Finally received my member statement which summarises my retirement fund breakdown.
Unfortunately it's all preserved - meaning, I won't beable to access it until I'm 65 or so. Decades and decades away. Because of this 'you can't reach into the cookie jar' type of control, many of my peers and younger compatriots aren't that interested in contributing extra or trying to maximise contributions. And if we are, it's not up to the $25k limit usually.
Even though it has great tax advantages, locking funds away into super funds can really limit your options in the near future. So when you're undecided about whether to contribute extra into your super funds or not, always consider the short and medium term and whether you will need funds for buying a house, getting married or for a new car. I prefer the way the Americans have structured their retirement funds and the flexibility it has over the OZ structure.
If anyone encountered financial difficulties in America, they can withdraw their retirement funds (at the cost of paying extra taxes), however, at least it can be withdrawn in the first place. Unfortunately for the Aussies, if we encounter any financial difficulties, the most we can access is around $10k and that's after going through rigorous paperwork and having to prove that you're seriously going through hard times and pretty much in arrears on your bills- but you're more likely to be homeless and begging on the street before you can access that $10k.
Here's the asset allocation breakdown of my super/retirement funds:
30% Australian Shares (Risky)
23% Overseas Shares (Risky)
12% Bonds (Semi-risky)
10% Property (Semi-risky)
9% Growth Alternatives (Semi-risky)
6% Cash Securities (Almost risk-free)
5% Defensive Alternatives (Almost risk-free)
5% Infrastructure (Almost risk-free)
Where 'risky' assets are considered to have a higher possibility of 'actual' asset returns failing to meet and exceed 'expected' returns. With increased risk of course, is the chance of increased returns.
The fund that I have it invested in, is considered to be a 'balanced' type of fund. Pretty much a middle-of-the-road type of fund where it's not too risky that I have massive fluctuations and not so risk-free that I have no gains and no investment growth. Which is perfectly fine for my risk profile. You need to work out your own risk profile before you can decide on which structure is the right one for you.
I don't want to find out next year that it has plummeted 50% and on the other hand, I don't want to discover that it hasn't kept pace with inflation since it was invested in such low yield assets.
With a 5 year average return of 5.52%, it's rather dismal and pathetic.
If you're trying to find a good allocation percentage, the rule of thumb is- the younger you are, the more you can afford to risk, so you can afford to be more heavily invested across stocks(domestic & overseas) and property. If you're older and close to retirement (eg: 50yo and older) then you should probably be rebalancing to something more defensive and less risky, such as more cash securities and cash accounts.
If you're expecting to live until you're 90 and older, you need to bear this in mind and evaluate how much risk you're capable of tolerating before you need your funds. There's nothing scarier than the idea of running out of funds while you're retired and having to rely on social government benefits...and particularly in the future... it's ghastly to contemplate the idea of running out of funds when you're 85yo or something and that there is no social government benefits because the government simply doesn't have any.
Monday, September 27, 2010
Wednesday, September 22, 2010
Saturday, September 18, 2010
Finding the courage to be brave and contrarian
A conversation I had today reminds me to remind myself that it takes courage to be brave and contrarian. Particularly in the field of investing. You can't follow the crowd and if you do, don't expect anything more than the average.
Warren Buffet, the wise dude from Omaha is often quoted:
No sane person likes to invest $10,000 only to see it drop to $9,000 the next week, for example. Because when that happens, your mind(and my mind) is plagued with slight regret that the $1000 could have been spent on fancy dinners, a new dress or some new toy. That if you hadn't bought that week, you could have bought the same number of stock for a cheaper price.
So in this imperfect world - I do realise that I have to boost either my retirement fund or my portfolio that's invested directly in stocks. Firstly, I'm overweight in property and cash, and underweight in stocks. At my age, I can afford to have a riskier asset allocation. Most of my parents friends are millionaires and they are invested roughly: 70-80% property, 20-30% shares, 0-10% cash.
Personally, I like the way they've invested and also prefer to have similar weightings on my asset allocation. If you are more risk averse and prefer to increase your returns (risk and volatility), you would change the weightings to a higher percentage in property or stocks. I have met so many people in the past who are either 90% property or 90% stock. It takes effort to learn, understand and invest in both markets. Most investors fear what they don't really understand. Complacency and reluctance to learn means they usually prefer to invest mainly in one or the other.
Sooooo....off to the stockmarket I go again to buy some more stocks... despite my risk-averse side telling me to invest the majority in property or cash. Property just had a huge boom this past year so the rental yields have dropped significantly in most suburbs. The only thing that worries me about the global market these days, are the huge deficits in the US and most European Nations. In the long run, how can nations grow and afford to spend on infrastructures and social services when their cash flow is leaking out in terms of interest and debt payments? That is one of the biggest reason behind my hesitation to direct more funds towards increasing my stock portfolio.
Mind you, Warrent Buffet's advice is quite handy in times like these. And I couldn't agree more with this quote of his when it comes to buying fundamentally strong companies for the long term:
We had a wedding to attend today. I stitched two images together from the DSLR to form a panorama since I don't have a camera that can shoot panoramic images(and I'm too lazy to crop the image in Photoshop since it's past 1am now). It was dusk and anyone who had a camera could not resist the beckoning lure of our iconic Opera House, Sydney Harbour Bridge and Centrepoint Tower.
It was such a glorious Spring day with warm weather and I couldn't resist taking a shot of the lilac Wisteria's that were trailing off the trellis :
At the wedding, I met a guy named Dennis and he was chatting to another friend about trading stocks. Dennis mentioned that Peter Lynch's book had a momentous influence on his trading techniques.
So...me being me... when I got home, I just had to hop on the net to google Peter Lynch. His name was familiar but I had never heard much about him. Everyone who's into finance has heard of Warren Buffet and George Soros but Peter Lynch?
"Peter Lynch managed the Fidelity Magellan Fund from 1977 to 1990, during which time the fund's assets grew from $20 million to $14 billion... achieving an annual average return of 29%."
It's hard not to be sceptical with any fund returning a very high average return exceeding 15% over several years or decades. Figures like that should always ignite little warning lights - particularly after the Bernard Madoff ponzi. Even for a fund that can return yields like that, it would be foolish to invest 100% of your funds in them. Everyone should be diversified across the asset classes (Property, Stocks, Fixed Interest & Cash), regardless of how tempting it is to invest in a singular asset class because of its attractive returns. Investing 100% in any singular asset class is one of the biggest risk you could ever subject yourself to.
Some people will say..."but I'm diversified...I have all my funds invested across 20 or 30 stocks. " however, you should be diversified across the asset classes and within the asset class. If that doesn't make sense to you, you better keep learning if you want to learn how to minimise your investment risks.
Warren Buffet is probably the most overquoted financial guru. He is however, a very successful investor and the second richest man in the world as a result of business aptitude.
One last photo before calling it a night. The wedding cake was cute. The bride and groom are both fanatical about aquariums, underwater diving and marine animals. This is their beautiful wedding cake, decorated with bride & groom turtles :)
Warren Buffet, the wise dude from Omaha is often quoted:
We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.The market has really tanked since 2007. Even for myself, a self confessed finance junkie, I find it hard to work up enthusiasm to contribute extra to my superannuation for my eventual retirement that's over 30 years away. And it's also hard to work up enthusiasm to buy stocks in a market that's volatile and swinging around with no clear trend.
No sane person likes to invest $10,000 only to see it drop to $9,000 the next week, for example. Because when that happens, your mind(and my mind) is plagued with slight regret that the $1000 could have been spent on fancy dinners, a new dress or some new toy. That if you hadn't bought that week, you could have bought the same number of stock for a cheaper price.
So in this imperfect world - I do realise that I have to boost either my retirement fund or my portfolio that's invested directly in stocks. Firstly, I'm overweight in property and cash, and underweight in stocks. At my age, I can afford to have a riskier asset allocation. Most of my parents friends are millionaires and they are invested roughly: 70-80% property, 20-30% shares, 0-10% cash.
Personally, I like the way they've invested and also prefer to have similar weightings on my asset allocation. If you are more risk averse and prefer to increase your returns (risk and volatility), you would change the weightings to a higher percentage in property or stocks. I have met so many people in the past who are either 90% property or 90% stock. It takes effort to learn, understand and invest in both markets. Most investors fear what they don't really understand. Complacency and reluctance to learn means they usually prefer to invest mainly in one or the other.
Sooooo....off to the stockmarket I go again to buy some more stocks... despite my risk-averse side telling me to invest the majority in property or cash. Property just had a huge boom this past year so the rental yields have dropped significantly in most suburbs. The only thing that worries me about the global market these days, are the huge deficits in the US and most European Nations. In the long run, how can nations grow and afford to spend on infrastructures and social services when their cash flow is leaking out in terms of interest and debt payments? That is one of the biggest reason behind my hesitation to direct more funds towards increasing my stock portfolio.
Mind you, Warrent Buffet's advice is quite handy in times like these. And I couldn't agree more with this quote of his when it comes to buying fundamentally strong companies for the long term:
Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years.
We had a wedding to attend today. I stitched two images together from the DSLR to form a panorama since I don't have a camera that can shoot panoramic images(and I'm too lazy to crop the image in Photoshop since it's past 1am now). It was dusk and anyone who had a camera could not resist the beckoning lure of our iconic Opera House, Sydney Harbour Bridge and Centrepoint Tower.
It was such a glorious Spring day with warm weather and I couldn't resist taking a shot of the lilac Wisteria's that were trailing off the trellis :
At the wedding, I met a guy named Dennis and he was chatting to another friend about trading stocks. Dennis mentioned that Peter Lynch's book had a momentous influence on his trading techniques.
So...me being me... when I got home, I just had to hop on the net to google Peter Lynch. His name was familiar but I had never heard much about him. Everyone who's into finance has heard of Warren Buffet and George Soros but Peter Lynch?
"Peter Lynch managed the Fidelity Magellan Fund from 1977 to 1990, during which time the fund's assets grew from $20 million to $14 billion... achieving an annual average return of 29%."
It's hard not to be sceptical with any fund returning a very high average return exceeding 15% over several years or decades. Figures like that should always ignite little warning lights - particularly after the Bernard Madoff ponzi. Even for a fund that can return yields like that, it would be foolish to invest 100% of your funds in them. Everyone should be diversified across the asset classes (Property, Stocks, Fixed Interest & Cash), regardless of how tempting it is to invest in a singular asset class because of its attractive returns. Investing 100% in any singular asset class is one of the biggest risk you could ever subject yourself to.
Some people will say..."but I'm diversified...I have all my funds invested across 20 or 30 stocks. " however, you should be diversified across the asset classes and within the asset class. If that doesn't make sense to you, you better keep learning if you want to learn how to minimise your investment risks.
Warren Buffet is probably the most overquoted financial guru. He is however, a very successful investor and the second richest man in the world as a result of business aptitude.
One last photo before calling it a night. The wedding cake was cute. The bride and groom are both fanatical about aquariums, underwater diving and marine animals. This is their beautiful wedding cake, decorated with bride & groom turtles :)
Wednesday, September 15, 2010
Ask, and you shall receive
In most situations in life, if we want something, we have to ask for it. Just like being in a relationship with someone. If you're unhappy about something, you have to talk about it. No-one can read your mind so you have to express yourself or ask for it.
A few years ago, a friend of a friend told me that at her jewellery shop, if a shopper didn't ask for a discount, they never offered it. However, if any shoppers ask for a discount, they will always get some sort of discount. I've always used her very sagacious advice and applied it to a lot of my shopping expeditions and it really works. In terms of personal finance, it also works in the financial banking sphere.
So what am I rambling about? I know that you can negotiate with banks for higher interest rates. In the past, they have increased the interest on my savings however it wasn't always the case. But there is a trick to it. If you just ask for a random interest rate increase, chances are you won't receive the increase. However, if you ask them to match the 'introductory rates' that are offered for new depositors or for 'introductory periods' then there's a 99% chance that they will match the rates. Especially if you've done a bit of research and ask for the specific rate that they are offering to other depositors.
If you're dealing with with a teller or a customer service representative on the phone and they're being stubborn, you can get what you want if you ask to speak to their manager or mention that you'll be transferring your savings to their competitor...the one with the higher rates of course.
Previously, I wrote about opening up my uBank account for their 6.01%-6.51% interest, compounded monthly. My other bank increased my rates, but uBank is a really well-thought out banking subsidiary of NAB's so I'll transfer some savings into their account. May as well keep my deposits diversified... until I find a new acquisition or a stock I want to buy.
It's not like Australian banks will collapse like US banks did in the 1930s. Off the top of my head, I think it was something like 500 banks and financial institutions failed in the US during that period. That's why the governments were so keen to guarantee banking deposits during the financial crisis. There are no banks that can survive a deposit run. They don't hold much in cash (just like most of us), they have loaned out their deposits in order to maximise their returns for shareholders.
There are so many Aussies who hate banks. Don't hate them, join 'em! Buy shares in them. Be a shareholder. Earn dividends. The major class action against the major banks is a bit of a joke. Most people who are constantly incurring late fees, interest and charges can't really blame anyone but themselves and their financial practices.
I'm not defending the banks or anything, but if you're a good steward of your funds, you probably wouldn't have incurred any of those charges. And if you forget occasionally, most of the time, call them up and ask for the fees to be reversed. They will usually reverse the charges.
Ask for it, and you will get it. Simple.
This being a personal finance blog, I guess I should stick to financial topics but... it's so tempting to write about things other than personal finance every now and then. On the weekend, we had gorgeous weather and it's spring :) Gardens are in bloom and of course, I had to go shopping for some new plants since our pot plants died while we were holidaying. Here are some shots that I took over the weekend revealing our Spring in its full glory :)
Beautiful daisies all over the farm in wild abundance:
I bought two Camellia trees and received two as a gift so I've got four trees:
Peach blossoms will always be one of my favourite:
Beautiful posy of blossoms:
As you can see from all those tempting blooms, I went a bit nuts and bought about $313 bucks worth of gardening materials and plants. Not to mention my photo frenzy!
Tuesday, September 14, 2010
Financial Gifts from Parents and Relatives
Have you been the recipient of a financial gift or series of financial gifts?
I stumbled upon the blog of a GenY girl (Meg) living in Texas who receives a financial gift of $24,000 and now $26,000 per annum from her grandparents. She's not the only one receiving monetary gift. It turns out, each of her parents receive $24-$26,000 (approx $52k/annum) and so does her aunties, uncles and all grandchildren! That's some serious wealth sharing practiced by her grandparents indeed.
Although no-one really likes to mention that they've received financial gifts, it does exist and as long as you don't really boast about it, you can fly under the radar unobtrusively without some people resenting you and being jealous.
It did provoke me into reflecting back on the gifts that we (meaning myself, family + friends) have received. Some more substantial than others. The amount depends on how affluent our respective parents are. The gifts aren't always monetary. You've been a recipient if any of these other 'gifts' reasonate with you: dinners paid by parents, cars, jewelleries, holidays paid by your parents, rental/study/living allowances, bills or weddings paid by your parents....
Because I blog and write using my name and not some 'fake' name or anonymous identity, I can't reveal names when it concerns myself. Otherwise I'd be drawn and quartered if anyone knew I was posting up their private financial lives up on the web for the world to read about.
Meg from the 'World of Wealth' blog provides a pretty tasty break down(for those who are interested in snooping about other people's financial health) of her assets and the gifts that she's received. I'd estimate that she's received about $300,000 in monetary gift via the form of trust funds, cash and loans (that are forgiven). Not to mention her family subsidising her travels.
Friend A: Financial gift received $300-$350,000
We all got various birthday presents for our 18th. When we asked her what her best present was, she mentioned that her uncle gave her a house that was worth about $300,000-$350,000(ish). Strangely, I don't think anyone was surprised. A few of us received cars from our parents when we first got our driving licence at 17. We were young and it didn't really mean too much until we attended university.
It turns out that the rental income that she received from her house was paying the fees on her law degree, clothes, entertainment and also with savings to spare. With the two property booms that we've had in 2003 and 2009, the house is probably worth around $500-$700,000 not to mention she's probably earning a significant 100k+ income from practicing law. Not bad at all for a GenY.
Friend B: Financial gift received $300,000
Friend B: He bought a $500,000 house when he was 22 years old. None of us ever explicitly talk about money, income or savings. So we didn't question him about the financing arrangement or anything. I'm not sure how we got talking about property investing but he told me that the $300,000 deposit was a loan from his parents. And now it's a loan that is 'forgiven' so he does not need to pay it back. They were probably waiting to see him mature a bit and behave a bit responsibly with his funds, to stop drinking and partying so much before they let him know he didn't have to pay the loan back. Now the house is fully paid off so that's $500-$600,000 worth of equity that he can pull out to fund future property acquisitions.
He's on the hunt for another property now with his fiance. With a DINKS status and high income for the pair of them, they will probably easily end up in excess of $1m net wealth before their mid thirties.
Friend C: Financial gift received $250,000
Friend C: Same thing as above. $250,000 'loan' that is 'forgiven' and probably was never really a 'loan' in the first place. Between this gift and his own savings, he is another GenY who has amassed $500,000 in net worth and is looking for another property to buy.
Friend D&E: Financial gift received $150,000
Friend D&E: A married couple, one child and stay at home mother. It seems everytime they bring up 'financial issues' to the parents, money is gifted. Both are GenY and have about $360,000 ish in net assets. Not sure what type of 'financial stress' can be felt with assets behind them, but I imagine that if you find yourself spending all that you earn or saving just a small amount, you would feel 'financial stress' regardless of your net asset amount.
Relative A: Financial gifts?? Not sure but the assets sure stack up to a rather significant figure.
My cousins also have affluent parents. And although we never discuss anything too personal between ourselves, occasionally parents like to brag. One proud set of parents induces other parents to start listing their kid's achievements. Family jaunts are always interesting in terms of finding out who is up to what in terms of their investing activities.
Relative A and his wife have accumulated three properties between them. They're both GenY and between the values of their three properties, I'd estimate their gross assets to be $1.44 million. Pretty good. Although I'm not sure if their net assets are also high or whether they're geared up to the eyeballs.
Relative B: 31 years old and has four properties with gross asset values estimated to be about $1.26 million. I would hazard a guess that Relative B is also a recipient of a monetary gift as well.
I could probably go on and on about the friends, relatives and friends of friends that I know who has significant assets. Also, the ones who has received significant monetary gifts. I don't know anyone who is irresponsible. Almost everyone has interesting investment allocations.
Some of my friends aren't as fortunate to have affluent parents and they manage just fine. Without a more invasive discussion though, it's hard to differentiate between the ones that have a massive net wealth and the ones that are massively geared. So on the surface, almost everyone appears to be rather affluent. In summary though, I'd rather ask no question and have no-one asking me questions too. It's a rather private matter really and none of anybody else's business.
Of course, it is an interesting subject :) Financial gifting is a bit like the lottery, except it's usually a lot more reliable. It does open up the question of what a person who is the recipient of the gift will do with the gift. Most friends/family that I know who has received monetary gifts feel guilty if they spent the money on hobbies and holidays. They have used the funds as a deposit for property and to invest and used their own hard earned income to fund their guilty pleasures.
Would you spend or invest if you received a monetary gift of $200,000 or more?
I stumbled upon the blog of a GenY girl (Meg) living in Texas who receives a financial gift of $24,000 and now $26,000 per annum from her grandparents. She's not the only one receiving monetary gift. It turns out, each of her parents receive $24-$26,000 (approx $52k/annum) and so does her aunties, uncles and all grandchildren! That's some serious wealth sharing practiced by her grandparents indeed.
Although no-one really likes to mention that they've received financial gifts, it does exist and as long as you don't really boast about it, you can fly under the radar unobtrusively without some people resenting you and being jealous.
It did provoke me into reflecting back on the gifts that we (meaning myself, family + friends) have received. Some more substantial than others. The amount depends on how affluent our respective parents are. The gifts aren't always monetary. You've been a recipient if any of these other 'gifts' reasonate with you: dinners paid by parents, cars, jewelleries, holidays paid by your parents, rental/study/living allowances, bills or weddings paid by your parents....
Because I blog and write using my name and not some 'fake' name or anonymous identity, I can't reveal names when it concerns myself. Otherwise I'd be drawn and quartered if anyone knew I was posting up their private financial lives up on the web for the world to read about.
Meg from the 'World of Wealth' blog provides a pretty tasty break down(for those who are interested in snooping about other people's financial health) of her assets and the gifts that she's received. I'd estimate that she's received about $300,000 in monetary gift via the form of trust funds, cash and loans (that are forgiven). Not to mention her family subsidising her travels.
Friend A: Financial gift received $300-$350,000
We all got various birthday presents for our 18th. When we asked her what her best present was, she mentioned that her uncle gave her a house that was worth about $300,000-$350,000(ish). Strangely, I don't think anyone was surprised. A few of us received cars from our parents when we first got our driving licence at 17. We were young and it didn't really mean too much until we attended university.
It turns out that the rental income that she received from her house was paying the fees on her law degree, clothes, entertainment and also with savings to spare. With the two property booms that we've had in 2003 and 2009, the house is probably worth around $500-$700,000 not to mention she's probably earning a significant 100k+ income from practicing law. Not bad at all for a GenY.
Friend B: Financial gift received $300,000
Friend B: He bought a $500,000 house when he was 22 years old. None of us ever explicitly talk about money, income or savings. So we didn't question him about the financing arrangement or anything. I'm not sure how we got talking about property investing but he told me that the $300,000 deposit was a loan from his parents. And now it's a loan that is 'forgiven' so he does not need to pay it back. They were probably waiting to see him mature a bit and behave a bit responsibly with his funds, to stop drinking and partying so much before they let him know he didn't have to pay the loan back. Now the house is fully paid off so that's $500-$600,000 worth of equity that he can pull out to fund future property acquisitions.
He's on the hunt for another property now with his fiance. With a DINKS status and high income for the pair of them, they will probably easily end up in excess of $1m net wealth before their mid thirties.
Friend C: Financial gift received $250,000
Friend C: Same thing as above. $250,000 'loan' that is 'forgiven' and probably was never really a 'loan' in the first place. Between this gift and his own savings, he is another GenY who has amassed $500,000 in net worth and is looking for another property to buy.
Friend D&E: Financial gift received $150,000
Friend D&E: A married couple, one child and stay at home mother. It seems everytime they bring up 'financial issues' to the parents, money is gifted. Both are GenY and have about $360,000 ish in net assets. Not sure what type of 'financial stress' can be felt with assets behind them, but I imagine that if you find yourself spending all that you earn or saving just a small amount, you would feel 'financial stress' regardless of your net asset amount.
Relative A: Financial gifts?? Not sure but the assets sure stack up to a rather significant figure.
My cousins also have affluent parents. And although we never discuss anything too personal between ourselves, occasionally parents like to brag. One proud set of parents induces other parents to start listing their kid's achievements. Family jaunts are always interesting in terms of finding out who is up to what in terms of their investing activities.
Relative A and his wife have accumulated three properties between them. They're both GenY and between the values of their three properties, I'd estimate their gross assets to be $1.44 million. Pretty good. Although I'm not sure if their net assets are also high or whether they're geared up to the eyeballs.
Relative B: 31 years old and has four properties with gross asset values estimated to be about $1.26 million. I would hazard a guess that Relative B is also a recipient of a monetary gift as well.
I could probably go on and on about the friends, relatives and friends of friends that I know who has significant assets. Also, the ones who has received significant monetary gifts. I don't know anyone who is irresponsible. Almost everyone has interesting investment allocations.
Some of my friends aren't as fortunate to have affluent parents and they manage just fine. Without a more invasive discussion though, it's hard to differentiate between the ones that have a massive net wealth and the ones that are massively geared. So on the surface, almost everyone appears to be rather affluent. In summary though, I'd rather ask no question and have no-one asking me questions too. It's a rather private matter really and none of anybody else's business.
Of course, it is an interesting subject :) Financial gifting is a bit like the lottery, except it's usually a lot more reliable. It does open up the question of what a person who is the recipient of the gift will do with the gift. Most friends/family that I know who has received monetary gifts feel guilty if they spent the money on hobbies and holidays. They have used the funds as a deposit for property and to invest and used their own hard earned income to fund their guilty pleasures.
Would you spend or invest if you received a monetary gift of $200,000 or more?
Wednesday, August 18, 2010
A little bit of inspiration
What inspires you? If you could travel 10 years back in time, what would you change?
I was over at a forum that I read from time to time. It's been 7 years since I actually joined that forum and 3 years to go before I can actually reflect back to see how far I've come since then.
No-one should be posting up their intimate financial details if they post under their real name. It would be great to contemplate the idea that I'm just one anonymous blogger in a world of 5 billion humans or so, but I know that no-one is ever anonymous on the internet.
Google is too powerful. It will trawl through everything with your name on it. Also, you are very likely traceable down to your IP Address. I previously listed some changes that you could implement to make the world a better place on my post '100 ways to help the world and yourself'.
Anyway, a few points from the thread about what people would change if they could travel back in time, struck a chord within me:
* Wear sunscreen. Appreciate the power and beauty of now
* Get started on buying assets/property/shares that are affordable now
* Do something that scares you daily/annually
* Don't be reckless with other people's hearts
* Floss - your teeth are precious
* Calcium - your bones will thank you when you're older
* Knees - be nice to them
* Your body is the greatest instrument you will ever own
* Treasure your precious few friends from childhood who has grown up with you
* Spend time with family + friends... you never know the future
* Don't sell assets, always buy
* Play monopoly
* Buy quality, low maintenance type of houses/apartments
* Act on your views, ideas & opportunities
* Keep learning
* Take action!
* Take time out for yourself
* Always read the fine print before signing
* Build your multiple income streams, plant those investment seeds everywhere and they will grow into trees bearing fruit
* Take time to think and contemplate life and the future
* Don't listen to naysayers, doomsayers and negative people
* Take more risks, don't be afraid
* Don't date someone not right for you, have courage to break up earlier
* Buy property when you can afford one, don't wait too long
* Work smarter
* Live simply
* Today may be the halcyon days, don't wait for those days to come
* Don't jump on the first offer, consider every offer before deciding
* Pay your loans on principle and interest, don't always keep paying only interest
* Time is valuable and powerful
* It's dangerous to delegate 'due diligence' in its entirety to property managers/solicitors/conveyancers/brokers etc
You can always find someone with an opinion and advice everywhere you look, but that doesn't mean you should follow all their advice without your own research. Advice is usually more useful if its from someone who has achieved in the area that you want to achieve in.
I was over at a forum that I read from time to time. It's been 7 years since I actually joined that forum and 3 years to go before I can actually reflect back to see how far I've come since then.
No-one should be posting up their intimate financial details if they post under their real name. It would be great to contemplate the idea that I'm just one anonymous blogger in a world of 5 billion humans or so, but I know that no-one is ever anonymous on the internet.
Google is too powerful. It will trawl through everything with your name on it. Also, you are very likely traceable down to your IP Address. I previously listed some changes that you could implement to make the world a better place on my post '100 ways to help the world and yourself'.
Anyway, a few points from the thread about what people would change if they could travel back in time, struck a chord within me:
* Wear sunscreen. Appreciate the power and beauty of now
* Get started on buying assets/property/shares that are affordable now
* Do something that scares you daily/annually
* Don't be reckless with other people's hearts
* Floss - your teeth are precious
* Calcium - your bones will thank you when you're older
* Knees - be nice to them
* Your body is the greatest instrument you will ever own
* Treasure your precious few friends from childhood who has grown up with you
* Spend time with family + friends... you never know the future
* Don't sell assets, always buy
* Play monopoly
* Buy quality, low maintenance type of houses/apartments
* Act on your views, ideas & opportunities
* Keep learning
* Take action!
* Take time out for yourself
* Always read the fine print before signing
* Build your multiple income streams, plant those investment seeds everywhere and they will grow into trees bearing fruit
* Take time to think and contemplate life and the future
* Don't listen to naysayers, doomsayers and negative people
* Take more risks, don't be afraid
* Don't date someone not right for you, have courage to break up earlier
* Buy property when you can afford one, don't wait too long
* Work smarter
* Live simply
* Today may be the halcyon days, don't wait for those days to come
* Don't jump on the first offer, consider every offer before deciding
* Pay your loans on principle and interest, don't always keep paying only interest
* Time is valuable and powerful
* It's dangerous to delegate 'due diligence' in its entirety to property managers/solicitors/conveyancers/brokers etc
You can always find someone with an opinion and advice everywhere you look, but that doesn't mean you should follow all their advice without your own research. Advice is usually more useful if its from someone who has achieved in the area that you want to achieve in.
Maximising interest on your savings
It really pays to move your savings around. Those who are complacent by leaving their savings in a basic transaction account - the banks truly love you. They share the love with you by paying you a lousy 0.01% interest rate per annum.
It's been a while since I've looked around to see which bank is offering the best interest rate. If you don't need your money urgently or anytime soon, it may be more ideal for you to invest your funds in a term deposit. Because I intend on using my funds pretty soon for other purposes, the best thing for me to do is invest it into a high interest account. Flexibility to transfer funds in and out is essential for me at this point in time.
Typically, an online account with minimal human interaction will offer the best yield. The more a bank can computerise their interaction with you, the less staff they need to hire and the less they need to spend on providing services, the higher the rates on offer. Pretty much a win-win situation for both party.
So after having researched who was offering what, I opened up an account with UBank. I first saw their advert in the SMH and thought...sounds dodgy...probably something dodgy...until I saw the smaller font under their name 'backed by NAB.' NAB is one of our big four banks so that sounds pretty credible. Still, everything should be investigated first.
I went to NAB's site and read up on the UBank initiative of theirs. It is pretty much NAB dressed in Green and trying to corner the online-high-interest-rate chasers. Er...that means me! :) Anyway, I have now opened up my account, it took about10-15 minutes to fill out the forms online and you will need verifying documents of course (Medicare, Tax File Number, Passport number etc). CBAs lousy offering of 4.5% pa pales in comparison to UBank's 6.01%pa variable interest rate. They both compound monthly.
UBank is structured almost like ING Direct. However, ING has been resting on their laurels. What are the best features to look for? High interest, no-fee savings account, bonus interest (total interest rate of 6.51%pa) if you really want to setup the Automatic Savings Plan (which is a pita and takes approximately 4 days before the funds are available).
I used to bank with Bankwest but their high interest is only temporary nowadays. Most other banks have high interest teaser rates but after 4-6 months they revert to rates that are pretty lame. Not to mention, I've been trying to cancel my Bankwest account for almost a year now, but they seem reluctant to let go! Crazy. I still get statements from them and my online banking is still operational despite sending them two cancellation requests by writing and calling them up.
It's been a while since I've looked around to see which bank is offering the best interest rate. If you don't need your money urgently or anytime soon, it may be more ideal for you to invest your funds in a term deposit. Because I intend on using my funds pretty soon for other purposes, the best thing for me to do is invest it into a high interest account. Flexibility to transfer funds in and out is essential for me at this point in time.
Typically, an online account with minimal human interaction will offer the best yield. The more a bank can computerise their interaction with you, the less staff they need to hire and the less they need to spend on providing services, the higher the rates on offer. Pretty much a win-win situation for both party.
So after having researched who was offering what, I opened up an account with UBank. I first saw their advert in the SMH and thought...sounds dodgy...probably something dodgy...until I saw the smaller font under their name 'backed by NAB.' NAB is one of our big four banks so that sounds pretty credible. Still, everything should be investigated first.
I went to NAB's site and read up on the UBank initiative of theirs. It is pretty much NAB dressed in Green and trying to corner the online-high-interest-rate chasers. Er...that means me! :) Anyway, I have now opened up my account, it took about10-15 minutes to fill out the forms online and you will need verifying documents of course (Medicare, Tax File Number, Passport number etc). CBAs lousy offering of 4.5% pa pales in comparison to UBank's 6.01%pa variable interest rate. They both compound monthly.
UBank is structured almost like ING Direct. However, ING has been resting on their laurels. What are the best features to look for? High interest, no-fee savings account, bonus interest (total interest rate of 6.51%pa) if you really want to setup the Automatic Savings Plan (which is a pita and takes approximately 4 days before the funds are available).
I used to bank with Bankwest but their high interest is only temporary nowadays. Most other banks have high interest teaser rates but after 4-6 months they revert to rates that are pretty lame. Not to mention, I've been trying to cancel my Bankwest account for almost a year now, but they seem reluctant to let go! Crazy. I still get statements from them and my online banking is still operational despite sending them two cancellation requests by writing and calling them up.
Why should anyone remain loyal to their bank when their bank doesn't care about loyalty. Anyway, UBank are so confident in their interest rate that they even have a table of their competitors latest offerings . How convenient.
If you're looking for the banks that offer the highest interests, see the table at the beginning of this post.
If you're looking for the banks that offer the highest interests, see the table at the beginning of this post.
Monday, August 2, 2010
http://aatrans.net/ is a scam so beware!
I'm not sure how long it takes Google to list and link my blog posts up to various topics so I'm doing my best in informing any potential buyers that AA Trans is a shipping container scam and do not under any circumstances, pay this swindler for shipping containers. It is a scam of evolving identities and this same fraudster keeps altering his/her identity slightly before going on ebay and online sale sites again to sell this fraud.
How do I know? I know someone who is a victim of this scam and it serves to remind me and everyone else to be wary when transacting your shopping online. I've researched into this scam and have discovered a few things. There are a few issues involved here:
1) Identity theft of Andrew Avis from the legitimate AA Transport Pty Ltd business by fraudster/scam artist "Alex Anderson" (highly likely a faked name). He stole Andrew Avis' company name and ABN number to document his invoice. Address theft by using a fake address 44 Botany Road. However a quick Google (map & streetview) and a phone call from me confirms that the business at that address is Community Broadcasting Association of Australia and they have nothing to do with shipping containers.
2) The scam artist has a bank account with Bank of Queensland (BOQ) (bsb: 124 036, account: 21472696) - do NOT under any circumstances, deposit your payment into this account because you will be scammed. I contacted BOQ yesterday and Sharon at their WA/Perth call centre said that it wasn't any of their business to deal with third parties (myself) and that they can't do anything about it. This is why fraudsters/scammers continue to proliferate. If banks such as the BOQ can't be pro-active in tackling the first mention of scam involvement then these scammers can keep conning many victims until the police can get their act together and interfere- this may take a long time since they have so many cases on hand.
Beware because it appears that this shipping container fraudster has been operating a string of frauds along the exact same line since last year. And no-one has stopped them yet! The same things occur again and again based on my investigation of the latest scam.
3)The domain http://aatrans.net/ was registered only on 7th July this year. So only 1 month ago. You can check it up yourself on a popular IT domain search site whois.com.au
A website so newly registered should scream out beware.
4)This "http://aatrans.net/" scam appears to be the third shipping container scam devised by the same person/group who scammed over 90 people last year and this year with "freight.forward" , "vicremovals - http://www.vicremovals.com and now aatrans.net scam.
Unfortunately for the person I know, they have already transferred funds to the BOQ account and that $2,500 is most likely a write off. If you have found yourself the victim of a scam, the steps you should take to sort out the mess and try to recover your funds will be:
1)If you paid by paypal or credit card, then you can dispute the transaction with paypal or your bank and request a chargeback
2)If you paid by direct deposit or cash then it's highly likely that you have unfortunately lost your money and the avenue of refund is very minimal
3)Contact your bank ASAP regardless of whatever means you used to pay the transaction or dodgy invoice
4)Contact your local police and report the theft/crime/fraud/scam
5)Contact the government agencies ASIC and ACCC to report the fraud/scam so that they can start investigations
To read further materials on how to spot and identify scams you can visit the following sites:
* http://www.consumerfraudreporting.org/
*http://www.scamwatch.gov.au/content/index.phtml/itemId/693900Some basic checkups that you can do yourself before you pay anyone when shopping online is:
1)Check their selling history or lack of history
2)Warning signs:
*A product is advertised at a very low price.
*The seller and any initial bidders have a very poor rating on an auction site.
*The other party wants to complete the sale outside of the auction site (if you do this, you lose any protections that the site operator offer to their users).
*The other party insists on immediate payment, or payment by electronic funds transfer or a wire service.
*The online shopping website does not provide adequate information about privacy, terms and conditions of use, dispute resolution or contact details.
3)If they issue you an invoice, do a thorough search on government databases(eg: ASIC) on the company name, who it is registered to, whether the address matches the company name, check Google map/streetview to give you a better idea (warning flags if you are buying from a shop yet the Google map/streetview points you at a residential house that looks nothing like a shop!)
4)Google the business and check whitepages/yellow pages registrations and call the number on those listings to verify
5)Check their domain on http://www.whois.com.au/ and if it has been newly registered then that may also be a warning sign
6)You can also check their IP Address with http://ip-lookup.net/(this can be found by looking at where emails originated from). For example, an email that I received from Amicroe Pty Ltd had the following IP numbers "211.26.140.226" and when searched it came back with the right match which you can see here http://ip-lookup.net/index.php?ip=211.26.140.226
7)Be careful when you are buying from a company that is supposed to be local, however after your research, you see that the domains/IP Addresses are registered in some foreign countries
8)Check that the ABN is valid and still active and matches the company name. You can do this with ASIC -http://www.search.asic.gov.au/gns001.html
9)Ask yourself if the claims made about the product are reasonable or just too good to be true. Be suspicious of online shopping websites that do not give their full contact details (physical or street address as well as phone and fax numbers).
10)Be very careful about paying by credit card and make sure the website used for payments is secure. Look for an unbroken key or lock at the bottom(this can also be at the top) of the browser window, or a web address beginning with ‘https//:’
11)Be wary when the person or company that you're transacting with has a sense of urgency about them when they try to get you to pay. This 'AA Trans' scam fellow used the following words to invoke a sense of urgency "I only have a few spots left this week so I'm really running out of time" - yep he was definitely running out of time...time to collect the funds and hurry off to the next scam victim before someone catches wind of the scam and the police is on their trail
Anyway, I hope that my recap of my investigations may shed light on how you can also investigate a business, person or transaction before you deal with them to verify that it is indeed, authentic and that you are not being scammed. Unfortunately for the poor victims swindled, it was painful for them to actually drive out to 44 Botany Road, Alexandria in search of their undelivered shipping containers only to discover that there is no shipping container site. It is infact the site of office buildings and takeaway food shops and urban development.
It is too late to regret after you've been scammed. All you can hope for is to protect yourself against future scams.
[Edit 12/05/12: The shipping container scammer appears to be making the rounds in the United Kingdom and London this time around- pls visit this post and have a read so that you don't get scammed: http://smartmoneyguide.blogspot.com.au/2012/05/united-kingdom-beware-of-shipping.html ]
How do I know? I know someone who is a victim of this scam and it serves to remind me and everyone else to be wary when transacting your shopping online. I've researched into this scam and have discovered a few things. There are a few issues involved here:
1) Identity theft of Andrew Avis from the legitimate AA Transport Pty Ltd business by fraudster/scam artist "Alex Anderson" (highly likely a faked name). He stole Andrew Avis' company name and ABN number to document his invoice. Address theft by using a fake address 44 Botany Road. However a quick Google (map & streetview) and a phone call from me confirms that the business at that address is Community Broadcasting Association of Australia and they have nothing to do with shipping containers.
2) The scam artist has a bank account with Bank of Queensland (BOQ) (bsb: 124 036, account: 21472696) - do NOT under any circumstances, deposit your payment into this account because you will be scammed. I contacted BOQ yesterday and Sharon at their WA/Perth call centre said that it wasn't any of their business to deal with third parties (myself) and that they can't do anything about it. This is why fraudsters/scammers continue to proliferate. If banks such as the BOQ can't be pro-active in tackling the first mention of scam involvement then these scammers can keep conning many victims until the police can get their act together and interfere- this may take a long time since they have so many cases on hand.
Beware because it appears that this shipping container fraudster has been operating a string of frauds along the exact same line since last year. And no-one has stopped them yet! The same things occur again and again based on my investigation of the latest scam.
3)The domain http://aatrans.net/ was registered only on 7th July this year. So only 1 month ago. You can check it up yourself on a popular IT domain search site whois.com.au
A website so newly registered should scream out beware.
4)This "http://aatrans.net/" scam appears to be the third shipping container scam devised by the same person/group who scammed over 90 people last year and this year with "freight.forward" , "vicremovals - http://www.vicremovals.com and now aatrans.net scam.
Unfortunately for the person I know, they have already transferred funds to the BOQ account and that $2,500 is most likely a write off. If you have found yourself the victim of a scam, the steps you should take to sort out the mess and try to recover your funds will be:
1)If you paid by paypal or credit card, then you can dispute the transaction with paypal or your bank and request a chargeback
2)If you paid by direct deposit or cash then it's highly likely that you have unfortunately lost your money and the avenue of refund is very minimal
3)Contact your bank ASAP regardless of whatever means you used to pay the transaction or dodgy invoice
4)Contact your local police and report the theft/crime/fraud/scam
5)Contact the government agencies ASIC and ACCC to report the fraud/scam so that they can start investigations
To read further materials on how to spot and identify scams you can visit the following sites:
* http://www.consumerfraudreporting.org/
*http://www.scamwatch.gov.au/content/index.phtml/itemId/693900Some basic checkups that you can do yourself before you pay anyone when shopping online is:
1)Check their selling history or lack of history
2)Warning signs:
*A product is advertised at a very low price.
*The seller and any initial bidders have a very poor rating on an auction site.
*The other party wants to complete the sale outside of the auction site (if you do this, you lose any protections that the site operator offer to their users).
*The other party insists on immediate payment, or payment by electronic funds transfer or a wire service.
*The online shopping website does not provide adequate information about privacy, terms and conditions of use, dispute resolution or contact details.
3)If they issue you an invoice, do a thorough search on government databases(eg: ASIC) on the company name, who it is registered to, whether the address matches the company name, check Google map/streetview to give you a better idea (warning flags if you are buying from a shop yet the Google map/streetview points you at a residential house that looks nothing like a shop!)
4)Google the business and check whitepages/yellow pages registrations and call the number on those listings to verify
5)Check their domain on http://www.whois.com.au/ and if it has been newly registered then that may also be a warning sign
6)You can also check their IP Address with http://ip-lookup.net/(this can be found by looking at where emails originated from). For example, an email that I received from Amicroe Pty Ltd had the following IP numbers "211.26.140.226" and when searched it came back with the right match which you can see here http://ip-lookup.net/index.php?ip=211.26.140.226
7)Be careful when you are buying from a company that is supposed to be local, however after your research, you see that the domains/IP Addresses are registered in some foreign countries
8)Check that the ABN is valid and still active and matches the company name. You can do this with ASIC -http://www.search.asic.gov.au/gns001.html
9)Ask yourself if the claims made about the product are reasonable or just too good to be true. Be suspicious of online shopping websites that do not give their full contact details (physical or street address as well as phone and fax numbers).
10)Be very careful about paying by credit card and make sure the website used for payments is secure. Look for an unbroken key or lock at the bottom(this can also be at the top) of the browser window, or a web address beginning with ‘https//:’
11)Be wary when the person or company that you're transacting with has a sense of urgency about them when they try to get you to pay. This 'AA Trans' scam fellow used the following words to invoke a sense of urgency "I only have a few spots left this week so I'm really running out of time" - yep he was definitely running out of time...time to collect the funds and hurry off to the next scam victim before someone catches wind of the scam and the police is on their trail
Anyway, I hope that my recap of my investigations may shed light on how you can also investigate a business, person or transaction before you deal with them to verify that it is indeed, authentic and that you are not being scammed. Unfortunately for the poor victims swindled, it was painful for them to actually drive out to 44 Botany Road, Alexandria in search of their undelivered shipping containers only to discover that there is no shipping container site. It is infact the site of office buildings and takeaway food shops and urban development.
It is too late to regret after you've been scammed. All you can hope for is to protect yourself against future scams.
[Edit 12/05/12: The shipping container scammer appears to be making the rounds in the United Kingdom and London this time around- pls visit this post and have a read so that you don't get scammed: http://smartmoneyguide.blogspot.com.au/2012/05/united-kingdom-beware-of-shipping.html ]
Tuesday, July 13, 2010
How to lose your life savings
Bernie Madoff Ponzi Scheme (Bernard L Madoff Investment Securities LLC): $65 billion with losses to investors of $18 billion
Roger Munro Ponzi Scheme (RG Munro Futures): $100 million with the money missing, either lost or spread around the world
We all think we are indomitable and are too smart to be victims of fraudsters and ponzi schemes. But if we're all so smart then how come ponzi schemes continue to flourish and every time there's a downturn in the economy, another bunch of folks have lost thousands, millions or their life savings due to these ponzi schemes? It's not just your typical neighbour next door that gets caught by these sophisticated swindlers but also multi-millionaires. Don't they have a swag of accountants and lawyers working for them? Is that just blatant greed or blatant stupidity?
I mean, how can you entrust anyone or any single investment firm with your life savings?! Haven't they heard of the term diversification? Or being responsible for your own funds? Don't they realise that if it's too good to be true then it usually is or the greater the returns, the higher the risks. So if someone approached you with an investment opportunity that returned yields of 20% -40% annually with minimal risks, kick them out. Even 15% return year on year with minimal risk is asking a lot...especially in these uncertain times with the stock market behaving like a moody teenager.
Ponzi schemes and Nigerian schemes are usually everywhere...from the investments where you're required to outlay a few hundred bucks to a few thousand dollars upfront to beable to become 'privy' to rort your friends and relatives. Or the emails telling you that they require your bank account to hide or deposit some money. If people became a lot smarter and stopped falling for these scams then I wouldn't have to spend so much time cleaning the spam out of my inboxes.
Beside the most recent frauster Bernie Madoff, Australia has it's own fraudster in Roger Munro. Reading about how he managed to scam his victims made me feel as if I was living in the twilight zone. Munro is crazy enough to even try blackmailing his victims to support him in getting ASIC to return his passport (don't do it guys, he will just jet off to some country like Christopher Skase), pay his legal costs and drop all allegations against him.
Madoff is quoted saying "People just kept throwing money at me."
Susan Chenery's article on Munro examined their similar attitude and 'exclusive' style of investing. If it's too exclusive to join...you shouldn't join, if any investment adviser or investment firm can't or won't answer your questions, then you won't like the answers - moral of the story.
Tim Swallow, one of Munro's victim says:
Roger Munro Ponzi Scheme (RG Munro Futures): $100 million with the money missing, either lost or spread around the world
We all think we are indomitable and are too smart to be victims of fraudsters and ponzi schemes. But if we're all so smart then how come ponzi schemes continue to flourish and every time there's a downturn in the economy, another bunch of folks have lost thousands, millions or their life savings due to these ponzi schemes? It's not just your typical neighbour next door that gets caught by these sophisticated swindlers but also multi-millionaires. Don't they have a swag of accountants and lawyers working for them? Is that just blatant greed or blatant stupidity?
I mean, how can you entrust anyone or any single investment firm with your life savings?! Haven't they heard of the term diversification? Or being responsible for your own funds? Don't they realise that if it's too good to be true then it usually is or the greater the returns, the higher the risks. So if someone approached you with an investment opportunity that returned yields of 20% -40% annually with minimal risks, kick them out. Even 15% return year on year with minimal risk is asking a lot...especially in these uncertain times with the stock market behaving like a moody teenager.
Ponzi schemes and Nigerian schemes are usually everywhere...from the investments where you're required to outlay a few hundred bucks to a few thousand dollars upfront to beable to become 'privy' to rort your friends and relatives. Or the emails telling you that they require your bank account to hide or deposit some money. If people became a lot smarter and stopped falling for these scams then I wouldn't have to spend so much time cleaning the spam out of my inboxes.
Beside the most recent frauster Bernie Madoff, Australia has it's own fraudster in Roger Munro. Reading about how he managed to scam his victims made me feel as if I was living in the twilight zone. Munro is crazy enough to even try blackmailing his victims to support him in getting ASIC to return his passport (don't do it guys, he will just jet off to some country like Christopher Skase), pay his legal costs and drop all allegations against him.
Madoff is quoted saying "People just kept throwing money at me."
Susan Chenery's article on Munro examined their similar attitude and 'exclusive' style of investing. If it's too exclusive to join...you shouldn't join, if any investment adviser or investment firm can't or won't answer your questions, then you won't like the answers - moral of the story.
Tim Swallow, one of Munro's victim says:
"I observed everybody for about four years and everybody
seemed to be making a lot of money. It was easy money. If you make money quickly and easily, you think it is going to go on forever... All people like Munro do is play to people's greed, which is the root of it all."
Trevor King supposedly lost $31 million and an American Oil Consortium lost $23 million. Other investors (about 68 of them) lost varying amounts. Don't they have accountants and lawyers who help draft documents and audit figures before they allow their clients to invest? It's amazing that Jim Thompson, one of Munro's victim even decided to invest after being quoted as stating:
"We asked for some confirming documents regarding the results
he was claiming to achieve consistently and his reaction gave the impression that we were casting doubts on his assertions- no way to behave if we wanted the privilege of being allowed to join his circle of investors...He also told us he traded using a secret system he himself had devised, in currencies, securities, options and indices in international markets; he had live feeds set up which told him what
was going on...We had to leave it entirely up to him to decide what to do. He didn't want to be questioned or asked to prove anything. He demanded unquestioning respect."
So Munro was rather secretive, rude and provided no evidence or supporting documents of his success yet Thompson invested $1,005,000 with RG Munro Futures? Some investors need to get their heads checked. Why on earth would anyone entrust their life savings or a few million to an 'investment' where they don't get any reports or investment break down of how the fund returned 20% plus for several years.
Not only that, but for someone to amass a few millions, you would think they would be more thorough about where they invest their funds. It also raises the question of Munro's supposed expertise across several investment categories (currencies, securities and options) when most specialised traders find it hard to even master and predict what is going to happen in a single category such as currencies.
Also, the reliance on a 'trading system' that he had devised... the problems with most trading systems are that they neglect or cannot account for human fear nor greed. They can't program human pyschology and behaviour with accuracy. Human behaviour and how we all react collectively as a group determines the direction in which the market moves.
Greed allows fraudsters to flourish and unfortunately, the inability or poor ability of the SEC, ASIC and ACCC means that we, as the investor, have to watch out for our own bacon and ensure we don't get fleeced.
Bills, bills, bills and the crazy months
Don't you just hate it when you go through months of never-ending bills?! Or even periods of never ending bills?!
A few months that I'm not particularly keen on are January, June, July & December for those reasons. I never like paying my bills monthly so I elect to pay them upfront and annually if that option is applicable. Less hassles and no need to think about them for a year after they're paid. When I was young, my parents told me that once you pay your bills, that's it. No more time wasted on thinking about it. Time is valuable. Each bill occupies about two minutes of my life. Two minutes is the time it takes me to open up the envelope, check the bill, note the due date on my calender and the time it takes to pay the bill online on that due date.
The problem with setting bills aside and paying them later is that you have to keep thinking about them until the moment you pay them. Same with monthly bills. You have to keep thinking about paying them monthly and if it's on automatic debit then you have to ensure you keep sufficient funds in your transaction account to pay for them. So an annual bill will consume two minutes of my time and a monthly bill will consume 24 minutes of my time in a year.
For those in financial trouble, not only do you waste time thinking about the bills, you waste time when you have to open up overdue reminder letters and emails, you waste your time calling up to re-connect services that got disconnected or suspended due to not paying your bills and you also waste time when you have debt collectors calling to hassle you. That could be 15 to 30 minutes per bill. So if you have lots of bills, think of all that time you waste on them!
Not sure why this year feels any different but it does. Maybe it's because the price of everything has escalated. Inflation- food/groceries, insurances, energy prices, transport, blah blah blah. I've been keeping an exact tally of my expenses out of curiousity in trying to determine what I spend on each typical 'budget' category since I don't have a budget and was curious after reading a few bloggers insight into their spending.
So how can I write a financial/money blog if I don't have a budget? I'm more interested about the strategies to investing and how to invest for the future rather than the baby steps of saving money since that is not a major issue for me. I guess you could say I have a rough budget. A simple one. If I earn $x per week, then I have to spend less than $x per week. You know, the wise idea of spending less than you earn. I've never bothered with the tiny details because I knew that I have savings and investments that I could liquidate to meet any massive emergency bills.
The main strategy that I believe works really well is to transfer any excess savings to a high interest savings account. When you have sufficient savings - move them into investment vehicles (my personal preferences are stocks and real estate). Any new bills that arrive, they are to be deducted out of your current income so you just spend less for that week or the next few weeks until they you pay them.
Very rarely do I spend my previous savings. Only in real emergencies and they are rare and more the exception. Most large annual bills are recurring anyway so you should know when they're going to be issued and when they should be paid.
Eg: I knew I had car bills due every June that amounted to roughly $2724 and that's just car bills(pink slip, green slip, insurance, rta road rego, car servicing and replacing tyres)...ouch. So I had to cut back on discretionary expenses a bit in May to pay the expected bills out of current income and not use previous savings. That way, my investments and savings are left alone to re-invest and compound without me interfering with them.
The aim is to never erode your previous savings and investments. That's the secret to building wealth and growing your assets. If you own your own business, even better.
We all have those months where the bills are never-ending and the goal is to not give into temptation and reach into your savings or emergency funds to pay for them. Try to adjust your discretionary expenses so you can pay your bills out of your current income until those expenses are paid for.
A few months that I'm not particularly keen on are January, June, July & December for those reasons. I never like paying my bills monthly so I elect to pay them upfront and annually if that option is applicable. Less hassles and no need to think about them for a year after they're paid. When I was young, my parents told me that once you pay your bills, that's it. No more time wasted on thinking about it. Time is valuable. Each bill occupies about two minutes of my life. Two minutes is the time it takes me to open up the envelope, check the bill, note the due date on my calender and the time it takes to pay the bill online on that due date.
The problem with setting bills aside and paying them later is that you have to keep thinking about them until the moment you pay them. Same with monthly bills. You have to keep thinking about paying them monthly and if it's on automatic debit then you have to ensure you keep sufficient funds in your transaction account to pay for them. So an annual bill will consume two minutes of my time and a monthly bill will consume 24 minutes of my time in a year.
For those in financial trouble, not only do you waste time thinking about the bills, you waste time when you have to open up overdue reminder letters and emails, you waste your time calling up to re-connect services that got disconnected or suspended due to not paying your bills and you also waste time when you have debt collectors calling to hassle you. That could be 15 to 30 minutes per bill. So if you have lots of bills, think of all that time you waste on them!
Not sure why this year feels any different but it does. Maybe it's because the price of everything has escalated. Inflation- food/groceries, insurances, energy prices, transport, blah blah blah. I've been keeping an exact tally of my expenses out of curiousity in trying to determine what I spend on each typical 'budget' category since I don't have a budget and was curious after reading a few bloggers insight into their spending.
So how can I write a financial/money blog if I don't have a budget? I'm more interested about the strategies to investing and how to invest for the future rather than the baby steps of saving money since that is not a major issue for me. I guess you could say I have a rough budget. A simple one. If I earn $x per week, then I have to spend less than $x per week. You know, the wise idea of spending less than you earn. I've never bothered with the tiny details because I knew that I have savings and investments that I could liquidate to meet any massive emergency bills.
The main strategy that I believe works really well is to transfer any excess savings to a high interest savings account. When you have sufficient savings - move them into investment vehicles (my personal preferences are stocks and real estate). Any new bills that arrive, they are to be deducted out of your current income so you just spend less for that week or the next few weeks until they you pay them.
Very rarely do I spend my previous savings. Only in real emergencies and they are rare and more the exception. Most large annual bills are recurring anyway so you should know when they're going to be issued and when they should be paid.
Eg: I knew I had car bills due every June that amounted to roughly $2724 and that's just car bills(pink slip, green slip, insurance, rta road rego, car servicing and replacing tyres)...ouch. So I had to cut back on discretionary expenses a bit in May to pay the expected bills out of current income and not use previous savings. That way, my investments and savings are left alone to re-invest and compound without me interfering with them.
The aim is to never erode your previous savings and investments. That's the secret to building wealth and growing your assets. If you own your own business, even better.
We all have those months where the bills are never-ending and the goal is to not give into temptation and reach into your savings or emergency funds to pay for them. Try to adjust your discretionary expenses so you can pay your bills out of your current income until those expenses are paid for.
Subscribe to:
Posts (Atom)