Hey team,
Happy Sunday.
Before I get into the money stuff just want to send a big shout out to the legends at Raiz Invest and General Assembly for facilitating the ‘How to money’ series that’s been happening over the last few months. Last week I presented the fifth event in the series on How to avoid the most painful money mistakes [recording here]. I’ll doing the final event in this series on Feb 24 all around ‘How to master your money mindset’ – check the deets and book your place here.
Share market wrap
It’s been a strong week for markets with the Australian ASX ‘All Ords’ (top 500 shares in Australia) finishing the week 3.5% higher on 7,112.9 points. Markets were driven by the Reserve Bank of Australia extending business support and promising longer periods of low interest rates coupled with a massive rally on Wall Street lead the Aussie market to finish the week on an 11 month high.
Other key markets numbers:
- The ASX ‘All Ords’ (top 500 shares in Australia) finished the week 3.5% higher than last Friday, on 7,112.9 points.
- The US ‘S&P500’ (Top 500 shares in America) finished the week 4.17% higher than last Friday, on 3,886.63 points.
- The US ‘Nasdaq’ (Top 2500+ mainly tech shares in America) finished the week 4.76% higher than last Friday, on 12,378 points.
- The Global ‘All World’ index (measured with the iShares MSCI world index (all share markets around the world combined) finished the week 3.3% higher than last Friday, at 116.2
Share story of the week
News Corp (ASX:NWS): This week the media giant ended up 16.24% driven by the announcement of whopping $2.41 billion profit for the quarter, up strongly from analysts predictions. No doubt performance partly driven partly by the massive focus on media outlets throughout the COVID pandemic pumping up advertising revenue, but will it continue in 2021?
Money mistake of the week: Analysis Paralysis
Analysis paralysis is a very long shortcut to money mediocrity… But our psychology often works against us. You want to make smart moves with your money. You want to do your due diligence and cover all your bases. And you DEFINITELY don’t want to fk things up and blow up your hard earned 💰💥
But sometimes, the more you analyse the harder it is to take action. I put together a short video on on how you can overcome analysis paralysis and drive action so you can start getting RESULTS 🚀
Money hacks of the week
Weekly jargon buster – Hedge Fund (via Morgan Stanley): A type of fund focused on absolute, rather than relative, performance. It is allowed to short (sell stock before you own it) stocks like Gamestop 😉 and can use financial leverage.
Video: How to plan with your money and how to translate ideas into results
One of my favourite quotes of all time is from the one-and-only #DerekSivers, he said; “If information was the answer, we’d all be billionaires with perfect abs”. And it’s so true. We all want results, but the key to turning ideas into outcomes is ACTION. But it’s not easy.
Because there’s so much information out there, it’s hard to build the confidence to take smart action. And nobody wants to do something dumb and cost themselves a bunch of money in the process. But there are some things you can do to plan smarter with your money and overcome the fear of fking things up so you can take ACTION and start getting OUTCOMES 💰💰💰
I’ve put together two videos below covering my top tips on how to plan, and then how to translate your ideas into action. I also go through some of the roadblocks that stop people from getting started so you can learn from their mistakes.
Video 1: How to plan with your money
VIdeo 2: How to translate ideas into results
Podcast from last week:
#59 When do you REALLY need a good accountant? Get around it on your podcast channel of choice here:
Online event from last week
Last week I presented the fifth live online event in the ‘How to Money’ series in partnership with Raiz Invest and General Assembly, How to avoid the most painful money mistakes in 2021. I cover the six biggest money mistakes we see and what you can do to avoid them. We help you learn from other people’s mistakes so you can achieve your version of awesome with money faster and with less stress. Check out the recording of the session here.
Smart Money upside
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
Couple mid 30’s w. Two children under 5. Household Income $350k, cash $100k, ~$2.5m home w. $400k mortgage
Frustrations when first coming to see us
Paying too much tax, lazy equity in property, and totally reliant on employment income. Info overload and making the wrong call.
What they wanted from us / the advice process
Passive revenue streams e.g. property rent that is positively geared one day + a solid share portfolio with dividends/capital growth.
What an awesome result looked like for them
Setting up a share portfolio with an income stream (low risk), at least one investment property, reducing tax bill. Also paying off the home in three years and being able to pull the rip chord from the crazy income job in 5-8 years time whilst making sure they’re maximising all the opportunity along the way.
What money strategy they were following when we started working together
Putting every spare sent into the home loan, add hoc spending plan
What money strategy they chose to pursue from our planning work
Purchase two small investment properties ~$800k, refinance all loans, index fund investment and debt recycle existing mortgage
Key benefits of going through the process
Clear plan on how to build income streams to kick in, in 8 years time and using up their lazy equity of $2m to do this.
Year 1 upside: $58,363
Year 20 projected upside: $2,721,610
If this story resonates and you want to chat about how to get these sorts of results, you can book an intro call with us 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.
PPS: Reminder for our next live online event coming up Feb 24: How to master your money mindset in 2021
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 to this email 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 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. Financial services guide.