tech/a
No Ordinary Duck
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Develop a few APPs.
LEVERAGE - that is the goal at your age and I wish I did more of it when younger...it's a double edged sword but it's the only way to riches..and wilth amount of cash you need to find a way to apply it to some investment that can make you multiples....investment property(safe but slow in this environment unless your doing reno's) , sharemarket is another but you need to study hard so you don't blow-up, business investment - higher risk, higher return...either way you need to increase your financial knowledge to reduce your risk and increase your returns.
Good luck.
Good luck.
mate all I can say is well done.
I'm 26 and I've got 24k right now, but I've only been in my job for a year and a bit though.
Maybe I should start a thread "what would you do with $24000 savings"?, 24 is a little too small to do anything with right now so I'm just saving away.
I'm 26 and I've got 24k right now, but I've only been in my job for a year and a bit though.
Maybe I should start a thread "what would you do with $24000 savings"?, 24 is a little too small to do anything with right now so I'm just saving away.
El Tigre
^Get back to beginners lounge
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I'm in the same boat.
Decent whack of cash but still quite a few years off a house.
- I general move between 50-90% invested (FPO shares only so far)
- rest in the bank - The problem is at 6.5%, turns into 4.5% after tax (30c bracket), more like 1.5% with inflation. hardly seems worth it.
- no managed funds
I hold a low/medium risk portfolio, all been good so far. Investing with little knowledge hasn't been a problem, set entry and exit, basic diversification, generally longer holds, buy when it's down, take profit when i see it, don't let the falls and gloom bother me.
Some would definitely disagree with me though. But I accept there is short term risk.
And capital gains is still bitch come tax time.
Decent whack of cash but still quite a few years off a house.
- I general move between 50-90% invested (FPO shares only so far)
- rest in the bank - The problem is at 6.5%, turns into 4.5% after tax (30c bracket), more like 1.5% with inflation. hardly seems worth it.
- no managed funds
I hold a low/medium risk portfolio, all been good so far. Investing with little knowledge hasn't been a problem, set entry and exit, basic diversification, generally longer holds, buy when it's down, take profit when i see it, don't let the falls and gloom bother me.
Some would definitely disagree with me though. But I accept there is short term risk.
And capital gains is still bitch come tax time.
I'm in pretty close to the same position, i'll give you a run down of where I am at and some small suggestions that may help you also. Not sure if you are working or a student either but will assume that your working.
I'm 24 yearsn old. I have only about $3k in the bank, however i've just finished paying off a car worth about $16k, I have $67k in shares however $35k of that is owing on a margin loan. I pay a portion off of this margin loan each pay (fortnightly) and as it reduces, if I see any more opportunities in the stock market I buy again and extend on the loan again. Note this is not a strategy for everyone, however I work in the finance industry, understand the risks and lucky enough to still be mooching off the parents hehe. Theres a couple of other bits and pieces i've got but nothing else of any significant value.
The first thing I would 100% suggest in regards to superannuation, is that if your annual income is low enough throw $1,000 into your super each year so that you maximise the government co-contribution. This is just money for jam and you will be absolutely amazed at the difference contributing $1,000 of your own money and getting even a $600 co-contribution for the next 5 or so years will make to the compounding of your superannuation assets through to age 60.
Other options depend largely on your personal situation, my sister doesn't have much against her name but has seen europe, new zealand, thailand and bali. I've only been to Thailand and will probably do the rest later in life, its all personal preference, but don't be afraid to put $5k to the side and give yourself a holiday with mates.
If your looking at buying a home in 4 years time then the first home saver account is a viable option, but i'd suggest you do some in depth research to some of the fineprint in regards to the account. i.e. you have to contribute $1,000 at least per year across 4 financial years to gain access to the funds and many other small parameters. If you'd like more details feel free to PM me and i can try help out.
If buying a home isn't on your radar just yet, or you'd like to take the more aggresive route like me, then investing in shares has the potential to be very rewarding, but also has the risks attached as well. Do some research, learn the ins and outs, and work out what type of investor you'd like to be as there a many niche's, combinations etc etc. I learnt the hard way that you can't just buy willy nilly and that having a strategy in place really helps.
I don't think anyone can tell you exactly how to split the $50,000 but in basic terms this is what i'd look at if it was me:
$5k ready for a holiday or any other personal luxuries i decide on at a later date
$10k in high interest bank accounts (take your $1,000 super contributions from this annually) and also contribute some of your pay to this as well.
$35k in shares to build funds toward a home with the possibility of also having an additional $20k markin loan if you can handle to risk to try build these funds at a faster rate and for the tax advantages (i'd also add money to this each pay to help build faster)
Hope that helps, feel free to PM me to discuss further. Its good to hear others in their 20's looking to secure some of there future, not just throw cash around partying and travelling.
Josh
I'm 24 yearsn old. I have only about $3k in the bank, however i've just finished paying off a car worth about $16k, I have $67k in shares however $35k of that is owing on a margin loan. I pay a portion off of this margin loan each pay (fortnightly) and as it reduces, if I see any more opportunities in the stock market I buy again and extend on the loan again. Note this is not a strategy for everyone, however I work in the finance industry, understand the risks and lucky enough to still be mooching off the parents hehe. Theres a couple of other bits and pieces i've got but nothing else of any significant value.
The first thing I would 100% suggest in regards to superannuation, is that if your annual income is low enough throw $1,000 into your super each year so that you maximise the government co-contribution. This is just money for jam and you will be absolutely amazed at the difference contributing $1,000 of your own money and getting even a $600 co-contribution for the next 5 or so years will make to the compounding of your superannuation assets through to age 60.
Other options depend largely on your personal situation, my sister doesn't have much against her name but has seen europe, new zealand, thailand and bali. I've only been to Thailand and will probably do the rest later in life, its all personal preference, but don't be afraid to put $5k to the side and give yourself a holiday with mates.
If your looking at buying a home in 4 years time then the first home saver account is a viable option, but i'd suggest you do some in depth research to some of the fineprint in regards to the account. i.e. you have to contribute $1,000 at least per year across 4 financial years to gain access to the funds and many other small parameters. If you'd like more details feel free to PM me and i can try help out.
If buying a home isn't on your radar just yet, or you'd like to take the more aggresive route like me, then investing in shares has the potential to be very rewarding, but also has the risks attached as well. Do some research, learn the ins and outs, and work out what type of investor you'd like to be as there a many niche's, combinations etc etc. I learnt the hard way that you can't just buy willy nilly and that having a strategy in place really helps.
I don't think anyone can tell you exactly how to split the $50,000 but in basic terms this is what i'd look at if it was me:
$5k ready for a holiday or any other personal luxuries i decide on at a later date
$10k in high interest bank accounts (take your $1,000 super contributions from this annually) and also contribute some of your pay to this as well.
$35k in shares to build funds toward a home with the possibility of also having an additional $20k markin loan if you can handle to risk to try build these funds at a faster rate and for the tax advantages (i'd also add money to this each pay to help build faster)
Hope that helps, feel free to PM me to discuss further. Its good to hear others in their 20's looking to secure some of there future, not just throw cash around partying and travelling.
Josh
You could easily do a cut down version of what I suggested. An important thing to do is to make all 24 of those big ones work their guts out for you at all times and keep adding to them. $24K is not a bad start and I know some pensioners that would kill to still have that much capital (so watch out for pensioners
).Always chase the best returns. If that means opening a new bank account every month because you are chasing those sorts of returns, pain that it be, do it. Flog those 24 little buggers to death. Set high but achievable targets for yourself and review them regularly.
At the same time learn about bonds, hybrids, shares, derivatives, property, business, etc; over time those 24 will have lots of mates that you can flog harder again because you know more. You will also mitigate some of your risks as you will not be like the majority who just know shares or property. Way too dangerous and limiting to your future wealth creation and capital protection; you see it all the time in threads when someone defends an asset class like property to the death; if that is all you know you become attached and emotive. It takes effort to learn and that is why the Super funds have so many detainees on their books; their clients hate their fees and performance, but take no responsibility or action to fix the problem.
Money is attracted to the people who like it (not in love with the stuff), and that is only because those people just pay closer attention to what it is doing and where it is going.
tech/a
No Ordinary Duck
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You could easily do a cut down version of what I suggested. An important thing to do is to make all 24 of those big ones work their guts out for you at all times and keep adding to them. $24K is not a bad start and I know some pensioners that would kill to still have that much capital (so watch out for pensioners
Always chase the best returns. If that means opening a new bank account every month because you are chasing those sorts of returns, pain that it be, do it. Flog those 24 little buggers to death. Set high but achievable targets for yourself and review them regularly.
At the same time learn about bonds, hybrids, shares, derivatives, property, business, etc; over time those 24 will have lots of mates that you can flog harder again because you know more. You will also mitigate some of your risks as you will not be like the majority who just know shares or property. Way too dangerous and limiting to your future wealth creation and capital protection; you see it all the time in threads when someone defends an asset class like property to the death; if that is all you know you become attached and emotive. It takes effort to learn and that is why the Super funds have so many detainees on their books; their clients hate their fees and performance, but take no responsibility or action to fix the problem.
Money is attracted to the people who like it (not in love with the stuff), and that is only because those people just pay closer attention to what it is doing and where it is going.
Nice theory.
Yup, pretty much; I guess it comes down to your 3% thing.
explod
explod
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Im a couple years older than 22 and have a bit more than that in savings.
Plans are:
Get married
6 - 12 months travel (30%)
Maybe consider buying a house when we get back if the numbers stack up, otherwise leave the balance in current investments [Cash (50%), Hybrids(5%), Silver(5%), Value stocks(22%), and a couple spec stocks (18%)]
Best post so far but would add:
try to avoid the mariage bit till you are at least 35,
about 5 grand on a painting by Yvonne Audette will double in price every five years and trebble at least when she dies.
buy and read over a number of times, "Trend Following" by M Covell and "Rich Dad Poor Dad" by R Kyosaki.
Trust no one but yourself and if you have any doubt on any decision do not do it.
But overall, a good thead.
I just turned 22 and have a 40+k portfolio and and $$$ in high interest savings account.
looking for a property soon, when the time comes and possibly travel next yr when i finish my degree.
Depending on your situation, Id put a deposit on a property, high interest account or shares, bonds, etc
looking for a property soon, when the time comes and possibly travel next yr when i finish my degree.
Depending on your situation, Id put a deposit on a property, high interest account or shares, bonds, etc
Julia
In Memoriam
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Well done on saving $50K.
At your age, I'd only be putting into Super what you need to in order to get the government co-contribution. Imo you are too young to want to tie the greater part of your money up in an area which you cannot access until you may not have the capacity to enjoy it.
I'd be going for the FHBG and getting into entry level property. Quite apart from it likely being a sound investment if you choose carefully, the whole satisfaction of owning your own place should never be underestimated imo. It gives you security, no one can tell you to leave or what you may do to it.
Good luck, though I suspect you won't need it as you're clearly well on the way already.
At your age, I'd only be putting into Super what you need to in order to get the government co-contribution. Imo you are too young to want to tie the greater part of your money up in an area which you cannot access until you may not have the capacity to enjoy it.
I'd be going for the FHBG and getting into entry level property. Quite apart from it likely being a sound investment if you choose carefully, the whole satisfaction of owning your own place should never be underestimated imo. It gives you security, no one can tell you to leave or what you may do to it.
Good luck, though I suspect you won't need it as you're clearly well on the way already.
So_Cynical
The Contrarian Averager
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I did not agree with Julia initially, but on reflection and doing the math now partly do. Because of your age, compounding interest and the Super Guarantee % works in your favour extremely well.
At age 22 the average person can easily be a millionare plus at 60 thanks to the Super Guarantee.
Assuming you got the average wage of $64K, that would give you ~$6K from your employer at 9% for the Super Guarantee and if you added $1K and got the Govt. $1K, that is $8K into Super per year. Compounded at a not unrealistic average of 7%, you would have nearly $1.5m by the time you are 60! Pretty cool for not really trying – but once it was over $200K you would want to manage it yourself to get the return and outcome, or you surely wont.
So for the huge sum of $19 per week ($1K p.a. from you) up to the age of 60, under this scenario you should end up a millionaire and a half at age 60. You would have $1.1m if you ignore the extra $2K p.a.
The humorous part is because the BB’s did not have the Super guarantee like you do, they do not have the Super assets that you guys should have at the same age. So anyone paying attention to their Super at age 22 onwards will be very well off at age 60, whether you like it or not. Even more so if the Govt. jack up the rate to 12%. Just remember, many will never do the simple math or will just ignore their Super and will wonder what happened at 60 when the ones who did pay attention are very comfortably retired.
OK, now to take care of the 38 year gap that ~22 year olds can’t see past. This is a bit tougher, but can get nearly impossible for most fairly quickly.
A 22 year old has 28 years to go to 50. So what advantages does he have over someone older?
Let’s assume the same net return of 7% every year on the capital compounded.
For every one thousand dollars per annum, he has to find about $19 per week.
On the average wage of $64K you get about $1K per week clear.
Scenario 1 - 28 years to go to bridge the 10 year retirement gap:
He uses the $20K as a lump sum in year 1, and adds $8K of his own p.a. including year 1.
He has to find $152 plus the $19 for Super per week for the next 28 years and he has about $820K when he is 50.
If he does not use and compound the $20K, under the above scenario he would only have $690K at age 50.
On the average wage it is just possible.
The decision is then yours if it is off to Gerry Harvey’s or delayed gratification and your retirement at 50? The odds are heavily against you having the required discipline to retire at 50.
Scenario 2 – 18 years to go to bridge the 10 year retirement gap:
He now needs to find $22K p.a. to have $800K
That is $418 until 50 plus the $19 for Super per week until he is 60.
On the average wage, my guess is no chance.
Scenario 3 – 8 years to go to bridge the 10 year retirement gap:
He now needs to find $75K p.a. to have $820K at 50.
That is $1425 until 50 plus the $19 for Super per week until 60.
On the average wage…errr, no.
As the rules will change over the years it would be up to you to fine tune your Super and gap strategy to get the required outcome.
And don't forget you have to keep contributing to your Super between 50 and 60 to make up the missing employer contribution to maintain the target.
You can do your own compound interest calcs here if the gap capital amount is too big or small, etc:
http://www.moneychimp.com/calculator/compound_interest_calculator.htm
At age 22 the average person can easily be a millionare plus at 60 thanks to the Super Guarantee.
Assuming you got the average wage of $64K, that would give you ~$6K from your employer at 9% for the Super Guarantee and if you added $1K and got the Govt. $1K, that is $8K into Super per year. Compounded at a not unrealistic average of 7%, you would have nearly $1.5m by the time you are 60! Pretty cool for not really trying – but once it was over $200K you would want to manage it yourself to get the return and outcome, or you surely wont.
So for the huge sum of $19 per week ($1K p.a. from you) up to the age of 60, under this scenario you should end up a millionaire and a half at age 60. You would have $1.1m if you ignore the extra $2K p.a.
The humorous part is because the BB’s did not have the Super guarantee like you do, they do not have the Super assets that you guys should have at the same age. So anyone paying attention to their Super at age 22 onwards will be very well off at age 60, whether you like it or not. Even more so if the Govt. jack up the rate to 12%. Just remember, many will never do the simple math or will just ignore their Super and will wonder what happened at 60 when the ones who did pay attention are very comfortably retired.
OK, now to take care of the 38 year gap that ~22 year olds can’t see past. This is a bit tougher, but can get nearly impossible for most fairly quickly.
A 22 year old has 28 years to go to 50. So what advantages does he have over someone older?
Let’s assume the same net return of 7% every year on the capital compounded.
For every one thousand dollars per annum, he has to find about $19 per week.
On the average wage of $64K you get about $1K per week clear.
Scenario 1 - 28 years to go to bridge the 10 year retirement gap:
He uses the $20K as a lump sum in year 1, and adds $8K of his own p.a. including year 1.
He has to find $152 plus the $19 for Super per week for the next 28 years and he has about $820K when he is 50.
If he does not use and compound the $20K, under the above scenario he would only have $690K at age 50.
On the average wage it is just possible.
The decision is then yours if it is off to Gerry Harvey’s or delayed gratification and your retirement at 50? The odds are heavily against you having the required discipline to retire at 50.
Scenario 2 – 18 years to go to bridge the 10 year retirement gap:
He now needs to find $22K p.a. to have $800K
That is $418 until 50 plus the $19 for Super per week until he is 60.
On the average wage, my guess is no chance.
Scenario 3 – 8 years to go to bridge the 10 year retirement gap:
He now needs to find $75K p.a. to have $820K at 50.
That is $1425 until 50 plus the $19 for Super per week until 60.
On the average wage…errr, no.
As the rules will change over the years it would be up to you to fine tune your Super and gap strategy to get the required outcome.
And don't forget you have to keep contributing to your Super between 50 and 60 to make up the missing employer contribution to maintain the target.
You can do your own compound interest calcs here if the gap capital amount is too big or small, etc:
http://www.moneychimp.com/calculator/compound_interest_calculator.htm
white_goodman
BOC
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vegas, hookers, world series main event entry, have a white christmas
winning
winning
At age 22 the average person can easily be a millionare plus at 60 thanks to the QUOTE]
What will $1M be worth when you are 60. When I was your age it was touted that you could retire in comfort if you had 10,000 pounds. Try retiring now on $20,000.
Julia
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This was said with respect to blue chips.
Seems a peculiar comment when you consider that most of the banks, with franking included, offer around 8 - 9%!
Wysiwyg
Everyone wants money
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If you put it away until your 60's you could have a million dollars to do all that.
