Join Australia's most dynamic and respected property investment community

Where should i put my money

Discussion in 'Investor Psychology' started by bfhoon, 10th Aug, 2016.

  1. bfhoon

    bfhoon Member

    Joined:
    3rd Aug, 2016
    Posts:
    10
    Location:
    NSW
    Hi Everyone

    I'm wondering where should I invest all my money at this stage in my life. I basically want to retire by the time I'm 55. I'm currently 34 years old and I'm a scrooge and will continue to scrooge my way all the way to the coffing its gone on for too long now lol. Low paying job but the hardest saver ever.

    I currently have a mortgage of $150K the property should be worth an easy $500K easy and its my PPOR.

    I have 70K in super, 2K in shares.

    My partners income is also dismal very low she is 32 yrs old and 40K in super.

    I hate debt so I have been smashing the home loan with every cent we get but I'm wondering if I should ease up on the payments and maybe put some more into super or gamble on the share market.

    I had an IP but sold it at a massive loss I watch hundreds of people I know make tens of thousands of dollars for minimal effort however it turned a sour misery story for me which for the 5 yrs I held it was a massive stressfull burden only to be kicked up the arse with a $50K loss at selling time with the emotional baggage and toll it took on us. For this reason I don't think the property gig is for me. By no means I'm saying its no good I know it is I hear all the stories but I don't think it works for me I'm very unlucky so maybe the sharemarket is a bad idea for me also.

    Anyway I'm wondering should I just smash the homeloan until its paid and then maybe invest in shares or something else, or should I ease back and start investing now and worry about the mortgage later.

    Is now a good time to invest in shares ie slow economic growth etc etc. I was thinking maybe WW shares I saw a trend graph of high and lows and judging by the past 3 trends if history repeats WW shares should be on the rise shortly.
     
  2. Bran

    Bran Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    3,213
    Location:
    At work
    Spend some time in the LIC and ETF threads. Better than 'gambling'.
     
  3. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,545
    Location:
    Sydney or NSW or Australia
    There are plenty of options available to you. It might pay to speak with a financial planner to assist you in defining your goals and mapping a path to get there. Your super fund may have access to a discounted planner.

    You might investigate managed funds or index funds whichmay not be as volatile as a direct share portfolio.
     
  4. ellejay

    ellejay Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,110
    Location:
    Kimberley and NZ
    There are no guarantees in life, or investing. No one likes to lose money but it seems there is always a risk of losing if you want to take a chance at winning. If you read behind the success stories of the people you think have made 'tens of thousands with minimal effort' you'll see it's not so straight forward or else everyone would have done it. Most people on here will have some stories about financial losses, it's what you do next that makes the difference between recovery or further losses. You're relatively young and have plenty of time to make very good gains, when you have good networks, advice and understand what went wrong last time.

    Sometimes unforeseen economic or political events lose us a lot of money. That's my direct experience, nothing I could have done differently. Does that mean we should never invest again? These days I realise you win some and lose some. I just try to make sure the losses aren't catastrophic, so I can always recover.

    Sounds like you have great spending habits so that's the first step to financial success covered. You now have to move on from your earlier financial loss which could hold you back because you seem to have generalised it to mean that you're unlucky and will keep losing money no matter what you do in the future. I'm not into mindset talk, but that mindset will certainly keep you poor. What's going to happen when you experience your first loss on the share market?

    Don't rush into shares because you feel you've been put off property. Personally I wouldn't focus purely on mortgage repayments. Take time to read the forum, make connections with people on here and absorb until you feel informed enough to work out your next step.
     
    Phase2 and Gockie like this.
  5. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,726
    Location:
    Sydney
    I'll give you my 2 cents which probably won't mean much to you with the frame of mind your in atm though.

    1. Forget the past. Totally and completely.
    2. Start fresh. Personally I would choose real estate (what you choose is upto you). Learn the basic and fundimentlas from books, forum. Network with some successful investors on here.
    3. Write up a plan, choose a low risk strategy to start.
    4. Take action. Start building wealth and then go from there. You can adjust along the way.

    You have to realise that losing money, or failing at some point may be inevitable but shouldn't stop you to keep going.

    You are young enough to achieve your goal. All comes down to how bad you want to retire at 55 and what you're willing to do to get there.

    Good luck
     
  6. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    2,458
    Location:
    Sydney & Gold Coast
    Invest in some books, and yourself, first :)
     
    MTR likes this.
  7. JacM

    JacM VIC Buyer's Agent Business Member

    Joined:
    12th Jul, 2015
    Posts:
    1,106
    Location:
    Melbourne, Australia
    Forget WW shares... they're going down the toilet due to the sprinkles debacle discussed here:

    First world problems!!

    :p:p:p:p:p:p:p:p:p
     
    Phase2 likes this.
  8. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,758
    Location:
    Perth WA
    Based on what you've suggested above, I'd smash down the home loan. You're on a low income (not sure what this means, another guy thought he was on a low income but was earning $100k!) but based on your recent loss, the fear of losing more and your scroogy lifestyle, paying off your HL is a pretty great option. Getting aggressive at this stage does not sound like it would sit well with you - most people here are very aggressive but that is not for everyone.

    Give yourself time to achieve something great, get your home paid off asap and you'll still be well ahead of nearly everyone your age. I don't know many 40 year olds with a paid off home.

    This will also give you time to learn, and get comfortable with whatever strategy comes next.
     
    JDP1, Heinz57 and MTR like this.
  9. bfhoon

    bfhoon Member

    Joined:
    3rd Aug, 2016
    Posts:
    10
    Location:
    NSW
    Im on 60K a year its laughable other half 30K so were aussie battlers. I could have the mortgage finished up in 5 yrs flat if I wanted to and then im thinking its time to have fun on the stockmarket. I know what everyone saids about risk but iam so unlucky anyway I try to forget my losses in life. Im just really thinking now maybe im best cracking out a $50K loan on shares and hoping to double it to make some easy cash. I can just see if I pay don the mortgage in 5 yrs time the stockmarket will probably be booming and expensive I always seem to just miss the boat.....
     
  10. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,758
    Location:
    Perth WA
    From your post you have a few self talk issues to conquer as well :) Please don't put anything on the sharemarket at this point. Pay off your house. Don't leverage it, and save cash to invest for the long term.

    You need to read and learn before you do anything else. And not just about the markets, also to gain some confidence in yourself.

    You're only a battler if you choose to define yourself that way, and as long as you do, that's what you'll be. Change your thinking and you'll have a shot at changing your results.
     
    Gockie, JDP1, pinkboy and 4 others like this.
  11. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,726
    Location:
    Sydney
    You're not so unlucky. It's that approach/attitude above that is most likely the reason for your losses. Why don't you instead take the time and spend the effort to learn how to build wealth with the right mindset if that's what you want to do?

    Your approach above will at best lead you no where, and at worst leave you completely bankrupt.

    People seem to want it all and not do what it takes to achieve it. There are no shortcuts.

    Just my 1.5 cents.
     
    Jess Peletier likes this.
  12. bfhoon

    bfhoon Member

    Joined:
    3rd Aug, 2016
    Posts:
    10
    Location:
    NSW
    Yes I kind of agree, I really struggle to understand alot of it though Ive had this attitude my whole life I cant shake it I guess its just how my life panned out you cant change unlucky I have tried the whole good vibe approach for a while still didnt work..... I think the only reason im a good saver is the fact I knew If I wasnt Id be totally doomed so I guess if nothing else at least I have that instilled into me. Hmmm back to the drawing board.
     
  13. Brady

    Brady Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    452
    Location:
    Adelaide, SA
    Obviously took some work to become a good saver, you must have set goals/budgets - you already know that you could payoff your house in 5 years.
    Suggest keeping at that for now and start taking in some knowledge into where to from now.
    Need to have the same approach for your next goal, building wealth - don't go looking for a quick buck.
    I'll take a long term solid performing asset that will compound over time then a quick buck won, quick buck is likely to be lost just as quick as it was won.
    Research and work out what asset that is for you.
     
  14. S0805

    S0805 Well-Known Member

    Joined:
    3rd Jul, 2015
    Posts:
    333
    Location:
    VIC
    as others have mentioned....my opinion is that you need to change your mindset first before you do any further thinking or action. It sounds cliché but its the key thing.....
    quickest way to change mindset i believe is hang around with right minded positive people, read books. may i suggest go to next PC meetup in your city. you'll find many on this forum are willing to disclose many of their success & failure stories with you that you'll be amazed. sometimes we need to know others done the same mistakes as we have and still managed to change their destiny...good luck..:)
     
    Jess Peletier likes this.
  15. Phase2

    Phase2 Well-Known Member

    Joined:
    14th Jul, 2016
    Posts:
    421
    Location:
    Perth
    Why is $70-75K/yr in post-tax income laughable/unlucky? Not as much as your friends or family members make? The median Australian household gross income is about $80k/yr, and you're at $90k. Stop comparing yourself to everyone else, and do your own thing!

    It doesn't sound like you're unlucky, it sounds like you've made some naive mistakes. BUT, turns out you're an awesome budgeter/$saver! That's a biggie in your favour.

    Perhaps you'd benefit from the services from one of the financial planners that contribute to this forum. I've never used one, so I can't vouch for them, but it might be the impetus you need to start making some good decisions and start being "lucky".
     
    JDP1, Player and Jess Peletier like this.
  16. Phase2

    Phase2 Well-Known Member

    Joined:
    14th Jul, 2016
    Posts:
    421
    Location:
    Perth
    @bfhoon So when you retire at 55, how much annual income will you be happy with? How much can you save each year until then?

    If you like I can run some property vs shares scenarios for you so you can see what it would take to retire by 55 without gambling away your $ on the ASX.

    I'm not a financial planner, I just like helping people and playing with spreadsheets..
     
  17. Marg4000

    Marg4000 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    903
    Location:
    Qld
    It appears that at present you are not in the right frame of mind to invest in property or the share market - which you refer to as gambling!

    I would suggest you continue doing exactly what you are doing and pay off your PPOR. You are clearly doing well with this and it appears to fit in with your comfort zone.

    While you are doing this, read as much as you can about investing. Keep reading this forum, also read books and newspaper articles. Don't believe everything you read, but look on it as increasing your knowledge.
    Marg
     
  18. Matt Ad

    Matt Ad Well-Known Member

    Joined:
    7th Mar, 2016
    Posts:
    88
    Location:
    Perth
    Let us know how you are going! has the end of this year been productive? are you going to be setting some goals for next year? I have to give my personal opinion,as I have dedicated alot of my time to learning before acting. There are many key words you have used in the above which will prevent you from making more money and creating some wealth for yourself, I would suggest if you havnt already, take some time to adjust your thinking, learn about investing rules (such as why saying "hoping to double it to make some easy cash" is wrong) and go from there. we arnt all cut out for investing, physiologically some of us have biases which we cant control, but when you cant do it yourself, outsource it :D. Wish you the best, and please feel free to keep everyone in the loop.
     
  19. LifesGood

    LifesGood Home Building & Development Consultant Business Member

    Joined:
    26th Jun, 2015
    Posts:
    643
    Location:
    Perth WA
    Pay your house off, spoil yourselves every once in a while and remind yourself that sometimes s**t happens but we live another day.
     
    Matt Ad likes this.
  20. JDP1

    JDP1 Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    2,838
    Location:
    Brisbane
    As others have said here...the attitude needs some adjusting.ie the way you see yourself.
    Easier said than done ofcourse...but its really important.
    You actually are not in such a dire position- 2 incomes, combined isn't so bad. You have 350k in gross equity in your ppor and your super balance isn't bad for someone your age.