Another Newbie looking for advice

Discussion in 'Share Investing Strategies, Theories & Education' started by KJB, 28th Oct, 2016.

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  1. KJB

    KJB Well-Known Member

    Joined:
    25th Jun, 2015
    Posts:
    84
    Location:
    Perth/Bangkok
    Hi everyone,

    (Originally I was going to post this in PC, but as @Simon Hampel is trying to get this forum pumping I thought id switch :) ) Plus it I thought id get amongst it all :)

    Very new to any asset class apart from property. I am in the process of educating myself. I have/had next to no knowledge of most of the topics on this forum. Just started on bogles books and lurking a lot on PC's other asset classes.

    Between having Investopedia up on one computer, vanguard assets class on another computer and reading forums on my phone just to understand what I am reading ..not to mention being dragged off chasing links on LIC's and bonds etc etc its a long process!!! and to be honest very overwhelming at the moment - though I'm sure everyone has gone through/is going through the same.

    I want to keep my strategy as simple as possible to start off with (so that I do actually start!)

    So these are my plans (ill try not to ramble too much)

    When: Plan to start July next year (wanted to start ASAP but due to my tenants running off, extended vacancies + drop of rents along with some big unavoidable personal expenses, I need to take a step back to get my cash buffer back to a healthier level.

    Time horizon of 20 + years (before I start to look at living off some of the dividends)

    What? To start out with I thought of vanguards VAS and VGS ETF's (was going to go with a retail fund -but it seems to be less fees to go with ETF's plus that I can start straight away - i.e. don't need a minimum of $5000 to start)

    Was looking at a split of 60/40 (VAS/VGS)

    The portion I would of been putting into bonds I am just going to allocate to IP offsets - once there not so heavily neg geared then ill look to allocate those funds to bonds/high yield indexes

    Am interested in LIC's but maybe later on once I'm more comfortable with all of this

    How? Dollar cost averaging - at the moment its looking to be approx. 20% of my pay plus pay increases each year -or maybe putting the pay increase amount aside to buy into LIC's

    Through a Disc trust (loaning the amounts each time) was originally going to gift but after reading 'Trust Magic' loaning seems to the smarter choice (will be verifying this with a lawyer next year)

    Does this seem reasonable? Any advice/ critiques on any of these points? or points that I have missed

    Again, I'm literally only halfway through my first non property investment book - I'm sure this will all change to some degree - just thought id get my thoughts on a page so all the more enlightened formumites can give me some direction from the getgo

    Much appreciated!! :)

    Kayne




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  2. twisted strategies

    twisted strategies Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    1,461
    Location:
    QLD
    could i suggest that you add a ( reliable ) calcutor , a blank note book and pencil to the study kit

    ( ready to crunch numbers , anytime things look interesting or confusing )

    i hold VAS since early 2011 ( and went into the DRP scheme )

    i am not a fan of government debt ( and 'packaged ' or 'sausage ' as i call makes it less attractive to me )

    ( but to each their own )

    i took VAS as an insurance policy ( in case my early share selections were riddled with poor choices )

    VAS is doing fine for me , and more than 50% of those early individually selected shares went nicely , but having VAS to help avert a total failure seems to have paid dividends ( some peace of mind and actual gains )

    no if buying VAS on market ( on the ASX ) timing COUNTS.

    the last day i bought VAS i bought 3 parcels on the same day as the SP plummeted ( the last batch were much cheaper than my first buy of the day , and easily saved the extra brokerage on the last buy alone

    should i do similar again i would use a $$ price .... say $5K parcels at a time ( rather than a set number of shares each buy ) ( on the real event it was a bit haphazard .. i was aslo trying to grab some other cheap shares as well )

    ( when VAS falls steeply the whole market is awash with panick selling ... 2011 wasn't a real crash , but many couldn't be sure when the selling was at te heaviest )

    investigate the DRP scheme it suits me , and might suit your 20 year plan , leaving any new cash available to aim at other targets , as juicy prices appear .

    hints ..... it is a tough line between discipline and flexibilty learning when to be on the correct side of that line will be a big help .

    you should never stop trying to learn ( and refining your skills ) and ( excessive ) greed can be an investment killer ,
    taking SOME cash off the table when things are going well , is rarely a major mistake ( but selling out completely sometimes is ).

    good luck ... this isn't an easy , simple game ( if it was ,nobody would hire managers or advisors )
     
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