Happy Monday.
This week I’ve shifted gears on the podcast and have been interviewing some Pivot Wealth clients about their money journey, how the planning process changed what they were doing with their money and some of the things that surprised them about financial advice. We also discussed knitting addictions and the most creative investment strategy I’ve seen in the 20 years I’ve been learning about personal finance. Check out the two most recent stories here.
I’m also going to be presenting the next event in our Property series with Raiz Home Ownership and General Assembly this Thursday on How to Buy Your First Property. Check out the details and book your place here.
Share market wrap
Australian and international markets held onto the strong gains from last week and continued to rise, driven by the continued COVID vaccine rollout and the stats showing now over 25% of people in the US have now received the COVID vaccine.
Key sharemarket numbers:
- The ASX ‘All Ords’ (top 500 shares in Australia) finished the week 0.9% higher than last Friday, on 7,325.80 points.
- The US ‘S&P500’ (Top 500 shares in America) finished the week 1.48% higher than last Friday, on 4,185.47 points.
- The US ‘Nasdaq’ (Top 2500+ mainly tech shares in America) finished the week 1.40% higher than last Friday, on 14,052.34 points.
- The Global ‘All World’ index (measured with the iShares MSCI world index (all share markets around the world combined) finished the week 1.61% higher than last Friday, at 124.44
Investment story of the week
Coinbase (Nasdaq: COIN): This cryptocurrency platform underwent its initial public offering (IPO) this week in the US at an eye-watering USD$110 billion valuations. Coinbase is the largest crypto exchange covering 11% of all crypto trades and has over 56 million users worldwide. After a valuation creeps from initial estimates around USD$65 billion to the eventual listing value of USD$110 billion, the shares ended the week over 10% down. Many expect the Coinbase listing to drive a heap of other Blue Chip crypto players closer to the listing. With the huge increase in attention on the crypto market in recent times, one to watch.
Jargon Buster of the Week
Index (via Canstar): Index: An index measures a market or section of a market and is calculated from the prices of selected stocks. Eg. The ASX200, the S&P/ASX200 Health Care Index
Money mistake of the week: Guilty spending
It’s easy to fall into the nasty habit of guilty spending. Because your money goals are so big and can seem so daunting, you think you need to push super hard with your saving and sacrifice your lifestyle today to have any chance of getting where you want to be. In this clip from the How to be Successful with Money Podcast, one of the Pivot Wealth clients Karim talks about how he overcame guilty spending and his tips on how you can find balance between enjoying your life today AND achieving your money goals at the rate you want. Check out Karim’s story here.
Money hack of the week: How to buy your first property
Buying your first home is key to getting onto the property ladder and setting up your financial future. But, it’s not easy… There are so many conflicting messages and hidden agendas that it’s hard to know who to listen to, or who to trust. However, you can make it happen if you know the rules of the game. This week I’m running a money education event with the legends at General Assembly and Raiz Home Ownership where I’ll cover the key steps in buying process, how to get into the market, and how to reduce risk when you buy – and the other things you need to know to enter the market with confidence. Register here.
Podcast from last week: #104 Pivot Client Story with Clare – How to confidently build assets outside your business after being burnt
In this episode, I talk to one of our amazing clients, Clare Sheng. She is a cracking business owner with her business, The Fitting Room on Edward which basically dominates the market for custom alterations on clothing and suits in Brisbane.
We talk a bit about Clare’s journey with financial advice, some of the things that surprised her along the way. We chat about how Clare had a big shift around the business, how she could actually leverage it to create investments in assets, outside of the business, how she built the confidence or broke through the fear of taking action when it comes to investing to get started and build a bunch of investments and make it make a bit of cash along the way. As well as some of, I suppose the things that Clare thinks is important for people if you’re looking at getting help with your money, we had a bit of a laugh about Clare’s knitting addiction as well. Check it out on your podcast platform of choice here
Giving update of the week
Last week I got in trouble with Pivot Wealth’s amazing Practice Manager Maryanne for making these newsletters too business heavy, and she suggested I include an update on our business giving that we do in partnership with B1G1 (Buy One, Give One). So I’ve committed to including a small slot in this weekly note going forward.
For anyone that hasn’t been following these updates for a while, before a potential client joins Pivot Wealth we run a money education session “Money Breakthrough Session” that we charge a small fee for and donate the money to charity. We started doing these in the height of COVID to support people struggling through the pandemic, but we were able to have a pretty solid impact so we’ve kept them going.
Some of the results to date:
- Over $33k raised
- Built five houses for disadvantaged families in India
- Provided 29,565 days of access to water to people in Asia and Africa
- Given 20,440 days of access to education to underprivileged people in India
- Given over 400 days of access to business training to women in Malawi
You can check out more information about our giving here.
Smart Money upside #17 – Getting into forever home
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 from one of our clients to help you take your money game to the next level.
Numbers/Background
Single female early 40’s, Household income ~$160k, saving $25k annually, investment property ~$700k with $500k mortgage and $160k super, no shares.
Frustrations
Not having a plan or strategy in place. Needing to pay in additional tax annually and accountant not helping. IP negatively geared and outlay holding back other asset-building strategies. No clear plan-has heaps of bank accounts and a basic structure around this. No plan on the investing front.
What they wanted from us / the advice process
A clear plan and strategy, getting into forever home, the pathway to a comfortable retirement.
What money strategy they were following before we went through the planning process
Building savings in offset and making some extra super contributions
What money strategy they chose to pursue from our planning work
Sell the IP and purchase an apartment to live in, regular share investments, cranking super to provide for retirement.
Key benefits of going through the process
Clear plan to achieve financial security, peace of mind that it will happen, asset uplift from property and share investments.
Value of advice after all advice fees year one: $31,359
Year 20 upside after advice fees: $356,861
If this story resonates and you want to chat about how to get these sorts of results, you can book an intro call here.
Be awesome,
Ben
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.
Disclaimer:
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.