Young Investors (<30) Thread

Got inspiration from the Where are you now, where are you going thread.

Though want to restrict discussions to young investors and those just starting out or have just started their careers.

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***Current Situation***

Age = 23

Work = Recently graduated and have just started working full-time.

Investments = 4 x Managed Funds = Total = $35k

* Macquarie Small Companies Growth Trust
* BT Imputation Fund
* Colonial FirstChoice Geared Share
* Challenger China Fund

Cash Savings = $18k (currently with ING though moving to BankWest soon)

I'm currently saving around ~$4000 per month of which around $3000 goes into the regular investment plans for each of the 4 management funds above. The rest goes into the internet savings account.

Still living with my parents, single, and have no major living expenses. Monthly expenditure I guess would be less than $100 (not including odd purchases such as clothes and stuff...).

I also salary sacrifice an additional 10% (on top of the 9% Compulsory) to super (Industry Super Fund).

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**Goals**

Short term goal is to build up my managed fund portfolio and be in a position to purchase an IP by 25. I want to put together a sound deposit so that I don't have to leverage too highly.

I'm also reading up on direct share investing and hoping to start either later this year or early next year with a portfolio of around $10k (this would of course be taken out of the Cash Savings account). I'm generally a very conservative and cautious person and thus, you will notice me posting alot of "obvious" or "simple" questions. Apologies for that, it's just me trying to keep myself sane and ensure that I don't miss anything

Another thing on my mind at the momment is Margin Loans. Trying to weigh up the pros and cons at the momment and whether I'm really comfortable with all the risks associated with it. I already dipped my toes in the water with the Colonial Geared Share Fund; internal i know, but a start nontheless.

I don't want to margin lend when i start out in direct share investing, as I want to test my skills and get a feel of the sharemarket first....so this may come latter. But I'm thinking more in terms of managed funds at this point.

Feedback and insights welcome.

 

*** Current Situation ***

Age: 23

Work: Been working full time for 3 years now. Yeah thats three or so years after high school doing nothing with my life.

Living Arrangements: Single at home with parents (yay for no board). No major expenses - fuel for my car and internet bill.

Portfolio:

- $9,985 in Colonial First State - 452 Aus Share
Value down from $10,000 invested 3 weeks ago

- $4,970 in Colonial First State - Global Resources
Value down from $5,000 invested a week ago

- 115 shares in Iinet
Purchased in 2005 - currently worth $462.00 - capital loss of $415.25 inc dividends)

- 150 shares in Telstra
Purchased in 1999 (T2) - currently worth $718.50 - capital loss of $391.50 inc dividends

- 500 shares in my local Bendigo Community Bank Branch
Purchased in 2002 for $1.00 not publicly listed - paying a 10c dividend this year!

- $53,000 in Bankwest account
Moving to Rabobank to get 7.1% instead of 6.5%

- $8,000 in accured annual leave.

- $17,000 in Super
Parents pushed this to get the govt. co-contribution for the last few years - no other contributions

- Save $500 or so a week.

*** Goals ***

Will probably keep saving all my money in the Bankwest / Rabo bank account. 23 years of living with the folks is getting a bit on my nerves. Planning to use up the accrued annual leave and go on holidays from work next year around April for 3 months.

Will look at purchasing my own PPOR when I get back to claim FHOG. I'll hopefully have $60,000 for a deposit. I'll start debt-recycling the loan (prob P&I) will living there. Redraw the equity and invest in an income fund to help pay off the loan quicker.

Once the minimum time frame for FHOG is done I'll probably move back home and rent it out. At some stage I'll use the equity in the property to purhase another IP - or maybe sell off some of the income fund to finance it.

EDIT:

I've never really been interested in a career or investing. The few shares I had where just things my parents recommended (iinet was my own idea though).

The CFS funds are a bit of fun at the moment. It's a small figure I'm going to watch for the next 6 months. I might get a margin loan on the 452 fund at 33% LVR.

 

It's interesting to see the type of shares you invested in. I would thought that people might like to start with BlueChips first. Are you planning on selling them off anytime soon?

You invested in the Colonial Geared Share about the same time as me. LOL. though I choose the generic Geared Share instead of 452 (any reason why you choose this fund in particular).

Excuse my ignorance, what's PPOR???

 

Principal place of residence, ie your own home if you own it

Edit: beaten!

 

Iinet and Telstra were bought a long time ago - back when I was young and naive - well I still am I guess I would of considered Telstra a blue-chip back then.

Iinet was about to buy out Ozemail to I was expecting the price to surge - which it did for a few days - but then I didn't sell and they dropped heaps.

I want to buy more shares in the community bank - it's the only banking branch left in my town - so I want to support it. I'll probably get my loan for my first property through them for the same reason (as long as the interest rate is reasonable). I might also buy 500 shares of BEN so that I can get the shareholder discounts they offer.

I'll probably never sell any of them - they're worth less than $2000 combined at the moment.

Actually I'm in the non-geared 452 share. I wish now that I'd gone into the generic geared share instead - I think I picked 452 based on previous perfomance - it was kind of a "this fund looks ok, what the hell lets just do it".

PPOR Primary Place of Residence - as opposed to IP Investment Property.

 

This is great! young ones doing well! I'm just out of the bracket at 32 yo!

archangelsupreme your doing well to save $4k per month! what do you do for work?

Prehaps people here can also post goals, ie want to achieve this in 5 years etc.. investing must have a written goal otherwise you will quickly side track..

 

Archangelsupreme,

Great thread, good work! You don't mind us oldies (30's) keeping an eye on it do you to see what you lot are doing? You're never too old to learn, and you might just teach me a trick or two.



Michael.

 

Definately. We want to gain insights from people who have been there and done that as well....it's hard starting out so we need all the help we can get.

Seeing people with multiple IPs already around this age makes me kinda envious...though i'm inpsired as I want to get my act together.

I currently work in IT Project Magement in a junior role...hoping to move to big and better things soon.

 

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***Current Situation***

Age = 21

Work = Graduate at Big 4 Accounting Firm

Investments = PPOR in Rockdale (in the process of settling)
(sold out of all funds to fund deposit, however have 10k of T3 funds im awaiting CGT 12 month to rollover on)

Super = ~20k

Cash Savings = About 10k in an offset


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**Goals**

Re enter the stock market about July next year.

Purchase IP (in either melbourne or lower north syd) in about the 380-400k price range by the end of 2008.

Chartered Accountant by June 2009

Longer term goals.
Mil in Property by 25
3 Mil by 30
Mil in Funds by 30
LVR level of 80% by 30...

Havent set many goals after 30 though

 

Your doing fantastic at just 21. Makes me think that I should've done more with my money when I was 21 instead of just putting it in an online savings account LOL.

Gosh, $20k in super at 21....you must've been working for a while or dumped money in their to take advantage of that Government-Co-Contribution thing mid-year.

 

3 of it is my own money while 6 is the governments.... thank you Mr Co-contribution... yes i wont be able to touch it for a while but im happy with that return...

 

Age 27
Married, 1 daughter
Currently renting (moved out of PPOR recently to be closer to work)
Purchased PPOR in 2004 for $190k, current value ~$370k
Purchase IP with my brother (70% us, 30% him split) in 2006 for $267k, current value~$370k
Earlier this year ripped out some equity and margined into some managed funds/shares - total amount of $225k in working in there now.

My wife & I had combined income of about $30k (before tax!) when we got our PPOR. Up to about $50kish when we got the IP.

Positives:
Getting started, coming from a situation of being in the hole to the tune of about $40k from stupid personal loans etc in the teenage years to having some options and hope for the future.
Waited till what I think is a great age for our first child. By far the best experience of my life, didnt even know that level of happiness and pride existed till she came along!
Got a good job I enjoy at a good place, working with one of the smartest guys I know, so enjoying the challenge and learning.

Regrets:
I have been reading property and wealth creation books since I was 18, so it took 6 years to make the first move. That is too long!!
Should have gone waaaayy harder when we were on 2 incomes, you dont realise how much money you have until you cut your income in half.
In hindsight should have gone a lot harder through the perth boom, but who knew it was going to kick so hard!

The immediate future:
Looking to get into the next property now, hoping to get into a slightly larger project for the next one. Finding it difficult getting over the "what to buy and where" question at the moment. Trying to determine what I think still has room for growth in the near term.

Goals:
Learn to smell the roses a bit - I am constantly thinking of the next step, kicking myself for not going harder in the past, stressing about making the right decisions for the future. Really need to learn to enjoy now a whole lot more than i do.

 

I'll throw my hat in the ring, since I fit into this age category!!

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***Current Situation***

Age = 23

Work = Business Analyst for Oil & Gas Co.

Investments = 2 IP's in Perth (adjacent development sites, 7 unit-site total) value 910-920K, loans 770K inc. LOC.

MF's = Approx 60K in Navra, approx 20K in CFS geared. Margin loan total at 45K. Just started capitalising interest on this, will see how the LVR moves around over 9-12 months, I might start paying the monthly interest again...

Direct shares = 40,000 speccies in AZS which I picked up for 8c, other than that, none.

Super = Dunno, company pays 12% super on top of salary, probably about 20Kish by now.

Cash Savings = About 4K, plus 7K still available undrawn in LOC for margin call/emergency.


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Goals: Short term = Just got engaged, so have a wedding to plan (and pay for!!) late 2008 some time.

I really need to sort out what I am doing with my development site, the yield is not great so it is a bit of a cashflow drain. But I think jumping in with a 7-unit development may be a bit large for a first-timer!! I have no dramas holding it for a few more years while I do other things, I just need to make my mind up.

Medium term = Generate enough passive income to replace my partners income, so she has a choice whether to work or not. Currently 14% of the way there, so whats that...about 1 day a fortnight!?!

Long term = Financial freedom for me by end 2019, currently envisioning a strong core of direct property geared to a neutral level, plenty of income oriented MF's with a big margin loan that I can cap interest on because I also have enough growth funds in the mix to maintain my LVR between 45-50%. Something like KeithJ's PPOR to $2M thread on Somersoft which I have printed out at home.

Anyway, its just a plan...life will probably get in the way!!


Chris

 

***Current Situation***

Age = 25

Work = IT

Investments = 4 x investment properties. 3 in Brisbane, 1 in Wollongong. 2 are being built (duplex). Total value around 1.15-1.2 million once the duplex is finished. Debt of 860k.

130k in shares. LICs and ETFs. (ARG, AFI, STW, SLF, GMI). Nothing terribly interesting, can’t be bothered trading direct shares.

Super - 40 k last time I checked

No cash savings. Anything extra just buys more shares or pays down margin loan.

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**Goals**

Keep buying as money permits until 40 or so the retire on decent $$. Oh and a nice car one day..The Audi RS4 at the motor showed looked nice

 

Frank, how much shortfall each year do you have on your portfolio?

 

Around $2000 p/m before tax, alot less after tax.. I gross 6k p/m from work so all is ok. Yield on the first two IPs are good because they were purchased < 2003 and the duplex yield will be good because of the whole "buy wholesale"..

I have it all detailed in a spreadsheet but contains alot of personal information so don't really want to post it

 

I must say your doing well! what got you into all those properties?

 

Dad gave me Jan Somers book when I was 16 or 17. I didn't enjoy the book all that much at the time but it got me started. Started saving a deposit from my part time pizza hut job while I was in school and when I got my first full time job in 2001 dad helped with the remainder of the deposit and bought first IP in Wollongong for 135k, renting for $150 p/w. Then I've just bought more as I go... I actually regret not doing more!!

 

Frank, just out of interest would you be in the position you find yourself in today if you had gone with shares instead of property?