Meet Ally

What was your relationship with money like growing up?

I didn’t really think about money too much when I was little, which was nice. We never went without anything in my family, but we were not spoiled either. When I was 14, I really wanted a job so I could buy my own clothes and have money to go out with my friends. I asked my mum to call McDonald's and give consent on my behalf because I had not yet turned 14 and nine months. From then on I have always had at least a part-time job, and sometimes up to five at once. Now I have a full-time job.

When I graduated high school, I started thinking seriously about making my own way in life. There was always a thought in the back of my head that I didn’t want to rely on anyone else for money. That thought crept in when my parents' relationship started to become rocky, and was cemented when they separated and eventually divorced. My dad managed all the finances in our household, so when my mum was on her own, I realised she didn’t know how to pay a bill, register her car, or set up her internet. It was a real eye-opener.

Even though I have been in a loving relationship with my husband since I was 18, I never wanted either of us to have to rely on the other financially. And we both do not.

And what is your relationship with money like now?

My current relationship with money is a complicated one. I always want to be in control of my finances, which is mostly a good thing, but sometimes that need for control makes me stressed about not having enough or not being able to meet a payment. On the other hand, that same drive pushes me to work hard, take on extra jobs, create content, and find ways to save money where we can.

What was your first job? (And how much did you get paid?)

My first job was at my local McDonald's at 14 years old. I got paid around $9 an hour for the first three months and then $11 an hour after that.

How did you first come across investing?

My dad mentioned I should invest my money when I was around 19 or 20, but I did not really think much of it at the time. A few years later I decided to do my own research, starting with podcasts, then books and articles.

Once I started listening I became so immersed in the idea that I was completely hooked. I started micro-investing on Raiz, solely using the round-up feature, just to get used to it. It didn’t take long before I built up the courage to make my first proper investment with a larger amount of money.

Was there a memorable early investment?

I invested in Shopify a few times at the end of 2022 and it has performed incredibly well, up 138%. I have just let it sit there, and every now and then when I look at my portfolio it makes me smile a little. 

How are you currently investing and can you provide a breakdown of your portfolio?

Here’s my current portfolio breakdown:

Where do you see investing taking you?

I want to retire early and I am going to use investing to get there. I have not worked out the exact numbers yet, I just know that is what I want. I am not talking about retiring by 35 or 40. I would like work to become optional between 45 and 50, which means I can’t wait for my superannuation to get me there. I need my investments to do that work.

I would also love to use my portfolio to pay off the rest of our mortgage at some point, and I want to start investing for my bub, and subsequent bubs.

What is one super extravagant and outlandish purchase that you hope investing will be able to buy you in the future?

A sailboat. Part of my semi-retirement dream is to learn how to sail and for my husband and I to take our boat around Australia and explore. We both love to travel, so using investing to fund that is the ultimate dream.

If you only had 25 words to convince someone to invest, what would you say?

You are the only person who can care for yourself financially. Investing is the best way to show future you the love you deserve.

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We want to hear your ‘How I Got Started’ stories. Respond to this email if you would like to be featured and we’ll get in touch!

Tomorrow Ally joins Jess on the latest episode of How I Got Started. Jess feels as though when talking to Ally she’s a few chapters ahead in her journey.

She's recently bought her first home as Jess has just settled on hers and she's swapped city living for the Blue Mountains while Jess is about to swap the beach for the bush.

So this episode isn't just about how Ally got started investing. It's also a chance for Jess to ask someone who's a few steps ahead of her what she's learnt along the way. (Spotify | Apple | YouTube)

Can Your Portfolio Reflect Your Values Without Sacrificing Returns?

Ally's portfolio is pretty straightforward IVV, VAS, NDQ. But she also has an allocation toward SHE, an ETF made up of companies with high levels of diversity in senior leadership. Bryce and Ren recently unpacked the state of ethical investing in a recent episode of Equity Mates Investing. (Spotify | Apple | YouTube)

First, understand how ethical ETFs actually work. There are two main approaches. A negative screen excludes companies that do not meet a sustainability criteria like fossil fuels, weapons, tobacco. A positive screen invests in companies making a positive impact, or companies working toward it. Many funds use a hybrid of both. The important thing is that sustainability criteria differs significantly from manager to manager, so just because a fund calls itself ethical does not mean it aligns with what you actually care about.

Second, understand the performance trade-off. Bryce and Ren compared DZZF, Betashares' ethical diversified high growth ETF, against its closest non-ethical equivalent VDHG over five years. DZZF returned 9.5% per annum. VDHG returned 12.3%. Run the difference through a compound interest calculator over a working life and the difference is significant.

Third, keep perspective. That underperformance happened during a period that included a fossil fuel boom driven by the Russia-Ukraine conflict, exactly the type of companies ethical funds exclude. Pick a different five-year window, say 2018 to 2021, and the picture looks quite different. Past performance in any direction is not guaranteed to continue.

Ethical investing is becoming a larger part of the market, with around $1.5 trillion invested in responsible investments in Australia. But look under the hood, make sure the fund's criteria match your values, and go in knowing there may be a performance cost depending on the moment in time you are investing through.