Renovation rewards
Property has always paid off for Monica Mathis, writes Rob Stock.
Harmoney owner’s financial winner
Monica Mathis’ first paid work was on her parents’ farm, but her dislike of cows meant dairying was never going to be her future.
Instead, she turned to picking strawberries, until she landed her first peach of a job in the financial services industry.
She’s now general manager of Harmoney, New Zealand’s first, and largest peer to peer lender.
How financially savvy are you?
Pretty good I think. Having completed a degree and MBA in business, I have a good understanding of business financials, but it’s the day-to-day financial interactions in the business world, like budgeting, forecasting, cashflow and managing profits and losses that really teach you the hard lessons in life.
I’ve managed very large sales and marketing budgets throughout my career and in very data-driven financial environments, so understanding return on investment is critical. I also hold the purse strings at home.
How did you pick up your savvy money skills?
As well as my formal education, my parents were farmers, so I got a good idea of what assets and liabilities are from a young age.
When I was young, my father used to tell me that when an animal was sick, it was really dollars that we would lose, as they were the main assets on the farm. So it was in that way that I started to understand the value of assets. Since then, I have spent 25 years in financial services organisations across Europe, Australia and New Zealand.
I had to learn very quickly the financial rhetoric when talking to investment bankers, CFOs and CEOs – so it was a case of learning by total submersion.
What was your first paid work?
Working on my parents’ farm. I got paid an allowance for doing my chores, but I gave that up in the end, as I didn’t like cows.
So that was my first sunk cost. Instead, I went for the cleaner option, a strawberry farm – backbreaking job, but I loved getting that little brown envelope with cash in it at the end of the week.
How did your upbringing shape your attitude to money?
My upbringing shaped me a lot. Farming is a cyclical business and so seasonality and good money management were a very large reality of the day-to-day running of the farm.
A lot of the business conversations in our household would happen over the dining table, which I feel probably isn’t something that someone who grew up in a city or town would hear a lot of. I would always overhear problem solving and decisions being made. That gave me the confidence to make decisions about money very young, and to have assertive conversations about it.
If a child asked you the best way to make money, what would you say?
By getting a job and working hard. No matter what you are doing, put your full effort into it. If you do that, it will pay off. Even if you don’t enjoy it, put your full effort in while you look for something else. Explore jobs when you are young to see what floats your boat. Don’t ever slack off. Do your best always.
Would the message be any different if the child was a boy, or girl?
No. In fact, I have two children and I tell them both the same thing – that they both need to get a university education.
I don’t really care what job they end up doing, but I think it’s important for them to have a job through university to relieve the pressure of the student loan.
Do you trust the other money people?
Look, I’m pretty realistic in that I know all ‘‘money people’’ will have to align their own value systems to the company’s objectives and ideals.
I don’t tend to trust big organisations. It’s not a distrust as such, but I would much rather have one-to-one relationships with people that I respect and can have a good conversation with, on an academic and theoretical level.
Tell us your best investment decision ever?
The best investment decision I’ve made was investing in property in the UK. I bought my first flat in London, for around $65,000 and sold it 18 months later for $97,500.
We bought and sold again over a 10-year period. My husband and I made some good decisions in an appreciating market.
I wish we had kept the last house as it’s now doubled in value, but c’est la vie. Selling in London enabled us to have a decent deposit when we returned to NZ to purchase our first property here.
What has been your biggest investment mistake?
Individual Savings Accounts and Personal Independence Payments in the UK. I put money in 15 years ago that is only now showing a positive return.
What have you been willing to go into debt for?
Purchasing assets like house, car, boat. I use credit cards to earn air points and I believe in having good insurance to cover your debt exposure. I’m a big advocate for insurance. Having already had some rather large medical issues in the family, our health insurance has well and truly paid off.
Which of those were a good idea, and which ones do you look back on and go, ‘‘that was a really bad idea’’?
Renovating and building houses has been my best return on investment so far.
I guess having an architect as a husband gives me an advantage, but I also love change and therefore have been open to taking some risk in the different property markets we have been in.
How do you sum up your feelings towards spending?
I believe that we are on this earth for a short time and therefore it’s important to enjoy it.
I believe in spending money on holidays, nice restaurants and entertaining friends. Sometimes we go overboard and have to pull back a bit the following months – so it goes in swings and roundabouts.
If you were prime minister/ dictator, and could change one thing to improve the money lives of Kiwis (or a specific subset of them) what would it be?
I would ramp up the ‘‘financial literacy’’ frameworks in the school curriculum, make it compulsory, starting from kindergarten right the way through to college and university.
Get kids to start saving and to build an understanding of the value of money over time. Use role playing, gamification etc, to make it more interesting.
It’s crucial that our kids coming out of school or university understand the cost of living. It’s a fact of life that we need to understand money better.
‘Explore jobs when you are young to see what floats your boat. Don’t ever slack off. Do your best always.’