Beyond the Bar: A Bartender’s Guide to Build Wealth

A while ago, I reached out to our Bar Crafts community, sharing my intent to open a conversation about building wealth for bartenders. 💰

In our industry, we often discuss sustainability, seeking products that minimise environmental impact while flashing sleek labels.
However, we sometimes overlook a critical aspect of sustainability: people.

True sustainability begins with taking care of yourself, and that includes your financial well-being.

The demanding schedules, lack of sleep,  alcohol and substance abuse, and health challenges so common in hospitality don’t just affect physical and mental health—they also take a significant toll on financial stability.
It’s time to address this often-overlooked issue and prioritise a more sustainable future for ourselves.

How it Started for Me

Financial education has always fascinated me, and I was fortunate to have my Nonno guide me early on. He introduced me to financial products like bonds and taught me how they work.
From there, I developed a deep passion for this subject and spent the last decade studying and researching it.

Learning never truly ends, and I’m definitely just scratching the surface!
I’m constantly looking into new terminologies, exploring investment strategies, and expanding my knowledge.
Not everyone gets that kind of head start, so my hope is that this article will provide value to those of my peers who might need it.

Why Financial Knowledge Matters for Bartenders

Before diving in, let me be clear: this article doesn’t constitute financial advice.
Everyone’s situation is unique, influenced by personal goals, risk tolerance, disposable income, and countless other factors.
It’s crucial to do your own research and seek guidance from financial professionals before making decisions or investments. Financial objectives can vary widely based on circumstances like family, location, age, and demographics, so consulting with trusted experts is always the smartest move.

The aim of this piece is simple: to spark a tiny little interest in financial planning within the hospitality industry—a sector where people often find themselves struggling to make sound financial decisions. This isn’t due to lack of intelligence but rather a lack of experience, knowledge of available frameworks and understanding of systems designed to help build wealth.

If this article can help even a few take that first step, then it’s done its job.

It’s no surprise that many bar managers, venue managers, and even business owners struggle to build wealth, not just for themselves but for the businesses they run.
Securing smart deals with brands or successfully driving their establishments forward often falls short due to a widespread lack of understanding.
One of the biggest challenges in our industry is not just the lack of knowledge but the reluctance to admit it, creating an even greater divide between employers who may know little about hospitality and employees who often have no grasp of finance or business strategy.

While education is a key part of the solution, it’s not always accessible or available to everyone.
That said, while having this knowledge isn’t always essential, it can be incredibly powerful and valuable when leveraged to build a successful career and achieve long-term goals.

The Hidden Cost of a Bar Career

On average, a bartender in Australia can expect to earn between $3,000 and $4,000 per month.
Rent is a major hurdle, often reaching up to $2,000 a month (plus bills), and that’s before you even think about Sydney!
For many, this means opting for a share house, where they can split the cost of living with others.
On top of that, food and basic living expenses can add another $400-$500 per month. Factor in transport costs (we all know how many Ubers we take after a shift), post-work drinks, bloody cigarettes, and more, and it leaves hospitality workers with very little left at the end of the month.
As a result of that, I know many who’ve been in the industry for decades and have nothing saved to show for it.

That’s why learning how to invest even small amounts of savings is crucial.
It’s a way to start building something on the side, whether it’s for a house deposit or retirement funds down the line.

To start with, I think learning discipline is key.
Practising self-control and being mindful of spending, especially on those excessive nights out, not only benefits your health but also your bank account. Hanging out after work is fun, no doubt, but limiting those nights to just 1 or 2 a week will make a huge difference to both your savings—and your liver!

Investing vs. Trading: What You Need to Know

A lot of people see investing as the same thing as betting, trust me, that’s not the case!
You don’t need to be the next Wolf of Wall Street or a Forex pro to make it work. Trying to trade like that is a quick way to lose money, and it’s definitely not a reliable income source or a way to get rich. 👌🏼

Let’s clear up one major distinction: Investing vs. Trading.

When we talk about investing, we’re usually referring to medium to long-term strategies that apply to a broad range of assets and financial products. It’s not just about the stock market.
Think real estate, businesses, high-interest accounts, offset accounts, index funds, ETFs, treasury bonds—heck, even investing in education can be a great move!

“An investment in knowledge pays the best interest.” – Benjamin Franklin

Trading, on the other hand, is all about buying and selling financial instruments (like shares, bonds, options, CFDs, and other speculative products) within a short-term timeframe.

Sure, you can invest in some of these products as well, but trading involves using them to try and maximise returns in a short period, often as a daily practice.
To make this work, you need a high level of experience and expertise, but also active monitoring of the market and access to platforms that provide real-time pricing and the speed to buy and sell instantly. 

Of course, some of these practices are quite complex, and this isn’t the platform nor the purpose of this article to dive into all of them.
However, I thought it was worth pointing out the difference between the two.

What I really want to focus on today is why it’s important to start investing some of your funds in the first place.

Oh yes, brace yourselves, I’m about to bring up that dreaded word we all fear, but not everyone fully understands:

INFLATION. 🤌🏼

That’s right, the very thing that has caused bars to suffer in recent months, with rising living costs and a slowing economy.
In a nutshell, inflation refers to the general rise in prices and the decline in the purchasing power of money. It usually happens when there’s too much money circulating in the market.

(Yep, if we all suddenly became rich, the global economy would crash!)

Because of this, governments worldwide aim to keep inflation around a ~2% rate. When it rises above that, central banks step in with monetary policies, raising interest rates to make debt and asset purchases less affordable, which then drives up the cost of living.
If you want to dive deeper, a quick Google search will give you plenty of info.

But here’s what’s crucial to know: keeping your money under the mattress, or just letting it sit in a bank account, is a really… really… really terrible idea!

Each year, the value of your money decreases according to the inflation rate. This doesn’t mean you’ll see $1000 vanish from your bank account, but it does mean that the buying power of that $1000 will shrink.

How? Well, if your groceries cost more this year than they did last year, that’s inflation at work.

If something used to cost $5 and now costs $5.35, it might seem like a small increase, but that’s a 7% jump! Multiply that across the board, and it adds up fast!

Investing is a powerful way to protect yourself from inflation and keep your money working for you.

Play it Safe!

Great options with minimal risks that I suggest exploring are treasury bonds and high-interest accounts.

Don’t be afraid to look beyond your current bank. Some trustworthy banks (yes, I know, “trustworthy banks” sounds odd) offer high-interest accounts that can help combat inflation.

Right now in Australia, some banks are offering up to 5.5% interest. While this type of investment might not fully offset inflation, it certainly helps reduce its impact on your capital while maintaining very low risk, if any.

Keep in mind that these accounts usually come with conditions, like minimum monthly deposits or restrictions on withdrawals. That’s why it’s essential to evaluate your personal situation and consult with professional advisors.

Similarly, treasury bonds can be a solid addition to your portfolio. 
Treasury bonds work like this: when you buy one, you’re essentially lending money to the government, which promises to pay you interest periodically and return the principal when the bond matures. The government issues these bonds to finance various spending needs, not just public debt. Bonds can last anywhere from a few years to 30 years, paying interest annually or in two semi-annual tranches.

Incorporating these strategies into your financial plan can help offset inflation and significantly increase your savings.

For example, saving just a consistent $500-700 a month could result in roughly $50k over five years—definitely a great way to secure a house deposit!

Also, don’t forget about diversifying your investments!
Never put all your eggs in the same basket, and prevent your investments from going sour!

(See what I did there?! 🤣).

You don’t need to invest large sums, but diversifying your investments is always a smart move.

Stock Market: High Risk, High Reward

Looking into the stock market is another option, though it brings a bit more risk into the mix. You can invest in companies we all know, like Apple, Google, Meta (Facebook, Instagram), or even in sectors like real estate, mining or energy.

But here’s the catch: as you move into the stock market, your risk level increases significantly. While cheap stocks (penny stocks) can yield huge returns, they can also wipe out your investment in an instant.
So, make sure you do your homework! Don’t just follow the hype around a brand name or meme stock. Understand the company and the industry before you dive in.

Saving takes sacrifice, and for some, it’s not their cup of tea.
But in my opinion, investing is a powerful tool that can really add value to your long-term goals and help you stay prepared during tough times.
Whether it’s handling a sudden change like COVID-19 or planning for a family, having investments in place makes all the difference.

The Elusive 1%

If you’ve made it this far into the article, you’re probably part of that elusive 1%. 🏆

As I mentioned earlier, this kind of thing isn’t for everyone. You could place gold in front of some people, and they’d walk right past it. That’s what creates financial gaps in society in the first place!

If you stay stuck in a narrow view of the world, there’s not much anyone else can do for you. But being a curious person?
That’s the attitude that’ll serve you best in the workplace, at university, and everyday life in general.

I hope this article helps inspire some of you to start setting goals for your future, take action, and dig deeper into these concepts. Do some research, seek professional advice, whatever it takes to build some knowledge around the subject.

Imagine how much better our industry could be if more hospitality professionals gained some understanding of these topics.
Some already do, but unfortunately, when we look at the larger picture, that number still represents just a small percentage.

“Be relentless, adapt and grow, work harder, work smarter…
… Remember, work smarter!”
– Roger Federer

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