Cost of living experience

We had brunch with our friend Jen last weekend. One of the topics that we covered was her rent. She lives in a studio in CBD. So they increased the price of her rent by about 20%. Was initially 25%, but she managed to haggle down by 5%. She’s now paying an extra 5K per year, or +200/fortnightly. She makes about 110K/annually, excluding Super. So if I estimate her net salary, using the Pay Calculator, it estimates 3,136/fortnightly. Her rent is about 1,200/fortnightly. Rent alone takes up 38% of her net salary. Calculating her old rent amount which is 1,000/fortnightly. That makes up 32%. That’s still high. Based on the FI community, they estimate no more than 30%. Money Guy Show states around 20%-to-25%. Based on the current economy living with higher interest and inflation rates, it forces the % increase and breaks out of the range.

Now our friend makes about 110K. That’s decent in my opinion, since the average salary in Sydney as of to-date is 65K in NSW, but Sydney is 108K. Interesting statistics. Living outside of Sydney CBD would be much cheaper, but wouldn’t necessarily mean everything else is much cheaper due to rising inflation, but expenses do add up.

I can only imagine how lower paid workers are being impacted by the higher cost of living. What I’m still trying to understand is why can’t Australians make more if they’re locals? Is there a major skillset and salary gap between white collar and tradies here? Why is there bias here in Australia against foreigners?

Kathy’s working in AU cause of her relocation so I’ll continue to support her 200K+ salary, including Super. If it wasn’t for her relocation, she’ll either have to start from scratch or won’t be able to get a job at all. Whether Australians believe that they’re biased against foreigners who weren’t first on relocating (eg confirmed job before moving) compared to foreigner locals (eg spouses/partners). Even after becoming Australian Citizens, employers still follow a strict checklist when hiring employees and favor the local Aussies (non foreigners/expats/nomads).

I’ve worked in Accounting and Finance in Investment Banking and Financial Services for about 10 years. There’s no way I’m going to an Australian Uni just because employers expect it. Instead, I’ll utilize my skills and focus on Investing as a Nomad. Money will be working harder for us through Dividend Investing.