Hey team,
Happy Monday.
I’ve been getting a bunch of questions lately around the things smart investors are buying
People think that being good at investing is just about choosing good investments. It’s much more than that. Last week I put together a piece on what I just invested in and why, so you can learn about some of the considerations that should drive what will be a good investment for YOU. Check it out on Apple podcasts, Spotify, Stitcher, Podbean.
Share market wrap
Markets held on to most of the big gains from last week, with US and international markets continuing the solid run, driven by strong financial reporting from some of our biggest corporates including Macquarie and IAG.
Other key markets numbers:
- The ASX ‘All Ords’ (top 500 shares in Australia) finished the week 0.4% Lower than last Friday, on 7,081.30 points.
- The US ‘S&P500’ (Top 500 shares in America) finished the week 0.89% higher than last Friday, on 3,934.83 points.
- The US ‘Nasdaq’ (Top 2500+ mainly tech shares in America) finished the week 1.16% higher than last Friday, on 14,095.47 points.
- The Global ‘All World’ index (measured with the iShares MSCI world index (all share markets around the world combined) finished the week 1.26% higher than last Friday, at 118.28
Investment story of the week
Bitcoin (BTC): Ok, so I did write about this a couple of weeks ago, but the Bitcoin rally is continuing to surge hard so I felt like I had to include it again. Off the back of some tweets from Elon Musk and a bunch of other tech leaders, as well as the adoption of Bitcoin as a payment form with some of the big institutions the Bitcoin price is now closing in on USD$50k, currently sitting at AUD$62,816. When the price of BTC was below AUD$20, Finder.com founder and general supergenius Fred Schebesta predicted the price would hit AUD$100k by the end of the year. In the surge we’ve seen since it seems like he might be on the money. For anyone that doesn’t understand the details behind crypto or Bitcoin there’s a great explainer from The Hustle here.
Money mistake of the week: Not having the right amount of money in your emergency fund
Having a good emergency fund has a bunch of benefits, not least of which is the fact that it can help you invest better. Last week I put together a podcast talking through emergency funds and how much you might want to have in yours. Check it out here on Apple, Spotify, Stitcher, Podbean.
Weekly jargon buster – Options (via Canstar): Options are essentially contracts that give you the choice to buy or sell a particular security at a later date. This contract allows an investor to choose whether or not to go through with the transaction based on whether they think it is profitable.
Money hack of the week: What smart investors are buying now
Market downturns are the times wealthy people make money. But knowing what you should be investing in is tricky. There are so many options out there it’s like drinking from the firehose, and it’s hard to get the confidence to overcome analysis paralysis and take action.
Last week I put together a post about what I’m seeing the smartest investors buying now so you can learn from their experience, and how to figure out what investments might work for YOU. Check out the video here.
Podcast from last week: #75 How do shares actually work and how do you by shares
Get around it on your podcast channel of choice 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. one children under 5. Household Income $200k + ~$100k RSU income, cash $75, ~$550k investment property w. $400k mortgage
Frustrations when first coming to see us
No plan around RSU’s, no clear plan to own a family home.
What they wanted from us / the advice process
Achievable plan towards buying a home for their family. Ability to have another child and take maternity leave without going massively backwards financially.
What money strategy they were following when we started working together
Selling RSU shares to pay tax bills, saving in cash in investment property offset account.
What money strategy they chose to pursue from our planning work
Growing second income stream through a diversified investment portfolio, cranking offset account, children’s investment account, purchase a family home in 2 years.
Key benefits of going through the process
The confidence they were on track to end up in a good position, clear plan to the family home, building a second income stream.
Year 1 upside: $15,047
Year 20 projected upside: $1,890,312
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.
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 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. Financial services guide.