jacobsen Egg chair.

 

[SkinnyGoomba]

Nice. Fuuma you have great taste in furniture, I really liked your use of an lc3 sofa on the polished concrete floor in your place. That was one of a few pics that inspired my purchase of the lc3 armchair from cassina.