$200k cash + 15 year plan: what do you do?

What you have to understand with a investment strategy like that is your rate of return is uncertain and your linked directly to the performance of overseas and asx listed markets then examine the past performance and trading results because what happened in the past is irrelevant ,try and read all you can first 180k can turn into 90k real fast ..

 

No, your addition to taxable income would be the capital gain, not the capital. So if you put $90k into shares, and kept them all for at least 1 year, and then started selling parcels where each annual parcel was always (somehow) the equivalent to $9k capital + $9k increase in capital, then the increase to your income would be 50% of the $9k increase in capital, or $4.5k of extra income, taxable at your marginal tax rate. (I think - I'm newish to shares too)

 

Mcarthur is right. You could possibly sell a large amount of shares and not pay CGT.

Example
Your wife bought $100,000 worth of shares. These jumped to $136,000.
She sells and has no other income that would mean a capital gain of $36,000
apply the 50% CGT discount and that would mean taxable income of $18k.

but keep in mind if she has shares she may have received dividends too.

 

Hi Willair - thanks for your take and certainly some good points.

I feel this would be a concern for someone:

• Who only invests for capital appreciation of share price and not a growing dividend stream
• With a short time horizon
• Who is not emotionally fit to invest in something like this / has a low tolerance to risk

Thankfully, I'm none of the above

 

Also take into account your personal circumstances ,because if you have a full-time job outside trading investing,you may be unable too watch the markets every day so it could be better to sometimes focus on longer term trading style as there is no universal style that fits everyone..
If you read books then there is one is from the early 1990's that our then Accountant gave me a free ticket to is priceless,still have the singed copy.


How To Start With No Savings And Get Rich Safely
by Stuart Moore

Then you have this one to give you an idea on trail and error..

The Black Swan (Taleb book) - Wikipedia

 

I used to own that book by Stuart Moore many years ago but gave it away along with about 50 or so trading books / courses. Can't really remember anything much of its content now.

My main concern is you mentioned the word trading a couple of times. So others need to decide if they're an investor or a trader.

The author certainly has an interesting history. I remember Stuart Moore from my trading days and recall him presenting at Aust Technical Analyst Assoc (ATAA) meetings that I regularly attended. His real name (he has had a number of aliases over the years) is Brian Costello.

Here's a recent presentation outline he did for ATAA in Brisbane in Feb 2016:

And they wonder why most traders lose money.

 

Yes that's his name Stuart Moore,i have not seen him speak in over 24 years and thanks for the link ,and it's looks like he will be speaking at the Greek club 29 Edmondstone street ,south Brisbane Monday, February 15, 2016 ,first visit free ,subsequent visit 40 bucks..r/h back seat..

Quote..
My main concern is you mentioned the word trading a couple of times. So others need to decide if they're an investor or a trader.

When you look at it from the outside it all seems simple and straight-forward enough ..A investor is sometimes the same as the trader the only difference is standalone single one name holdings work on a timeframe and make their own trading decisions and that means the first rule is never ever let a interday/multi short term duration bbq plate trade turn into a long-term trade and that takes discipline and that's something that can't be taught with the trade frequency of trail and error ..

 

I am confused: why are we discussing trading when the OP clearly stated he is going to invest in the old school LICs for the long run?

Feels like I missed something somewhere.

 

Exactly. That's why I highlighted the mention of "trading" in @willair's post. The OP is looking to "invest" not "trade". The rest of the post was just providing some background about the author of the book he recommended as a potential warning.

Nah I take that back, I just wanted to confuse you @Ouga .

 

Hi @izzy16,

I'm considering a similar strategy. I have a small portfolio of shares at the moment held in my name.

Are you planning on building your portfolio inside a Trust or in your own name?

 

Disregard this, I hadn't read all pages in the thread.

 

What about the use of trusts or bucket companies for investing in shares but no children are on the scene and unlikely to be for next 3 to 5 years?

What structures can be used in these situations given person 1 would be on 37% tax bracket and person 2 on 32.5% bracket?

 

Sole owner
joint owner
corporate owner
trustee owner
Don't forget about structuring the funding of the share owner.

 

Is it just a myth about advisors telling their clients that for PAYG employees that trusts are too expensive??? Given in my example the 2 partners will only ever stay in the 37% tax bracket?

 

No. I have set up many trusts for share investors.

 

How will Labour's "other" policy change the game for those with family trusts?

Labor’s crackdown on family trusts a ‘tax grab’, Coalition says

 

Yes