Jaimie: Well, my guest today is Alpha Schulte. Now Alpha has over 20 years of experience in the accounting and finance industries. Starting out as a corporate tax accountant. Alpha soon realised that she had more of a passion for personal finance and studied a Diploma of financial planning. Now Alpha helps women business owners understand their values, limiting beliefs and habits around money and how to build wealth for the lifestyle they choose. Alpha, welcome to Pitch Perfect.
Alpha: Thank you very much, Jaimie. It's a pleasure to be here.
Jaimie: I am so happy to have you here because you are in my world. You are a proud member of PR club and couldn't wait to get you on the podcast. So many questions. The first one I guess I want to know so many people probably want to know is why did you decide to specialise in women business owners in the finance part?
Alpha: Yeah, that one it didn't start that way. Because when I when I started on my my personal journey, because this is how it began. I realised, oh my gosh, there's so much that we don't get taught in school. There's so much we don't learn this oh my goodness, so many so many mistakes that I made and I watched my parents make and I thought everyone needs to know this. So I started out trying to spread the words about just generally finance and I encountered a lot of different responses particularly from from from men. They really wanted to know about crypto and it was all about investing as a bit there's so much more than that. And then there was a lot of fear that women had around even talking about money or even acknowledging they didn't necessarily know and they didn't want to make out like they didn't know so I thought I really need to. So I then was all my clients were women. And then I found that in order to sort of have the motivation to do it, it was more women business owners who really had the you know, because personal development journey hits you like, like a brick when you're when you're in your own business. And so you have to learn these things because your livelihood depends on it. So it kind of just narrowed down to that almost organically and that's that's pretty much all I mean, I'm happy to help any woman in particular because I think my message is probably am I approach is probably more suited to women. But it tends to mainly be women, business owners or entrepreneurial characters who are drawn to me
Jaimie: So what are some of those mistakes that you made?
Alpha: Oh, credit card debt was one and that was one thing that I watched my parents get a lot into. And I still ended up repeating that mistake because we have these beliefs and habits and stories we tell ourselves unless we deal with them. They they rear their ugly heads. And also I'm quite risk averse. So not really knowing that I didn't I, I took a long time to even start the investing journey because I was just too scared to do anything. You know, I'm sure I gather a lot of it. And then I still want it and I was like oh what do I do? What do I do like I had analysis paralysis. I didn't kind of watch into anything. I'd watched my parents make some pretty random property decisions, because they're both immigrants from Europe and the Europeans were all into property. But I watched some things work and some things not so it's like well, not all property is good. So I can't just launch into that. So that was there. Probably my two main mistakes was getting into personal debt. And then also being a bit too meek when it came to investing when there's so many different ways to invest and also just not generally taking risks when it comes to earning income and jobs and stuff like that. So I think once I got a bit older and a bit more brave. I began to and gather knowledge as well. And that was a big part of it. I yeah, I did a lot of learning.
Jaimie: So relate to that. So just a quick personal story. I actually got my first credit card when I was 18. And I spent years in debt in fact, I think it was my early 30s that I actually was almost 80,000 in credit card and personal loan debt and I just one day I read a lot of you know, Dave Ramsey, I listened to his podcast that the snowball method where you the idea behind that is you pay down your smallest debt first. Regardless of the interest rate. So it gives you that momentum and that rural morale boost and then that works for me and I got out of debt. And I vowed to never ever get a credit card took me about two or three years to pay it all off and I vowed I would never get a credit card ever again. was funny though because just recently we've moved into our brand new house we've been building and the funds got really low. Like I'm talking we had like $1,500 left in our account because they did pay 40,000 to get a new driveway, a new deck, you know, blinds and shutters all this sort of thing. And I was so tempted to get a credit card but I thought no, I'm gonna make this work. How can I get extra money so I started selling things and then talking to the bank. Yeah, back up again and it's now a lot more healthy, but I will never get a credit card again. I think so many people fall into that trap. Do you think as a business owner, it's worse when people have that kind of that temptation to use a credit card, especially when they're starting out their business to be able to pay for a new website and some Facebook ads and all the expenses required to starting up a business.
Alpha: Yeah, it's um it's a tricky one and it is very personal dependent because it I guess in a way it comes down to the beliefs you have and also the how much trust you've got in your own willpower, or your own ability then to pay it back. Definitely when you're starting out a business, even if it's an online business, there's still capital outlay and capital outlay can tend to get you into a bit of a debt spiral and then how to build up the income to contend with that. I deal with a lot of business owners who are in their startup phase, and I often encourage starting their business more as a side hustle so they've still got some steady income to go and like just try and build up a certain cover and work within that when I first started. I was very scarcity mindset. So I was I was trying I didn't you I didn't pay for Canva. I didn't pay for zoom. I was trying to do everything as low cost and you know, the free versions. And I came to realise that you know what? This is actually constraining me. So I was like, I need to build up a little bit more of a buffer financially, and I'll budget that into into my business. And it's it's interesting when we think of budgeting when it comes to our personal finances, but with the business you've got to do it almost even more so because your income fluctuates so much but your expenses tend to stay quite steady. So it's a different methodology for how to go about it. But yeah, as far as credit cards go, I have a credit card, but I pay it off every month. So I find I then have buckets of money where I make sure that I save for things and if I know there's a big expense coming up, like you know, my annual mastermind or a Kajabi invoice or whatever, I have that money sitting there so when the bill comes I can just pay it off, but the payment comes out of the credit card, partly because a lot of payment systems these days are just set up for credit. Even with like a debit credit card. Sometimes it's a little bit I've always used my credit card or like a debit card when I was 18. I got a credit card, because I was travelling, but I put money on it. But then, you know 10 years later, I ended up with actual credit card debt. So I was like that's why I was just so amazed. I can end up in that space, but it hits us all. So yeah, so my answer is it really depends on what your experiences are. And if you've been burned by credit card debt, I can totally understand not having one and I applaud you for being able to manage without it because it's really difficult and the way our world is set up.
Jaimie: Absolutely. I think, I think it's funny how you can sometimes help others coming from a position where you've made mistakes that you've been there and you can relate. So yeah, I'm really happy to say we didn't get this is a personal item. I've got a credit card in my company account, but my personal I never wanted to get a credit card again and never will and I hope I can instil that into my own children's values. When you talked before about things that we aren't taught at school. Why do you think we are taught this stuff? I mean, it's 2023. Surely maybe they've changed the curriculum. I'm not sure my kids are too young to attend school yet, but why don't they teach basic financial principles even budgeting in schools these days?
Alpha: I don't know. And yeah, just before we hit record I mentioned I've got my goddaughter is about to turn 18 And I've got a cousin who's in her last year of school, they have no idea about money. So it isn't getting taught. Maybe selective schools are choosing to bring in some curriculum elements of it, but I think mainstream, it's not there and it's you're right it's 2023 We should be being thought about this. We've just gone through a pretty bumpy financial process and we're you know, heading you know, there's there's debate as to whether or not we're heading into recession, to be honest, I feel like we are but anyway, that's another topic, but it should be taught and I could put my cynical hat on as to why I think it's not being taught because a certain degree of ignorance means that you can kind of control the narrative a bit more. Not that I don't know maybe it's too hard to teach people about money because you have to when you when you teach the principles of money, you kind of have to delve into the mindset side as well because they go hand in hand. And that is tricky. Like I get that would be almost impossible for a teacher to try and handle in a schoolroom environment because it would bring up stuff. And it would also then bring up the differences between what some families have and what's in some families don't have so perhaps that's that's does that make sense? Yeah. Come too much of a minefield. And that that's possibly there. It's all conjecture, really, but it is it does bring up stuff. But to be honest, it's better to bring up the stuff when you're like 16 to 18 than it is when you're in your 30s and 40s when it starts to really impact you and that starts to impact
your children as well.
Jaimie: So true. Even if I was taught at school, if you get a credit card, it's not your money. You need to pay it back eventually at a higher interest rate. And here's how accumulative interest works or compounding interest works or even if they just created something and then they might I don't know, but they do something where they give everyone some play money and they say you've got this amount of money. Let's do a budget for your groceries. That way you can electricity costs, just basic budgeting that would have helped me so much as an adult, rather than just thinking money literally grew on trees, you know.
Alpha: But that compounding that is a it's a really and that's something that could teach in Math like and they probably do, but they may not relate it to the concept of money. But compounding something that I find a lot of a lot of clients and people I speak to, they sort of understand it. But then when you really start to put the numbers down, they're like, oh, and it's not just about the interest that you pay, like whether it's on a credit card or mortgage. It also can work in reverse. So especially at the moment when interest rates on cash are higher than I have been in a while because obviously the interest rates on debt are also higher. It can also work for you as well. And even with investing too, you know the earlier invest in that nest egg can just grow and grow it's that compounding effect actually can work in your favour. But we don't hear about the good side of it all that much. we all we all hear about like a concern or a fear side because that's more news curvy.
Jaimie: Yeah. So true.
Alpha: But it's important to balance out the story.
Jaimie: Yeah. And so how can people how do you help people in today's day and age business owners? How can people get involved into your world and how can you help them in a practical sense?
Alpha: So I have quite a holistic kind of reach and this is why while I studied financial planning and I started to go down that path, I never actually became like a fully fledged financial planner because I feel like a lot of what they are able to do within the boundaries of the industry is very constrained. There's a lot of stuff that happens beforehand. You know, like I said before, about you know, our values, what do we what do we what do we value in life? What kind of a lifestyle Are we even heading towards? There's this whole kind of you know, you grow up you get educated you get a job you buy a house okay, so But is that really right for everybody? Some people might want a tiny home on a big block of land out in the in the country. Some people might want the big you know, house and the you know, the fancy car, what are we heading towards and it makes it really difficult to plan financially if you don't actually know where you're headed. So I start out working with clients to understand their values and their lifestyle. And then we look at beliefs and stories as well because a lot of that will constrain people. Once they get to the point where they have to start making decisions or patterns will start to evolve. They're like, Oh, I can never do that or that never works for me. I was like okay, let's unpack why that never works. And let's figure out how to maybe break the pattern or the cycle of how it's always gone for your family, if that's the story that you're telling. So I tend to start a lot with what I call the first sort of foundations. And then we look at some of the fundamentals of you know, the kind of buckets like you have an emergency fund in a business. Do you have like, planned out what your expenses are for the year are they peaks and troughs how to plan better for those, how to talk to your accountants, you know, what are they talking about when they talk about a balance sheet or profit and loss? What kind of metrics do you need to know to try and demystify it so, so scary as well? And how to make it kind of like, okay, well, this is what happens when this like what's the consequence of making this decision or to click through rate? So that's more the business side, but I'm also very interested in making sure that business owners understand how it impacts their personal lives as well because you know, do you want to save your children? Do you want your children to go to private school? What kind of retirement Do you want? Do you want to go on a holiday every year? And if so, what kind of holiday just to try and figure out how holistically to make it all work. And then to get the mind aligned with that so that you're making decisions that are actually working for you rather than you kind of going oh, well, what am I just I'll just do that or, oh, that sounds really great. I'll get that. And it's all very reactionary. It's it's, there's no real intentional plan behind it or strategy. So that's where I come in is to try and help clarify and demystify and support.
Jaimie: And so do you work one on one with people when you do those kinds of sessions?
Alpha: I do work one on one, I've launched a membership as well. So there's a bit of one on one and then a group environment. So there's some support, and I have an online course which people can do that sort of more the basics. And that's that's very much foundational where it looks at values, it looks at income. So I have a five step process there where we look at how to make more income, how to look at spending, saving, investing, and then the legacy impact because the other thing too, not many people well, I shouldn't I shouldn't generalise, but there's a lot a lot of families out there that don't have wills, how to manage things when you're gone, or even even now how do you want to manage like, for instance, I'm part of the sandwich generation. So I've got a young daughter who's eight and I've also got parents and they're at my in their 80s. So I'm sort of managing your young primary and then also what to do with ageing parents too. So trying to figure out how to manage, you know, enduring power of attorney and health directives and all of that as well. So helping everyone navigate that and know who to talk to and what terminology what to ask. So that it's not quite so scary.
Jaimie: Yeah, it's it's one of those things that you think I don't need to worry about it because it's not going to happen. And yeah, actual so many people think that way and put it off.
You mentioned an emergency fund and that's something which, you know, I hear about through like Dave Ramsey, for example, who I talked about, one of the financial gurus in the States. I listened to his podcast for years and got me out of once I got out of debt. Actually, I stopped listening, but he has all these different steps like baby steps, and he talks about an emergency fund and one of those steps I think he suggests six months. It's interesting how you said an emergency fund for your business as well. It's not something I've heard or even thought about before, so do you is that something you suggest having a six month buffer or or a three month buffer if the money was to completely stop coming in? Is that the idea behind that and how does it work in the business sense?
Alpha: Yeah, so it's because small business especially if it fluctuates, and unless you've got to have like a membership where things are a bit steadier, or even if they are things can go up and down. It's just just to have and you can have it as a same account really, but depends on again, depends on how you personally like to operate. I like to have things separated, just because it's easier for my brain to like compartmentalise it when I can see it separately, but I also then manage it. So there's sort of like the the bills fund and an emergency fund. The emergency is really not as important for business. Again, depending on what kind of business it is. If you've got equipment that could break, then yes, it's very important. If you're an online business, it's probably more important to have sort of an overarching bills account. So that when you do have those ups and downs, so it is dependent on the business model and the structure of it, but it's really just to cover the ebbs and flows. So if there's a like for instance, last year at Miami or actually before now, we have our I was gonna say emergency fund. I also had a car fund my personal side because I knew I had a very old car that would need replacing, and sure enough to use in it needed replacing. So I was like, Okay, great. I've got the money sitting there and that just covers that but then other things so you know, like there'll be you know, even my new car needed new tires, or you know, the washing machine breaks or something like that, and that's what the personal emergency fund is for in a business. It's a little bit different. So just again, depends on what you need it for, but it's handy to at least think about and consider and to go do I need this or am I happy to just have a fund to cover the big bills that I know we're gonna come in, you know, business insurance that comes through or do you pay stuff monthly? How is it set up? And just to have a plan for it so you've at least got it's not reactionary?
Jaimie: This is a really great reminder for me because I used to do this I used to have an account for groceries and then bills and then entertainment eating out all that sort of thing car insurance, you know operating expenses, and now I just put everything into an offset account against our mortgage and destroy it out from that. So it's a really timely reminder. So do you recommend having these different accounts for groceries and you know, you've only got a certain amount that you've budgeted for and if you run out at the end of the week or month or fortnight however you do it you need to go to the cupboard and get some canned food and make what you can out of the pantry. Is that kind of how what you recommend?
Alpha: Yeah, so I do like but because you can have a lot of fun. A lot of banks now will allow you to have multiple accounts that are still sitting under your offset so you can actually divvy them up. And again, this depends on on your own personality. I've got one client who takes cash out every week for groceries. And I was like that's that's my grocery fund for the week. Because basically it's kind of like the old envelope system. Yeah. And she does that and that's and that works and if she's run out of money at the end of the month, and at the end of the week, she doesn't weekly. We can do it monthly depends. I probably work better weekly because monthly I'd be like I'd spend the whole thing in one week especially when the farmers markets on. But then and then it then comes down to like we just went away for a month and I made a point to eat the pantry and eat the fridge and it was actually really good because I was like, You know what, I've got so much food sitting in here and I just keep adding to it. Rather than like getting creative and pulling stuff out. Going “Oh can I make with this?” And and then I actually started to eat through the food and then some of it was expired and other things. I was like well, I can actually give this to a food bank as well, rather than just like hoarding it myself. So it's, it's actually a really good exercise to do just to minimise clutter as well. But then also to get a bit more disciplined and thoughtful with food and then you start to plan and when you plan you also eat that up. So you know much more nutritious foods and stuff so it actually has like a more holistic effect as well. But yeah, so I do like the bucket system. I don't go quite as sort of small as like groceries and car. I tend to have what I call for me a bills fund. Then I have a ‘fund” fund, and that's for anything entertainment, travel, whatever kind of comes into the fund category goes in there so I managed my bucket a little bit differently, but again, it really is what works for you. There isn't a you must do this this unless this way or
Jaimie: Is your groceries come out of your bills, funds do they?
Alpha: Yeah, right. So so I just have generally so I put a certain amount in there. So I've calculated my annual budget and then I put a certain amount in every month and some months I'll use up the amount I've put in other months I won't and then that will cover also things like car insurance, health insurance contents, what you've nailed in all the insurances and all the other you know, car repair and tires or whatever else might come up.
Jaimie: I’ve learned many hearing this because I'm just thinking out loud now. Even CommBank who I have my my banking with, they actually even already categorised all your spending so that he can go in there every month or even the last year and see how much you've spent on groceries and eating out all that sort of thing and that can help you work out a budget.
Alpha: Yeah, a lot of banks will do that. Now there used to be separate apps. I've tried out a number of apps over the years and I found them a little clunky because I spent more time trying to recategorise the things I got wrong, whereas the bank accounts actually tend to get it quite right. Also because they noticed your behaviour. And they'll see if you've categorised something that they got wrong, then they'll take that the next time so they learn that Yeah, so it's quite handy. To have a look at and it's often a bit shocking at first and you're like oh wow, I spend that much on groceries. Okay,
Alpha: Let's. let's fix that.
Jaimie: So true. And then you actually also now much would be no, but you can go the chat GPT watching it on the show. I was morning shows the other day and you can type in all the ingredients that you have in your fridge in your pantry. And you can say create a recipe based on these ingredients only adding all the ideas just using what you've already got in your cupboard or fridge. How cool is that?
Alpha: That is awesome. Yeah, so that's that's that taxi and that makes it so much. There's so many tools now that make things easier like even investing. There's so many there's there's no excuse to not be able to do things because of chatgpt can help you meal plan. And I'm assuming you could also say make this nutritious or vegetarian or pescatarian. I would probably do that too. I would imagine.
Jaimie: Probably. Yeah. So this is really motivating me. I'm going to go from here and start doing a budget because I haven't got one and also so many times we'll just go through drive thru our finish late at night and like I was gonna get a KFC late and I haven't planned and meantime the pantry keeps building up and in the grocery bills and we threw out some means this morning which we didn't get around to cooking. So I think that there's so many messages in these for not only myself but so many people generally listening to this podcast. So how can people get in touch with you out there if they want to work with you and help have that foundational meeting to to get things straight?
Alpha: So I do, I do a discovery call if anybody's interested in just finding out a bit more but I guess socials is probably the easiest so on. On Instagram it's @alphamoneymadesimple. My email address is also alpha@money_madesimple.com.au and I'm on Facebook as well MMS- Money Made Simple. And my website is just money_madesimple.com.au and on there you can find you can contact me that way and there's all sorts of other pieces of information. Yeah, lots of free stuff on there too to kind of help. I've got webinars I've done which I've put the recordings on there too.
Jaimie: That's great. And if you're listening to this podcast, you can't see Alpha’s fabulous earrings. They're like piggy banks, I think giant bright pink piggy banks dangling with $1 sign in the ear. I love it is that your signature sort of style. You have a whole variety of those types of pieces.
Alpha: Well, I have I have calculated earrings. I've got a Yeah, I found that I do love I'd love earrings. And I found these ones. I was like oh my god, these are perfect. And my daughter is like no, no, no, look at that. That's just you. That's funny, right? Simple. I was like yeah, so I tend to I tend to wear them when I'm doing interviews and things but yeah, I just I try and you know, have flowers or I'll have rainbows. It really depends. But yeah. Because money can sometimes be a bit of a dry subject.
Alpha: Yeah. Jazza with jewellery.
Jaimie: Oh, that's great. Well, thank you. I've learned so much. Is there anything else further you'd like to add that we haven't covered today?
Alpha: I guess more it's just ask questions like even if you think it's a silly question or you know, even just talk to your friends because a lot of them will be like Oh, I didn't know that either. And I Yeah, it's it's a conversation or confirm. We should all be having, you know, what are you doing right now? How are you? Are you have you refinanced? How did you find out? How are you managing your groceries? Like I get these conversations a lot with people but I also instigate them because I want people to be able to talk about it freely. I think it's you know, at this particular point in where the world is. Having that sense of community and sharing ideas is really good. Like, for instance the Chatgpt on how to eat through your pantry. I've changed how I grocery shop, like you know, sharing that with people just to give them ideas for shopping or groceries as a co op even, like just being able to share that I think is really important. And just to try and take this fear factor away from the concept of money and that we can all do something regardless of what age we're at. There's something that we can do and to talk to friends and family about it and find out more.
Jaimie: Yeah, absolutely out but thank you so much for coming on to pitch perfect today. It's been fabulous.
Alpha: Thank you to Jaimie. I love being part of PR club.
Jaimie: Oh yeah, I love having you up in PR club too, so we'll link put the links to get in contact with you in the show notes. Thanks again for coming on. And thanks for listening.