Fireside Finance: Tim Calder, Prime Campus

Welcome, Tim! Tell us a bit about yourself.

Well, I am 40 years old, born and raised on a farm in the Bay of Plenty, attended boarding school in the Waikato, university at Otago, and now live between Queenstown and Hamburg (Germany) with my wife and three kids while I remotely manage my now public student property fund Prime Campus.

You certainly sound like a busy man. What strategies do you use to strike a balance between work, finances, and personal life to achieve a fulfilling lifestyle?

My work is a big part of my finances, which literally occupies every waking hour of my mind. However, as I am self-employed and work remotely, my family and I are able to travel between New Zealand and Germany to follow the warm weather and maximize our time together.

How do you handle financial setbacks or unexpected expenses, and what advice can you offer for building financial resilience?

Through managing student property for over 20 years, I have learned to expect unexpected expenses. While not for the faint of heart, the way I build resilience to these setbacks is through ruthless frugality. I find practising gratitude helps lower your baseline requirements for happiness.

While not for the faint of heart, the way I build resilience to setbacks is through ruthless frugality. I find practising gratitude helps lower your baseline requirements for happiness.

Speaking of resilience! In your opinion, what are the most common financial challenges people face today, and how can they overcome them?

I don’t think some people truly understand the power of compound interest, which causes them to inadvertently overconsume. If people knew just how much future value they could create on a daily basis by simply stretching a little further down the supermarket aisles, it would blow their minds.

How has your understanding of risk evolved in your financial journey, and how do you approach calculated risks?

The most obvious one for me is how I have scaled back the leverage I apply to my investments as I get older. In my 20s, my loan-to-value ratios were in the 80s; in my 30s, they were in the 60s; and now, in my 40s, they are below 40. I’ve tapered this faster than most would, as I’m less interested in risking the lifestyle my family currently enjoys for anything better.

It sounds like you’re a shrewd investor. What’s your philosophy on building wealth, and how do you avoid getting bogged down in the nitty-gritty of financial tracking?

‘Building wealth’ means ‘creating financial freedom’ for me. I achieve this by investing in assets that I deeply understand and am acutely focused on adding value to while applying leverage. I only need to review my PocketSmith account on a biannual basis, as my natural frugality keeps my positive cash flow strong.

What advice would you give those who might be more focused on immediate financial goals or daily expenses to start thinking about their long-term financial well-being?

This quote helped me:

“Most people overestimate what they can do in one year and underestimate what they can do in ten years.” — Bill Gates

In my 20s, I was always disappointed when reconciling my annual goals, but when I looked back in my 30s, I was genuinely surprised by how much I exceeded my 10-year goals.

A fun one to end things on! What’s one thing you splurge on without feeling guilty?

I love splurging when there is a special at the supermarket on an item that I regularly buy. Each of my friends seems to have a story about one of these occasions they like to tell (much to my wife’s embarrassment). There are so many, but one that comes to mind was when I purchased a couple hundred cans of my already dirt-cheap tuna at the supermarket because it had a 15% discount.