how do you explain to someone the benefits of saving money to build wealth

The "While others shop at DJ's, I shop at KMat, so when retired I can chose to shop at DJ's while others will be forced to shop at KMart" moment

Few understand the concept. One of the reason you can see many flailing about as retirement approaches asking lots of questions about investing some of which are along the lines of "How do I turn $1 into $1m within five years."

I no longer care. People have as much right to trash themselves financially as they have to make a success of it.

 

I like to describe it like this: life is a big ball of @#$%. You can either choose to deal with it upfront, spread out over the course of your life until you're 65, or all at the end.

It has to be dealt with. There's no avoiding it. But you can choose how you want to deal with it.

 

I think the worst thing is one even can't shop at Kmart but Opp Shops. I think letting people take out Super from their accounts might lead to more people worried in retirement.

 

There's always the salvos.

 

Don't sweat it. Let future tax payers deal with it. Although I acknowledge two things (a) my spellings isnt all that grate and (b) those who do what you say regarding super withdrawl will not acknowledge their decision was probably part of their less than satisfactory outcome. Rarely have I seen recognition of that including one clown yesterday, who was in the PSS and back in GFC times apparently elected to go cash, reduced his contributions to the minimum and, on retirement, took 50% pension and the rest cash - because super is crap you understand.

 

Is cash converters still around ? Or do all the thieves now go to the local Westfield to flog off gold jewellery ?

 

I also have concern with those who think they can retiree early and be wealthy with $1m. A simple example is a pizza hut menu.

Back in 1981 it was $2.20 for a family size pizza (30%+ bigger than now too) at pizza hut (The beer to wash it down was 25c)


Now a pepperoni pizza costs $9.95 and a beer served may cost $6.
A 350% increase in the space of 40 years for the pizza
A massive 2300% increase in cost for the beer.

So if Peter and Sue retire early at age 49 with savings of $1m and a fully paid home that $1m could be worth a future value of $285,000 when they are 89. But they will have spent it largely in the early years. They cant afford pizza.

But that $1m property will be worth $3.5m.....Property resists inflation. Money and many financial investments may not. eg What are the following shares worth ?
Pasminco, HIH Insurance, Dick Smith, OneTel.

 

Yep I've seen some around.

 

In the wrong product?

 

Gladstone?

Probably makes sense to budget for spending just the income from the portfolio, and making sure there is additional buffer for the inevitable downturns.

 

Hi Sackie, Loving your input. Being new to the property chat platform, I am finding hard to navigate. I did a post to ask for some insight ( lol Not sure if it is being seen)
How can I get in touch? Would love some insight. Thank you

 

Hi,

I saw your posts, both posted only today. Give the PC community some time to respond. Saturday is their recovery day

 

Thanks Sackie. Being a newbie, I assumed I did not post the right way , the reason it is not being seen. Did you go ahead with building the GF?

 

Still investigating the pros/cons of it.