Smart money weekly; ASX continues to fall, Employer share plan events, WTF is financial advice

Ben Nash

Hey team,

Happy Monday.

The ASX has entered a technical “correction”. Being a drop in stock prices of 10 per cent or more from their peak. By the close on Thursday, the ASX 200 index was down 10.3 per cent from its record high set in mid-August. The trillion-dollar question is, when will the heavy selling stop? Despite tens of billions of dollars having already been wiped off the local market, and trillions more globally, there are likely further losses in store. I know I spoke about this last week, but the interest rate hikes that are on the horizon combined with general fear sends the market into a bit of a frenzy. Whilst it’s looking like we’re yet to hit a floor, the question is, what are you going to be doing in this market?
Below is my news article, I unpack more about what you should be thinking about.

Smart Money upside #53
Because people don’t often talk about the full ins and outs of their money, it’s hard to learn lessons from hearing what good and bad choices other people make. This story is from one of our clients to help you take your money game to the next level.

Individual; mid 30’s, income ~$310k, total assets ~1.8m, savings~ $10k annually

Overall feeling that their investment strategy had plateaued

What they wanted from us / the advice process
Long term plan for multiple income streams. Clean up their current debt.

What success looks like for them
Feel financially steady
Income, earnings and wealth are greater than their debt
Confident that there’s a growth trajectory

What money strategy they were following before we went through the planning process
Saving in cash and using personal loans to fund lifestyle expenses

What money strategy they chose to pursue from our planning work
Clear all personal debt, use cash savings to invest in a diversified investment portfolio

Key benefits of going through the process
Maximising the opportunities that are available.

Value of advice after all advice fees year one: $5,526
Year 20 upside after advice fees: $4,564,465

If this story resonates and you want to chat about how to get these sorts of results, you can book an intro call here.

Giving update of the week
This week one of our amazing clients had a baby, so we’ve celebrated by helping 100 women in Kenya with desperately needed medical support and childbirth assistance. This is all part of our ongoing commitment to make a difference in the lives of our clients and simultaneously make an impact on our world through our partnership with B1G1 (Buy 1 Give 1). You can check out more information about our giving here.

Upcoming events:
Our employer share plan event kicks off next month, so make sure you register and don’t miss out. If you can’t make the time, still register and the recording will be emailed you to straight after the session. Check out the full list of events that are coming up and click through to register:

Event schedule and links to book here:
Employer share plans 101: Tuesday, Feb 1, 2022, 11am
How employer share plans work (deep dive): Monday, Feb 7, 2022, 2pm
Employer share plan tax hacks and mistakes to avoid Thursday, Feb 10, 12pm
How to make more profit from your employer share plan Tuesday, Feb 16, 2022, 10:30am
How to invest if you’re saving more than $5k monthly: Thursday, Feb 24, 12pm

Money Hack of the week: How to make the most of risks and uncertainty.
How often do you take risks and improvise? It’s something we’d usually like to avoid, right? Well, Lynne Cazaly and I had a great talk about everyone’s biggest fear: failure. While most of us have a love/hate relationship with failing, Lynne has a very effective strategy that guarantees improvement after a failed attempt. It’s all about getting comfortable reacting to uncertain situations and making the most of your scenario. Check out our full chat here.

Share market wrap
Hawkish remarks by US Federal Reserve chairman Jerome Powell sparked a sharemarket rout on Thursday amid fears runaway global inflation will force central banks to bring forward interest rate increases faster than expected. The S&P/ASX 200 dropped 1.8 per cent, and officially entered correction territory on a 10.4 per cent fall since its August high. Bitcoin mirrored the sharp fluctuations in traditional markets this year, highlighting the tightening link between crypto and mainstream financial assets.

Key sharemarket numbers:

  • The ASX ‘All Ords’ (top 500 shares in Australia) finished the week -5.31% lower than last Friday, on 7,266.30 points.
  • The US ‘S&P 500’ (Top 500 shares in America) finished the week -3.25% lower than last week, at 4,326.51 points.
  • The US ‘Nasdaq’ (Top 2500+ mainly tech shares in America) finished the week -4.96% lower than last week, at 13,352.78 points.
  • The Global FTSE ‘All World’ index (largest 3100 companies in the world) finished the week 0.46% lower than last week (Friday AEDT), at 7,554.31
  • The S&P Cryptocurrency ‘Mega Cap’ Index (tracking market value of Bitcoin and Ethereum) is currently at 3,779.87 for the month, down -26.89% for the month to date

Investment story of the week: Hubify Ltd (ASX: HFY)
Hubify Limited provides telecommunication services. The Company offers data management, broadband, network management, digital phone, and other services. They pride themselves on having a ‘new breed’ of technological experts, all with a shared desire to push the company forward by unifying people and technology. All of their services are integrated to create a seamless experience for clients. They provide global engagement and they add value through Insuretech solutions to the insurance and travel industry, which increases end customer engagement. The combination of all these factors makes the company an interesting one. Whilst the company has had a rocky start to 2022 on the sharemarket, on Thursday, the price jumped up 16%. With its holistic product that can provide consumers with end-to-end service, it’s a company worth adding to the watchlist.

Money mistake of the week: Not taking the time to simplify a complex situation.
Does taking time to assess a complex decision make it any easier? I had an eye-opening chat with psychotherapist Andrew Sloan about a captivating area of decision making he’s looking into. He told me about his interest in our reactions to complex situations and how we could improve this and other impactful factors of our human experience. Check out our full chat here.

In the news: $2 trillion tech stock drop shows smart investing is needed
The stock market has been particularly volatile lately and shows no sign of abating. One type of stock, in particular, has been wiped off $2 trillion. These declines come with opportunity, but with so much activity many investors are questioning where markets are going from here and what 2022 has in store. I unpack the key things you should be across to invest the smart way when the market is crashing, click here to read more.

Jargon Buster of the Week: Loan to value ratio or LVR (Via Macquarie)
The amount, as a percentage, borrowed for an asset against the value of the asset.

Podcast from last week:  #154 WTF is financial advice
This episode is a presentation I recently put together on WTF is financial advice and it came off the back of a bunch of questions that I’ve been getting lately around what advice is, and how it works. What are the things that you should be thinking of when you’re going down this path and I sort of unpacking the key issues, the mistakes that people make when going, looking for advice and going through the advice process, or looking to engage an advisor as well, the different types of advice and how they work.

So you can figure out what might work best for you as well as how to actually choose an advisor and some of the questions that you need to ask for to make that happen.


Be awesome,


PS: If you want a hand to get on the front foot with your money in 2021, check out our 45-minute one-on-one sessions here. We’re donating 100% of the money raised to charity, so you can up your money game and do something good on the planet at the same time.

I know you’re smarter than someone that would need me to write the words that come next, but our compliance peeps are real hard-asses so here we go… This information is not personal advice, poetry, or a map to where Jimmy Hoffa is buried. It may only be regarded as general advice, and definitely shouldn’t be considered something worthy of inclusion for Donna Hay’s next cookbook or the Archibald prize. This is actually just an email communication that has been sent to a bunch of people and doesn’t even have your name on it. Your personal objectives, needs or financial situation have not been considered when preparing this email, but I want you to know that I have spent a lot of time thinking about the Venn diagram intersection of poetry, landscaping, and essential oils – if you’re fascinated by this same phenomenon please reply so we can compare notes. You should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs, and if necessary, seek advice before acting on it. You should also consider other people when getting on and off public transport, smiling more, eating healthy, and listening to your mum when she tells you that you’ve been working too hard. Where the information relates to a financial product, you should obtain and consider the relevant product disclosure statement before making any decision to purchase that financial product. Where the information relates to a hilarious joke I’ve made, you should consider belly laughing deeply. Worth noting also that past performance is not a reliable indicator of future performance when it comes to investments, and definitely not when it comes to the Wallabies. Financial services guide. All jokes aside and just to be clear, this information may only be regarded as general advice. That is, your personal objectives, needs or financial situations were not considered when preparing it.  You should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs, and if necessary, seek advice before acting on it. Where the information relates to a financial product, you should obtain and consider the relevant product disclosure statement before making any decision to purchase that financial product. Past performance is not a reliable indicator of future performance.