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Discussion in 'Introductions' started by squiddum, 3rd Oct, 2007.

  1. squiddum

    squiddum New Member

    Joined:
    3rd Oct, 2007
    Posts:
    1
    Location:
    Melbourne
    Hello! :)

    I stumbled across this forum via Google (can't remember exactly what I had Googled), and I'm glad I did! I've read quite a few threads and have learnt a few things -- thank you to all you posters who are responsible for my newfound knowledge! :D

    You guys seem like a very helpful and nice bunch! :)

    Me, I'm 25 and work in hospitality -- no, I do not earn a high wage! Or even an average wage! But I'm totally fine with that, because I love my work. Besides, I believe in the "it's not how much you make, it's what you do with it" thing. Basically I'm here because I would like to learn how to make smart decisions about my money.

    I'm the biggest procrastinator ever, so I'm proud that I've finally invested money for the first time recently. It's bad that it's eight years later than I intended -- since I was a kid, I always thought I should save something like 10% of my income and invest it in managed funds -- but I should just look at the present and future, right? Better late than never! (I thought it would probably be never, at the rate I was going!)

    All the money I've earned in the past eight years has gone -- either spent (wasted!) or given away -- I'm pretty much starting from scratch. As of two weeks ago, I have 2k in a managed fund (Perpetual Ethical SRI), and am adding to it fortnightly.

    I'm interested in investing in more than just Australian shares, so now I'm researching managed funds that invest in property securities and global shares. I like the look of APN Property for Income Fund No. 2 and Australian Ethical Large Companies Share Trust. (Yes, I'm interested in ethical investments -- this means I overlook the large majority of funds!)

    One last thing about me -- my life trajectory isn't the norm. I'm kinda taking a gap decade -- I'm probably going to go to uni in the next few years. So I should really be saving lots of money for short term use. (There's the "should" again! :rolleyes: )
     
  2. Elkam

    Elkam Member

    Joined:
    21st Jun, 2006
    Posts:
    22
    Location:
    Lanaken, Limburg
    Hello squiddum

    Isn't there a saying something like......

    Knowing the problem is half the solution? Well, your half way there and certainly much better off than most 25 year olds who still need to look up the word investing in the dictionary. :D

    Wish you much success in your investing.
    Elka
     
  3. AsxBroker

    AsxBroker Well-Known Member

    Joined:
    8th Sep, 2007
    Posts:
    1,448
    Location:
    Sydney, NSW
    Hi Squiddim,

    Welcome!

    I hope you find this forum a great place to find useful information.

    Cheers,

    Dan

    PS If it makes you feel better your employer is saving 9% for you with SGC as long as you earn more than $450 per month :)
     
  4. Glebe

    Glebe Well-Known Member

    Joined:
    15th Aug, 2005
    Posts:
    932
    Location:
    Sydney, NSW
    Hey dude,

    If you're a low income earner make sure you look into government co-contribution into your super. If you can live without it until you're 65 it's probably the best investment you can make.

    Super co-contribution
     
  5. Nigel Ward

    Nigel Ward Team InvestEd

    Joined:
    10th Jun, 2005
    Posts:
    1,172
    Glebe's point is a good one...but as a 25 yr old it's going to be a long time till you'll see your super money...(but of course you need to take a long term approach to investing).

    ps. congrats on getting started. It's only onwards and upwards from here. Learn all you can but don't let it get overwhelming.

    A simple approach is best. You need to aquire growth assets (shares and property), use borrowings where appropriate to maximise your asset base as early as possible and manage your cashflow on the way through. Don't get sidetracked by exotic strategies or financial products.

    Cheers
    N
     
  6. AsxBroker

    AsxBroker Well-Known Member

    Joined:
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    Posts:
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    Location:
    Sydney, NSW
    Yeah, it's hard to beat the govt's 150% return for the govt co-contribution!

    Also for us young'ins the government is effectively paying for our insurances inside super (thank Johnnie!).
     
  7. crc_error

    crc_error The Rule of 72

    Joined:
    1st May, 2007
    Posts:
    1,367
    Location:
    Melbourne, VIC
    If your looking at ethical investing, check out Hunter Hall global ethical trust. I'm in that one, and its a great fund for global small companies exposure.. plus their 5 year return is quite good.. where most international funds have poor 5 year returns.

    Hunter Hall Investment Management - Performance & Portfolio

    they also have ethical super funds..
     
  8. crc_error

    crc_error The Rule of 72

    Joined:
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    Location:
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    which gives him plenty of time for his small contribution today, grow into a large holding tomorrow!
     
  9. Mark Laszczuk

    Mark Laszczuk Well-Known Member

    Joined:
    16th Aug, 2005
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    Location:
    Brisbane
    I'm gonna go against the grain here and disagree with Glebe (something I don't usually do). I said it recently in another thread, but I personally don't think super co-contribution is a useful strategy for an active investor in their 20's. The main reason being that you are not going to see that money for another 40 years, once it goes in there, that's it.

    If you invest those funds outside super, sure your tax bill is going to be higher, but there are plenty of ways around that and you have - most importantly - flexibility. If you insist on paying higher rates of tax on those funds, think of the tax as your 'flexibility surcharge'.

    A lot of things are going to happen to you over the course of your lifetime and you may want or need access to funds at any time. Super co-contribution has it's place, but in my view it's (mostly) for people who are not active investors who just want to live off their super benefits in retirement and people in specific circumstances who have spare cash so they can bump up their super a little bit (eg: no non-deductible debt, close to retirement, etc).

    Of course, it all depends on individual circumstances whether co-contribution is appropriate for any one particular person.

    Mark
     
  10. crc_error

    crc_error The Rule of 72

    Joined:
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    Location:
    Melbourne, VIC
    Hi Mark,

    I'm going to agree with your general point, but disagree with it partially.

    Sure I agree Super shouldn't be number 1 focus of someone in their 20's or 30's, and a active investor should be investing in things outside super, however not many people are going to miss say $500 per year to invest into super. Then the government will match that up to $750 making a $1250 contribution into super and having 30-40 years to grow. If you do this in your 20's, then imagine how this will compound over 40 years!

    Invest into super what you wont miss, and I'm sure $200-$500 wont be missed by many people, even active investors.

    Tom
     
  11. MattR

    MattR Well-Known Member

    Joined:
    23rd May, 2007
    Posts:
    229
    Location:
    Sydney
    I'd agree, I'd use the co-cont if I could access it to pay for my life and income protection insurance within super.

    $20 a week squirrelled away int super is easy money. And with a 150% return (or 300% for 2006 !!!!!) its a pretty damn good return. Compound and multiply that over a few years and you have got yourself a nice base for your super to grow on.


    Edit: Welcome squiddum
     
    Last edited by a moderator: 5th Oct, 2007