Lockdown Tips #2

I hope my lockdown video for this week will help and amuse you! The points in it are so important that I’ll list them again in this post.  

  1. START WITH A MORNING WALK – it’s VITAL. With gyms in Sydney still closed, it’s even more critical. Don’t lie in bed ruminating with “Should I get up or not? … it’s cold … I’ll do it tomorrow … “. Sound familiar?

    I absolutely promise that the very  day you start this new routine you’ll never look back. Your eyes and your cheeks will glow, you’ll feel more positive, and tackle the rest of your day with more energy than you thought you had. In fact, some people I’ve talked to have slowly cut their dependence on antidepressants with regular walks. Its effects are even better in the gym, once it reopens! Read the 20 Benefits of Walking in Move! 1.0 again.

  2. Have CITRUS FRUIT and at least 2 glasses of water before your walk. After 7 hours or so of sleep, you must hydrate! Water stimulates your colon – perfect with your walk to prevent constipation.

  3. FREE YOUR MIND while you walk. Look at the trees, the sky, listen to the birds. No talking on smartphones – especially if the kids are out with you. The hour or so you have on your walk is precious. Don’t waste it. Attend to any young kids at home, and then take them out with you. 

  4. Use your family lockdown time WISELY. Infants and toddlers can be draining I know, but try talking calmly to them, sing a song together or hum a tune. 

  5. Teach kids HEALTHY EATING. Start with helping them understand the body’s digestive process. Knowing how their heart, lungs, liver and kidneys function reinforces the importance of eating and exercising well. Read my post on ‘Sweet Addicts, Healthy Kids’. There are excellent books available suitable for kids 5 years and up, and I’ve put up a couple on the video. Order 1 or 2 online if you can – I recommend the Australian site ‘Booktopia’.

  6. Teach kids to SAVE. Principles of building wealth and saving is what ALL children should be taught – and it’s your job! Critically they must learn that money is not about greed and power, but having choices and being financially independent. Start with credit card debt. $1000 owed could double and even triple over time if not paid off in full. But saving only small amounts can increase month after month, as long as they keep saving. 

  7. Teach kids SHARES – from as early as 8! If they save only $500, you can buy shares for them until they turn 18.

Explain bank interest to them, and how today’s rates are so low that shares are the go. If they’re mature enough, throw LICs and ETFs at them. I cover this in Invest 3.0. They could buy a share in a store they actually go to, eg. JB Hi-Fi or Athlete’s Foot.

They love their smartphones don’t they? Do they know who their phone internet provider is? Telstra, TPG or Aussie Broadband perhaps?

Ask them what they think their phones and iPads are made from? Statistica.com provides very useful smartphone data for them to look up – eg. iron, lead, zinc, tin, copper and aluminium to name a few. Now, which ASX companies produce these materials? BHP and Rio Tinto are 2.

Get the kids to pick 2 stocks each, eg. JBs and Athlete’s Foot. They can start a ‘pretend’ watchlist on the ASX website. Check the share prices with them often. At least 1 person in the family will be hooked, want to know more and do their own research – exactly what happened with me. I sat with Dad everyday while he showed me his list of rubber and tin stocks! 

Now, isn’t this so much better than talking about nothing or posting on social media? Time is their greatest asset: make sure they know how to use it!


LOCKDOWN TIPS #1

You’ve had a lot to take in recently with ‘About Investing’ – and your responses have been very encouraging! I’ll update you with more investing tips in the coming weeks. In the meantime, log on to the ASX for more info if you haven’t already.

Meanwhile, just when we thought it was safe to leave our masks at home … it’s lockdown in Sydney, Melbourne and Adelaide as at 21 July. How long for, we’re all asking? It’s like predicting the sharemarket’s ups and downs. No-one can. 

We’re confined to our homes. Working, schooling and caring is difficult and frustrating at best. If your work’s an ‘essential service’, at least you’re getting out-of-doors therapy. The rest of us have to make the best of it. (By the way, I think hairdressers and barbers are essential; maybe we could go in, masked, one at a time?) 

Loo paper aside, how should we prepare?

  1. Buy fresh, green vegetables and carrots. (You can’t give the “no time!” excuse now!) Make a lunchtime and evening salad with grated (or whole) carrots and your choice of sliced fennel bulbs, cos lettuce and celery. Scrub and wash the veggies and chew. Skip the processed dressings: lemon juice, parsley and rocket are enough to liven them up!  
  1. Buy citrus fruit (including kiwis), apples and/or red papaya. Slice and eat with a squeeze of lime. Have your citrus juiced or quartered first thing in the morning, and apples between breakfast and lunch.
  1. Stock your pantry with healthy carbs – ie. wholegrain oats or Weetbix, sourdough, Turkish, multigrain or wholemeal pita bread, pasta, and rice or rice noodles (no instant noodles or horrible flavour sachets). All can be bought from your nearest supermarket; Deliveroo can knock on someone else’s door.

    I know you’ll rush for comfort food (‘discomfort food’ as I term it) – this becomes especially unhealthy if you’re stuck at home, sedentary and eating it daily. It’s dangerous, addictive and a hard habit to break. 
  1. Exercise. The gym’s closed, so WALK! I do at least 2 to 3kms a day (or more if I need to). PLEASE make this a must-do part of your day. Don’t make friends with our arch-foe  resistance, which lulls us into this ‘‘why bother?’’ attitude. Succumb and you’ll regret it. 
  1. Relax and focus with a good book. I recommend Eat Like The Animals by Stephen Simpson and David Raubenheimer. Their 2 videos have featured on my website for many weeks now. I still have copies to give away, so please watch the clips to find out how to get one. Read the book for your own sake and for your kids! 

Healthy light food & snack preps 

  • Have your healthy breads toasted with egg, cheese, tuna or shredded chicken or falafel. Add lettuce or tomato. 
  • For snacks try Vita-Wheat with peanut butter, Greek yoghurt with honey.
  • If you need a sugar fix, have dried figs, pear or apricot. Soak overnight, drain the water, add a dollop of cream and a few walnuts or almonds. 
  • Pastry lovers should try a crumpet instead of a biscuit. How does cream cheese and jam or just honey on one sound? Kids will love it too!
  • If you desperately need chocolate, dark is best (it’s low in sugar), but milk chocolate is OK. Have a few almonds or walnuts with it for fibre. 

All this and suggestions for lunch and dinner meals are in my earlier posts.

Emotionally distance yourself from any nasties still lurking in your pantry. NOW’S THE TIME TO THROW THEM OUT!!  

Please keep your questions, comments and suggestions coming – I simply LOVE receiving them!

Share your thoughts on our Let’s Talk page


Invest 6.0: Future planning

We’ve come to the final segment of our stockmarket adventure, where I’ll explain retirement funds and give you a selection of shares to start your portfolio. 

  1. Decide the kind of investor you’d like to be. Make it simple and narrow it down. Are you ‘conservative’ or ‘active’? I’ve made suggestions in Invest 5.0 to help you decide, so you can enhance your investment options.
  1. Know what your financial position will be at retirement: this applies whether you’re conservative or active. It means knowing your income and expenses, which will depend on your tax bracket, mortgage repayments, and any pension and/or social security benefits you may receive. 
  1. Know your tax threshold according to your tax bracket. The Australian Tax Office provides details of individual income tax rates. Saying “I can’t get my head around any of this!” will not get you far – you will never understand if you don’t take the time to find out. BUT: if you need an accountant to sort out your tax, get one. 

Buying & keeping shares

Having started so early, the sharemarket is now my second language – but what I learned in the 60s and 70s was not complicated!  

  1. We bought dividend-paying ‘yield’ stocks, giving us a good income 
  2. Saw new opportunities in ‘growth’ stocks
  3. Picked 10 of those growth stocks and discussed them with our groups
  4. Traded and waited.


Some of my shares took off within months, others after years; four would die a slow death. Still believing they could be resuscitated, we have this bad habit of clinging on and not selling even if the share/s make up just a fraction of our portfolio. Psychologists believe our reluctance to take a loss is greater than accepting a gain. Very true!  

TIP:  If your stock falls, say by 10–20%, it may be a good idea to get out of it quickly. As long as you can show profits from other share trades in your tax return, you can also off-set losses.  

Internet & media

The internet has now made investing easier. We simply click to buy, sell and research without having to talk to a single person or see a stockbroker. But the noise-info from financial ‘experts’ and economists has overwhelmed and confused many of you. Notice that their predictions are always accompanied by “maybe”, “most likely”, and/or “if management continues on this growth trajectory … “ Is this at all helpful??

The fact is nobody knows the future and profits generated the year before may not continue to the next. Have you picked up how the media, right on target, come out in droves when there’s a ‘bear’ market crash? They simply love the chance to go on TV or social media, telling you how much the shares have fallen and how much your  superannuation has dropped. And they do the opposite when shares rise sharply in a ‘bull’ market – crying “it’s boom time’’ rattling off the stocks that have risen so much, it makes you sick that you didn’t ‘get in’ earlier!! 

You know what? WE can do much much better.  

Spend-control

First remove the fear of investing. I get it that most of you are clinging on to your hard-earned savings, earning a measly 1% interest. Let’s put spending in perspective.  

In the past year, how much have you ladies spent on toiletries, fragrances, shampoos, and skin-care? Clothes, shoes, accessories? Cleaning products, cookware, kitchen gadgets? And how much have you men spent on electrical gizmos, computer games and equipment, and sports gear? Have we actually used every single item of stuff we’ve bought?

And then there’s eating out. Have we splurged on decadent breakfasts or lunches where only 1 serving costs more than an actual dinner? Have we bought presents thoughtlessly? We often give kids rubbish. Why not deposit money in their bank accounts?

Calculate all your misspends. Excluding food you’ve thrown away, what does it come to in the course of a year? We don’t give a thought to the money we’ve wasted but focus instead on the money we may lose!

My father and his friends would frown on such thinking. They invested wisely with thousands, but avoided supermarkets for Singapore’s (clean) wet markets – buying fruit and vegetables dollars cheaper per kilo.   

Managed funds

You might be feeling complacent with your superannuation and other managed funds without getting more involved – but you should read your fund’s annual financial report. In particular:    

  • How your fund is performing
  • Management and investment fees charged
  • How and where your money is being invested.
  • Invest in at least 1 online daily newspaper – they’re quick to alert of any argy-bargy with investment products.

In a superannuation portfolio for example, you’ll usually see a pie-chart divided into coloured segments totalling 100%, showing where your money is being invested. Fund managers will alter percentages according to market changes in the short to medium-term. Here’s the pie-chart of my own super fund:

  • Equities: Shares
  • Private equity: International or Australian companies unlisted on stockmarkets
  • Cash: Safe and secure with low risk, giving 2–3% interest
  • Australian Fixed Interest: Bonds loans issued by the Australian govt – less volatile than shares but lower expected return
  • International Fixed Interest: Bonds as above
  • Credit Income: Covers a range of alternative debt investments
  • Liquid Alternatives: Combines equities (shares), bonds, currencies & commodities
  • Property: Office buildings, shopping centres and industrial estates; residential property, eg. apartments & retirement villages 
  • Infrastructure & real assets: Utilities & facilities providing essential community services.

TIP:  Click the ‘Asset Classes’ link on your super fund’s website for more information.

Superannuation funds usually give you 4 investment options:

  1. Cash‘ 
  2. Capital Stable‘ 
  3. Balanced‘ 
  4. Growth‘ .
  • Cash, Capital Stable and Balanced are safer for those in or near retirement, safeguarding income from regular allocated pension payments in any sharemarket crash. 
  • Growth means share investments for younger people with time to recover after a downturn.  It’s still important to have the Growth option in all portfolios.  When the market recovers, you don’t want to lose out by having all your capital staying in ‘safe’ mode. 

TIP: If super funds bidding to buy Sydney Airport are right, there’ll be a substantial revival in both local and global travel.

A few of my own ASX picks

FINAL TIPS:

Avoid travel stocks WEB, QAN and HLO at present – but keep watch. Every living being with money saved up will be packing their bags to cruise and fly once vaccination rates go up and that awful green spiked ball disappears from our screens.  

Keep up with business news in your daily papers and online. Subscribe to at least 1 of Motley Fool’s many specifically targeted newsletters (eg. ‘Share Advisor’, Extreme Opportunities’, ‘Dividend Investor’ or ‘Hidden Gems’). 

Observe. Talk to people. You’ll develop a keen sense of what the future holds. Therein lies the secret to share investing. Simple enough? 

“TIME IS MONEY. BUT WEALTH IS THE RESULT OF TIME.”

The perfect quote from Scott Phillips of The Motley Fool to end my About Investing series (for now). I simply loved presenting it to you – GOOD LUCK!


Invest 5.0: Personality!

Do you realise that your personality type is critical to your initial and ongoing capacity to invest? It’s so close to home, yet it’s one thing we overlook (or choose to). 

Maybe I should distinguish between personality and temperament

What we all see is your personality: it’s the face you put on. But your temperament is what you are underneath.  

I first learned this in the book Personality Plus by Florence Littauer – a delightful author whom I actually met at a seminar 30 years ago. Reading it made me realise how important it was to understand our inner selves, as she writes: 

“Know what what we’re made of
know why we react as we do
Know our weaknesses and how to overcome them.”
1

This jazzy, fun chart compares the 4 temperaments we apparently have: 

Similar to the chart, Littauer says: 

  • The sanguine’s “optimistic, cheerful and bubbling”
  • The melancholic’s “analytical, detailed, perfectionist”
  • The choleric’s “adventurous, confident, productive”
  • The phlegmatic’s “patient, obliging, consistent, laid back”.2

Decide which temperament you are – but you could be a mixture of them! 

Littauer also gives us a very thorough checklist of strengths and weaknesses to determine our dominant and less dominant personality traits. Please get her book if you can (it’s had numerous reprints). 

So it’s quite clear that by understanding ourselves, we learn to understand others – so important in business and personal relationships. But it’s especially important in INVESTING, where your temperament is key to your ability to make right decisions.

TIP:  Want to be successful? Work on your weaknesses and enhance your strengths!

My dear Dad, in his innocence, knew this. He matched stock recommendations with what he called his clients’ “moods”. Here’s one example.

A wealthy, well-known lady – we’ll call her ‘Patsy Leow’ – used to frequent the Singapore Turf Club in the old days. She loved picking ‘outsiders’3 – but most of her money went on horses with short odds, or ‘favourites’.

Gorgeous Madam ‘X’ is a dead-ringer Patsy Leow! 

 When Madam Leow asked Dad for his share tips, he chose those “that will never go down” – solid companies with increasing yearly profits and paying healthy dividends. He also told her of 2 or 3 shares he liked that were “cheap now but had lots of potential to go up in price”. Her eyes lit up and she said, “Yes, Alex, we’ll put a few thousand on those!” 

Such speculative stocks kept Madam Leow interested: she liked the challenge and excitement in picking a winner that would eventually pay well, and she came back for more. 

So for all you optimistic choleric and sanguine risk-takers – who enjoy a good punt and love to talk about your wins, ‘speckies’ have great appeal, and you’ll likely go this way. 

But worrying melancholics and laid-back phlegmatics amongst you should invest conservatively, limit borrowings and stick to topping up superannuation, investing in property, managed funds, and ETFs or LICs (see Invest 3.0). Such options will suit you perfectly without the compulsive need to check your stocks several times a day!  

In the past, worriers bought “solid” shares which they could “lock up and keep for their children”. It worked well 20 years ago, especially for the banks, but not now. 

I also recall a manager of the Hongkong and Shanghai Bank  pointing to me when I was 8 and saying to Dad: “If you love your daughter, buy her HSBC shares!” My father did more than that – he also bought shares in Standard Chartered Bank, and told his clients to do the same.

TIP:  Banks are no longer stockmarket darlings. ‘Fin-techs’ – a common, current term – relate to digital financial products like ‘Blockchain’. This is looming to weaken dominance of the Australian ‘Big 4’. It’s time to look for other dividend-paying stocks with growth potential.

My personality, my formula

My personality without a doubt influences the shares I buy. But it’s a little more complex. I believe I’m mainly sanguine with a little of the choleric, melancholic and phlegmatic thrown in.  

I love excitement. I’m a risk-taker. I love the unexpected. But at the same time, I’ve learned to be patient and cautious. 

My strategy over the last 40 years was to slowly build my portfolio up to about 30 stocks, and sometimes more. This roughly comprises: 

  • 50% per the ‘IPD’ formula (see Invest 1.0) that tick boxes of income, profit and dividends
  • 30% into ‘growth’ stocks with healthy revenue (ie. income before expenses), but haven’t yet made a profit (ie. income after expenses) 
  • 20% in reserve for stocks with ‘potential’ – but I don’t invest more than $1000 on those. While no-one wants them today, I’m thinking long-term for up to 3 years. 

My advice

  1. Don’t get caught by the FOMO (Fear Of Missing Out) – it’s dangerous!
  1. Assess how much you can invest. Never, never, never over-borrow to buy shares. When the market dives, you’ll still sleep well. The good news is markets always recover. If you’ve invested wisely, your money’s safe. People who’ve told me, “I’ll never buy shares again!”, are those who were bitten by the FOMO bug. They lost their money, their pride, but worse, missed opportunities yet to come.

TIP:  Be patient. There will ALWAYS be a good time to buy. Keep saving and make sure you’re mentally, physically and financially ready to ride the next wave. Happiness isn’t having money, but peace of mind and sleeping well at night.

What should you invest in?

  1. For those about to retire, my best advice is to top-up your superannuation to the max while you’re still working. If you want to have a go and have a spare $1–5K, get Telstra (TLS) and another newish Telco I’ve heard good things about: Aussie Broadband (ABB). TLS has a decent and fully franked dividend. (I hold parcels of Telstra and BDA, I’m watching ABB and may buy soon.)
  1. Want some fun? There are 2 (shock, horror) marijuana stocks you could pick: BOD Australia (BDA) and Althea Group Holdings Limited (AGH). Prices as of 5 July 2021 are 0.37 cents and 0.35 cents respectively. I believe you’ve a fair chance of making a profit in a year. I hold parcels in both shares.
  1. If you’re not ready to start an online trading account, the ASX website is excellent. You can create your watchlist and monitor and research stocks. It also runs several  information sessions throughout the year. 
  1. Worriers should go for managed funds or ASX-listed investment companies (LICs). I’ll give you the ASX codes for some LICs and leave you to research them. Pick 1 or 2 and don’t look at their prices for a few years:

      AFI
      ARG
    –  WAM
    –  WGB
    –  WMI.

You can see that I find all this very thrilling and engaging – I hope you also do by now! That risk element is the motivation we all need to keep us researching, observing and asking questions

I’ll share my vision for the future with you in Invest 6.0.

 1 Littauer, F. (1992). Personality Plus, p.12. Grand Rapids, Michigan: Baker Book House Company.

 2 Littauer, p.19.

 3 What we call ‘long shots’ or ‘roughies’ – ie. horses unlikely to win.

 4 Stockbroker-speak for companies presently sitting in a corner waiting for someone to ask them to dance. Will they eventually take to the dance floor? In my experience, even when only 1 or 2 of them did, I more than made up for those that packed up and left!


Invest 4.0: Lifestyle

I’m now going to get quite personal with you. How does your lifestyle affect your ability (or inability) to invest?

My advice to you is to first take stock of your everyday life. Are you too busy to pay attention to your health? 

In my 20s and early 30s, I ate anything and everything that was ‘easy’ and required the least preparation. I didn’t have an exercise routine and lacked energy and concentration – not good when you have a family and are trying to build a second income. 

What have I realised since?

A regime of healthy eating, exercise, good sleep, social interaction at work and with family and friends sharpens your senses, keeps you motivated and inspires you. Importantly, it lifts your attitude to become open to opportunities and make rational decisions with your money! 

When I look around me, I see many people who frown and seem distressed, worried and anxious. I smile at (mostly) everyone, but no-one smiles back!  I get a certain pleasure in doing this because when even only one person reciprocates, it’s as though I’ve made their day. And often the sad faces I see and meet are those with money problems. 

If this is you now, don’t gamble, invest or make any financial decisions, however attractive the ‘sure thing’ looks. Simply wishing you had more money won’t get you out of this hole. You need to solve your problem quickly. 

What should you do? 

  1. If it’s your health, seek professional advice. Don’t make excuses, or try to figure out what’s wrong with you.  
  1. If it’s your finances, seek professional help or ask someone you know who can guide you in this area. A good Australian resource is the ACCC1 : its ‘Where to get help when you’re in debt’ guide is excellent. It’s important to remember that when you’re feeling ‘low’, you become vulnerable to get-rich schemes that promise ‘instant’ gratification. Gambling, buying shares or investment plans you know little about is DANGEROUS. 
  1. You might be in a troubled relationship – whether intimate, with family or with friends. I believe this is the hardest to reconcile and fix. Whether we like it or not, our lives revolve around those nearest and dearest to us. 
  1. Is your work situation happy or unhappy? I know I couldn’t possibly turn up for 8 to 10 hours a day working in a place that made me miserable. Anyway, I wasn’t ambitious, because the people ‘higher up’ the chain didn’t inspire me.

My first and last permanent job (which lasted 35 years) did not pay a 6-figure salary that my colleagues aspired to. But I LOVED IT.  My goal was to build a second income (my Dad’s advice!) and get home in time to make healthy dinners for my family – not to attend endless meetings, compile reports and spreadsheets. This wasn’t my thing and bored me senseless. 

Building wealth  

Now, that excited me! Reading the business sections of newspapers, talking, listening and observing with the objective of finding the next share to buy. 

When life took a beating, I took a deep breath. I didn’t trade until things went back to normal and I could make rational decisions again. The best part was that because I saved, invested and built my portfolio, it was earning dividends: I could always sell 1 or 2 shares without having to borrow on my credit card.  

Do you dream of being happy, healthy and focused? Your lifestyle determines your wealth or lack of it.

Nothing runs smoothly in life. When there’s a bump on the road, will you grumble and crumble? Or will you be IN CONTROL?  

Well … here’s where your PERSONALITY comes in, in its close link with your lifestyle. Invest 5.0 will explore this very subjective but important element.

 1 Australian Competition & Consumer Commission.

Share your thoughts on our Let’s Talk page


Invest 3.0: Age

Can I assume that by reading this far into ‘About Investing’, you’d like to learn more about the sharemarket?

If so, I hope you’ve now started to save. You need a minimum of AUD500 to buy an ASX-listed company. Add up to about $30 for brokerage costs and GST charged by the online trading platform. (Charges might vary according to the broker.)   

There are 3 important things you need to take into consideration:   

  1. AGE 
  2. LIFESTYLE 
  3. PERSONALITY

I will deal with the age factor in this post. 

Age

This is crucial as to what shares you buy, whether you want income (through dividends) or growth (stocks that have potential to increase and grow your money-tree). 

1. 19 to 25 years  

You’re probably spending too much of your parents’ money and too much time on your devices!

When I was 20, I was already well-acquainted with the stockmarket. It was 1969. Newspapers were full of the astonishing rise of a West Australian nickel company called ‘Poseidon’. Nickel was in great demand from the 1960s due to the Vietnam War. From 80 cents a share in September 1969, Poseidon went up to $280 by February 1970. Some brokers even said it could go up even further. (Advice:  Brokers and ‘experts’ often get it wrong!

Poseidon has in fact been resurrected. But will it take off again?

TIP:  Nickel (Ni) is in demand again, 52 years later.  This ‘power metal’ is used in all things electronic – batteries, electric vehicles, smartphones and medical equipment to name a few.  

TIP: The world’s largest producers in order are: the Philippines, Russia, Canada and Australia.  Pay attention to the nickel producers that have binding supply contracts (i.e. they’ll be there a lot longer).

Finally, 19 to 25s – please read my last 2 Invest posts. You have the precious gift of time. You’re smart. Use your intelligence wisely. Social media influencers won’t make you rich. The sharemarket will

2. 25 to 39 years

I know you really want to buy property – but that could well be beyond your reach, especially in Sydney and Melbourne. 

There are many more people like you discovering the advantages of entering the stockmarket. You’re listening to podcasts from experienced investors. You’re online, continually searching for ‘tips’.

But too much information results in confusion.

Balance your information and your index funds with your own research. Spend a little of your investment money and buy 1 or 2 of your own stocks! Get excited about them! I guarantee it will help you better understand the mechanisms of share movements.

‘LICs’, ‘LITs’ and ‘ETFs’ … I hear that you talk about them a lot. They’ve become ‘trendy’. But do you fully understand the difference between them and ordinary ASX-listed shares? Read this Q&A article by Andrew Heaven (The Weekend Australian, November 7– 8, 2020).  

Google should not be your only resource. OBSERVE what’s around you. So many clues! Get together with like-minded friends. Pool money together to buy investment magazines or subscribe to excellent resources like The Motley Fool and Padley Today. TALK to people.

If you’re still keen on property in Australia, it’s still an option in South Australia and Western Australia, and even in country NSW and Victoria. The same principle applies to shares. Finding the next best thing or the next best location is worth the time you spend researching and asking questions

Lastly, SAVE. By all means go out for your coffee, but stay in for your smashed avo on beautifully toasted sourdough!  

3. 40 to 55 years

This is a critical time. Think of how you’d like to spend your retirement.

If you’re working, put as much as you can into your mortgage (if you have one) – and depending on your income, opt to salary sacrifice up to the maximum allowed.  

Don’t be blasé about your superannuation or finance. Get the facts now, not when you’re 60!  

Most super funds have financial advisers, and some may not charge for their initial consultation. If you want to keep it simple, pick a good-performing fund and keep an eye on it. Websites have links to compare fees and performance with similar industry or public super funds. The Australian Taxation Office website is also helpful. Read the PDS (public disclosure statement) that all super funds must provide; if there is anything you don’t understand, ask.

There’s a marvellous article by James Kirby in The Australian about financial advice and the fallout from the recent Australian Hayne Royal Commission. He notes financial advisers are now harder to find, and says: 

“ … This is a sector in crisis. Industry reports suggest that the total number of licenced advisers will drop from 22,000 to 15,000 over the next few years. … 

“Due to the burden of post-Hayne financial advice regulation the best advisers want to concentrate on ‘sophisticated investors’ who operate with much less ‘red tape’ than everyday investors. That is, they satisfy the legal definition of ‘sophisticated’ having $2.5m in investable assets or an annual salary of $250,000 a year.1

In a nutshell, Kirby writes that you need to invest $500K to be considered a worthwhile client. To make an adviser’s practice viable, they must be able to charge you $3000 a year (at least).  What’s more, paying for one-off (or “niche”) advice you need at the time (which to me seems perfectly reasonable and fair) is not possible under current rules in the industry.

So unless you’re resigned to paying $2000 to $3000 a year for a financial adviser, “that’s your lot!!” (a phrase of our senior gardening guru, Peter Cundall).   

BUTif you’re willing to use $1000 or more of your savings, I encourage you to buy shares. Read my previous Invest posts. If you have any questions, please leave a comment at the end of this post, or in Let’s Talk.  

4. 55 years & over

You should have already set a retirement date!

Barring any unexpected events, have an idea of how much super you’ll have and the tax-free income you’ll receive

Personally, I don’t think ‘retiring’ is a good idea.  

TIP:  Your last day at work must be the first day of your new life! 

What can you do now that you couldn’t do before? NEVER stop doing what you love: keep meeting with friends, make new ones, learn a language, musical instrument, join a choir and .. a gym!

Invest 4.0 will explore how your lifestyle and personality impact on your ability to invest successfully.

 1 Kirby, J. (June 5, 2021). ‘This year’s advice: Rip it up and start again’. The Australian.

Share your thoughts on our Let’s Talk page


Invest 2.0: Learn how

My many years in payroll at a major Sydney hospital made me aware of one thing: most people spent more time worrying about their fortnight’s salary than their financial future

Women in particular didn’t “want to be involved in anything financial”. Most did not know how much interest they were paying on their mortgages, or what their credit card balances were. 

From married women, I’d often hear: “I just let my husband or partner handle our money – I don’t understand anything about investing.” And from single ladies: “I’m too scared to buy shares – I just put my money into super!”  

Ladies: Learn to invest for yourself!

The trend was so different in Singapore. At my Dad’s stockbroking firm, clients actually comprised more women than men. They would come in at 10am sharp with their pencils and notebooks to exchange share-scrips and deal out their ‘chits’. They did their homework and were ready to trade. My father, Alec, was their favourite broker. He was honest, and would refuse to take their orders (and anyone else’s) if he thought the shares were “rubbish”. People listened because most of the time he was right.  

Respected 73 y.o. stockbroker Alec at the office, 1987 –
he loved his PC too!

Dear ladies, relying on one person to secure your financial future and/or burying your head in the “it’s all too hard” box is not an option – especially in these economically uncertain times.

Men: this goes for you as well. Responsibility of managing money must be shared or at the very least explained to your partner who doesn’t want to be “involved”. Broken relationships, unexpected illness or death can result, and the other partner might be made homeless or be scrambling to make sense of paperwork left behind. 

You can learn basics of tax and investing!  

Unfortunately, there aren’t as many wise and honest stockbrokers these days like my father. But the good news is that we can do it ourselves with online trading platforms like CommSec. It’s simple to buy and sell shares on it, and easy to navigate too. You simply can’t miss the BUY and SELL click boxes! Research before you trade – and with a steady hand on the mouse, your confidence will grow and you’ll make sensible decisions. 

Ready to trade online?

  1. Get a Scrapbook

    What’s your goal? Is there more than one? Why and when do you want to achieve this? Write it down.

    What’s your dream? Write it down. Your goal needs to be strong enough to stop you frittering away your time on things you needn’t be doing at all. I knew my dream from age 8, and I still have my Scrapbook – I’ve never stopped cutting and pasting articles on shares in it. (My dream was to sing in a band, so I kept writing a list of songs I liked. I also wanted to be smart like Dad and learn about shares.)

    We do have time. In fact, lots of it. 
  1. Write a share-list of what you think will be the ‘next best thing’ in the future – and get their ASX codes.

    REMEMBER:  Investing is for the long-term
    . It’s too late when shares have already become a ‘trend’ (e.g. Afterpay), when prices keep rising and it’s too costly to buy. 
  1. Start an online trading account. If you’re unsure which, the Commonwealth Bank’s CommSec platform is a safe bet.  
  1. Start a watchlist of share codes of shares you like. Each code will have its own company info and updates. Annual reports should be the first thing you read. If you don’t understand what the figures mean, look at the profit, loss and turnover figures. Easy enough?
  1. Read, read, read. Subscribe online to The Australian, The Sydney Morning Herald (includes The Sun-Herald) and the Australian Financial Review. Later, I suggest you subscribe to a few newsletters from The Motley Fool, e.g. of the ‘Dividend Investor’, ‘Share Advisor’ and ‘Extreme Opportunities’. ‘Marcus Today’ is also good, and a useful guide to your existing stock picks.
  1. Observe. When you’re out shopping, what are the ‘BNPL’ (Buy-Now-Pay-Later) options advertised? Okay, maybe it’s too late for Afterpay, but there are still others under the radar doing well; you’ll see their names if you look for them when shopping.   
  1. Ask questions. Speak to your friends. What are they buying? Clothes, make-up, furniture, home appliances, computers, TVs? Is it online or from retail outlets? What are their best or best-avoided sellers? Behind each product is a company, and behind each company is an ASX code. 
  1. Network. Find 4 or 5 people that have an interest in stocks and shares. Get together whenever you can and brainstorm – it’s so much better than an online chat room! Start conversations. Expand your network. I got my best share and property tips from people I never knew before!
  1. Learn the terminology and acronyms. Here’s a list to start with: 

    Franking credits
    Ex-dividends & Cum-dividends
    Options
    Rights issues
    IPOs
    SPPs
    SAAS, IOT,  SMB, A1
    (new terms in annual reports for tech-based companies). 

I’ll stop now, your head must be spinning. Thanks for bearing with me. 

Invest 3.0 will have more ASX codes to research and one very important factor many financial advisers miss … PLUS the many mistakes I made which I want you to avoid!

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Invest 1.0: Shares

INVESTING. S-c-a-r-e-d already?? 

Okay, it’s not only about stocks and shares – but in 1950s idyllic Singapore, it was the only thing Dad (and everyone we knew) was doing. Every morning from the time I was 8, I’d sit next to him, with his newspaper spread out on the dining table. He’d read aloud names of his rubber, tin and palm oil shares to me, and would listen to share reports on radio every weeknight. 

He went further – giving reasons why he bought them and why he knew they would go up in the future. “Dad will make lots of money to start his own business and Mum won’t have to go to work!”, he’d say.

At the time, ‘money’ and my mother not having to work held special meaning for me. My parents frequently argued about finances and Mum always looked tired when she got home late from the office. Yes, we had our devoted nanny (Ah Chai) to bathe, clothe and feed us – but I so wanted my mother there too. Dad’s vision appealed to me: I was interested and wanted to know more.  

Enid Blyton and singing in front of the mirror now took second spot after I started reading the financial page in Singapore’s Straits Times (I write ‘page’ because they had only one then), and later the Business Times. I don’t remember Dad reading anything apart from this newspaper and annual company reports. He told me it was important to read them and check on their income, profits and dividends (IPD). Losses are not necessarily bad he said, if the company was growing and expanding – but if income and turnover kept increasing without a profit, “Be careful!”

Closing share prices from Singapore’s Business Times, 1975 (my daily staple)

Our home slowly became what we now call a ‘chat room’ with one exception: food and people were included. Our live-in cook and maids diligently served and cleaned while Dad exchanged share-scrips (or the colonial term ‘chits’) with his clients. Some stayed for a meal, others sat and talked. I listened. I made notes. 

So that’s what I learned early on about the ‘secrets’ of investing. While I believe nothing much has changed, I encourage you to heed my father’s warnings so you’re well prepared. 

Moving forward to the 1980s … my ‘quiet’ years, compared to the bustle-buzz of my Singapore days. Adapting to my new life in Sydney, I had only(!) 3 goals: paying off the mortgage, starting a share portfolio and buying an investment property. Do you notice that all 3 were finance-related? What finance gurus preach now, I did then – no eating out, movies or shopping for things I didn’t need

I SAVED. 
I INVESTED TIME. 
I PREPARED.  

I already had a few ASX stocks in my portfolio by then, but needed more. I read newspapers but didn’t buy them – mostly because I snatched the loose business sections that people had thrown out in shopping centres!

But I did subscribe to the magazines Money and Share Investor. I now subscribe to The Motley Fool run by Scott Phillips. I also read Marcus Today, partly because I fell in love early on with Marcus Padley who just happened to give the same advice my father did … 

I picked apart the stocks recommended in the magazines and newspapers, highlighted and then wrote down what I liked in my ‘share book’. In 2 years, my savings were growing nicely and I would soon be ready to launch my portfolio. 

I  know that times are tougher now – it’s so much more difficult to buy an investment property than it was 20 years ago, especially here in Sydney, even with low interest rates. But here’s where shares come in: banks will be paying near-zero interest until at least 2024, so it definitely pays to do your research and build your portfolio.  

10 tips to start a share portfolio

  1. Get the necessary information about the companies, including their ‘IPD’: income, profit and dividends. 
  2. Have patience and courage to begin. 
  3. It’s OK to borrow money to buy shares (or a property) – but have enough for you and your family to live on, and don’t borrow so much that you can’t sleep well at night.  
  4. Never spend more than you earn. If you can’t pay off your monthly credit card balance, you’re spending too much. 
  5. Ask advice from those smarter than you, and take them out for lunch!
  6. Save regularly even if it’s a small sum – you’ll be rewarded.
  7. Never believe anyone who boasts of a ‘fortune’ they made on the stockmarket. They’re either exaggerating or lying.
  8. Choose value over cost. Don’t avoid shares simply because their price is too ‘high’. Buying 100 shares at $10 each may give you a better return than buying 1000 shares at $1! 
  9. What can you see that no-one else can?1 Take your eyes off your smartphone and look around you. 
  10. “If you’re good in this game, you’re only going to be right 6 times out of 10. If you buy only 1 stock, you’re essentially tossing a coin and that’s no way to invest!”2

We’re now entering the decade of 5G. Are you aware of how much it will impact our everyday lives? For example in health, agriculture, transport and e-commerce? Quantum computing, smartphones, electric cars – what do they need? Lithium, graphene, copper and nickel. Make a  list and pick 1 … or 2.

Please watch my previous ‘Let’s talk finance‘ snippet if you haven’t already.

Don’t be afraid to start. Focus. Time is your friend, don’t waste it. 

Finally, because I love linking my posts: IF YOU EAT BETTER, YOU’LL THINK BETTER! 

Stay tuned for Invest 2.0 out soon.

 1Padley, M. (November 8, 2017). The Sydney Morning Herald.

 2Phillips, S. (January 6, 2021). The Motley Fool Share Advisor [Scott Phillips quotes Peter Lynch].

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Menopause

I first heard about menopause and osteoporosis in my early 20s. It was in a book called Everywoman by Derek Llewellyn-Jones, which my prudish mother kept hidden. I found it by accident and read the contents.  

‘At a time which is quite variable and individual for a woman, the remaining egg follicles in the ovary begin to disappear. This … occurs sometime between the 45th and 55th year of life. …

‘As the months pass fewer egg follicles are stimulated and the amount of oestrogen secreted by them diminishes still further, until the menstrual periods cease altogether. The menopause has arrived. … [T]his is a time of hormonal turbulence.’1

And: 

‘Hot flushes are noticed by at least three-quarters of women … other symptoms often attributed to declining hormones include depression, irritability, headaches, palpitations, dry skin, frequency of passing urine.’2

Llewellyn-Jones believed that those symptoms were not because of a lack of hormones but because of the need to adjust to being menopausal.

Osteoporosis

‘Women lose bone more rapidly than men, particularly 5–10 years after the menopause. The thinning of bones is called osteoporosis.’3

Right. So this was what I had coming to me? The price I had to pay for being a woman? Why didn’t Mum at least warn me?

But thinking of it now, how does a mother explain to her young daughter what she should be preparing for when she reaches 50?

Maybe I was different. I wasn’t into clothes, make -up and the usual feminine ‘things.’ All I wanted was to learn how to stay healthy, sing, write and be financially independent. At 20, I was already thinking of the future – mainly spelled out by slogans from my Dad such as ‘save’ and ‘buy shares. Health was the last thing on my list – until after I turned 30, when I was first drawn to the books of Dr N W Walker. 

As it turned out and discussed in Move! 2.0, I had premature menopause at 36. I knew osteoporosis would cripple me if I didn’t take steps to prevent it

In reality, would young, beautiful, vibrant women today even believe they should be preparing now for this ‘thing’? I think most would google ‘menopause’ or ‘osteoporosis’ and then promptly scroll back to their favourite websites.

My early symptoms were: 

  • less frequent periods with longer intervals between
  • insomnia
  • rapid heartbeat
  • frequently dropping things
  • dry skin
  • brittle hair without body
  • general lack of interest in life.

One night after months of tests, totally discouraged and frustrated without any conclusive diagnosis given, I sat on the floor crying, wishing, praying, and hoping I’d find an answer.  

The answer came the next morning.  I remembered what I had read 14 years ago, and asked my doctor for a blood test to check my  FSH (follicle stimulating hormone) levels. I already knew what the result would be: yes, it was menopause. I was just too young for this! 

The somewhat encouraging words from my doctor were: ‘No more children, Shirley – but at least you have your son.’ I sat on a park bench and cried some more.  

The disturbing images of old age I had growing up in Singapore flashed before me: I now fully understood. The men and women who couldn’t get up from their chairs, who gorged, didn’t exercise, smoked, drank and sat all day. They only looked forward to heart disease and diabetes. 

In Move! 3.0 I wrote on how HRT restored my life again. But I knew I couldn’t depend on that alone. It was Diet, Exercise, and Relationships. And I had to work on all 3.  

HRT plus

I keep returning to this topic because I’d like my female readers to avoid the pitfalls I met. 

My first question is: is it the true fountain of youth it’s made out to be?

Many friends have suggested that it’s a substitute for exercise. They tell me: ‘It’s alright for you – it’s HRT that’s giving you energy!’

But HRT alone does not build bones and muscles or release endorphins. It can also make you put on weight.

If not for Dr Walker’s diet, eating more calcium-enriched foods and sticking to my food combinations, I would have easily piled on the kilos over the years. It was also years of walking, my mat home-exercise and more recently, the regimen of a structured weights/aerobic circuit class at the gym. 

It was HRT,  my DIET and EXERCISE that saved me from osteoporosis. 

I also found HRT’s effectiveness diminishes with age. When the time comes to stop taking them (around 75 years) I want to walk away with confidence, still active and enjoying life – and not as a wobbly, crotchety old woman. 

So dear friends, please remember it is never just the one thing that gives results. It could be the foods we eat, friends we choose to have, or the way we think. With the right options, YOU are the creator and YOU are  in control. 

 1Llewellyn-Jones, D. (1971/1992). Everywoman: A gynaecological guide for life [6th edition], p.379. Penguin Books Australia: Ringwood, Victoria.

 2Llewellyn-Jones, p.382.

 3Llewellyn-Jones, p.388.

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MOVE! 5.0

In my final Smart Moves piece, I’ll get straight to the point: START YOUR FITNESS PROGRAM. It’s never been so important. Aside from safeguarding our health, it’s also been found to build immunity – absolutely necessary in the current COVID-19 pandemic. 

Exercise + vaccine links

In fact, scientists say that a fit body can increase a vaccine’s effectiveness and reduce its side effects – already proven with the flu and HPV (Human papillomavirus) vaccines. Studies on the effects of exercise before and after a COVID-19 vaccine are still ongoing, but Associate Prof. Kate Edwards from the University of Sydney says similar results are expected.1 Isn’t that good news?

According to Edwards, ‘regular exercise … makes vaccine responses stronger and that likely then means you are more protected from the disease’. Her research says this does 3 things: 

  1. increases immune cells that guard the body, which destroy infected cells and make antibodies to kill viruses and bacteria;
  2. Releases myokine molecules, which alert the body’s defence system; and
  3. Strengthens the immune system over time and increases its response to infection.2

It markedly benefits older people. A 2019 study found that those who exercised regularly had an elevated antibody response to those who didn’t. Training on the day of a jab and afterwards are also believed to extend vaccine protection. Prof. Rob Newton from Perth’s Edith Cowan University says the exercise link with other vaccines (other than COVID-19 ones) is ‘so strong’, concluding:

‘The key is that exercise has no downsides. It gives benefits regardless … ’3

My formula

I have used dumbbells, kettlebells and barbells at my gym for nearly 4 years now – it has given amazing results even at my age (72). I’ve twice stopped myself from falling, and have the power to lift fairly heavy items without hurting my back. I walk even faster than I did 10 years ago. And combined with stretching, I no longer suffer bouts of sciatica which once crippled me for days. 

I recently discovered that balancing on each leg 30 seconds at a time with arms outstretched improved my balance and gave me sharper focus. Like strength, poor balance is a casualty of inactivity and age. As a bonus, the left and right sides of my brain are also said to benefit. Here’s my demo. It’s tough at first, but please persevere – you’ll be thrilled when you can maintain this pose for 30 seconds without toppling. 

A really good book on the power of strength training is The New Rules of Lifting for Life by American strength-coaches Lou Schuler and Alwyn Cosgrove. It’s an intelligent guide on using weights and your own body mass to build strength and power. It also devotes a chapter on single-leg strength exercises to improve balance. A review of the book cited 2 key phrases: ‘Decline is inevitable’, and ‘How fast you decline is up to you’.4 It is. 

GET EXERCISING NOW. Walk, jog, lift weights or even dance – if that takes your fancy. Don’t just endure it, enjoy it! And unless you have a reason not to, no excuses for not starting. But get your doctor’s all-clear first

If you have niggling back or neck pains or have had previous injuries, I do recommend you look at https://physiocise.com.au/ – where classes are run entirely by physiotherapists. A great resource which I use. 

So my new readers and Pearlers, what more can I say to get you to commit to a regular regime at the gym or fitness centre? You know you should. SO DO IT!

1Aubrey, S. (April 18, 2021). ‘Why exercising before getting a vaccine is a good idea’. The Sydney Morning Herald. Retrieved from https://www.smh.com.au/lifestyle/health-and-wellness/why-doing-exercise-before-you-have-your-vaccine-is-a-good-idea-20210415-p57jet.html

2  Aubrey, SMH.

 3 Aubrey, SMH.

Goodyer, P. (December 4, 2012). ‘Getting older? Get stronger’. The Sydney Morning Herald. Retrieved from https://www.smh.com.au/lifestyle/health-and-wellness/getting-older-get–stronger-20121203-2aqq7.html