Interview: Melissa Browne on Why ‘Budgets Don’t Work’
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Interview: Melissa Browne on Why ‘Budgets Don’t Work’

Kellie Amos

Kellie Amos

22/09/2020 • 10 minute read

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A different approach to money management

I’d never given much thought to how my personal experiences and environment impact my approach to money management. Truth be told, I’d never given much thought to money management in general! That is, until I turned 20 and set my first major savings goal – a six-month exchange in Europe.

Having that target to work towards made me look deeper into where I stored my money, what interest I was earning and how much I was spending week-to-week. For the first time in my life, I set boundaries around what went in and out of my bank account. It was the first step – the first spark of interest – to nudge me down a path towards financial understanding and literacy that I’m now exploring as a career.

Although I’m in no rush to become a certified financial advisor, I have found myself more interested in money as I get older. Particularly when it comes to my spending habits. So, when I sat down and started to read Melissa Browne’s latest book Budgets Don’t Work, I found myself reflecting on my history with money a lot.

Budgets Dont Work

Melissa Browne is a financial advisor, accountant, author, and entrepreneur (to name just a few of the many hats she wears). You may have seen her on Instagram sharing stories as @moremoneyforshoes or even attended one of her financial planning courses. I came to know Melissa through the former and when the opportunity came to interview her, I jumped at the chance.

I ploughed through my copy of Budgets Don’t Work in about 3 days, taking notes and highlighting along the way. I found it to be a refreshing take on the kinds of books you’d expect to read in this genre. As I said, the mentality behind money was never something I’d really thought about but Browne had me conjuring up memories from the depths of my childhood. When we think of money, we tend to think of it in its most superficial forms, yet the impact it has on our lives is far from just superficial. Browne challenged me to confront my biases and consider my financials from a more humanistic perspective.

So, having the chance to sit and pick her brains for half an hour left me with a few more points to chew on. Check out what she had to say about investing, saving, and – most importantly – why budgets don’t work.

Q&A with Melissa Browne

Q: Can you talk a little about why you decided to write Budgets Don’t Work and where you were at in your own life when you started writing it?

The concept started out as just being about ‘money types’ but the further I dove into it, the more I wanted to discuss. Money types just appeal to ego, but I didn’t want to offer another ‘how to’ guide, as understanding what goes into your financial decision making can better prepare you for curbing your habits and maintaining changes. I took inspiration from Brene Brown (a shame researcher from Houston)’s quote ‘What you know matters but who you are matters more.’

Personally, I was at a time when I’d unpacked a lot of my own stories and history in the past few years and was surprised that there were still things I hadn’t looked at that were impacting me financially. I wanted to include these stories because for a long time I’ve written and spoken about how we’re not telling our money stories enough and so I wanted to share my own.

Q: In your experience, what gets people most engaged with their money?

Time in their life is a big one. As we become adults, our priorities shift. Most people come to me for help when they’re at a turning point in their life. They effectively decide it’s time to ‘grow up’ and get a handle on their money.

Engaging content is also a key driver, because it’s about presenting money in an engaging and interesting way.

And of course – a global freaking pandemic! There’s nothing like having your safe job or your reliable income or a ‘good economy’ ripped apart that makes you want to manage your finances better. Certainly, in the past six months we’ve been forced to confront our financial position – many of us for the first time – and want to take control back over our finances.

'There’s nothing like having your safe job or your reliable income or a ‘good economy’ ripped apart that makes you want to manage your finances better.'

Q: In my home and a lot of other households, money isn’t a topic discussed openly around the dinner table. Do you think that’s starting to change or are we only just starting to open up these kinds of conversations?

With COVID-19, I have seen more people looking to talk about money because it is at the forefront of community issues.  But money is still something around which there is so much judgement, criticism and comparison.

'I believe it’s shame and fear that often keep us quiet. Either we’re ashamed because we have too little or because we have too much.'

Certainly, in the current pandemic, I’m talking to people who were on good incomes who are deeply ashamed they have no savings. But I’m also talking to people who are benefitting from the stimulus monies because they were working part-time and are now receiving more income or perhaps their business is benefitting and again, they’re ashamed to admit that they’re doing well and yet they want to make sure they don’t squander this opportunity and they don’t know who to talk to for help.

Q: Early on in your book you mention that your father retired “comfortably in his early fifties” but never showed you how he achieved that financially. Had he shown you, how much of a difference do you think it would’ve made to your life?

Definitely, not just to my own life but my sister’s as well. I’ve had these conversations with my father now, thanks to my own financial journey, but having my father come to my siblings and I from a young age – sparking that interest early on – would definitely have given me a stronger advantage growing up.

Q: In your book, you talk a lot about how “our finances don’t sit in isolation from our everyday lives”. What are some ways you think we can shift perceptions around money?

I encourage people to look to other areas of their life when they’re considering money stories, their money environments, their money type and money habits. That’s because how we interact with, say food and exercise, for example, will often mimic how we behave with money. Or there will be similarities we can draw on. For example, I often talk about how I’m terrible with chocolate and have absolutely no self-control. My preference is not to have it in the house so I’m not tempted. So, just like I do with chocolate, I set up great habits, boundaries and environments with my money to make it easier for me to exercise self-control.

It’s also important to understand that we’ve accepted a one-size-fits-all approach to money as well as money stories that are simply not right for us.

'We wouldn’t accept a one-size-fits-all approach to food, exercise or relationships so why do we assume that we should fit ourselves to a single rigid, outdated approach when it comes to our finances?'

Instead, it’s about understanding who we are, why we behave the way we do with our finances and curating a suite of financial habits that are right for you.

Q: You mention in your book that you take a ‘30-day financial detox’ twice a year to help control your online Money Environment and the influence it has on your spending. What are some other ways you get away from comparison culture online?

So the last two weeks I’ve had regular catch-ups with different groups of women who are very much about sharing where they’re at and being really vulnerable and transparent. But at the same time, they are cheerleaders, willing to share what works for them and what doesn’t. They want to help each other, both financially and also personally. So, for me, that’s really important – as well as doing things like the 30-day detox and the rest.

Q: I’m an investment newbie! Any advice on how to break into the investment world?

I think you need to sit down and do the goals work first. I’ve been asked only last week “during COVID, are goals even relevant anymore?” and they absolutely are! I would still work towards the idea that ‘this is the life I want to design, I just don’t know quite when.’

'So, before it might have been, ‘by 2022 - 100% I’ll be doing this’ now it’s ‘I still want to do this I just don’t know if it’ll be in 6 months or 18 months.’

If part of that life you want to design is to buy a home, then maybe start with the $1 for $1 challenge I do – where for every $1 I spend on wants, I have to automatically invest $1 into the share market. You might save by putting that $1 towards your house deposit or because that’s bonus savings, you might decide that should go into an exchange traded fund (ETF), which is an index fund where you’re passively investing in, say, the top 200 shares in the stock market. An ETF is a really neat way of starting to invest without really needing to do the individual research into companies or even different types of funds, at a very low cost.

A lot of young people can think that investing is not for them because they’re just never going to be able to have enough money to do something of significance. But certainly, the share market is a place where it’s very equal because you can invest with such a small amount.

Q: With the coronavirus pandemic throwing the future of many young Aussies into the woodwork, what’s one golden piece of advice you would give to young people stressing about their money right now?

Oh gosh, okay, first of all, I would just acknowledge that it is tough. I absolutely can see people, whether they’re millennials or older, going “well we had set up for this and this was the plan but now – who friggin knows!”

I would also say, though, that millennials have time on their side and that’s their superpower. So what I would suggest to them is to simply start. Whether it’s just with a small amount every week or every month, even if you think to yourself “Really $10 a week? That’s all I can do, that can’t be worth it.” it is – you’ve just got to start.

'...millennials have time on their side and that’s their superpower. So what I would suggest to them is to simply start.'

My mentor KJ, who was at my book launch, said one of the most important things you can do right now is stash cash. So if I was a millennial I would be stashing cash and thinking there are going to be opportunities that come out of the global pandemic. But, unless you are stashing cash you won’t be able to take advantage of them.

I would say it doesn’t matter how small – just start and maybe look no further forward than 90 days. Don’t think 3 or 5 years ahead because it can be depressing and difficult to see your way through it. Just look at the next 90 days and ask yourself: how can I find more cash? How can I start to move towards my goals in 90 days? Because it’s really easy to look at the negative in these uncertain times, yet you can find some positives when you set achievable goals.

Win a copy of Melissa’s new book!

Budgets Don’t Work is now on sale! To celebrate, we’re giving two lucky winners each a $50 Amazon voucher and a brand new copy of the book to kickstart their financial wellness journey. For your chance to win, head on over to our Instagram now to enter and go into the draw.

Winners will be announced September 16 at 2pm AEST.

Terms and conditions apply.

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Kellie Amos

Written by Kellie Amos

Kellie Amos is a contributing writer for Oiyo. She has a Bachelor of Business in Marketing and a Bachelor of Creative Industries in Creative & Professional Writing from the Queensland University of Technology. Kellie has previously produced content for a range of finance companies, entertainment publications, and fintechs.

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