Hey team
Happy Monday.
Things are busy at Pivot Wealth HQ with the silly season upon us and seeing a bunch of new clients come in before the holidays. In property news, while the interest rates haven’t ticked up just yet there’s been a lot of news this week in regards to property prices slowing down, even whispers of a slight fall across Sydney and Melbourne across the next 12 months. Brisbane and Adelaide however are predicted to stay strong. For those of you that have been waiting to get into the market or to upgrade, then change is on the horizon. For those of you in the market already, consider your position and look at the long term data before making any decisions.
Giving update of the week
This week a couple of our amazing clients settled on their first investment property, and we’ve celebrated by providing 365 days of shelter to underprivileged people in India, as 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).
Upcoming events:
We only have one more event for the year, but we know that many of you are keen to get on top of your finances for the new year. Stay tuned as we’ll have a bunch of new events coming in the new year. Check out the full list of events that are coming up and click through to register:
In the News: One simple word for us millionaire wannabes: Investments.
Read more about this uni student who thought she was doing the right thing and quickly realised she made a mistake that cost her thousands. It’s everyone’s wildest dream to become an instant millionaire with absolutely no effort on your part. I have one simple word for us millionaire wannabes: Investments. Click here to read more.
Money Hack of the week: How to have both rules & flexibility with your finances.
Having some spending rules in place is great in theory until you want to take a holiday or buy that new toy you’ve had your eye on. Pivot Wealth client Nicola and I chatted about how she’s feeling now that she’s got good foundations in place for her finances. She’s feeling more confident in her plan but is pleased with the flexibility that allows her to spend when she wants to. Check out our full chat here.
Share market wrap
US stocks finished mostly higher on Thanksgiving eve as investors received a bunch of data, including minutes from the Fed’s November meeting, which showed that inflation is probably not that transitory and that members are ready to raise rates sooner than expected if inflation persists. On Thursday, the S&P/ASX 200 closed 0.1 per cent higher in a muted day that reflected similar advances for US and European shares overnight. The global crypto market capitalization surged 1.23 percent from Wednesday to Thursday to stand at $2.60 trillion.
Key sharemarket numbers:
- The ASX ‘All Ords’ (top 500 shares in Australia) finished the week -1.7% lower than last Friday, on 7599.90 points.
- The US ‘S&P 500’ (Top 500 shares in America) finished the week 0.02% higher than last week, at 4,701.46 points.
- The US ‘Nasdaq’ (Top 2500+ mainly tech shares in America) finished the week -0.79% lower than last week, at 15,845.23 points.
- The Global FTSE ‘All World’ index (largest 3100 companies in the world) finished the week 0.76.% higher than last week (Friday AEDT), at 7,310.37
- The S&P Cryptocurrency ‘Mega Cap’ Index (tracking market value of Bitcoin and Ethereum) is currently at 6,561.11 for the month, down -3.32% for the month to date
Investment story of the week: Fisher & Paykel Healthcare Corp Ltd (ASX:FPH)
Fisher & Paykel Healthcare is a world leader in medical devices and systems for use in respiratory care, acute care, surgery and in the treatment of obstructive sleep apnea. FPH shares advanced 3.9 per cent after the company reported $222 million in first-half profits following strong revenue for respiratory devices for hospitals. During the first half of FY 2022 they, reported a 1% decline in operating revenue and a 2% reduction in net profit after tax. Pleasingly, despite contending with elevated freight costs, Fisher & Paykel Healthcare was able to deliver a 135 basis point increase in its gross margin to 63.1%. Healthcare is an area that is continually growing, so an established business and market leader such as FPH is on my radar.
Money mistake of the week: Underestimating trust as being key to achieving success
Trust, Trust, Trust. The best way to build trust is to see humanness and avoid retreating into fear. I chatted with Dr Amy Silver on the psychology of building trust and achieving success. Check out our full chat here.
Jargon Buster of the Week: Risk Tolerance (Via Canstar)
Your relationship with money and anxiety about it. Risk tolerance does not refer to an investor’s ability to avoid risks, but rather their emotional connection to seeing share prices rise/fall and how they respond to potential risks.
Podcast from last week: #144 – Cryptocurrency Investing 101 [Live event collab w. General Assembly]
In this episode of the how to be successful with money podcast, it’s actually a recording from a live online event, it’s called Cryptocurrency Investing 101.
I’d unpack sort of the basics of crypto digital assets, investing the things to look out for what you should be thinking about to make smart decisions when it comes to the cryptocurrency space, as well as some of the mistakes to look out for and how to create a smart financial plan. That includes cryptocurrency but in a smart and sustainable way. I also had a ton of questions that I went through. So chances are if you’ve got questions around crypto, those were answered there as well.
Apple
Spotify
Stitcher
Podbean
Smart Money upside #45
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.
Numbers/Background
Single, income ~$230K, have purchased properties with family members in the past and invested into equities (firing from the hip approach)
Frustrations
Have a number of investments but no real structure around the holdings nor a game plan.
What they wanted from us / the advice process
My career trajectory and earning potential is very much up in the air. I want to ensure that I am able to plan and have a strategy that can be flexible with this – never sought advice around the bigger picture
What money strategy they were following before we went through the planning process
Purchasing some shares on an adhoc basis and looking to exit a couple of investments that were made with family members.
What money strategy they chose to pursue from our planning work
Going to deprioritise purchasing a family home, clean up/consolidate my current investments. I’ll purchase a new investment property, continue to rent and invest in a diversified investment portfolio along the way. Will make ad-hoc superannuation contributions to benefit my tax footprint and also ensure I am planning for the longer term as well – building wealth both inside and outside of the superannuation environment.
Key benefits of going through the process
Was able to identify what my highest priorities are and find a balance between achieving them today and planning for the future. With such a unique earning trajectory, I wanted to be on the front foot to maximise my position over the next few years -setting me up for a lifetime. I feel that this plan has given me clarity on how to do this and some structured steps to get cracking.
Value of advice after all advice fees year one: $69,198
Year 20 upside after advice fees: $2.06m
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.