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Just finished reading the book. Anyone else read it?

Thankfully a lot of the steps for me were already complete (ie having bought my house, got plenty of reserve savings etc)

But the suggestions about upping my super and getting into shares as soon as possible were very persuasive

My original plan was to pay my house off in 5 years and then keep it as an investment whilst I built a new house

Now I’m thinking it’s probably worth staying in my current house for maybe 6/7 years and upping my super and getting started with a share portfolio straight away

And given my own house hasn’t gone up that much over the last few years it probably makes a ton more sense to put that money into shares and having a much lower new mortgage when we build again

Anyone else read the book or have any other investment tips?

Haven't read his book.
Mrs started doing his save $5 notes for a while, then was a little awkward when paid in cash and most if not all at times was $5 notes!!

I put extra into my Super, not a lot, but its cash I don't miss.

Shares, don't have any, although I did get a great tip the day after 9/11 and know of people who cleaned up buying Gold.

Investment tips - bendigo dogs r6 quinella 5,8. Hoping the 5 wins, as I part own it.

mighty_tiger_79 wrote:Haven't read his book.
Mrs started doing his save $5 notes for a while, then was a little awkward when paid in cash and most if not all at times was $5 notes!!

I put extra into my Super, not a lot, but its cash I don't miss.

Shares, don't have any, although I did get a great tip the day after 9/11 and know of people who cleaned up buying Gold.

Investment tips - bendigo dogs r6 quinella 5,8. Hoping the 5 wins, as I part own it.

Load up!

mighty_tiger_79 wrote:Haven't read his book.
Mrs started doing his save $5 notes for a while, then was a little awkward when paid in cash and most if not all at times was $5 notes!!

I put extra into my Super, not a lot, but its cash I don't miss.

Shares, don't have any, although I did get a great tip the day after 9/11 and know of people who cleaned up buying Gold.

Investment tips - bendigo dogs r6 quinella 5,8. Hoping the 5 wins, as I part own it.

Which part?

Sounds like you to a tea

Haven't read the book as a lot of the 'summary checklists' from people who have read the book always listed things I was already doing.

I am keen to get your summary on what was the compelling arguments to pumping money into super now (as a relatively young bloke).
I tell mum and dad to both do it, as they are close to retirement so will be able to access those funds in the not to distant future, however for myself, I don't think the tax benefits outweigh the fact that money is now locked away for the next 40 years. Also, with the growing push from the left to change how super is taxed in the future, there is every chance any tax benefit I get now will be offset before I can take it back in retirement.
On top of that there is always the underlying risk that I die before I get it anyway! haha

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As for other tips, the one thing you said that jumped out at me was your plan to pay off your house then later use it as an investment property.
The big issue here is you'll likely get a new mortgage on the new house, while your investment property is mortgage free.

You are better off structuring the other way, such that the mortgage is on the investment property (and therefore interest is deductible) while your new home has the smallest mortgage possible (where interest is not tax deductible).

I agree you still want to get your current mortgage as low as possible, but you should do this without actually paying any more than necessary off.
Get an offset account (I assume you might have one already), and load it up as quickly as possible to the point your net mortgage is 0.
When you are ready to build the new house, use the money in your offset account to do so, such that the mortgage remains on what is becoming the investment property, and your new home has little to no (un-deductible) debt on it.

{Many people pay off their first, then borrow against that for the second, and although the mortgage security is on the first property, the ATO will deem the borrowings were used to purchase the family home, not the investment property, and as such, can't be offset against your tax}.

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Now, as for shares, agree, always good to start as early as possible, but I would not necessarily say you have to get them, especially if you have a current mortgage that is not paying deductible interest. I would strongly recommend paying off your home first, then getting into shares once you have spare cash after that.

Lets say your home mortgage is paying 4% (round numbers).
What you put into the share market has to return 6.4% (=4/(1-0.375*)) *37.5% assumed tax rate you are currently paying, before you are even breaking even.
Then you need to add a further factor, for the simple fact that the share market has an element of risk to it, and your investment return needs to cater for the risk you have taken.

Saving 4% on your home loan is a guaranteed return, getting more than 6.5% on the share market isn't.

For mine, the biggest benefit of getting into the share market is it makes you financially aware, and helps with savings plans. If you already have a mortgage to smash (via the offset account if you think this property will become an investment in the future), then you know you are going to be a diligent saver already, and don't need that incentive of the share market to drive that for you.

That's probably it from me for now, though I'll happily follow this thread with interest and provide more thoughts as topics touch on certain areas.

[Still very keen to hear BFI's reasons behind super though!]

This was the part that sold me

One guy puts 5k a year into shares from age 15 for 10 years, then from 25-60 doesn’t put in anything, let’s it compound

Second guy waits till he was 25. Then puts in 5k per year for 36 years till he is 60

#1 puts 50k in
#2 puts 180k in

Assuming 10% a year returns (for simplicity)

#1 ends up with more than a million dollars MORE than #2 (2.7 vs 1.6 if I remember correctly)

My plan was to throw everything into paying off my remaining mortgage but I think I’m gonna do a few things first

1) increase my super to 15% (it used to be there when I was at the govt)
2) increase my wife’s super to 15% (she is on maternity leave and after will still only be on part time so the govt will chip in 50c for every extra dollar we put in

3) start a few share portfolios and put 2-5k in each. One for me and one each for both of my kids.
4) then pay down the house. If it takes 7 years instead of 5 I think I’ll still be in front given super and shares are massively outperforming property at the moment
5) will make a decision about keeping or selling the house in a few years. Probably get a professional financial planner for that part

Another thing about super

I pay 37% on every dollar that goes off my house right now

If I put that into super that money only gets taxed at 15% at the other end.

For my wife she’s only paying 18c but she gets an instant 1.5 on those contributions

Cheers Benny,

So the argument he is making for Super ($2.463m balance in case 1, vs $1.496m in case 2) is based on compound interest, rather than the benefits of super itself.

If case 2 does nothing with his money other than p155 is up against the wall, then yes, its a big difference, however if he is paying off a mortgage for example, then all of a sudden the comparison becomes a hell of a lot closer.

Agreed, the difference between 37% and 15% tax right now is very good agreed, that's the clear 'pro' for super for mine. Still concerned about the 'con' of there being no guarantee the left won't change the rules in the future.

Yes you have that money locked up and they could change the rules. I wouldn’t be putting every single dollar into my super but going back up to 15% instead of 9.5 is a good move imo.

Yeah, super should be higher than 9.5% and its a pity recent governments haven't been able to push that figure up to where it should be.
You're only talking about 5.5% so agree, no real harm in giving it a push along now.
If you were looking to shove 30% of your income (ie: all your savings) in that direction I'd have a few alarm bells going off, but at 5.5% it seems fine.

Good luck with it.

We've been following a financial advisers plan for a few years :

- Upped both our super to 11%
- Upped our home loan repayments

But, and he's fairly pragmatic, he also suggest living while you're living. Don't be stupid with your money, but live. Live life. Plan, but live life.

We've spent 3 weeks in Thailand this year and are in the process of putting in a pool.

I used the book to set up the joint accounts with the missus. I used to be someone that would write down a fortnightly budget, now I don't even think about money.

Booney wrote:he also suggest living while you're living. Don't be stupid with your money, but live. Live life. Plan, but live life.

Yup, very good advice.
No point saving a heap of money if you hate your life while saving it, or even worse turn into a w@nker while trying to save it and then ending up with no one to enjoy your money with in the future.

Booney wrote:We've been following a financial advisers plan for a few years :

- Upped both our super to 11%
- Upped our home loan repayments

But, and he's fairly pragmatic, he also suggest living while you're living. Don't be stupid with your money, but live. Live life. Plan, but live life.

We've spent 3 weeks in Thailand this year and are in the process of putting in a pool.

This^....Coffins don't have pockets. Half of us probably won't even live to see our super, or be able to spend it all. Kids will love you for it though.

Live Wyatt, live for me....

Yep good advice lads

I think I’m already well in front of most people in that I haven’t known when pay day is for years. That’s the main goal - means I am comfortable and I never stress about it

And I’ve spent 16 weeks overseas in the past 10 years, plus renovated the house

But besides paying down my mortgage I haven’t really thought about making some “serious” money via investing.

Living comfortably is great but if I can put my excess cash to work I’m gonna be much better off. And at 33 the time for that is now, not in 15 years time

Q. wrote:I used the book to set up the joint accounts with the missus. I used to be someone that would write down a fortnightly budget, now I don't even think about money.

Currently I put all my spending through a credit card that auto pays out of the offset account. And then I download all transactions a month or two later to see what we spend money on.

So it’s kinda like a budget in reverse lol.

But I like the idea of seperate buckets for splurge and saving up for holidays etc.

Another thing the book mentions

Shop Around for a super account.

The difference between a high fee account and a low fee account could make hundreds of thousands of dollars difference to you

My old super account with pssap was pretty low fees anyway but it’s still worth looking around.

He recommends host plus, and after briefly checking them out they are slightly lower fees and better returns in the past.


Stuff like that is where you can make a massive difference in a few hours of work. And most of us just don’t because we are lazy

Love all the advice guys

Think i will start to get serious about my money, will up the super this week

I have been playing around with Raiz (previously Accorns) and found it as a really good low level way of saving

I always upped my super especially when I knew I wasn't going to spend a lifetime with my ex.
Paid off too, at the age of 46 I already had no house payments to worry about, got a 60k lump sum and a 40k PA indexed pension for the rest of my life.
I could almost live off that if I chose not to drink or go out but as I do I still need to work most days!

I adjust my super investments about 3 times a year and change the % thats invested into different sectors