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It's Pay Day! The ABC's new column where we ask Australians the money questions we don't like to talk about. We aim to demystify personal finance and normalise conversations about what we earn and how we save it — or spend it.
Sam Drummond is a lawyer, disability advocate and the author of Broke – a memoir about life on the fringes, disability and the power of hope. He's also a passionate Melburnian, proud home owner and dad to a four-year-old.
Sam reveals he is a conservative spender, has paid off his HECS debt and sacrifices his sourdough cravings for his four-year-old's penchant for supermarket sandwich loaves.
How would you describe your financial situation right now?
As someone who just wrote a book about my childhood, called Broke, I'm surprisingly content.
Before our four-year-old was born, my partner and I bought a house we love. We try to think carefully about how we spend our money. This includes researching the banks, superannuation and utility companies that most align with our values, and focusing on experiences over things (although we invariably end up with a lot of toys and craft lying around).
We're in a position where I couldn't really imagine a request our daughter had that we might refuse because it's too expensive. I could imagine a request I would refuse because I think going without is part of life. That includes, but is not limited to, an iPad, a horse and those shoes that flash when you walk.
How was money spoken about in your house growing up?
My brother and I spent most of our childhoods at mum's place. We knew we didn't have much but probably didn't understand the reasons.
Mum always sacrificed for her kids, often skipping meals. I remember the car running out of fuel on multiple occasions. We earned pocket money from ticking boxes of chores on the fridge. Mum always found some coins to take to school for our Dollarmites account, even if it wasn't as much as the other kids. She told us the rent was always the first thing to come out of her pay so we could keep a roof over our heads.
Dad ended up doing an accounting degree as a mature age student. Looking back, he rarely made great decisions with money. But he often talked about the ethics of paying your fair share of taxes, giving to charity and paying child support.
What did you spend your first pay cheque on?
Rent. I was on youth allowance for my first two years of uni. I was spending about two-thirds of it on rent. It was unsustainable — the pressure it created impacted my studies, my friendships and my health. I worked 12 hours a week at minimum wage, but it gave me a bit of breathing space above the bottom level of the hierarchy of needs.
How much of your income goes towards your rent or mortgage each week?
Technically, about a quarter of my income goes towards mortgage. But we're trying to reduce the mortgage as much as we can with an offset account. So that proportion is probably closer to half.
What has been your biggest financial disaster?
During lockdowns we switched to ordering groceries online.
With a young kid at home, avoiding physical aisles saved so much time and energy that we kept doing it.
Around September 2022, Woolworths decided that if a product wasn't available, they would issue store credit instead of a refund. This fact was hidden at the bottom of emails that said "these items were out of stock and will be refunded" at the top. I didn't realise this had changed until last week so I now have about 50 store credits — ranging from $3 to $30 — which they say expire after three years.
There have probably been bigger disasters but this is top of mind. I wonder how many others have been getting the same credits without realising?
How much was the last loaf of bread you bought?
The four-year-old prefers the supermarket brand soft sandwich bread, which is $2.70. I buy supermarket vouchers through my union with a 4 per cent discount, so the actual price is more like $2.59.
If I had it my way, there's a sourdough called Casalinga that's sold at some independent supermarkets for $8.50 and I could eat that for breakfast, lunch and dinner.
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Cash or card?
Phone. I would be completely card free if it wasn't for Melbourne's notorious myki card.
How many bank accounts do you have? How do you organise your money?
Just the two, the mortgage and the offset.
Then, in a habit that goes back to a lesson from my Year 10 commerce teacher, as much as possible is put on credit and the entirety of that bill is direct debited from the offset account the next month. The credit card companies don't make it easy to set this up — for the obvious reason that they make less money — but it means as much money as possible is offsetting the mortgage interest and our money is working for us.
The catch is that you have to have enough money in the bank or else you risk going into actual debt. As I learnt as a kid, not having a lot of money is expensive.
What's the biggest lie you tell yourself about money?
Probably, "I can't afford that."
I don't enjoy spending money. It makes me feel sick when I feel like I've been ripped off, which is probably not all that healthy.
But I get the same feeling when I see others ripped off, which I hope contributes to a sense of responsibility to make sure others get a fair go too.
What's your biggest financial achievement?
As a disabled person, simply getting a job was a big one for me.
Less than half of working-age disabled people have a job in Australia. We are eight times more likely to have a government payment as our primary income. The median income of a person with a disability is less than half of the wider population. That context defined the expectations I had of myself, and that of potential employers when I walked in for a job interview. But it need not be the reality.
Similarly, paying off HECS was a big one. I never thought I'd get there because I never thought I'd earn enough to even start paying it off.
But perhaps the biggest achievement was sitting down with Mum and working out how she could pay off her house. She is now debt-free going into retirement, which she said made her feel "seven years younger".
Sam Drummond's memoir Broke is available here or at all good Australian book retailers.