Hello.
My name's Santasha Nabananga Bamblet. I'm a proud yr the
Order KERNI Whoalbury and a waddery woman. And before we get started on She's on the Money podcast, I would like to acknowledge the traditional custodians of the land of which this podcast is recorded on a wondery country, acknowledging the elders, the ancestors and the next generation coming through as this podcast is about connecting, empowering, knowledge sharing and the storytelling of you to make a difference for today and lasting impact for tomorrow.
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She's on the Money, She's on the Money.
Hello, and welcome to She's on the Money, the podcat pass for millennials who want financial freedom. My name is Beckside and with us is the one and only Victoria Divine.
You did not sound excited today. You sound like bear. I don't want to be here. I don't want to talk about this. Victoria's use the word portfolio over now, I know.
So you can tell that I've checked out of this one.
Yeah, you're already.
We can make it fun.
Investing is literally my favorite topic in the entire world. I don't know how to reiterate that more. I have literally written a book on it. And then I'm also releasing the spoiler an investing course story soon, which I'm really excited about. Oh my goodness, gracious, I'm just going to teach you all the things.
Watch out. You do have a way of making it very, very exciting. But it is the first Wednesday of the month, so we are looking at an investment topic, and today we're talking about constructing your perfect investment portfolio.
I don't know do we have structure that means that on the first, I guess Wednesday of every month we talk about investing, Like, has that exist said for this whole time? And I haven't noticed? And our producers just a wizard, I think it has.
I think so I didn't notice either. That's very impressive. That is very impressive.
We just have these big brainstorming sessions and I'm like, what about this topic? In this topic and this topic? And then she's smile and nod, smiling, and then she like organizes them. What the heck like it's a job. I bet nobody else noticed, but I don't think so we finally noticed and elsa thank you. I won't be able to unsee it now, how annoying are we now? Predictable?
Oh?
That sucks, but also good one out.
Some people love the comfortability of it. Nava, you mentioned to me that you were at a speaking event recently and you talked about the idea that risk and investment has two facets. Could you tell us a little bit more?
Yes, Actually I love a speaking event, and recently this has come up a few times because I just think it's really important. So when it comes to the investing world, I feel like we all get analysis paralysis, right, that we feel so overwhelmed with this concept of where we start and what we should be doing and what our perfect portfolio looks like, that we forget that things can
actually be quite simple. And I mean, I'll get more into it later on, but I talk a lot, especially in person when I do like a speaking event, which, for those of you who don't know, a lot of my time now I'm a retired financial advisor. A lot of my time is actually spent in corporate and seeing corporate talking to I guess employees about their financial wellbeing and their financial wellness, and it's one of my favorite
things in the entire world. But I often will say the phrase I'm a conservative aggressive investor, and that sounds very juxtapositione right, Like it sounds like, wait, you can't
be both, Victoria. If you've listened to all of our podcasts, you've probably listened to the episode that we've done on risk profiles where I talk about how there are usually like six or seven different risk profiles and they go all the way from capital stable, conservative, all the way up to high growth or aggressive, which is language I don't particularly like in the investing world because it makes us feel a little bit overwhelmed, a little bit scared.
Like the second the word aggressive comes out, you're like, hold up, that might not be for me. Yeah, Like, I'm not so sure. However, I would say that I'm a conservative aggressive investor, and a little bit later in the show, I'll explain to you exactly why that does actually make sense.
Few Okay, So, v you did ask me to gather some relevant data for this, and you know I am not a money wiz, but I'm gonna I wrote that.
You are get this really good at Google.
I'm very good at Google, and I wrote some stuff down. So let's see.
I'm ready. What have you brought to the table today. Some of these are tongue twister. Here are Beck's top tips on creating your perfect portfolio.
All right, so I've got some information from Australian Investor study for twenty twenty three, which focus on nexs.
That's true, that's big dog.
That is And basically I'm going to focus today on female identifying people investors. I should say, also what they call next gen investors, which babies, the little tiny babies.
Little tiny babies who have so much opportunity to do well.
They do, and that I'm very happy that they're starting young. So I'm going to give you the data on the female identifying investors first. Yep. So the average age of female identifying investors is forty seven.
Is that surprising?
I don't know. I have no idea. Is that surprise?
I feel like we're dragging it down slowly. I feel like forty seven is a good number because obviously it's before retirement.
Sure, but I like want.
The average age of an investor to be younger because that means they've got more opportunity to create wealth. Ideally, ideally, but they could be.
A bunch of twenty four year olds and a bunch of one hundred year olds and then that makes the average age.
Actually, that makes me want to find the difference between the me and the median and the morge or do you want to do it for me or do you want me to do it?
I think it. Yeah, I don't have no idea, but yes, let's argue that.
Yeah. So it's important to understand when we talk about data that there are actually three ways that people might report on it. Right, So there's the mean, there's the median, and then there's what's called the mode. And we're just going to take a quick dive into a statistics lesson for a hot second, because I do think it's really important to understand these things because so many times we see data and I know from your notes you're about
to talk about the median, so let's start there. So the median is actually the number that is smack bang in the middle. So if you got every single data point, like if there were ten people in this data set, we would order them from smallest to largest number and then smack bang in the middle, that is what the median is. So the median is if we got every single data point, put them in a row, and then hit the smack bang middle one R. That's just the middle number that occurs.
Right.
Then you've got the mean, and the mean is from my perspective, it's interesting to see what's smack bang in the middle, but it's also interesting to see kind of what the average is. And I would say the mean is more of an average. So what you do with the mean is you take all data points, add them together and so plus plus plus plus plus, and then you divide it by how many data points there are
in that set to get the average number. So if you added them all together, you'd end up with a really high number maybe and a really low number, and then there would be an average that comes out of that. And so from my perspective, to get a really good idea of what data is looking like, I kind of want both of those numbers because in a perfect world, both of those numbers are really similar. But you might
have smack bang in the middle. The medium might be five, right, because you've got ten data points and they go from one all the way through to ten. Smack bang in the middle happens to be five. What a dream, right. However, if you had a more diverse data set where the lowest numbers one and then five was still in the middle, but then the last number was one hundred. If you had divided all of those, your mean is going to be higher, and that's going to give you a good
indicator of whether they're on par or not. So it's just nice to know those things. And then the third one I mentioned is the mode. And essentially the mode is just the number that occurs the most. So you might have ten data sets and five of them happen to be the same number. That's the mode. It's just the most common number to occur in a data set.
Gotcha, I actually cannot believe this is the first time really understanding what that means. Median kind of seems a bit useless, but it is a reason helpful.
But like we find that most surveys and most reports will use the median because it seemed to be the average. That's why when we talk about things like salary, I don't particularly like the mean. I much prefer the median because when we're talking about the mean and we've added everything together, if I said, what's the average salary of a female identifying person in Australia, right, you've got all your CEOs, then you've got all of your stay at
home mums who don't particularly have a high income. But we're not saying they don't have any value. We're just talking about finances here. We add them all together and then Beckett comes out as an average of about eighty five thousand dollars. Right, that's not normal, Like, that's not the normal income. Whereas if we lined everything up and took you know, what is actually the middle of what these people are earning, and what do female identifying people
in Australia actually earn, what does that look like? It's more like sixty five thousand dollars sure, And that's a really big difference. Like if we're making decisions based on data. And this is why I think it's so important for us to understand it, just so we know what's going on.
But it's so important that you know, like our government takes this into consideration because if they're using the mean or the median to make decisions about our healthcare or what we can afford or what we can actually do with our finances, there's a big difference when we're talking about a cost of living crisis. When it comes to someone who earns eighty five thousand versus someone who earns
sixty five thousand. Right, right, So if we aren't using the right data point, or we're not looking at both of them, we're actually doing people a disservice. That makes so much sense, I hope so because I tried to make it make sense. Yeah, I really that's a great explanation.
Be thank you so much.
Tell me more about female identifying investors.
Speaking of median, the median trade size for female identifying investors is four thousand and five dollars. That's big dog. Yeah, that's pretty good. And the median portfolio size is ninety five, nine hundred and ninety dollars. Now, VI, I want to know, and maybe I should not as already, what's the difference between trade and portfolio? Yeah?
Okay, so trade is how much they might so trade each month. So you might go, hey, beck, I really want to start investing. So trade is important when we talk about So let's get a little bit deep for a second. If you're an investor and you download any platform, there's going to be usually some type of brokerage fee. And brokerage fee is a fee that you pay for your trade to be carried out. So Let's say on average it's twenty bucks, So you sit down and go,
V I really want to invest. However, if I'm investing twenty dollars today, is paying twenty dollars for that privilege making the total trade worth forty dollars? Is that worth it? Absolutely not from my perspective. So what a lot of people do is they kind of bundle their money up. So you might have a savings account to the side where you put money into it each and every single month, and then when it hits one thousand dollars, it hits two thousand dollars, you invest that all in one go.
That's what a trade is. It's like a transaction essentially. So it's genuinely smarter to have higher amounts per trade, which obviously there's a lot of privilege in that because you need more money to have a higher trade amount. But what that means is it brings down the percentage of your brokerage fee. So if you said I have twenty bucks to trade and I go great, no worries.
Your brokerage is twenty dollars, that's one hundred percent of the fee, which means if your money is then invested, beck it has to make another twenty dollars, so it's got a double in order to break even for what it cost you to invest. So that's not that sexy. But if I said to you, all right, it's twenty dollars, but you've invested four grand, you'd be like, that's fine. It's not going to take that long for my four thousand dollar portfolio to return twenty dollars and then some.
And so many times, and I'm obviously wildly passionate about this, but so many times people just forget about their brokerage and how much their portfolio cost them. So you might look at a portfolio and be like, well, I've got one thousand dollars invested. Oh my god, it made me my first twenty dollars. I'm making money, And you go, hold up, ut, how much was your brokerage? Have we'd taken that into consideration, Like have you made back what it cost you to get in the door? So right,
that's what a trade is. And then total portfolio is the total amount that you have invested, right, so from all the trades that have added up. Okay, it's honestly, and obviously this is just stuff we've never talked about beck like, you didn't learn this in school, so it makes sense you don't get it, sure, but it's pretty simple when you go, oh, what's a trade? Oh you traded it?
Yeah, all right?
In the words what's a portfolio, it's everything you own? Oh okay, like nice, we scary exactly. And I feel like the more we talk about this stuff, and this is why obviously we do do so many investing episodes, I just want it to make sense so that you feel super comfortable with it. And obviously this topic is about constructing your perfect portfolio and to me, spoiler, there's no such thing, but we're going to help you feel
comfortable with that idea. I just think it's so important to have these conversations because they make me feel so much more confident in my own portfolio. But also I can see you go, ah Vy, that actually makes sense, Like this makes sense, and I think I could do it, and that's my favorite thing.
Yeah. Absolutely, Well, my last point for that one was that fifty five percent of people do prefer stable returns.
I'm not surprised by that.
Yeah, I think that's so that's like more of a comfy sort of thing, like it's maybe like low, but it's stable and it's consistent.
Women take less risks than men. At the end of the day, women are less likely to want risky a portfolio. However, I think that that's also about education, because as we're going to get into the more educated you are, often the more likely you are to take on very comfortable risk. Sure, so we're not saying go invest in bitcoin or cryptocurrencies
or things that are inherently very risky. What risk often means is that you're putting more of your money into the share market as opposed to just holding it in cash. And the second you can understand that, the more likely you are to go, actually, maybe I am a growth investor. Maybe I am a little bit aggressive.
And you didn't know it. Okay, I really like that. Actually, So the next thing, I'm going to go through the top five types of investments for female identifying people that are outside of SUPER. So this does not include super.
No, and also on that super is not an investment. Super is a tax structure in which you invest in. You can invest the money that is sitting in that tax structure, and I could not be more passionate about that because it's your money, right, it's eleven percent. Now, Beck, do you know how many people listening to this podcast have still not pulled their finger out and how to look at their own portfolios to be like, Oh, I
wonder if this is working for me. If you're listening to this episode, this is just like a little bit of a side note personal attack to you.
I do love you.
That is why we are saying this right now. That is why I think it's really important. But if you are listening to us because you've clicked on an episode to learn about how to construct your perfect portfolio, but you haven't taken the time to go and look at what portfolio your superannuation is sitting in. Turn off this episode, go look at your super. Don't do that. Listen to the rest of this episode, and then go look at
your super because that is eleven percent now of your income. Beck, are you saving or investing eleven percent of your income every single month? I wish you are in super?
Oh true, you are in Super.
So like, why aren't we caring more about it? It is so much money. It is your money. Go and take control of it. Go and look at what it is. Do you know what the most And I have said this before, a million times. But like, if anything, I am a broken record. Beck, do you know what the most underutilized resource I believe is our huts? Oh honey, yes, yes, but also the call center. Superannuation funds iced to be a call center at super I know, but like your fun I would call you.
It's so nice thing, But like you had access.
To all the information to tell me what my super fund was doing, what it was invested in, what my risk profile looked like, how that works, and if you couldn't answer the question, you'd send me someone who could. Sure you're paying the fees on your super fund so that you can access that, and so technically it's free to call because you can't not pay your super fund fees, YOLLO call them. Abuse that system. Make sure you know it inside out, because at the end of the day,
it's your money. And to be really dramatic, but also it's not dramatic, it's just true. The difference between you not making a decision and not looking at your super today and just retiring is hundreds of thousands of dollars. You can be hundreds of thousands of dollars better off because I told you to be true. Credit for that.
I love that. I love that. I'm gonna personally give you all the credit if that's okay, thank you, thank you.
So I would like to personally take all the credit. Yeah, I have perfose working out so well for us.
It's great transaction, all right. So v fifty four percent of Australian shares held directly.
Oh okay, you know what, I'm not surprised by that. Oh I'm not surprised by that. Like, if that's the I guess, let's say the will one investment for female identifying people held outside of Super I feel like that makes the most sense because, to be honest, that's the like, I don't know, what would you say, It's like the gateway drug of the investment world because they're the easiest to get your hands on.
Yeah, yeah, what's next?
Okay?
So next is we have thirty five percent in residential investment property.
Who's surprised? Zero Peoplian dream? Yeah mummy nice? What's next?
Okay? Next we have thirty percent in term deposits.
Not surprised. Term deposits, especially at this point in time because of what our economy is doing, very attractive. Yeah, I'm not saying go invest in them, but they have become increasingly attractive. The other thing that's increased in attractiveness recently, Beck, apart from.
You, we did not plan that.
We did so crazy that we haven't been each other looking good. Okay, sorry, sorry, is just high interest savings accounts. Ah, you're better looking than a high interest savings account.
Back, thank you.
That is so the nicest thing anyone's ever said to me.
I know.
Okay. Next, we have thirteen percent in ETFs. I'm surprised by that, and eleven percent in international shares held directly, I'm not surprised by that.
Hah.
So I'm surprised by the exchange traded funds being only at thirteen percent because if you look at our community, a lot of people when you start an investing conversation, you'll say, well, you know, Beck, you've got your first thousand dollars. One thousand dollars to get straight into the share market is very easy. From my perspective. What you need to do is have a think about there's like a laundry list of things. We've done episodes on this before.
But what you going to do is think about your values. And I know that sounds really fluffy, but you actually need to think about your values. You go, well, what kind of investment do you want pick? Like you live over Brunswick Way. Yeah, yeah, hippy dippy, You're fine. You're probably going to be a little bit more ethical than the A Bridge bear. So like we're going to start thinking, like, do you want to invest in BHP?
What's that?
It's the oil company? Oh? I do not know that? No? No, I say no because I know you don't know it. Do you want to invest in like gambling or tobacco or like, you know, all of those things that you actually spend a lot of money on.
Like you know, I should say no, but I wouldn't mind.
Yeah, you wouldn't mind that. I think it's really important to talk about your ethics first and like do you want to hold those things or not? Yeah, let's say you say no and you want to go down the route of a more ethical portfolio, and you go, all right, well I want it to be ethical. All right, We've got some guidelines here that's really good. Do you want
to pick your own shares? In that case, if you do want to pick your own shares, I'm going to be real blunt and say to get diversification on an entire portfolio with just one thousand dollars is incredibly hard because of the purchase price shares exist at. So to buy a NAB or like a bank share of any kind, you're looking at more than fifty dollars per trade. Sure,
So what are you going to do? Buy one share and then another share in a different bank, and then another share in a few different asset classes to get diversification, in which case you only have one share per asset. Or are you going to look at an ETF, which is an exchange traded fund, which is essentially a big basket of shares that a fund manager has picked and put in the basket, and you go, I want to own that because it gives you instant diversification. So I'm
not making recommendations here. I'm just very surprised to hear that of all Australian female identifying investors, only thirteen percent of them are holding ETFs. Yeah, right, because that ETF is basically instant diversification. And if you look at our community, I would say that's one of the most popular asset classes to talk about. Like people aren't saying, oh, should I buy this particular share Beck. They're saying, oh, have you used this ETF? Are you with Banguard? Are you
with beta shares? What does this look like? And I feel like that's the conversation we're having the most as opposed to what shares should we hold? Directly in saying that, let's go back to the data that you gave me before you said the average age's forty seven. Now, I'm not so surprised that an ETF isn't as popular, because if you're forty seven, that's not old. Like I'm not throwing you under a bus. But the entry point in the investment world was very different when you started investing.
Let's say, if you started investing in your twenties and you're now in your forties. Sure, so it wasn't an ETF, and ETF was much harder to get into, whereas a direct share might be something that your parents taught you to buy or they owned and you just replicated their portfolio. So I'd be interested to hear what you think. And I know what's coming up. I just can't see the data, but I reckon when you tell me about these younger investors, I think that the stats for ETFs are going to
be higher. Let's have a little word.
Well, just really quickly, I want to say, we do have an episode Basics of Investing that we did a few months ago, many.
Investing things and so many low key keep an eye out, because I am dropping an investing course really soon. Yes, true, true money master class. We're going to do an investing master class. And you know what's kind of embarrassing because I've been being asked for this for years and I haven't done it.
Hey, that's quite all right, exactly right. So just in case you're listening and you're like, I don't know what any of these things mean, I.
Actually just want okay, like this is actually one of the reasons I retired as a financial advisor beck because I legally couldn't have done this master class if I was licensed to.
Give follow advice.
Yeah, I had to wait so as much as since. Yeah, it wasn't because I was being lazy. But no, sounds more clickbaity if I say it that way, Hey.
Little bit, just kidding, No.
Carry on, carry on, What have you got for me? Tell me about next genn invest So.
Yes, we are going to touch on next gen investors now between eighteen and twenty four year olds. Tiny babies, So first up, just a baby, just honey, baby. The average age is twenty one baby, so sweet. The median trade size is five two and fifty nine dollars.
That's that's higher.
It's very exciting.
That's higher than women on average. That is so big dog energy. Yeah, that is very very impressive. And the median portfolio size is forty five thousand and five hundred dollars for a twenty one year old. Yeah, isn't that lit?
That is so good.
That's like literally half of what the average is for women.
They've got a bright future.
Give me twenty years. I want to see this data again. It's gonna be so good.
Curious to know what the high if that's the middle, yep, that I'm curious. Not the highest is.
Oh my gosh. I see so many We ask a lot of people in our community like what do you earn? What do you spend? What do you earn? What do you like?
All of that?
And I think it's so interesting, Like there are a couple of people and it blows my mind. And do you know what, Beck, there's a whole heap of privilege that plays into it. Sure, but we've had them on the show before. If you listen to our money diaries where young girls are like, yeah, I'm twenty one and they have one hundred and fifty thousand dollars an investment portfolio.
So what Yeah, how how did we get?
Is it black magic?
Yes, it must be. I don't think it could be anything else.
Was it from your trust fund? It's it's not there. Actually usually it's not, so to give them credit, it's really not, of course.
So the top five investments outside of super for this bracket.
I'm excited. I'm excited.
Tell me some of your predictions might be right.
So first, I'm actually really excited to hear these, cause I love being right.
So forty three percent is held in Australian shares held directly.
Okay, that's a little bit lower.
Thirty three percent in Yes, yes, that was correct.
Yeah, I told you you were.
Absolutely spot off.
I feel like the tiny babies I eat. Most people who listen. Do you know what I was about to say, I e most people who listen to our show. But do you know the average age of our listener? I'm going to say forty, no, fifty, No, I don't know.
There's one point six million of you. So the average age is actually and it's a it's not an average age because I don't have the media and I actually just have like the mean, which is all the numbers added together and then divided by the total number of listeners, and that is twenty nine. Oh really, yeah, isn't it good? Yeah, so if you like took it for a bracket, it's between the ages of twenty eight and thirty four.
So, coy, that is really coollection because I thought it.
Was just tiny babies listening because so many times we talk to these like super young, super passionate like investors who am like, how are you better than I ever was? Yeah, and yeah, no, it's just people like uspeck Well, welcome to.
All our twenty nine year olds and everyone else.
That's hello friends, Love you, udy nine, Love you guys.
Next up, we have thirty two percent in residential property.
That's interesting because I'm pretty sure you told me that the average of female investors is thirty five, so like, that's not that far off the mark. True, Yes, impressive.
The difference here, I think is that there's thirty five percent of residential investment property for maybe the yeah, okay, older generation yeah, okay, actually.
Just maybe their first homes. This is probably first homes. I would say, I could go on around here where I do not believe that your family home is an investment, But we're going to save that one for another day.
Yes, absolutely. And then we have thirty one percent in crypto, which is interesting, Big Dog Energy Alrightyes, I would.
Like to see your portfolios. I'm always so interested back when it comes to people who buy crypto. No shade, absolutely, no shade. As you know, I don't care what you invest in. I just care that it comes from an educated place. I care that it is in line with your values and that you are feeling really confident with the decision that you've made and you've like did everything. But the fact that crypto is one of the riskiest assets, knowing that so many women and women are usually more
conservative to be a little bit stereotypical. To know that so many people who are investing in crypto before they're investing in shares which are inherently less risky, right, blows my mind.
Yes, very interesting. I find that very interesting. And then lastly, V we have twenty five percent in international shares held directly.
How cool.
Yeah, wow, I'm really really excited. I actually really like this of these people.
I think it's an interesting, I guess thing to go through and just talk about. Do you know what the next gen investors? Give them another ten years, they're going to be running rings around every other.
Person, and quite frankly, they can.
I will let them.
I will let them. I'm weaving them full control.
We'll give them the podium. They can have this podcast all. They can take it, absolutely anything they want. All right, beer, let's go to a really quick break. Let's have a quick break, eat a coffee frape, and on the flip side, we're going to dive into exactly why I always say that I'm a conservative but aggressive investor. Don't go anywhere.
Okay, V we are back.
You were saying at the start that risk in investing is multifaceted.
Let's discuss that a little.
Bit multifaceted risk that feels like it makes it much smarter than it actually is. I like it. So we're a multifaceted tongue twister. No, it just makes me feel intelligent. We should use it more often. Yes, all right, So let's talk about risks. So risk essentially like if I drew a little risk reward chart. The more risk you take on, the more you could potentially lose. So we have four different recognized asset classes here in Australia, and I'm not going to get into every single nuanced about
each and every single one of them. However, we have cash, essentially the money in your bank. We have fixed interest, which is things like term deposits, high interest savings accounts where you lock your money away, and bonds. We have property, which is the great Australian dream. And then we have shares, which arguably is remote perspective, the sexiest of the four asset classes. Right. So you've got those four asset classes and a good portfolio is made up of a good
mix of all four of those. So when you're talking to the idea of risk, the more risk you take on, the more you could potentially return. But as we've said, the more you could potentially lose. So we know in Australia beck that the lowest risk asset class is technically cash, right, so the cash in your bank, like, you're not necessarily
going to lose it. In fact, we live in Australia and we have government guaranteed bank accounts which means, hypothetically, if the world flipped upside down and your bank went down, Beck, and it became completely bankrupt, the government guarantees that they will give you back up to two hundred and fifty thousand dollars of what you've got in your savings count.
So that feels pretty comfy, right, Yeah, So if like your bank for some reason went absolutely down, the gurglar, it's all right, the government's got you back.
That is so cool. I did not know that.
Very cool. But also, let's be honest, if one of the big four banks goes down, Bed, I promise there is so much more to worry about, right than your savings. And I know that that sounds dramatic, but if one of the banks is going down, her economy is absolutely rancid.
And I know, and this hasn't happened before, but I can almost guarantee that if one of the big banks was going to go down because of how much it props up the economy, the government would basically jump in, give them a little bit of a life raft and make sure that that didn't happen because of how impactful those big four banks are on our economy. Right, But in saying that makes us reel really safe. The flip side of cash, though, is that a dollar today is
not worth a dollar tomorrow. And we know this because of inflation. As you know inflation, and we knew when we got kicked in the absolute guts when our Hex and Help debts went up by seven point one percent. Inflation's really high at the moment, and that essentially means that what we could buy on this day last year, beck,
is more than what we could buy today. And essentially CPI or consumer Pricing Index is essentially where, in the most simplest terms, a whole heap of economists they go, Beck, let's go shopping, and they have a basket of goods just from woolies or coals, and they go and fill their basket full of all of these essentials and then they go, what does this cost? And last year it might have cost thirty five dollars and this year it might cost forty five dollars. So that's the increase in
consumer Pricing Index or CPI or inflation. How much stuff is going up, right, So it means that if you're going to put all your money in cash and go, do you know what the other asset classes real risky. I'm not so sure about them. It means that because inflation, when you see you went up by seven point one percent, you would need to be making on your savings account at least seven point one percent to have the same
amount of money that you had last year. We're not saying that if you dumped ten grand in a savings account, you won't have it. Next year. You'll have ten grand, it will stay identical. But to purchase the same amount of stuff that you could have purchased last year with ten grand, you're going to need ten thousand and seven hundred dollars because it's increased by seven percent. Does that
make sense? That does make sense, So you're going to need more, Yeah, because unfortunately the world is increasing in price, and ten grand today is not worth what it is tomorrow. And that means that, unfortunately, if you're going to have all of your assets or all of your money tied up in cash, it's going to cost you more over the long term, and you're actually shooting yourself in the foot, which is not that sexy.
Right.
Then, we've got and we're not going to go too much into it, but bonds and fixed interests and stuff like that higher return but also relatively stable, and it's going to depend on what type of asset class you get into. Then we've got property, the Great Australian dream. It's not going to go up in the same way that it has over the last thirty years. But that's absolutely okay because it doesn't mean it's a bad asset class. It means we just need to be smart about what
we're purchasing and where we're purchasing. And as I've said before, we are only talking about that in investment terms. I'm not talking about your first house or your first apartment. To me, that is a hygiene factor, not that you need to have one. Beck I don't think that anyone needs to purchase property if they don't want to. Renting is totally acceptable as an outcome for putting a roof over your head. Like, it doesn't matter if you own
property or not, that's not the point. But if you choose to buy a property to live in, that's not an investment because if you've chosen it to be an investment, you would have to sell it for that money to actually have an impact on your life. So don't get me wrong, it's an absolute privilege to pay off a mortgage completely and not have to be paying rent each in every single month. But we also need to look at the flip side of that where if you go, yeah,
but it'll increase in value. That's that old school concept of downsizing.
Right.
It's like their stereotypical two lawyers. They get married, but they have a lot of income. They go by the biggest house in a very fancy suburb. Right, They work until they retire. They retire at the ripe old age of sixty five years early. You can say the lawyers a right big dog, right. Yeah, their properties now worth like five million dollars, Oh big dog. But all their money is tied up in that five million dollar property because it was a big mortgage and they've spent their
entire lives paying that mortgage off. Right for them to live comfortably in retirement, because they've used their family home as their main asset, you know what they have to do. They have to sell their family home because you don't just have five million dollars. Like your house might be worth five million dollars, but if you've worked your entire life to build up this beautiful, big home, doesn't matter if it's a big or small. This is just the
example I'm using. You worked your whole life for this, right, you've built it up, You've done all of this stuff and you're so excited about it. But now it's all designed the way that you want it designed, and you've brought up your kids in there, and now your grandkids come over. For you to have a comfortable retirement, you have to sell that house. You have to move potentially into a different suburb because you can no longer afford
the suburb. While still having retirement savings, you might go and buy a house for two million dollars in a different area, and now you have access to the additional cash to retire comfortably. So from my perspective, Beck, why did we save all our money and invest it technically into this big family home for us to then dispose of it if it is our one favorite true asset.
Like, if you've worked your.
Entire life for your dream family home but all your money is tied up in it, well, do you want to have to throw your family home down the drain so that you move to a smaller place Like, Don't get me wrong, that's a very valid investment strategy if that's aligned to your family values and what you want to create. Telling you right now, I have only just finished renovating. It's not even finished. Don't even start me my first home. I'm so excited about it, but I
also know that it's not my forever home. However, having gone through this whole process of picking things and doing my own bathrooms and oh my god, I got to pick the carpets and the lights in my bedroom. If I get to my big family home one day and I do that, I don't want to sell that. I want to bring my kids up in that house. I would want my kids to bring home their kids and
that's their grandparents' house. Do you know what I mean? Like, everybody has different values, and I'm not saying that you need the same ones as mine, but I think that we need to reframe this idea that your family home is an investment, because from my perspective, it's only an investment if you're willing to dispose of it. Does that make sense?
It makes so much sense.
Okay, so other house ran to side. We now move on to shares, and they are, from my perspective, one of the most attractive investment types. Do you know why? I think they're real sex because they do two things. Beck, in this day and age, two things I know. We love a flexible gal. They can increase in value. Nice. Nice, But they can also pay you with dividends. Oh my, I've worn something that is worth more tomorrow and also paid me for the privilege. Hot girlshit.
Yeah.
Anyway, So shares I think are relatively attractive, but we know that they're more risky. So because they're more risky, people tend to shy away from them. But they usually shy away from them because they don't have the education around what we're building. So when I say I am a very conservative, aggressive investor, I say I'm willing to take a lot of risk by exposing most of my money to the share market. So I'm happy for my money to all be in shares. I do have my
emergency fund. Please don't get me wrong. Never invest your emergency fund. Beck, They're the rules. I made them, so you've got to follow them. You have to follow you have to follow them. Yeah, absolutely, no investing of your emergency fund. However, as a conservative, risky investor, I'm not picking crypto. I'm not picking shares that have just joined
the market. I'm not picking. Do you remember when everyone was talking about after pay shares and they were just like super excited about buying after pay.
Yeah, that does ring a bell.
Yeah.
I feel like it was maybe like twenty eighteen, twenty nineteen. Everyone was like, oh my god, I wont after pain and I was like, oh, a big billion energy, you will. But after pay weren't paying dividends. So I was like, I'm not buying that because I want to be paid for the privileged baby. Yes, So to me, that was not a share that I purchased. And the only way people were making money by buying after pay shares back then was to buy them, have them increase in value, and sell them.
Laughing at and joke that I was going to make, but I.
Know I want to hear joke now.
Okay, Well you were going to say they don't play paid, they don't pay dividends. I was going to say, it's a selfish not a share. Yeah, okay, anyway, that's so dumb. Who are so?
I love that you tried.
Thank you and thank you pople laugh here even though it was so dumb.
That's why I laughed. I think everyone's like that, what was that really?
Really bad.
She's usually really funny for you. Thank you, You're welcome, but sorry continue. I want assets that to me are really stable. So, as much as to quote every investment professional ever, past performance is not a reliable predictor of future performance, I do not want to be buying things that don't have good past performance, as much as we can't use it as a predictor of the future. To me,
it's what's making me feel comfortable about the future. So if a share has been on the Australian share market for the last fifty years, has for the last fifty years paid out a dividend and has consistently increased in value, We're not saying doubled every year, because that's unsustainable, do you know, just bopping along, going up, maybe in line with inflation, that would be good. Just just keeping We
love a girl that just keeps up. We're not trying to go fast, You're just trying to get to the place safely, right. So for me, I would much prefer that type of share than a risky one. So when I say that I'm conservative but aggressive, I have most of my assets tied up in shares, but beck those shares are so boring it's not funny, Like those shares
are the most conservative shares I could buy. They are what is called blue chip shares, and I have them spread across a few ETFs because again, love some diversification as much as I could, and have managed my own direct share portfolio before. Just love a good ETF sometimes, Yeah, they do good. They be good. They've got good fund managers involved with them, They're from good companies. I've got a little bit of Australian shares, like we've got some
Australian stuff. I've got some international stuff as well.
Wow, discriminate.
I love some international stuff in an ETF too. Tax oblations, they're not as complicated as if I owned them directly. Sure, So I just I'm a low maintenance kind of girlie. I don't want much except all of the returns. I want those exactly.
We wouldn't hurt.
So when I say that, I'm the type of person I don't really like taking on risk that it's unnecessary for me. I just want to be that slow and steady horse that wins the race.
She's not making a.
Fuss, she's sactly. I want to look at my portfolio and as much as like this is hypocritical. I'm so happy to share it with all my friends, which are you. I still when I log into my platform to have a look at my shares, if my portfolio is down, I get that like hit in the chest, you know, and you're like, oh, you know that feeling that you
get if you're not an investor. You get that feeling when you check your bank account and you thought there was one hundred bucks more in there than there actually was. It's that feeling when you're But that's just the emotional investing journey, and we have to be aware of that. And the reason I'm sharing that with you right now is because I genuinely get a little bit stressy about it,
regardless of how much education I have. But that's why we need to be educated, because then I go, actually, Victoria, put your ex financial advisor hat right back on, and tell yourself that it's just your reflection of the market. The market's not doing so well at the moment, so it kind of makes sense that your portfolio is reflective.
Makes sense.
So if your portfolio is reflective of the market, you can't be too mad. No, However, if your portfolio is tanking and the market is doing really well. We need to have a look at what you've done.
Absolutely, but actually it's not you.
It's market exactly, especially if you've chosen assets that are well diversified, and diversified can be really scary. But Beckett's basically just not putting all your eggs in one basket. So if you've got a thousand dollars and you're trying to invest for the first time, buy a few different options or an ETF or a managed fund or something that is going to give you that instant diversification. Because if you went and just bought one bank, I promise
that it's not good diversification. Sure, it is really bad diversification. I could not recommend it.
It is a solid advice viee.
He's an investor.
I think I'm almost there. Via. I feel like that's a really good place to leave it for today.
Is it a good place to leave it because you're run out of time or you've run out of like energy capacity? Okay, that makes sense, but I can rant on another episode because honestly, when it comes to investing, essentially all of this is just trying to make you feel as comfortable as possible when it comes to getting started. And I feel like the hardest thing is actually just taking the first sleep. And I think when it comes
to getting started on your investing journey. I know we've talked about trades and how you know it's not worth investing twenty dollars if your trade is twenty dollars, right, But if that's what gets your foot in the market, and it actually gives you exposure to an ETF so you can follow the market go up and down and you can get that emotional investing journey in. Maybe it's an investment into your financial literacy so that you get exposure to the market you feel really comfortable with it.
Would I recommend that all the time? Absolutely not. Maybe find a shared trading platform that makes sense for your investment amount, like beck if you were talking about, oh, I have my first fifty bucks to invest, Well, I'm not going to say go with self Wealth because they've got a minimum investment amount of five hundred dollars. That's not going to work for you, is it. But you might consider something like share Z's where you can invest with as little as one cent. And that's not me
trying to promote a platform at all. I just think if you are looking to get invested, there is going to be an option for you. In fact, just to do a little shameless plug, I wrote a book. It's called Investing Wishes on the Money. I did a chart in that book, so maybe if you don't even want to buy it, just like, head down to kmart, open the book, take a photo of this chart, run away,
pretend it never happened. But it's a comparison of all the fees, all the charges, all of the bells and whistles, what exposure you get for a whole heap of investing platforms that are most popular in our community. So we go through spaceship, we go through rays, we go through shares is, we go through self wealth, we go through peerl like literally everything that is really popular in Australia at the time that I wrote that book. I've compared.
So all you have to do is go through it and go all right, Well, do I want a micro investing platform? No, okay, Next I want to share trading platform. I really want exposure to Australian shares. Okay, well, these are the ones that give me access to that. Oh look, here are the fees, here are the charges. I don't know if I want that particular bell and whistle, or I do want some more research, or I don't want
some more research. So you can make the best decision for you, because picking a platform, from my perspective, one of the hardest decisions when it comes to starting your investing journey. Right, well now is a really good time to leave. Yeah, you're done with me? I are done.
Need to absorb all of this.
We can talk about it over lunch. Oh, thank you, Absolutely not.
We can talk about a multitude of other things, but let's talk about this again. No, that's sorry, Sorry for me.
Sorry, not sorry. Well, you have a good week. We will see you on Friday for Friday drinks, and then we'll see you on Monday for another Monday and money dough and I can't.
Wait, can't wait. So you guys say goodbye.
Boy.
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