My portfolio. Does this look ok?

Hi,

This is from a thread in the property forum but I want to post this specifically in here and get some opinions

Does this portfolio look safe and balanced? Just aiming for some growth and dividends with balanced risk. Looks a bit bank heavy to me now.. It was recommended by my advisor. I was going to put more money into this..

SMA Antares Dividend Builder - $12,500
Vanguard Australian Share High Dividend ETF $10,000
Commonwealth Bank $10,000
NAB $7,000
Platinum International Fund $10,000


Thank in advance..


-Frank

 

No bites eh

How does this fit in with your overall financial situation - what else do you have. What is your current need for income, when do you plan to stop working etc. Is this in super, trust or your name etc?

 

Hey Il Falco,

No Bites hehe..

You said in the other thread that the portfolio is not good hence why I'm looking into it. I don't know enough to make my own choices with shares but need to invest. So I'm trusting a Financial Advisor to choose for me, but if you're saying they are a bad mix of shares then I'm worried.

I have $1.5m in cash and will retire in 8-10 years. When I retire I would like 85k per year income after tax. I don't want to ever eat into the capital if possible. I want to leave capital as it grows for my kids. So ideally I would like income from dividend payments only and let the capital growth build.

Right now, I need around $40k yearly from this money (somehow) to supplement my working income.

I don't have super, don't have any trust accounts. The money is in my name only. I just need to invest it. I'm not happy just leaving it in the bank even though the bank is giving me 3% on it. The 3% is giving me the $40k interest ($45k actually) I need yearly but the money itself is not growing just sitting there, hence why I need to use the share market.

People are telling me 'just by an index, or a LIC or an ETF and thats that' but I wouldn't' know which one, there are hundreds. Do I just go choose an ETF that I think I am happy with? Like for example one that has shares in Property and thats that? Or what about an LIC.. yeah but which LIC? I've heard of ARGO and AFI but don't know much about them.. See what I mean I can't invest $1.5m on my own and risk losing it..

I don't want to buy a few indexes for say $200k each and watch them for a while and see if they perform then put in more money.. I don't want to waste time like that either.

Investing is not my thing, i'm slowly gaining knowledge but its still not my thing, so to solve my problem I got myself an advisor but then the question is, how do I even know he is doing the right thing anyway..

I've told my advisor that I need dividend payments now, capital growth and balanced risk. Could this explain why he purchased the direct bank shares and seems to be leaving a bit towards the banks?

My untrained mind suggests that he bought the direct bank shares for the dividends and then balancing that with the SMA Antares Dividend Builder, the Platinum Growth Fund and the Vanguard Australian Share ETF..

Just my uneducated guess.



-Frank

 

@Frank Manno, assuming you did not inherit the $1.5 million in cash, you must have a fair bit of enterprise and initiative to earn that kind of corpus. Why not use some of that drive to learn about shares, investing, LICs, ETFs etc.

If you have made it this far into the forum, why not attend a Peter Thornhill seminar, but a book or two and dive down a bit further into the forum? All the answers you seek are right here.

If after all this, if you can't be bothered learning, find a good advisor. I have spoken to Luke Rathborne from Fortitude Wealth and he seemed like a really good guy. He is apparently one of the financial advisers that Peter Thornhill consults and I was told that Peter's son was going to join him shortly (a few months ago now).

Luke asked me about my plans and when I told him what I had learnt on this forum, he pretty much told me to continue doing what I am doing now as his approach was somewhat similar. He told me that he felt he could not add much value to what I was already doing (for my life-stage). I came away from my conversation with him thinking he was a person with lot of integrity. Of course, your experiences may vary.

NOT advice, do your own research.

 

@orangestreet Yeah Luke is a good bloke and could likely assist Frank. His asset allocation would be different to mine, but wont go to far wrong. Importantly, Frank needs to get his super pumping and look at ownership structures pronto.

Frank, from reading your posts I think its clear that you need some assistance from someone who knows what they are doing. Buying an index for a while and seeing how it goes is not how things work. In your situation, super must be a very big priority given the tax free kicks. I'd seriously be meeting with a few different fee for service advisors....ideally ones aligned with Vanguard, DFA or low cost LICs. You dont have to settle for the first one you meet.

 

What age will you be retiring? If it's around 60 then as @Il Falco said Super becomes a greater priority. But when no longer working you can earn over $18,000 pa in own name tax free. Do you have a partner to enable income splitting?

It's not just a matter of what to buy, that the easier part. Getting an overall plan taking into account your risk tolerance, tax, Super and income splitting etc needs to be part of it.

I agree that seeing a good advisor is likely worthwhile but having some basic level of understanding may help you identify a good advisor.

 

That's maybe why the FA bought into those 2 Banks,, dividend payments from those 2 alone outside the DRP
depending on the units held can be very solid income wise...

 

I did inherit it, hence why I'm lost as to what to do with it.

Yes this is exactly what I am doing. I have subscribed to his newsletter and will be reading this book. I'm keen to attend one of his seminars as soon as one is available. There doesn't seem to be any announced at this stage. In the meantime I'm trying to learn as much as I can by reading this forum.

I will look him up and see if I can get a consultation with him. Thanks for the tip..


-Frank

 

I'm 52 and want to semi retire in about 8 years, start winding it down and then work a few years more.. So 60-62yo retire.. The type of job I do is not the type that I can do in my older years of 60-70yo..

I do have a partner but not one that I can use for income splitting so basically I'm on my own with this.

I think this is the clincher what you wrote "basic level of understanding to help my identify a good advisor"

I already got myself an adviser but this was when I knew half of what I know now, which is not much. He has been good all along from what I can see and has taken my whole situation into account, hasn't been pushy, even advised that maybe I should diversify and buy an investment property.

He has been pushing me into super but I've been holding back for the moment to make sure I don't want to do anything else with the money, like for example get involved in a development and then start putting money into Super.. Which I've decided recently I don't want to get into a development, so super is the go now..

I think I will keep learning as much as I can.. Keep the $50k already invested in my current portfolio via my current advisor.. Maybe invest another $50k just to round it off to $100k and go and see Luke Rathborne for a second opinion and possibly use his services.


-Frank

 

If you have 1.5M to invest, this is loose change. Why not do what your advisor said and see how it goes?

On the other hand, if you don't know why your advisor recommended each one, maybe find an advisor who will explain things a bit more clearly and hold your hand a bit more?

 

I hear what you are saying and sometimes I look at it like that as well. There are thousands of people who have invested a lot more than this with no problems and why am I worried so much. I just don't want to get it wrong I think..

I've only started this investment less than a week ago I'll speak to the advisor and find out exactly why he's invested in these particular shares, this will shed some light as well while in the meantime do what I said previously about seeing Luke and Peter Thornhill book.

-Frank

 

Maybe put some in super?

@5% return it means you need $800k for this $40k

Consider having one, lower tax rate that comes with some tax benefits, especially when you retired
Just asking - have you got insurance & will? You might want to look at those too.

Is it the best way?

Have a look to get familiar with what you putting money into

Investing | ASIC's MoneySmart

http://www.asx.com.au/education/shares-education.htm

Educate yourself as much as possible, just to make sure you understands what he says and you can judge whether the recommendations make sense

Remember knowledge is power! And check whether the person is licences to give advice

Financial advisers register | ASIC's MoneySmart

 

Any reason to rush investing another $50k before seeing the second adviser?

 

I'm just itching to invest. I think I better calm down.. lol

-Frank

 

I like your monkey
Have you had a look of the LIC beginners guide from austing? That's gold!!

 

Fank pal, this portfolio looks awful and you should feel bad about yourself.

No, really!

 

Biz long time no reply I feel bad about myself with or without the portfolio at the moment lol

Actually I just got off the phone with my financial advisor..

He told me that with this portfolio he is basically assuming a starting position in the market and that he plans to add more to it as we progress and more money comes in. Its just a starting point.

-Frank

 

I chose the picture carefully as it is a true representation of my state of mind at the moment

I will check the beginners guide, thanks.


-Frank

 

If you're hoping to manage it yourself, you advisor is on the money for a few reasons.
a) You're worried about getting it wrong
b) You're not used to working with large sums of money (assuming, due to inheritance rather than savings)
c) You have no experience trading (also assumed by your posts and your monkey )

If the 1.5M is inherited, the last thing you want to do is whack it all in at once and watch the market go down straight away.

BUT - he should also be advising you on a longer term strategy that involves an allocation into a variety of assets and also points you in the right direction in regard to tax efficiency and so on. There's no point keeping the whole lot in cash for too long.

 

Possible class action against the CBA due to recent scandal. I also have CBA shares and going to be interesting to see what may transpire from this.

CBA board's breathtaking tactics bring on a class action