Money Magazine April 2021

Most people resign themselves to the fact that “mortgage boots” are part of life. It is an assumed financial pain stretched over 30 years or more in exchange for long-term gain, an asset that will help support your lifestyle on your retirement. Not so for the people we feature in this month’s cover story (page 32) who are part of the FIRE community. FIRE is the acronym for financial independence, retire early, which means that anyone who lives by the FIRE mantra would plan their finances in such a way that they can stop working full-time in their 30s, 40s or 50s. Most of them would pay off their mortgages in 10 years or less. Susan Hely first wrote about the FIRE movement in 2018 and we decided to revisit the topic…

Letter of the month Stocks that make the top of the pops I read with interest “Top 50 shares and property” in the February issue. What caught my eye was the list of 50 top stocks for 2021 with the explanation of how these stocks were chosen by Bell Direct staff. Having access to the 2021 edition of Martin Roth’s Top Stocks (featured in the January issue), I cross-checked the top 50 with his 90 listed stocks and found only nine entries appearing in both lists. I then searched for companies that I was invested in and found only four in the shortlist – three of them were banks, the other a gold miner. It was an interesting exercise as both lists were compiled using legitimate data and acceptable criteria. It was an illustration of stock…

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DEBBIE DUNCAN “I love buying my children ‘little’ surprises; things they’ve told me they really want that I know they can’t afford. Usually, clothes and shoes but sometimes games. I’d struggle to give that up. Also, splurging on books, going out for coffee and buying movie tickets, especially when the British or French film festivals are on. Come to think of it, an early retirement is looking less and less likely.” TIM VERRENDER “As an avid vinyl record collector and music nerd, collecting and sourcing rare and hard-to-find vinyl records is my favourite (but also my most expensive) pastime. Also, splurging on live concerts, music festivals, dinners with friends and impromptu road trips would be almost impossible for me to give up.” MICHELLE BALTAZAR “It’s that constant battle between choosing to ‘live in the moment’…

Last week, I was talking to a friend about his financial situation – and he said he’d done well investing in property in London during the 1990s. He was working and living there, and realised the rent he was paying was more than the money he would need for a mortgage. Home loan rates hit a record high (17%) in Australia in June 1989 and stayed there until April 1990. My first home loan was around 14%. It was quite intimidating. These were big numbers. It wasn’t easy to figure out how a rise of 0.25% or 0.5% would affect repayments – there were no nifty online calculators, it was a matter of manual calculations written longhand on A3 pages. I was meticulous with my calculations – I never wanted to…

Melissa Caddick posed as a financial planner to allegedly defraud her clients of millions of dollars before disappearing. In reality, she was not a qualified adviser. The terms “financial adviser” and “financial planner” are restricted by law to those authorised by ASIC to provide advice. They must meet stringent educational and ethical standards and must undertake continual professional development to retain their licence. The lesson here is to do your checks before entrusting them with your money. (Nicola Field covers this in more detail on pages 42-45). Research shows that people who are already receiving advice are great proponents of the service. In CoreData’s report The Value of Advice, 90% of clients say that accessing financial advice has left them in a better position and 89% say advice has allowed them to lead…