Financial planner/advisor for someone financially illiterate?

In Australia you are better to have little assets or a lot . If you are in the middle you are screwed. System punishes people in the middle....Dems how oostrayaa rolls.

 

Buy them “The Barefoot Investor” for Christmas.

Highlight relevant chapters.

 

Yes, I think your right. That’s why You got to shoot for the stars

 

......und most end up in the middle.. ...so gubbermint makes dem spend assets and then they live above the breadline

 

Will they read it and comprehend it ? Some people will shrug and blame their family, circumstance, their boss who underpays them and more.....I know so many people who have excellent careers and incomes after decades of hard work and study. Or small businesses that are very successful. People who know them possibly refer to them as lucky. There will usually argue 0% luck and 100% hard work, effort or sacrifice.

I have two relos who are dentists. They had so much luck after studying for 14+ years and then they where so lucky to push every cent they had into starting their own practice up to their eyeballs in debt and forgiving so much as working parents. Being born intelligent was their only luck.

 

I haven't had a chance to talk to this person about money yet, but yesterday we went over to their house and I noticed the following:

• The second toilet had one of those cleaning cubes that colour the water blue wedge itself under the flush mechanism in the cistern. This caused water to continuously run at full pelt. Did they turn the water off at the inlet valve? No they waited for me to arrive instead.
• The aircon was turned on a near arctic 19C. Then for a while, the back door was opened to let the food smell out, while keeping the aircon on.
• The cooktop seems to be binary. If it's on, it's on 9. They seem to believe that this will cook things more quickly, even if the water is already boiling.

I found the whole experience a bit frustrating and I'm not feeling confident about getting through to them. I'll still sit them down and try, but if I can't, I'll just transfer their money back to them and just let them be their own worst enemy.

 

This is the sort of stuff a lot of people do. And it really doesn’t sound so terrible.

I’m a miser, but I doubt the cost from the door being open for a short time or the extra water used in the toilet, or having the element on high is that significant.

And, be fair, most people have no idea what’s inside a toilet cistern or how to fix it when it won’t stop running.

I think you should still have the conversation with them - definitely when you aren’t feeling frustrated. And if they seem interested ask if there is anything you can do to help. But in the end it’s their life. And they can always downsize if needed.

Did they give you the money to look after because they were trying to save it? If so, that’s a positive sign.

 

So true. The aged pension for a single is (I think) $960 per fortnight! That's obscene. If one didn't have to rent, that's a shedload of money for doing nothing.

I could live on $20 a day (easily) I kid you not. Bowl of oats for brekkie, 2 cans of tuna for lunch and a modest dinner. Easily!

Add in utilities etc and that comes to say, $200-250 a week max. Another $200 per week ie $10K a year left over for a couple of overseas trips.

I mean seriously?

And I'm busting my gut trying to get ahead with all these IP's etc while I fund others to the tune of almost $25K a year tax free, work free?

 

Plus many will die leaving tax free paid off property windfalls to their rich adult children!

Retire now, spend up and then get the pension at 67. You can also invest and get a certain amount of money on top of the full pension and lead a great life.

 

Is your PPOR means tested, irrespective of how much its worth?

And won't the investments on top of the pension be means tested?

 

No, you could be living in a $19mil mansion with a moat and still get the pension.

Yes, but only if over a certain limit which is around $270,000 for a single person or $405,000 for a couple for the Full Pension. You could have up to $593,000 or $891,500 and still get a part pension.

Plus the income from these investments is assessed at the deeming rate so if you could invest in very high dividend yielding shares worth $270,000 you could get a very high income and still be on the full pension.

Age Pension - Deeming - Services Australia

 

Geez man I might need to reconsider my 'strategy'.

 

Nope ...it is your mindset which is letting you down. You have enough to sell 2 a year... It just you don't want to pay gains nor eat into capital. I see this a lot. Time is finite but money is not if you plan well. If you have $5m paid off us Poor technically you would never eat capital if you spend only 120k per year.