Hello, my name's Santasha Nabananga Bamblet. I'm a proud your 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 podcast for millennials who want financial freedom, My friends, Today is Friday, which means it is time to sit back with the girls with a bev in hand, to unpack our favorite moments of the week and of course, to celebrate our incredible She's on the Money community. As always, we'll be
sharing our favorite money wins. We're going to discuss what's making news in the finance world, and today we are going to be answering a juicy money question, which this week is all about investment diversification.
But first it is.
Time to recap the week that was. Miss jesse Garci, could you talk us through what happened on our Monday Money Diary.
Absolutely, Monday's diarist was ever so lovely. She watched her family go through bankruptcy when they were little and they lost pretty much everything, which, as we've spoken about on the podcast before, is definitely considered a form of financial
trauma and something that really shapes your money story. And she spoke to us a little bit about what the impacts of that were on her as an adult, how it has kind of changed her perspective and you know what she's thinking about because now she's in the position her and her fiance are building their first home together,
which is so exciting. And she spoke a little bit about the impacts of that mindset really had on her and the goals that she has and how it can sometimes be a little bit of a barrier, which I think is super relatable for a lot of people and a really good example of how even those things that we experience in childhood. She personally didn't go bankrupt, her parents did, but that it really impacted her a thousand percent.
It really carried into her adulthood and she was just very self aware, and I thought that was super admirable and showed that she had been working really hard on her financial literacy and her self awareness.
Agreed.
I felt like it was a really powerful story as well, because trauma isn't only just for the person who quote experienced it. It can be really peripheral as well. Yeah, and sometimes we don't even notice that it's impacting us until we get a little bit older and you start making decisions and you're like, why am I so much like my mom? And you're like, oh, oh, okay, that
makes a lot of sense. That's how they grew up, that's their values, that's their beliefs, And I think it's just really interesting.
We're also discussing fun trauma in a couple of weeks time on The Deep Dive Ladies, so stay tuned for that one as well.
I'm really excited.
Fu us very fun, Georgia King, I hear your voice on their show Talk to Us What Happened on Wednesday?
On Wednesday, I sat on the bench. I was not a part of Wednesday's show.
The Gorgeous Kate I got you toed.
Out, got you to Kate Brandsgrove joined us on the show to talk all about interest rates and what they mean from a home buying perspective and are interesting topic.
But how did she get to kick you off your podcast? George? Well, she's a special woman and I a little it happened.
I allowed it.
Do they answer the degredation?
Yeah? Good, good, no problems at all. I am glad well with that recap. To my friends, do you know what time it is? You guys know what time it is? Is time for our budget direct money Wins of the week Georgia King, what are you bringing to the table?
Alrighty, let's hop into it.
The first win of the week comes from Amy Money Win. My sister and I work at a golf club along the Peninsula and we both work out at the front reception desk and accommodation together. We had some guests stay with us for a couple of days and they loved us so much that we received a five hundred dollar tip between the two of us wo plus we also got fifty dollars on top of that each from another one of their friends. Both paid pretty averagely, so it really made our weeks.
How good's that? Bucks? Money job. When it starts to go into three figures, you're like, that's a real money The.
Next week it comes from Jessica money Whin. I got a secondhand couch on Marketplace in my rental and I had my sister's boyfriend and my cousin carry it up the stairs for me. So I saved on the couch and the removalists.
I like that money and logistics win.
Removalists are expensive ladies pay. I learned that yesterday.
Oh really feel the moving process was very stressful. Moving on the next week, it comes from Brittany money Win. I got an almost brand new Mercedes kids driveable car from my estates by swap sell Facebook.
Group for free money win.
These usually go for about four hundred dollars. It was listed as not working and missing a charger.
That's a right, I'll get a charger. I'm saving four Hungie.
My amazing electrician husband fixed it for our daughter, who's four years old, and we had a spare twelve volt charger laying around.
Oh yeah, of course, piece of cake.
Turns out our daughter is absolutely terrified of the car and we'll be putting it in storage until our seven month old son is able to use it.
Okay, so yes.
One of my girlfriends gave her daughter like a mini range drover for her birthday. It was the boogiest thing I've seen in my life. We go to this first birthday and this little kid is being gifted this rain drover. I mean, it sounds real boogie, but it's obviously like actually a fun present.
Her daughter was terrified of it as well. She's like, that was expensive and I thought she'd.
Love it, And I was like, okay, so yeah, it'll probably come back at her second birthday because kids.
Don't know, they don't know money win.
Later though exactly next win is a loss actually, and it comes from is a loss, money loss. I traveled to Woomba for a work meeting and I paid six dollars seventy for a regular lactose free latte at the service station.
By the service station, Oh you can pay that angle and I respec that's still good. But she said the coffee was good. Oh it was good. Servo, coffee is good? Is it can't say the same?
Actually, is it true on a money related front? Because we are on shees on the money. That coffee's at seven eleven.
Yeah, they're going up the first time.
I actually laughed so hard and heard on the grape vine that they pushed that launch off because of the circus around my coffee.
Yeah, coffee gate, so they pushed that off.
But they are going up, which, to be honest, still a total coffee guys, that's still very good value. The thing that Jess is going to be real salty about though, Jess doesn't drink coffee, so I don't know if you read the pr or the media release from them. Can I have to break it to her now then live on the show, Jess. They're also doubling the price of slur piece.
No, oh my god, I'm I was literally like two dollars for coffee still really chat, but two dollars for a slow absolutely not?
Are you real salty? We like the guys at seven eleven.
They're I mean, they're not actually our friends, but we think that they're our friends.
The next win comes from Emma, guys, money win. I've just turned my first apartment into an investment property and a tenant is moving in on Friday.
Money when that's exciting? So how exciting would that be? Oh my gosh?
So many yeah, but just like so many of our community work their buds off to get into their first homes and like, that's obviously a massive milestone in itself. However, imagine buying house and then getting your first ten and you're like, this is now making money?
Like that's sick killing it. Well done, Emma. Last win of the Week, Ladies comes from Callista. Since listening, Okay, it's quite self indulgent. Sorry, I chose it because it's pretty complimentary to us. Since listening to She's on the money. I've closed all of my buy now, pay later accounts, been contributing extra super and tax through work. I've sorted out automated transfer to savings accounts to stop me spending
all of my money. I've been investing regularly in ETFs, and I just got a new job that pays me more.
What, Queen, I'm just doing it all as queen behavior.
I love being part of this community that teaches me so much and keeps me on track.
We love having but also like we're just putting the information out there. Look at all that work she did. We didn't do that, Like we just talked absolute smack on this podcast and then take credit for.
Stuff like that. It's great it is great, Georgia King.
It has been obviously fantastic celebrating some of your budget Direct money wins Budget Director, winner of can Star's Insurer of the Year Award twenty twenty two.
Budget Direct Insurance solved with.
That, let's go to a really quick break and after the break, we're going to talk about diversification in your share portfolio. And we have a topic that we want to talk about. The jess is found in the media. Don't go anywhere.
Alrighty guys, this week I wanted to talk about something it's not facked yet. Just let me be very clear because sometimes when we talk about these things, people get confused. A proposal that came out from the Greens and they've proposed four years. I know, this is really interesting. They've proposed a rent freeze that would last for two years to address the cost of the crisis, the rental crisis.
Anyone who's renting, George, I mean, you literally just moved because your rent went up, right, yes?
Or is that why you moved?
You were like salty? Absolutely not yet amongst men.
Okay, all right, all right, we'll take this off lineage. We'll take it to a wine but.
Yeah, a lot of people are experiencing increasing rand, which obviously in many instances is a case of increasing interest rates, which then the landlord's passing along.
Yeah.
Yeah, it's a whole big, long thing. But it's just another add on to the already extremely long list of expensive costs that we have to pay just for being
a wife, which kind of sucks. So the Greens have proposed a two year rent freeze, which would mean that Australia would be frozen from the weekly amount agreed upon or advertised at the beginning date of the proposed bill, which at this time is the first of August twenty twenty two, which would mean that for two years from the first of August twenty twenty two, which would obviously be backdated, that rent would be frozen where it is.
So if right now you pay three hundred dollars a week, for the next two years, your rent would stay at three hundred dollars a week, which sounds really nice, particularly when everything's going up. According to some research that was actually done by SQM, weekly rent has risen by fourteen point one percent in Australia in the past yeah, which is that's a lot like and I know that we've been talking about how expensive everything feels. But like to
hear fourteen point one percent. I mean, correct me if I'm wrong, but that seems like heaps for twelve months. And so that's kind of why they've proposed this. The Greens would need backing from other political parties to make this happen because obviously they are not the party in parliament currently. I don't know if that's the right word or the right phrase.
But you know they're not going to pay out. They any mean, baby, they.
Said we think this is a great idea. It remains to be seen if everybody else jumps on board. But I wanted to chat to the girlies and say, what do we think. It seems like a grade under your own face, Valley, But I always find with politics that there's usually a downside or a surer something like that.
Which makes them look real good. Though.
Well yeah, and I mean, they have the largest number of seats that they've ever had, which is really cool because I think for a lot of us, and please, I'm not getting I mean, I'm talking about it.
We're totally getting political. You're talking about the Greens and that's okay.
I'm not trying to sway people in any way.
But no, we have respectful conversations about potential policies and how that might impact our community, Jessica, and you are well within your arts to have an opinion on that because whoever had done it, whether it was the Greens or Liberal or labor, Like, it's just a policy that we're discussing.
This isn't a jess votes for the Greens.
Yeah, But like, I think it's really cool because the Greens, I think, aligne with a lot of people within our age group. They seem to care about a lot of things that a lot of us do care about. And I just thought it was really interesting to kind of talk about the fact that this kind of left of side party is coming in and proposing changes that seem like they would really resonate for a lot of people.
I feel like there are a few people in our community who am like, oh, yeah, that's great. Like, you know, George, if that existed for you, you wouldn't have been mucked over with such a large increase in rent And I feel like it's actually really like one of the draw at the end of the day of renting is reliability. It is knowing that each and every single month, you
only have to pay that set amount of rent. And if your hot water system breaks, all like meat, your air conditioner system breaks, and it's going to cost you. It literally is going to cost me fifteen thousand dollars to put a new reverse cycle into our house. Like, that's not your problem. That ain't your circus said, it is not your monkeys.
That is somebody else's house.
Gee, you would just pick up the phone, call your agent and say, hey, the eircon doesn't work.
Can you just organize someone to come and look at it?
Like that is one of the complete benefits of renting, that it's consistent, right, But for them to increase rent, buy a massive amount, and if you're saying it's gone up fourteen percent, let's remember how those statistics are calculated, that would be an average across the board. I know people like you know my sister, she signed a new lease at the start of COVID, got a really sweet deal and a really sick house, and I'm like, wow, that's really nice.
When I was all right, I couldn't afford that. Who knows.
I haven't spoken to her about rent recently. I'm assuming that her owners might be going, oh, like, maybe we should put it back up to what it used to be.
And I'm assuming George, that's maybe what happened to you where they've gone all right, Well, you know COVID's quote over we want actual rental yield for this, which from an investor perspective makes a lot of sense, right, Like, if you purchase an investment property with the intention of creating a rental yield to put you in a wealthy position when you are older, like, that's your progreative, you can charge whatever rent you want. But I think that
puts people in a compromise position. So to say we're going to cap it at two percent annually, you're all right, Like that seems kind of reasonable. I'd be interested to know the semantics of that, Like, am I only allowed to increase Jessica Ricky's rent by two percent each year? Or if I tell her I'm not renewing her lease, can I then increase it by fifteen percent.
To a new tenant.
Will that increase turnover and therefore decrease availability of rentals?
That's a really good point.
I hadn't thought about the fact that if the rule became let's say you can't increase the rent on your tenant for two years while they're living. There is the workaround. But if you put a new tenant in you can change the productya is it?
Like it hasn't making someone redundant and then you can't hire someone else for like three months after into the
same role. Like, I don't know how that works. But I was looking online at this obviously in preparation for this episode, and there's a group called the Property Investment Professionals of Australia and they're saying that the Queensland Greens Party's implementation or proposed implementation of a two year rent freeze is likely to push investors out of the market because if I can only increase your rent by two percent, that's not a good yield if you compare it to
the share market, right, But it will increase homelessness. And I think that that's an interesting take because if there are less investors investors equal rental properties available for people to rent, then obviously there's going to be less people able to get into properties, less availability, and I think that creates an even bigger housing crisis above and beyond affordability.
So it's an interest conundrum I can see where the Greens are coming from when they say, oh, we would like to implement this, because obviously an emergency rent freeze is going to give time for wages to increase to CPI, because obviously inflation has been absolutely crazy recently, and with inflation, like just if your costs increased and you owned a rental property, you'd be like, oh, I can soak some of that up by increasing my rent, but your rent's
income has an increased. So I can see why they would do it, but I also see the flip side of going, hmm, that's actually maybe not the best idea.
Yeah.
Well, the opposition was asked if they would support the red freeze, and shadow Mister for Housing and Homelessness Michael Sucker said no, and that I would argue is why as someone like I'll be the first to admit that I am definitely not as aware or as educated or as involved in politics as I guess I would like to be. And so it's really interesting when stuff like this comes out, because like I looked at that headline and I was like, oh my god, that sounds amazing,
Like rent freeze. Everything's expensive, Like I'm worried that my rent's gonna go up, like when our at least renuely, you just never know, and everything else is already costing so much money, like it's a real stress. And I was like, oh, I got amazing, what a great policy, and my brain kind of stopped there. And that's why I wanted to talk about this, because I think that.
Lots of people would be thinking the exact same thing you did.
And it's kind of interesting, how yeah, Like on the surface, that is such a great choice, but the economic fallout or the butterfly effect, I guess that these choices have can go so much broader, And so by talking about it, I hope that maybe we showed another side of the coin.
I've been reading online and there are a fair few different property commentators who have actually said, look, this snap rent freeze is doing nothing for long term housing supply issues. In fact, it's making it worse, because why would you potentially purchase an investment property that you're going to rent out if it's like not got good yield or ability to grow over time, because that's one of the draw cards for an investor, right, and that rent increases are
actually below inflation. And then I took it one step further and looked at some research that was done by Picker, who is that property group that I mentioned before, and that showed that rents had grown at only half the
rate of inflation over a decade nationally. So that's actually not that bad in the grand scheme of things, if you look at the big picture, and we always say on the pod like if in doubt, zoom out and look at the bigger picture, because right now post COVID, you're like, yep, that rend freeze will be you know, so good for so many people. But if we look at the bigger picture, it's actually quite detrimental.
It will be interesting to see what happens as well, ladies, because we have seen over recent times that the volume of investors in the market has decreased because of COVID and because of lending restrictions and legislative changes.
Yeah, there's so many different reasons.
So if this does come into effect, it will be interesting to see if that decreases further.
Yeah, and I know that lots of people, yes you included, well like this is sick.
And then I put my finance hat on.
I'm like, oh, I don't know about these This actually feels like it's probably detrimental. And you know, there are lots of people in our community that have varying and very diverse views on landlords and whether you should own property or not or what that looks like. But at the end of the day, there is a housing crisis, and one of the ways to actually, you know, help improve that is to have more properties available for rented
reasonable prices. And I think there's probably a few things that you could do that isn't a rent freeze that puts us in a better position long term. So it'd be interesting. I don't have the answers. I just am a spectator to this with an opinion. I'd like to see what other people have to say.
Oh.
With all of that said, ladies, Money Dilemma time.
Oh what a dream, Let's go, Hi Bear.
Have you got a money dilemma you just can't solve? The She's on the Money team is here to help. Every week, we tackle your dilemmas, both big and small, to answer your most burning money, career and life questions. To get involved, simply head to our website and leave us a quick voice recording and you may just find yourself on the show. Now let's take a listen to today's Money Dilemma.
Hi, lovely ladies, thanks so much for the great podcast. I'm really loving all of the investing related content, and I have an investment related question. I currently invest in a small number of index based ETFs, and I'm looking to branch out and acquire a handful of individual stocks. I've read that you shouldn't buy companies that are holdings within your ETFs so that you're not doubling up in
your portfolio. But I was wondering, if you consider that the share price of a company represents great value, you like what the company does, and you want to acquire them as an individual stock, is it a mistake if they're a holding in one of your ETFs.
Thanks ladies, Victoria Devine, Georgia Kie. I don't know how to answer this question, but you know what I can add to this conversation.
Oh, I thought you were going to say, you know what I can do, handball it to you.
I can do that, and I will do that. But I just loved this money dilemmasts question. I loved her energy. I loved her aura.
You loved her aura.
Yeah, that's all I can really add to this. I like to this conversation, but I'm really curious to hear what you have to say.
VICKI d do you have any comments that you would like to make.
Jess, I don't know the answer, but I suppose maybe to simplify it because there was not jargon, but for our newer investors or people who are not so confident. Essentially, what she's asking is, if she has an ETF, which as we know, it's a bundle or a basket of different shares, can you make me so proud? Thank you. I'm just I'm literally just repeating what you taught me. But if she has an ETF, let's say within that ETF, I have invested in Cheese on the Money.
Great, a genius idea.
I mean, it's not on the stock market, probably never going to be in the stock market, but I'd invest in that company.
Yeah.
But if my ETF that has all companies owned by women, For example, one of the shares that in there is Sheees on the Money, should I? And I'm like, I really like Es on the Money. I want to invest in them more. Should I then go directly and invest in Cheese on the Money shares outside of that ETF or not. She's asking is that redundant or is it okay? Because I love the company and its values and its ethics, et cetera.
That's a very good way of phrasing it.
To be honest, I think this is a bigger picture, right, So investing in an ETF is often done so. An ETF is an exchange trade of fund. As you said before, Jess, it's basically a basket of shares that is managed by a fund manager who's in charge of bringing shares in and putting shares out and you know, making all the big investment decisions. Most ETFs on the market are what's called an index, and that means it it just has
a whole bundle of different shares in it. It might have the top two hundred shares in Australia in it, and it then takes the average returns and gives those to you. So it's not really looking for, you know, above and beyond benchmark performance. It just kind of is the average of the average. And most people view an ETF as a relatively safe bet. They look at it and go, you know what, I don't know heaps about the investment markets.
I am not a financial advisor. But what I have done is founder basket that has the values and the goals and the ethics that I am happy to adhere to, and a pretty good manager that makes those decisions. What she's talking about is going to the next step. And if you guys want to know more about that, we did a really good bias but really good episode on
the different ways to invest. We talked about micro investing and then share trading platforms and robo advice or what it means to get full service financial advice and how those different things work. But there's a lot more risk when you're picking the shares yourself because there's a lot more responsibility on you. It's not about like, oh, v I went and bought an A and Z share today
and I go, oh congrats. You actually hold it in exactly the same way as you would in ETF, however, and ETF is going to give you automatic diversification because there's a manager that's in charge of making sure that if it's the top two hundred stocks, it always has those top two hundred in it, and they might come and they might go. But if you just go and buy an Z and then that goes, you know, down for any reason, you're going to feel the full breadth
of that drop. So if you are an individual share investor, your job is to not just pick one A and Z share, but maybe pick a basket of eight to ten or even twelve different shares to diversify yourself. And to me, that's a really big responsibility because how do you know what to buy and what to sell and what's actually doing well without significant research. It's not to say you shouldn't do it. I just think it's a
big responsibility. I love because it's literally my career and my job, and I adore it and I do it for myself. However, I think we need to be really careful we're making that decision because the diversification isn't automatic click, it isn't an ETF. However, I think what she's saying is should we double up, Like, yeah, I own A and Z inside my ETF? Should I go on buy it direct? And to be honest, I've got clients that do do that. They own an ETF that you know.
I'm using A and Z as an example because I was doing some research on them this morning and so they're stuck in my head. It has nothing to do with the recommendation to Steph Wyer. Sorry for that spoiler, but A and Z is in your ETF, but it's the top two hundred shares, so it makes up one two hundredth of your portfolio. So to me, I go, oh, well, I wouldn't really mind about the double up because you're not significantly invested in in.
Your ETF at all. However, I would.
Really lean to, well, why are you then purchasing it as an individual share instead of buying more of that ETF?
Like, what is your goal?
If you're goal is to diversify more, maybe you've gone or I've bought this ETF and it is all Australian shares. Let's go back to that example of the top two hundred companies in Australia. When it comes to diversification, adding an individual share isn't really going to diversify you, but adding another ETF that actually holds global companies would. So you go, well, what is your goal here? Is it just because you love that share? In which case you do you boot go buy some more of that if
that's what sets your soul on fire. I'm not going to argue with you, but we really need to go back to the crux of well, what are your goals and importantly, what is your risk profile. If you're a conservative investor, maybe an investment that is an index ETF that tracks the average of the top two hundred companies in Australia is AOKA and you're like, yep, no problems. Maybe direct investing is actually too risky and it's not actually aligned to.
Your risk profile.
So the first thing I'd do is look at my risk profile and understand where my assets could potentially be
in my investment portfolio. Then I'd look at my values and what I actually want to create eight and why I might want to hold something directly, not saying don't do it, that's not the case, but it's really like it's not really a question a financial advisor could even answer as a personal question because it's kind of like, well, just why do you want to do that is what they're going to ask in the first place.
Yeah, interesting that there's no like negative tax implications for investing in something twice and stuff like that, Like it's not nothing wrong with doing it, No, like.
You're gonna have tax implications from making money. And as I've said on the podcast before, if you're paying tax, you're making money. That is a great outcome. We need to be careful of turning over assets too quickly. So if you buy some AM's edge shares today, they make a massive profit and you sell them in a week, you're going to have fifty percent more capital gains to pay because you held them for less than twelve months.
So there are things to think about.
But like you're already going to be paying tax on a profit anyway, it's not really a tax question for me. It's a diversification question and whether that's aligned to your goals and values and your risk.
Profile or not.
Well as it is that a right, that's what you were going to say anyway, wasn't it that words.
Out of my mouth?
Actually?
So sorry, Sorry Friday guys.
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