1 00:00:08,039 --> 00:00:11,039 Speaker 1: Hello, and welcome to The Australian's Money Puzzle podcast. I'm 2 00:00:11,119 --> 00:00:15,080 Speaker 1: James Kirby, who was editor at The Australian. Welcome aboard everybody, 3 00:00:15,160 --> 00:00:18,480 Speaker 1: all investors, I expect feeding just a little bit nervous 4 00:00:19,120 --> 00:00:22,400 Speaker 1: this week. It's not every day we have share market 5 00:00:22,520 --> 00:00:24,880 Speaker 1: session to kick off the week where we have the 6 00:00:24,920 --> 00:00:28,320 Speaker 1: worst session in four years, which we had this week 7 00:00:28,360 --> 00:00:31,840 Speaker 1: on Monday, three and a half percent off the market, 8 00:00:32,560 --> 00:00:37,479 Speaker 1: definitely rocky times. We see the NASDAC is already in correction. 9 00:00:37,760 --> 00:00:40,680 Speaker 1: The S and P that's the main US market is 10 00:00:40,720 --> 00:00:43,919 Speaker 1: down about seven and a half percent as we speak 11 00:00:44,000 --> 00:00:48,240 Speaker 1: on Tuesday, and we will see what it does this evening, 12 00:00:48,280 --> 00:00:51,120 Speaker 1: whether it goes into a full blown correction or not. 13 00:00:51,320 --> 00:00:54,240 Speaker 1: Very hard to say. We can see just middle of 14 00:00:54,280 --> 00:00:58,080 Speaker 1: the day Tuesday that the Australian market is stabilizing a little. 15 00:00:58,120 --> 00:01:00,400 Speaker 1: But I can tell you that the slightest answering, I 16 00:01:00,400 --> 00:01:02,640 Speaker 1: should say, in the US features and we will fall 17 00:01:02,760 --> 00:01:06,080 Speaker 1: with them, faithfully, we will fold. Don't you worry. We 18 00:01:06,240 --> 00:01:08,720 Speaker 1: fall lemming like every time we did three and a 19 00:01:08,760 --> 00:01:12,440 Speaker 1: half percent on Monday, and that is barely what happened 20 00:01:12,480 --> 00:01:17,160 Speaker 1: on the US overnight Monday. Perhaps on our market. But 21 00:01:17,360 --> 00:01:22,280 Speaker 1: more broadly, I want to talk about for the diversified investor, 22 00:01:22,560 --> 00:01:25,360 Speaker 1: For the investor who is like most of you, I'm 23 00:01:25,400 --> 00:01:30,759 Speaker 1: sure has shares, probably has property in some fashion, has 24 00:01:30,880 --> 00:01:33,839 Speaker 1: other assets. Then you might have gold, you might have cash, 25 00:01:33,880 --> 00:01:37,680 Speaker 1: you might have alternative assets. How do we handle a 26 00:01:37,959 --> 00:01:41,200 Speaker 1: period of instability which we've seen some of, which we 27 00:01:41,280 --> 00:01:44,080 Speaker 1: may see much more of because the conditions that have 28 00:01:44,160 --> 00:01:49,280 Speaker 1: triggered this selloff are unclear. There is no single trigger, 29 00:01:49,440 --> 00:01:51,720 Speaker 1: and on that basis, it could happen again at any time. 30 00:01:51,880 --> 00:01:53,720 Speaker 1: I was thinking, who could we have as a guest 31 00:01:53,840 --> 00:01:56,880 Speaker 1: on the show to talk about the broader situation. It 32 00:01:56,920 --> 00:02:00,600 Speaker 1: needed someone who was a diversified investor themselves. I thought, Hey, 33 00:02:00,960 --> 00:02:03,880 Speaker 1: Anthony Keane, who has been on the show before. He is, 34 00:02:03,920 --> 00:02:06,760 Speaker 1: of course the personal finance guru and news corporation. He 35 00:02:06,800 --> 00:02:09,600 Speaker 1: operates out of Adelaide. In the end of We're all 36 00:02:09,639 --> 00:02:13,680 Speaker 1: in the same big, happy family, and we finally met 37 00:02:13,720 --> 00:02:16,840 Speaker 1: in person. Irl. Great to have you on board today. 38 00:02:17,040 --> 00:02:20,040 Speaker 1: Tell me we'll talk about all things, not just the 39 00:02:20,120 --> 00:02:23,760 Speaker 1: market downturn, but how that could affect everything, How it 40 00:02:23,800 --> 00:02:27,160 Speaker 1: could affect, for instance, interest rates, how that could in 41 00:02:27,200 --> 00:02:30,840 Speaker 1: turn affect property. I was entertained by the fact that 42 00:02:30,919 --> 00:02:34,760 Speaker 1: you had a piece awfully well timed where you mentioned 43 00:02:34,760 --> 00:02:38,919 Speaker 1: that you had sold all your shares recently. Now that's 44 00:02:38,960 --> 00:02:40,960 Speaker 1: not quite a Warren Buffett like move where you sold 45 00:02:41,000 --> 00:02:44,280 Speaker 1: all your shares just before the downturn. You have lots 46 00:02:44,320 --> 00:02:47,800 Speaker 1: of shares. You just sold all your ordinary shares and 47 00:02:47,840 --> 00:02:51,839 Speaker 1: you've switched entirely to ETFs to exchange traded funds. That's 48 00:02:51,880 --> 00:02:54,359 Speaker 1: a big call, right, tell me? Is that forever? And 49 00:02:54,680 --> 00:02:55,520 Speaker 1: why did you do it? 50 00:02:56,160 --> 00:03:00,840 Speaker 2: Yeah? And I absolutely I have sold every direct share 51 00:03:01,280 --> 00:03:04,000 Speaker 2: that I've built up and owned, but that's been a 52 00:03:04,000 --> 00:03:06,919 Speaker 2: gradual thing over that it started buying maybe twenty five 53 00:03:07,000 --> 00:03:08,840 Speaker 2: years ago. But this is the first time in a 54 00:03:08,919 --> 00:03:11,480 Speaker 2: quarter of a century I do not have one individual share 55 00:03:11,480 --> 00:03:14,280 Speaker 2: to my name. And I'd like to say it was 56 00:03:14,520 --> 00:03:17,320 Speaker 2: timed the share market were out perfectly, but no, it 57 00:03:17,400 --> 00:03:21,520 Speaker 2: was purely a strategic and getting old decision. And unlike you, 58 00:03:21,800 --> 00:03:25,000 Speaker 2: I don't have a self managed super fun but as 59 00:03:25,040 --> 00:03:29,120 Speaker 2: I've got older, my superbalance has grown as everyone's done, 60 00:03:29,440 --> 00:03:31,200 Speaker 2: and that is through a lot of index funds. So 61 00:03:31,240 --> 00:03:33,799 Speaker 2: I invest in a lot of Australian overseas as you said, 62 00:03:33,800 --> 00:03:37,240 Speaker 2: diversified investments through a lot of index funds through super 63 00:03:37,480 --> 00:03:40,840 Speaker 2: but not yet self managed. But that is something I 64 00:03:40,880 --> 00:03:44,120 Speaker 2: am considering for both shares and property in the next 65 00:03:44,200 --> 00:03:47,800 Speaker 2: sort of five to ten years purely. And so the 66 00:03:47,880 --> 00:03:50,440 Speaker 2: reason I've looked to sell out of the direct share 67 00:03:50,480 --> 00:03:53,800 Speaker 2: ownership is purely because if you're holding it this stuff 68 00:03:53,800 --> 00:03:56,080 Speaker 2: in super, the tax benefits that you get from it 69 00:03:56,120 --> 00:03:59,320 Speaker 2: when you do retire from work and switch your money 70 00:03:59,320 --> 00:04:02,520 Speaker 2: to several times about that, I'd like to I've investment 71 00:04:02,600 --> 00:04:05,360 Speaker 2: properties outside of cheaper, but would like to own one 72 00:04:05,600 --> 00:04:08,920 Speaker 2: in the future as well, purely for that capital gains 73 00:04:09,000 --> 00:04:12,760 Speaker 2: tax benefit. It's just you're talking tens of thousands of 74 00:04:12,800 --> 00:04:15,960 Speaker 2: dollars of savings by doing that. So I do love shares, 75 00:04:16,000 --> 00:04:19,160 Speaker 2: I write about shares every day, and I do plan 76 00:04:19,320 --> 00:04:22,360 Speaker 2: to get more in the future. But it's just a 77 00:04:22,400 --> 00:04:27,280 Speaker 2: matter of strategy, age timing. Moving that direct share ownership 78 00:04:27,320 --> 00:04:31,000 Speaker 2: withinside throppernuation. As I get closer to my mid eight 79 00:04:31,080 --> 00:04:33,799 Speaker 2: fifties and sixties, it will work better. 80 00:04:34,600 --> 00:04:39,120 Speaker 1: You don't have to think anymore. You have vtfs. There's 81 00:04:39,120 --> 00:04:41,280 Speaker 1: an element of truth on that, isn't it. You can 82 00:04:41,320 --> 00:04:43,680 Speaker 1: put them. You can say, okay, I've got my sessings. Really, 83 00:04:43,760 --> 00:04:45,920 Speaker 1: I don't really care if come bank ors of fifty 84 00:04:45,960 --> 00:04:48,800 Speaker 1: percent for PHP fours fifty percent anymore? Is am I 85 00:04:49,440 --> 00:04:50,200 Speaker 1: simplifying it? 86 00:04:50,279 --> 00:04:52,479 Speaker 2: I think you're right. I think the one thing that 87 00:04:52,560 --> 00:04:55,760 Speaker 2: will hold me back from going direct shares again in 88 00:04:55,800 --> 00:04:58,599 Speaker 2: the future, through a self managed fund or just through 89 00:04:58,960 --> 00:05:01,520 Speaker 2: a retail or what other the fund that opposite direct 90 00:05:01,560 --> 00:05:05,320 Speaker 2: share investment is do I want do you want the headache? 91 00:05:05,520 --> 00:05:08,360 Speaker 2: Do you just want to trust what the markets are doing? 92 00:05:08,480 --> 00:05:10,800 Speaker 2: Because I've been burnt. I heard you talking, I think 93 00:05:10,880 --> 00:05:13,960 Speaker 2: last week on your podcast about Goodman Group how to 94 00:05:14,080 --> 00:05:17,320 Speaker 2: the star and the market as a real estate investment trust. 95 00:05:17,360 --> 00:05:19,839 Speaker 2: Now I bought them in the GFC and lost ninety 96 00:05:19,839 --> 00:05:22,279 Speaker 2: percent of my money before I sold out and then 97 00:05:22,480 --> 00:05:25,159 Speaker 2: and they've gone gangbusters since. Had I held them, which 98 00:05:25,160 --> 00:05:28,479 Speaker 2: I didn't for various reasons, would have gone great. But 99 00:05:28,680 --> 00:05:31,120 Speaker 2: it's just the damage and that the damage it does 100 00:05:31,160 --> 00:05:33,960 Speaker 2: to your confidence as an investor when you have those 101 00:05:34,000 --> 00:05:36,279 Speaker 2: sorts of losses. I don't know. I'm not sure that 102 00:05:36,320 --> 00:05:38,039 Speaker 2: I want to go through all that again. And it's 103 00:05:38,040 --> 00:05:40,280 Speaker 2: like with the fall we've had in recent days, everyone 104 00:05:40,360 --> 00:05:42,160 Speaker 2: super is going to take a hit, but that's everyone 105 00:05:42,200 --> 00:05:45,840 Speaker 2: super pretty much all those that are invested in share markets. 106 00:05:45,440 --> 00:05:47,839 Speaker 1: So you're comforted by the fact that you won't do 107 00:05:47,920 --> 00:05:51,800 Speaker 1: any worse than everyone else's basicity than the index from 108 00:05:51,839 --> 00:05:52,799 Speaker 1: here on or better. 109 00:05:54,040 --> 00:05:57,320 Speaker 2: That's exactly right. But shares are great and a lot 110 00:05:57,320 --> 00:06:00,919 Speaker 2: of people love that watching it, and I have loved 111 00:06:00,960 --> 00:06:03,080 Speaker 2: it in the past, But is it right for my 112 00:06:03,160 --> 00:06:05,400 Speaker 2: stage of life? And I know you've also spoken about 113 00:06:05,440 --> 00:06:08,040 Speaker 2: as people. Do you get older, it's do you want 114 00:06:08,080 --> 00:06:10,720 Speaker 2: to spend your time watching the moves of individual stocks 115 00:06:10,720 --> 00:06:12,279 Speaker 2: every day? Or do you want to spend your time 116 00:06:12,400 --> 00:06:15,880 Speaker 2: enjoying sort of life and retirement and not having to 117 00:06:15,920 --> 00:06:19,120 Speaker 2: worry about the self managed super fun compliance and all 118 00:06:19,120 --> 00:06:19,880 Speaker 2: that sort of stuff. 119 00:06:20,040 --> 00:06:23,000 Speaker 1: Does your attitude towards property and how much property you have? 120 00:06:23,720 --> 00:06:26,080 Speaker 1: Does it change when you see one of these shock 121 00:06:27,360 --> 00:06:28,480 Speaker 1: share market selloffs? 122 00:06:29,520 --> 00:06:32,640 Speaker 2: You don't see We saw a fifty five percent fall 123 00:06:32,680 --> 00:06:36,839 Speaker 2: in the ASX during the global financial crisis. I've never 124 00:06:36,880 --> 00:06:39,400 Speaker 2: seen anything like that in any of the property markets. 125 00:06:39,680 --> 00:06:43,039 Speaker 2: Makes me relieve that I'm more exposed to real estate. 126 00:06:43,920 --> 00:06:46,919 Speaker 2: But the property market in Australia is sort of a 127 00:06:47,120 --> 00:06:50,600 Speaker 2: real variation in what you get. I'm running a column 128 00:06:50,600 --> 00:06:53,040 Speaker 2: this week. In the past twelve months we've had Perpose 129 00:06:53,120 --> 00:06:56,840 Speaker 2: done plus twenty five percent and Melbourne which is down 130 00:06:56,880 --> 00:06:59,680 Speaker 2: a couple of percent. So that's a massive variation in 131 00:06:59,720 --> 00:07:03,480 Speaker 2: proper as well. But you don't tend to check your 132 00:07:03,520 --> 00:07:07,120 Speaker 2: prices every day. You see it as a long term investment. 133 00:07:07,200 --> 00:07:10,960 Speaker 2: But different people have different preferences as to what they like. 134 00:07:11,040 --> 00:07:12,680 Speaker 2: And I've got a bit of trouble with readers in 135 00:07:12,680 --> 00:07:16,880 Speaker 2: the past writing that I prefer property over shares any day, 136 00:07:17,160 --> 00:07:21,160 Speaker 2: but very happy to own shares and index funds through 137 00:07:21,160 --> 00:07:23,880 Speaker 2: superannuation and have that exposure to the market. 138 00:07:24,160 --> 00:07:26,680 Speaker 1: It's interesting on the share you've gone for the you've 139 00:07:26,720 --> 00:07:30,520 Speaker 1: gone for the indexing and got away from the sort 140 00:07:30,560 --> 00:07:34,400 Speaker 1: of details and the individual variation of shares property. You 141 00:07:34,440 --> 00:07:38,120 Speaker 1: don't really have that choice. I'm just thinking of the 142 00:07:38,160 --> 00:07:40,520 Speaker 1: point you're making that I can stand here and tell 143 00:07:40,560 --> 00:07:44,040 Speaker 1: everyone the property prices are up four percent across Australia 144 00:07:44,080 --> 00:07:46,920 Speaker 1: this year so far. You're laughing at that. If you're 145 00:07:46,960 --> 00:07:49,440 Speaker 1: in Perth, you're saying, hey, we're up twenty percent, and 146 00:07:49,520 --> 00:07:51,560 Speaker 1: if you're in Melbourne you're saying, hang on a second, 147 00:07:51,960 --> 00:07:54,440 Speaker 1: that's not true. In this city, we're down one percent. 148 00:07:54,520 --> 00:07:57,520 Speaker 1: And you live in Adelaide. Adelaide is doing well. If 149 00:07:57,560 --> 00:07:59,240 Speaker 1: Adelette keeps going the way, it's going to have a 150 00:07:59,320 --> 00:08:03,320 Speaker 1: higher average than Melbourne within a matter of weeks. They're 151 00:08:03,400 --> 00:08:06,840 Speaker 1: absolutely light. The average dwelling value is in the high 152 00:08:06,920 --> 00:08:10,680 Speaker 1: seven so maybe seven eighty thereabouts. Its neck and neck 153 00:08:10,760 --> 00:08:15,520 Speaker 1: right now, Do you, as a property investor seek to 154 00:08:15,760 --> 00:08:19,960 Speaker 1: diversey to diversify your risk as you've done with the shares? 155 00:08:20,320 --> 00:08:22,760 Speaker 1: Do you try and basically not have all your eggit 156 00:08:22,800 --> 00:08:25,440 Speaker 1: and basket and have a property that isn't that are 157 00:08:25,480 --> 00:08:26,200 Speaker 1: in different places? 158 00:08:28,120 --> 00:08:32,160 Speaker 2: Yes, most definitely two states. At the moment. I always 159 00:08:32,160 --> 00:08:34,079 Speaker 2: thought that there's no way I would ever be able 160 00:08:34,160 --> 00:08:37,240 Speaker 2: to afford property in Melbourne because of the price is there. 161 00:08:37,240 --> 00:08:41,480 Speaker 2: But having watched that difference, that sort of difference just narrow. 162 00:08:42,240 --> 00:08:46,760 Speaker 2: Looked at Hobart a few years ago, was like soaring 163 00:08:46,840 --> 00:08:49,959 Speaker 2: the prices there, and now that now their medium price 164 00:08:50,000 --> 00:08:52,000 Speaker 2: is one hundred thousand sort of less than any other 165 00:08:52,320 --> 00:08:56,080 Speaker 2: state capital city. So there are cycles in each city 166 00:08:56,920 --> 00:09:00,880 Speaker 2: and diversifying works great as a direct property investor, but 167 00:09:01,040 --> 00:09:05,760 Speaker 2: also great as a property investor from our land tax 168 00:09:05,800 --> 00:09:09,000 Speaker 2: point of view as well, because of the different land 169 00:09:09,040 --> 00:09:12,199 Speaker 2: tax raisings in the different states, so you'll often find 170 00:09:12,240 --> 00:09:15,000 Speaker 2: investors trying to diversify to a different state. So I 171 00:09:15,000 --> 00:09:17,880 Speaker 2: had planned for Perth, but I've missed the boat on 172 00:09:17,920 --> 00:09:21,960 Speaker 2: that one. But Melbourne would potentially be on the radar 173 00:09:22,120 --> 00:09:24,880 Speaker 2: in the next year or two, and you've spoken recently 174 00:09:24,920 --> 00:09:27,840 Speaker 2: about over supply there, so I'll be keeping an eye 175 00:09:27,880 --> 00:09:30,439 Speaker 2: on that, but definitely diversify. 176 00:09:30,960 --> 00:09:32,680 Speaker 1: Okay, very interesting. I want to talk to you about 177 00:09:32,679 --> 00:09:36,720 Speaker 1: a couple of quite topical issues how this market proversivet 178 00:09:36,720 --> 00:09:39,640 Speaker 1: could affect why they're investing. Will be back in a moment. 179 00:09:54,000 --> 00:09:57,040 Speaker 1: Hello and welcome back to the Australians Money Puzzitive podcast. 180 00:09:57,040 --> 00:10:00,240 Speaker 1: I'm James Kirby talking to Anthony Keene today, my Colie 181 00:10:00,480 --> 00:10:06,480 Speaker 1: in News Corporation on the finance section of all the 182 00:10:06,520 --> 00:10:09,600 Speaker 1: papers and digital assets that we have guest on the 183 00:10:09,640 --> 00:10:13,440 Speaker 1: show before. Always happy to have him back, Anthony. I 184 00:10:13,480 --> 00:10:15,400 Speaker 1: was just thinking that one of the things we have 185 00:10:15,520 --> 00:10:18,320 Speaker 1: at the moment is there's a fairly line boble market. 186 00:10:18,360 --> 00:10:23,040 Speaker 1: We've got some softening in the property market, and traditionally, 187 00:10:23,040 --> 00:10:26,000 Speaker 1: if you've got a share market, a serious share market diversity, 188 00:10:26,200 --> 00:10:28,840 Speaker 1: people will move to property. I can give you instances 189 00:10:28,880 --> 00:10:33,400 Speaker 1: back over the years very clear instances where that happened. Now, 190 00:10:34,120 --> 00:10:36,600 Speaker 1: we don't know how bad this will get, but it's 191 00:10:36,600 --> 00:10:39,400 Speaker 1: been a pretty bad week so far on the market. 192 00:10:39,440 --> 00:10:43,360 Speaker 1: That the worst week for four years, And you could 193 00:10:43,480 --> 00:10:46,360 Speaker 1: argue it wouldn't take much more to knock more off 194 00:10:46,800 --> 00:10:50,880 Speaker 1: global markets, particularly the US, because there are always risks 195 00:10:50,880 --> 00:10:54,559 Speaker 1: in the market, but there are distinct risks emerging just now. 196 00:10:54,559 --> 00:11:00,720 Speaker 1: They're geopolitically, particularly US presidency, particularly wars in different parts 197 00:11:00,760 --> 00:11:03,400 Speaker 1: of the world. These are things that can knock a 198 00:11:03,440 --> 00:11:06,760 Speaker 1: market out very easily. It's fragile. I think we could 199 00:11:06,800 --> 00:11:10,080 Speaker 1: say that, and we had a sharp sell off, which 200 00:11:10,160 --> 00:11:13,960 Speaker 1: could extend What I want to draw out from you, 201 00:11:14,000 --> 00:11:17,880 Speaker 1: as someone who invests right across the board in all classes, 202 00:11:18,440 --> 00:11:24,160 Speaker 1: what might happen? What can a share market downturn do 203 00:11:24,320 --> 00:11:27,240 Speaker 1: for broad investments? Apart from the fact that your shares 204 00:11:27,240 --> 00:11:30,000 Speaker 1: have lost value, it takes some energy out of the market, right, 205 00:11:30,040 --> 00:11:34,280 Speaker 1: What might happen with interest rates for all investors if 206 00:11:34,320 --> 00:11:37,400 Speaker 1: we have an extended share market sell off. 207 00:11:39,320 --> 00:11:42,960 Speaker 2: Yeah, that's a really good question, James, because I think 208 00:11:42,960 --> 00:11:47,679 Speaker 2: you're right. If this market sell off continues, and Stephens, 209 00:11:48,679 --> 00:11:52,360 Speaker 2: we saw it during COVID, we saw it before that 210 00:11:52,440 --> 00:11:56,880 Speaker 2: in the GFC when interest rates just drop really sharply, 211 00:11:57,160 --> 00:12:00,520 Speaker 2: that's going to obviously not be good news for the 212 00:12:00,559 --> 00:12:03,280 Speaker 2: people that have been in loving their five percent plus 213 00:12:03,400 --> 00:12:06,920 Speaker 2: returns on cash in the last couple of years, because 214 00:12:06,960 --> 00:12:10,360 Speaker 2: if the Reserve Bank cuts rates quickly, obviously those rates 215 00:12:10,360 --> 00:12:13,040 Speaker 2: will fall. But I think in the past as well, 216 00:12:13,080 --> 00:12:15,600 Speaker 2: it could be great for bonds. Now I've never invested 217 00:12:15,640 --> 00:12:18,840 Speaker 2: directly in bonds. Most people have probably never invested directly 218 00:12:18,840 --> 00:12:21,200 Speaker 2: in bonds, but you might have a portion in your 219 00:12:21,280 --> 00:12:25,760 Speaker 2: super But I remember because as high interest rates, you 220 00:12:25,800 --> 00:12:28,640 Speaker 2: can get great returns from bonds when they're sharp falls 221 00:12:28,679 --> 00:12:31,640 Speaker 2: in central bank interest rates because of that inverse way 222 00:12:31,720 --> 00:12:35,640 Speaker 2: that they work. So might be great for that. Falling 223 00:12:35,720 --> 00:12:40,120 Speaker 2: rates might be beneficial for property if it becomes easier 224 00:12:40,120 --> 00:12:43,120 Speaker 2: to borrow to invest in real estate as well, So 225 00:12:43,160 --> 00:12:44,080 Speaker 2: there's potential there. 226 00:12:44,160 --> 00:12:46,599 Speaker 1: It could be actually easier to finance investments. 227 00:12:47,000 --> 00:12:48,640 Speaker 2: Could be yes, but there's also going to be a 228 00:12:48,640 --> 00:12:50,079 Speaker 2: lot of gloom and a lot of people losing a 229 00:12:50,120 --> 00:12:52,040 Speaker 2: lot of confidence and stuff. And let's hope we don't 230 00:12:52,080 --> 00:12:54,520 Speaker 2: have anywhere near the falls we had in that sort 231 00:12:54,520 --> 00:12:57,040 Speaker 2: of flash crashing COVID. All the huge falls we had 232 00:12:57,080 --> 00:12:59,319 Speaker 2: back at around two thousand and eight, two thousand and nine. 233 00:12:59,800 --> 00:13:05,040 Speaker 1: You with your move to ETFs, if you saw a 234 00:13:05,080 --> 00:13:08,079 Speaker 1: flash crash, a harder crash than we've had. Let's say 235 00:13:08,080 --> 00:13:10,320 Speaker 1: we're down. Let's say that the US market is down 236 00:13:10,760 --> 00:13:14,000 Speaker 1: approximately seven and a half percent is to drop so far, 237 00:13:14,720 --> 00:13:16,600 Speaker 1: but let's say it dropped really sharply and we did 238 00:13:16,679 --> 00:13:19,680 Speaker 1: twenty percent drop or so in the US market. Would 239 00:13:19,679 --> 00:13:22,840 Speaker 1: that disturb your plan about ETFs forever? Would you say, gosh, 240 00:13:22,920 --> 00:13:25,600 Speaker 1: this is there are bargains here. I can't resist it. 241 00:13:25,840 --> 00:13:28,440 Speaker 2: Yeah, it's right, and a lot of them. A lot 242 00:13:28,480 --> 00:13:31,800 Speaker 2: of the brokers and the ches specialists I've been speaking 243 00:13:31,840 --> 00:13:34,360 Speaker 2: to you have literally been waiting for a fall, for 244 00:13:34,400 --> 00:13:37,240 Speaker 2: a breather, whether it's ten or twenty percent. And I've 245 00:13:37,280 --> 00:13:40,920 Speaker 2: had this money sitting on the sidelines. Because market drops 246 00:13:40,960 --> 00:13:44,600 Speaker 2: twenty percent, you're effectively buying at a discount. I've still 247 00:13:44,640 --> 00:13:46,960 Speaker 2: got scars from the GFC. James. I listened to all 248 00:13:47,000 --> 00:13:48,760 Speaker 2: of that and bought it a ten or twenty percent 249 00:13:48,800 --> 00:13:52,480 Speaker 2: discount heavily, very heavily, and then we'll lost another thirty 250 00:13:52,520 --> 00:13:54,920 Speaker 2: five percent on my money and took years and years 251 00:13:55,000 --> 00:13:55,959 Speaker 2: to get That was nice. 252 00:13:56,040 --> 00:13:58,120 Speaker 1: You sound like someone who's been through the war, Anthony, 253 00:13:58,160 --> 00:14:02,240 Speaker 1: that you were you forever. Look, I'm so glad you've 254 00:14:02,280 --> 00:14:05,160 Speaker 1: brought this up because I know a lot of our 255 00:14:05,240 --> 00:14:11,440 Speaker 1: listeners have not really experienced the grueling experience of a 256 00:14:11,600 --> 00:14:14,360 Speaker 1: share market fold. When I say a share market fold, 257 00:14:14,800 --> 00:14:16,840 Speaker 1: what you're talking about was worse. It was much worse 258 00:14:16,880 --> 00:14:20,800 Speaker 1: than the COVID dropped. The GFC was. It rattled confidence 259 00:14:21,000 --> 00:14:24,840 Speaker 1: in the deepest possible way. Banks folks, banks were being 260 00:14:24,960 --> 00:14:28,720 Speaker 1: saved in the UK and the US here and then 261 00:14:28,880 --> 00:14:33,320 Speaker 1: on top of that you had the worst type of market. 262 00:14:33,440 --> 00:14:37,200 Speaker 1: They says, it felt fifty five percent, but it took 263 00:14:37,360 --> 00:14:40,920 Speaker 1: two years to do that. It peaked in late two 264 00:14:40,960 --> 00:14:43,400 Speaker 1: o seven. It was the middle of March two oh 265 00:14:43,480 --> 00:14:45,240 Speaker 1: nine when we hit the bottom, and of course we 266 00:14:45,280 --> 00:14:46,880 Speaker 1: didn't know we'd hit the bottom because it seemed to 267 00:14:46,920 --> 00:14:49,800 Speaker 1: have been going down forever. So it's one thing to 268 00:14:49,800 --> 00:14:52,240 Speaker 1: be an investor goes through the COVID crash, which was 269 00:14:52,400 --> 00:14:56,240 Speaker 1: short and sharp, and the stock markets were flying back 270 00:14:56,320 --> 00:15:01,040 Speaker 1: up within months of the initial downturn. Much harder to 271 00:15:01,080 --> 00:15:03,640 Speaker 1: go through something like the GFC, where there's two solid 272 00:15:03,680 --> 00:15:07,360 Speaker 1: years for people, where the stocks just slowly sink. Child 273 00:15:07,440 --> 00:15:10,320 Speaker 1: child down by fifty percent. That's really difficult. So that'd 274 00:15:10,320 --> 00:15:12,480 Speaker 1: you both, Anthony, and I bet it does shape you. 275 00:15:12,760 --> 00:15:16,440 Speaker 1: Did it push you more towards property investing than it 276 00:15:16,520 --> 00:15:17,920 Speaker 1: might have? Than you might have? 277 00:15:18,680 --> 00:15:21,200 Speaker 2: I think it did. And look there's been I've been 278 00:15:21,280 --> 00:15:24,560 Speaker 2: fortunate being from Adelaide that Adelaide tends not to have 279 00:15:24,640 --> 00:15:30,200 Speaker 2: the heavy downturns in real estate prices that the big 280 00:15:30,200 --> 00:15:34,080 Speaker 2: Eastern capitals do. But that said, before these did, I 281 00:15:34,120 --> 00:15:37,160 Speaker 2: went about eight or nine years before these recent sort 282 00:15:37,160 --> 00:15:39,520 Speaker 2: of run up since around the sort of COVID period 283 00:15:40,240 --> 00:15:44,120 Speaker 2: of zero growth, holding onto a property and getting zero 284 00:15:44,240 --> 00:15:46,240 Speaker 2: growth but still having to pay all the holding costs 285 00:15:46,280 --> 00:15:49,640 Speaker 2: and the fees and things. So but you hold My 286 00:15:49,760 --> 00:15:51,240 Speaker 2: view is if all you've got to do with your 287 00:15:51,280 --> 00:15:54,240 Speaker 2: whole real estate, if you go through two price cycles, 288 00:15:54,280 --> 00:15:56,960 Speaker 2: two price booms, then you're set up for life. Because 289 00:15:57,080 --> 00:15:59,920 Speaker 2: of the magnitude and the size of the money that 290 00:16:00,120 --> 00:16:05,880 Speaker 2: invested in one individual property. Most people would not put 291 00:16:05,960 --> 00:16:08,560 Speaker 2: five one hundred and six seven hundred thousand dollars just 292 00:16:08,680 --> 00:16:11,400 Speaker 2: into one individual share or even a portfolio. A lot 293 00:16:11,440 --> 00:16:14,480 Speaker 2: of people don't do that. Property gives you that leverage. 294 00:16:14,600 --> 00:16:17,120 Speaker 2: So I think you're right they did. I've still owned 295 00:16:17,120 --> 00:16:20,480 Speaker 2: shares for all through the recovery, and Jesus was a 296 00:16:20,480 --> 00:16:23,440 Speaker 2: long recovery as well. We only to the all odds 297 00:16:23,480 --> 00:16:26,200 Speaker 2: in the ASX two hundred only a few years ago. 298 00:16:26,360 --> 00:16:28,560 Speaker 2: It took over ten or twelve years just to get 299 00:16:28,600 --> 00:16:31,120 Speaker 2: back to where they were in November two thousand and seven. 300 00:16:31,520 --> 00:16:35,920 Speaker 2: Whereas steady issue goes, property market just kept plotting higher 301 00:16:35,920 --> 00:16:38,640 Speaker 2: and as I said, flat for a long period while 302 00:16:38,680 --> 00:16:42,160 Speaker 2: I was watching other states go higher. But it's been 303 00:16:42,440 --> 00:16:46,480 Speaker 2: says Tener. Look, I'd be nervous about investing in SA 304 00:16:46,800 --> 00:16:49,920 Speaker 2: or Wa at the moment, even Queensland to a degree 305 00:16:50,240 --> 00:16:53,200 Speaker 2: because of the size of the gains that they've had. 306 00:16:53,320 --> 00:16:57,520 Speaker 2: Nothing keeps going up forever. But you've got that argument. 307 00:16:57,560 --> 00:17:00,120 Speaker 2: You've got various arguments for the under supply of a 308 00:17:00,200 --> 00:17:03,240 Speaker 2: state national aid, the huge population growth. I just think 309 00:17:03,240 --> 00:17:07,320 Speaker 2: the fundamentals are still there. And a roof over your 310 00:17:07,320 --> 00:17:10,280 Speaker 2: head is the best investment you can make, whether it's 311 00:17:10,280 --> 00:17:13,480 Speaker 2: your own home or whether it's an investment property or two. 312 00:17:13,520 --> 00:17:16,119 Speaker 2: I really believe that for a long time because of 313 00:17:16,800 --> 00:17:18,320 Speaker 2: the security that it gives you. 314 00:17:18,640 --> 00:17:20,720 Speaker 1: Okay, terrific, We've take sure break. We're going to have 315 00:17:20,760 --> 00:17:23,919 Speaker 1: some great questions from Alex and Christopher and Margaret and 316 00:17:24,560 --> 00:17:33,760 Speaker 1: if we get to it, orpheus back in a moment. Hello, 317 00:17:33,840 --> 00:17:37,159 Speaker 1: Welcome back to the Australians Money Puzzle podcast. I'm James Kirby. 318 00:17:37,600 --> 00:17:41,760 Speaker 1: I'm talking to Anthony Keene. We have some great questions here. 319 00:17:42,480 --> 00:17:45,439 Speaker 1: Alex says, I'm in my early thirties. I've been contributing 320 00:17:45,480 --> 00:17:48,119 Speaker 1: into super with the goal of starting a SMA super 321 00:17:48,119 --> 00:17:52,000 Speaker 1: fund to buy a house in Sydney. The thirty year 322 00:17:52,080 --> 00:17:57,000 Speaker 1: long price growth for capital cities it's five percent, assuming 323 00:17:57,080 --> 00:17:59,439 Speaker 1: I can even find a house in Sydney. This asset 324 00:17:59,480 --> 00:18:01,840 Speaker 1: with the priests did three million in thirty years time, 325 00:18:01,840 --> 00:18:04,600 Speaker 1: at which point on realize gains and earnings would be 326 00:18:04,600 --> 00:18:07,679 Speaker 1: taxed to thirty percent war Boardly, it seems like the 327 00:18:07,720 --> 00:18:10,679 Speaker 1: two tax hacks of super and negative gearing will be 328 00:18:10,720 --> 00:18:14,280 Speaker 1: phased out in the not too distant future. How is 329 00:18:14,320 --> 00:18:18,280 Speaker 1: this fair? Okay atleast Alex at least has packed an 330 00:18:18,280 --> 00:18:22,679 Speaker 1: awful lot into that question. A couple of things. He says. 331 00:18:22,720 --> 00:18:26,240 Speaker 1: First of all, that negative gearing could go in the 332 00:18:26,280 --> 00:18:30,000 Speaker 1: near future. I don't know about that. Actually, there's absolutely 333 00:18:30,000 --> 00:18:33,000 Speaker 1: no evidence about that, Alex at all. This is never advised. 334 00:18:33,040 --> 00:18:36,920 Speaker 1: This is only information. But you could argue quite strongly 335 00:18:36,960 --> 00:18:40,120 Speaker 1: that the ALP lost the election they might have won 336 00:18:40,200 --> 00:18:42,359 Speaker 1: on the basis that they went near negative gearing and 337 00:18:42,400 --> 00:18:45,280 Speaker 1: had a plan to reform it. Certainly, that and the 338 00:18:45,280 --> 00:18:50,200 Speaker 1: Frank dividend reforms combined was an expensive exercise for them, 339 00:18:50,200 --> 00:18:52,840 Speaker 1: and I don't think there's the political will to go 340 00:18:52,920 --> 00:18:55,720 Speaker 1: near negative gearing for some time. It's not even been discussed, 341 00:18:55,840 --> 00:18:59,159 Speaker 1: not by either party. However, on Super, you make the 342 00:18:59,200 --> 00:19:02,800 Speaker 1: point that he's making the point folks that the new 343 00:19:02,880 --> 00:19:09,919 Speaker 1: supertax which kicks in a three million and then you 344 00:19:10,000 --> 00:19:14,120 Speaker 1: pay fifteen percent new tax over on any earnings over 345 00:19:14,160 --> 00:19:16,680 Speaker 1: three million, that that is going to be it's going 346 00:19:16,720 --> 00:19:20,280 Speaker 1: to hit his property plans in Super over the long 347 00:19:20,320 --> 00:19:23,440 Speaker 1: period of time because it's not indexed, there's no plan 348 00:19:23,480 --> 00:19:26,000 Speaker 1: to index it. I would say to you, Alex, yes, 349 00:19:26,000 --> 00:19:29,159 Speaker 1: it's not fair that that new tax isn't indexed. It 350 00:19:29,240 --> 00:19:33,200 Speaker 1: should be indexed. It also shouldn't be on unrealized gains. 351 00:19:33,600 --> 00:19:35,480 Speaker 1: It should be on realized gains, and if they count 352 00:19:35,600 --> 00:19:38,840 Speaker 1: that it should be deemed. But I would just say 353 00:19:38,880 --> 00:19:41,080 Speaker 1: it's a long you're talking about a long period of 354 00:19:41,119 --> 00:19:45,639 Speaker 1: time and whether a particular supertax was or wasn't indexed 355 00:19:46,800 --> 00:19:50,360 Speaker 1: in thirty years time is unlikely to make a major 356 00:19:50,560 --> 00:19:56,160 Speaker 1: impact on your property returns, he says bravely. But that's 357 00:19:56,240 --> 00:19:59,560 Speaker 1: my view. What do you think, Anthony, I. 358 00:19:59,520 --> 00:20:02,480 Speaker 2: Agree with you on the negative gearing side. I think 359 00:20:02,520 --> 00:20:06,359 Speaker 2: that once bit and twice shy with with the Labor Party, 360 00:20:06,400 --> 00:20:10,119 Speaker 2: but also with these new unfair sort of tax plans. 361 00:20:10,160 --> 00:20:11,879 Speaker 2: I'm a bit of an optimist on that, and I 362 00:20:11,920 --> 00:20:14,679 Speaker 2: figure we are going to have a coalition government at 363 00:20:14,720 --> 00:20:16,600 Speaker 2: some time in the next ten or twenty years, and 364 00:20:16,640 --> 00:20:20,119 Speaker 2: I think that they're going to fight back against some 365 00:20:20,200 --> 00:20:24,800 Speaker 2: of the most unfair parts of that those rules. I 366 00:20:24,880 --> 00:20:28,560 Speaker 2: really think that it's not going to last. So thinking 367 00:20:28,600 --> 00:20:31,800 Speaker 2: of what government's saying today is probably going to be 368 00:20:31,840 --> 00:20:34,880 Speaker 2: completely different sort of ten twenty thirty years from now, 369 00:20:35,040 --> 00:20:38,159 Speaker 2: and I think it eventually everything does revert back to 370 00:20:38,960 --> 00:20:41,719 Speaker 2: fairness as well. It just might take time. And if 371 00:20:41,760 --> 00:20:43,440 Speaker 2: you get your own you're go unlucky enough to get 372 00:20:43,440 --> 00:20:45,280 Speaker 2: caught out at the period where it is unfair. And 373 00:20:45,320 --> 00:20:48,119 Speaker 2: we might see that next year with some several horror 374 00:20:48,200 --> 00:20:50,120 Speaker 2: stories that unfold in the next year or two. Once 375 00:20:50,160 --> 00:20:53,040 Speaker 2: that new tax comes in people being forced to sell stuff. 376 00:20:53,200 --> 00:20:55,520 Speaker 1: Yeah, exactly. I think you might have some farmers that 377 00:20:55,560 --> 00:20:58,159 Speaker 1: go brook or something or have terrible stories, and that 378 00:20:58,200 --> 00:21:01,040 Speaker 1: will be enough to turn the public to actually, first 379 00:21:01,040 --> 00:21:02,520 Speaker 1: of all, have a look at it, see what is 380 00:21:02,520 --> 00:21:04,960 Speaker 1: actually wrong with it. It's hard to feel sorry for 381 00:21:04,960 --> 00:21:07,080 Speaker 1: people who have three millions, super I take that on 382 00:21:07,119 --> 00:21:11,800 Speaker 1: board in two seconds. But also taxes, taxes should have 383 00:21:11,840 --> 00:21:15,440 Speaker 1: a certain shape and they should be broadly equitable, as 384 00:21:15,480 --> 00:21:17,240 Speaker 1: you say, across the board. Okay, do you want to 385 00:21:17,240 --> 00:21:18,480 Speaker 1: read the question from Christopher? 386 00:21:18,720 --> 00:21:21,919 Speaker 2: Yes, So Christopher is wondering what we think will be 387 00:21:21,960 --> 00:21:25,800 Speaker 2: the impact of a Trump presidency on the Australian dollar. 388 00:21:26,320 --> 00:21:29,639 Speaker 2: That's the easier or decent US ATF that focuses on 389 00:21:29,880 --> 00:21:33,879 Speaker 2: US energy stocks because he expects that they're about to 390 00:21:33,920 --> 00:21:37,240 Speaker 2: go gang busters if it's Trump gets in. John may 391 00:21:37,320 --> 00:21:41,800 Speaker 2: to have a thought. Yes, sure, yes, I was. It 392 00:21:41,840 --> 00:21:43,800 Speaker 2: was Yeah, I think he might be on the money 393 00:21:43,800 --> 00:21:46,560 Speaker 2: as far as demand for US energy stock. So I 394 00:21:46,640 --> 00:21:51,080 Speaker 2: heard that Donald Trump and his frenzied crowd chanting at 395 00:21:51,080 --> 00:21:54,200 Speaker 2: one of his rallies or speeches Drill baby drill, Drill 396 00:21:54,240 --> 00:21:56,480 Speaker 2: baby drill. That was what that was calling for. And 397 00:21:58,359 --> 00:22:01,480 Speaker 2: so that does. But as far as the impact on 398 00:22:01,480 --> 00:22:03,560 Speaker 2: the Aussie dollar, some of the stuff that I've read, 399 00:22:03,600 --> 00:22:05,800 Speaker 2: I'm not a currency specialist, but obviously, like you, I 400 00:22:05,800 --> 00:22:07,680 Speaker 2: get a lot of stuff comes across my desk all 401 00:22:07,720 --> 00:22:10,200 Speaker 2: the time, and there seems to be talk that may 402 00:22:10,240 --> 00:22:13,280 Speaker 2: not be very good for the Aussie dollar or global 403 00:22:13,359 --> 00:22:17,520 Speaker 2: exports overall for anybody, because of the talk of heavy 404 00:22:17,600 --> 00:22:21,240 Speaker 2: trap tariffs in that Trump might bring in, particularly the 405 00:22:21,280 --> 00:22:24,200 Speaker 2: wards China. And I do know that the Aussie dollar 406 00:22:24,320 --> 00:22:26,879 Speaker 2: is one I think it's the fifth most traded currency 407 00:22:26,920 --> 00:22:31,560 Speaker 2: in the world, largely because it's a proxy for investing 408 00:22:31,560 --> 00:22:34,720 Speaker 2: in global trade and investing in China in particular. They'll 409 00:22:34,760 --> 00:22:37,359 Speaker 2: buy the Aussie dollar based on the sort of China. 410 00:22:37,400 --> 00:22:39,720 Speaker 2: So if we have this massive trade war with US 411 00:22:39,720 --> 00:22:42,239 Speaker 2: and China and huge tariffs and things, I don't think 412 00:22:42,280 --> 00:22:44,160 Speaker 2: that's going to be good for the Aussie dollar. 413 00:22:44,200 --> 00:22:46,760 Speaker 1: Okay, very good, all right. I hope that's used for 414 00:22:46,800 --> 00:22:50,080 Speaker 1: to you, Christopher, it's I think it's beyond out that 415 00:22:50,280 --> 00:22:53,399 Speaker 1: if Trump won, and this will get placed since the 416 00:22:53,440 --> 00:22:57,720 Speaker 1: market instantly. But if Trump wins, it's beyond doubt it's 417 00:22:57,720 --> 00:22:59,560 Speaker 1: good for EID and plus a few stocks. And it's 418 00:22:59,560 --> 00:23:03,400 Speaker 1: also doubt that it's not good for ESG related investments, 419 00:23:03,480 --> 00:23:07,040 Speaker 1: especially where ESG investments have been packaged up into some 420 00:23:07,080 --> 00:23:11,240 Speaker 1: sort of a thunder and ETF. But that's a flip side, Okay, Margaret, 421 00:23:11,600 --> 00:23:14,680 Speaker 1: Mr GA or e T. I'm a new listener to 422 00:23:14,720 --> 00:23:19,080 Speaker 1: your podcast and I wonder if you can offer me information. Recently, 423 00:23:19,119 --> 00:23:21,680 Speaker 1: my super fund had a data outage that was caused 424 00:23:21,680 --> 00:23:24,320 Speaker 1: by a third party. It took more than a week 425 00:23:24,359 --> 00:23:27,560 Speaker 1: to resolve. Give me time to ponder how safe is 426 00:23:27,680 --> 00:23:31,320 Speaker 1: my super What if there was a malicious attack and 427 00:23:31,400 --> 00:23:34,600 Speaker 1: my super disappeared. I completely understand this question how somebody 428 00:23:34,640 --> 00:23:38,040 Speaker 1: would ask this, And she also says, I understand the 429 00:23:38,080 --> 00:23:40,440 Speaker 1: banks have some kind of insurance known as the Financial 430 00:23:40,440 --> 00:23:43,520 Speaker 1: Claim Scheme which will cover up to fifty k Okay, 431 00:23:43,560 --> 00:23:47,919 Speaker 1: two different things there, Margaret. Yes, old cash in Australia 432 00:23:48,359 --> 00:23:52,520 Speaker 1: held in banks or to be precise, approved positive taking institutions, 433 00:23:52,520 --> 00:23:55,439 Speaker 1: which is more than just banks, is guaranteed by the 434 00:23:55,480 --> 00:23:58,600 Speaker 1: government explicitly to the tune of two hundred and fifty 435 00:23:58,680 --> 00:24:02,159 Speaker 1: thousand per person per bank. Okay, So that's there, But 436 00:24:02,280 --> 00:24:05,240 Speaker 1: that to one side. Nice thing to know now about 437 00:24:05,240 --> 00:24:07,479 Speaker 1: how safe is your super I think we'll just focus 438 00:24:07,520 --> 00:24:11,639 Speaker 1: on how safe is your super in relation to malicious 439 00:24:11,680 --> 00:24:17,480 Speaker 1: attacks shall we say it attacks or scams. The reality 440 00:24:17,600 --> 00:24:20,439 Speaker 1: is that this is wide open and the funds have 441 00:24:20,520 --> 00:24:25,000 Speaker 1: had problems. I had a piece in the paper in 442 00:24:25,040 --> 00:24:27,760 Speaker 1: the section which I used this week, which was actually 443 00:24:27,800 --> 00:24:32,160 Speaker 1: a guest piece by Heather Gray Afka the Austrian Financial 444 00:24:32,160 --> 00:24:35,560 Speaker 1: Complaints Authority, and she makes the point that this is 445 00:24:35,680 --> 00:24:38,399 Speaker 1: very in super in the big super in the industry 446 00:24:38,440 --> 00:24:43,240 Speaker 1: super funds or the other funds. It's a small issue numerically, 447 00:24:43,720 --> 00:24:47,960 Speaker 1: but that small number of people who have been unfortunate enough, 448 00:24:48,320 --> 00:24:52,320 Speaker 1: whether there has been some scams or it issue, whether 449 00:24:52,400 --> 00:24:55,600 Speaker 1: they were malicious or not, it has been a problem 450 00:24:55,640 --> 00:24:57,919 Speaker 1: inside and for the people who were for the handful 451 00:24:57,960 --> 00:25:00,680 Speaker 1: of people who have been exposed to the it's danger 452 00:25:00,720 --> 00:25:02,920 Speaker 1: inside super fund, that's been the problem. So she makes 453 00:25:02,920 --> 00:25:04,520 Speaker 1: the point that it's a small number of people that 454 00:25:04,560 --> 00:25:07,800 Speaker 1: have had any issues in super with it or it scams, 455 00:25:08,320 --> 00:25:11,520 Speaker 1: but those people it's big news for them because she 456 00:25:11,600 --> 00:25:14,320 Speaker 1: mentions figures. She actually puts some figures on at eighty 457 00:25:14,359 --> 00:25:17,200 Speaker 1: thousand dollars I think was the precise nuver she put 458 00:25:17,240 --> 00:25:20,760 Speaker 1: on one of the issues inside Super. I don't think 459 00:25:20,800 --> 00:25:23,280 Speaker 1: anyone knows, Anthony that I don't think anyone can stand 460 00:25:23,320 --> 00:25:25,159 Speaker 1: in front of your super fund and say, listen, this 461 00:25:25,280 --> 00:25:30,160 Speaker 1: fund is immune from it attacks because it's they're always coming, 462 00:25:30,200 --> 00:25:31,280 Speaker 1: they're always breaking through. 463 00:25:31,880 --> 00:25:35,560 Speaker 2: Yes, and I agree, it is really hard to say it. 464 00:25:36,040 --> 00:25:39,600 Speaker 2: We haven't been really tested with a major attack like 465 00:25:39,640 --> 00:25:42,960 Speaker 2: we saw with health insurance details a year or so ago. 466 00:25:43,119 --> 00:25:48,119 Speaker 2: That wouldn't have thought that that would happen, but it did. It. 467 00:25:48,280 --> 00:25:52,000 Speaker 2: Supers always that risks to markets and things, and this 468 00:25:52,240 --> 00:25:55,960 Speaker 2: is just another potential risk. But I think that the 469 00:25:55,960 --> 00:25:58,480 Speaker 2: bigger risk might be just people being scammed from people 470 00:25:58,800 --> 00:26:02,640 Speaker 2: I know. They have been reported scheme of shading people 471 00:26:02,680 --> 00:26:04,600 Speaker 2: out of the money by getting them to transfer to 472 00:26:04,680 --> 00:26:08,280 Speaker 2: an early relay scheme or fan or some other thing 473 00:26:08,359 --> 00:26:10,160 Speaker 2: and then stealing it that way. 474 00:26:11,520 --> 00:26:13,560 Speaker 1: Yes, and that's money coming out of super but while 475 00:26:13,600 --> 00:26:16,760 Speaker 1: the money is safely inside super. Just for what it's worth. 476 00:26:17,000 --> 00:26:20,800 Speaker 1: This piece from Heather Gray Margaret said that AFKAR received 477 00:26:20,840 --> 00:26:24,720 Speaker 1: eleven thousand complaints in relation to scams last year. Only 478 00:26:24,800 --> 00:26:29,480 Speaker 1: twenty twenty out of eleven thousand came from superannuation fund members, 479 00:26:29,840 --> 00:26:32,080 Speaker 1: and she says why these complaints are smaller number the 480 00:26:32,160 --> 00:26:34,720 Speaker 1: average loss claimed in them was eighty eight thousand and 481 00:26:34,840 --> 00:26:37,400 Speaker 1: ranged as high as three hundred and forty four thousand. 482 00:26:38,040 --> 00:26:41,080 Speaker 1: So it's been struck by lightning. Right, It's very unlikely, 483 00:26:41,119 --> 00:26:44,440 Speaker 1: but if it happens, it's trouble for the people involved. 484 00:26:44,680 --> 00:26:47,040 Speaker 1: I think we'll come back to this another time. I 485 00:26:47,080 --> 00:26:49,240 Speaker 1: think this is worth a deeper dive. Thank you very 486 00:26:49,320 --> 00:26:51,160 Speaker 1: much for the questions. That's about as far I think 487 00:26:51,200 --> 00:26:56,920 Speaker 1: as we could go on that one today. All right, Orpheus, 488 00:26:56,960 --> 00:26:59,959 Speaker 1: do you want to try Orpheus's question, Anthony? 489 00:27:01,200 --> 00:27:04,240 Speaker 2: Yes. Orpheus says that a lot of your guests and 490 00:27:04,320 --> 00:27:06,760 Speaker 2: discussions are about how to make money through investing, but 491 00:27:07,000 --> 00:27:10,360 Speaker 2: he asked, what about protecting your final wealth and standard 492 00:27:10,400 --> 00:27:12,760 Speaker 2: of living if a health event or death cuts your 493 00:27:12,760 --> 00:27:16,080 Speaker 2: working life short. He's talking about life insurance or protecting 494 00:27:16,119 --> 00:27:18,200 Speaker 2: your ability to end an income and pay down debt 495 00:27:18,240 --> 00:27:20,480 Speaker 2: if you do become sick or injured and can no 496 00:27:20,560 --> 00:27:23,600 Speaker 2: longer work, or if you pass away. Wants to talk 497 00:27:23,640 --> 00:27:28,000 Speaker 2: about life TPD, trauma and income protection. Insurance cover both 498 00:27:28,040 --> 00:27:31,080 Speaker 2: inside and outside of super and would like to sort 499 00:27:31,119 --> 00:27:31,280 Speaker 2: of this. 500 00:27:31,720 --> 00:27:35,320 Speaker 1: You're a diversified investor, Anthony, do you have all those insurances? 501 00:27:35,800 --> 00:27:38,080 Speaker 2: Yes? And Orpheus is right because he says it's an 502 00:27:38,280 --> 00:27:42,040 Speaker 2: unsexy but essential need to protect wealth. And you're right, 503 00:27:42,119 --> 00:27:44,520 Speaker 2: and there are arguments of having it both within and 504 00:27:44,920 --> 00:27:46,000 Speaker 2: outside of Super. 505 00:27:46,119 --> 00:27:48,080 Speaker 1: Do you your Do you have your insurances? Are they 506 00:27:48,080 --> 00:27:49,720 Speaker 1: inside super or outside? 507 00:27:50,119 --> 00:27:54,280 Speaker 2: Mostly inside Super? And that's purely from apart from some 508 00:27:54,480 --> 00:27:58,800 Speaker 2: trauma cover which you cannot have inside Super, but death 509 00:27:58,840 --> 00:28:02,560 Speaker 2: covered TPD and in protection you can have that withinside Super. 510 00:28:03,000 --> 00:28:06,560 Speaker 2: And it's yes, my children are getting older and finishing 511 00:28:06,600 --> 00:28:09,199 Speaker 2: school now, but I've been in the process in the 512 00:28:09,240 --> 00:28:12,000 Speaker 2: last couple of years of winding down some of that 513 00:28:12,080 --> 00:28:15,439 Speaker 2: cover within Super because you've always got Some people can 514 00:28:15,480 --> 00:28:18,520 Speaker 2: waste a lot of money with huge insurance cover through 515 00:28:18,560 --> 00:28:22,000 Speaker 2: Super because obviously the cover school fees and the like 516 00:28:22,119 --> 00:28:25,359 Speaker 2: if you do pass away. But when those or big 517 00:28:25,440 --> 00:28:27,080 Speaker 2: mortgage is the same sort of thing you gotta cover. 518 00:28:27,200 --> 00:28:31,359 Speaker 2: But people can get get caught being over insured later 519 00:28:31,400 --> 00:28:33,800 Speaker 2: in life. That said, the vast majority of ossies are 520 00:28:33,880 --> 00:28:36,720 Speaker 2: underinsured and don't have enough and think that maybe the 521 00:28:37,080 --> 00:28:39,480 Speaker 2: default one hundred and something thousand dollars of cover they 522 00:28:39,560 --> 00:28:41,560 Speaker 2: might have in their industry super fund or whatever, it's 523 00:28:41,600 --> 00:28:43,840 Speaker 2: going to be enough, and it's not. If anything happens, 524 00:28:43,840 --> 00:28:47,520 Speaker 2: so yet definitely worth looking at, definitely worth speaking to 525 00:28:47,560 --> 00:28:48,600 Speaker 2: a specialist about that. 526 00:28:49,720 --> 00:28:53,360 Speaker 1: Okay, terrific. And I would say, as you see, very true, 527 00:28:53,400 --> 00:28:55,960 Speaker 1: the vast majority of people are under insured. However, I 528 00:28:56,000 --> 00:28:59,720 Speaker 1: would say to our audience, who I instinctively feel would 529 00:28:59,760 --> 00:29:03,040 Speaker 1: be across the basics of this anyway, watch out that 530 00:29:03,080 --> 00:29:05,760 Speaker 1: you're not over insured. As Anthony says, as you get 531 00:29:05,800 --> 00:29:10,280 Speaker 1: older and you have all these insurance settings, particularly if 532 00:29:10,320 --> 00:29:13,640 Speaker 1: you have income protection insurance or even life insurance, and 533 00:29:13,720 --> 00:29:17,360 Speaker 1: if you've got a substantial amount in SUPER, then you 534 00:29:17,600 --> 00:29:19,960 Speaker 1: to ask yourself, why did I get this? Once upon 535 00:29:20,000 --> 00:29:22,440 Speaker 1: a time, fifteen twenty years ago, I got all these 536 00:29:22,440 --> 00:29:24,840 Speaker 1: insurances because I really needed to cover things because I 537 00:29:24,960 --> 00:29:28,320 Speaker 1: was really exposed, right I didn't fully own my house, 538 00:29:28,400 --> 00:29:31,400 Speaker 1: or I didn't have much in Super, et cetera, et cetera. 539 00:29:32,480 --> 00:29:35,320 Speaker 1: Is that still the case? An insurance BROKERA, I'm afraid 540 00:29:35,320 --> 00:29:38,280 Speaker 1: it will never tell you to have less SUPER, to 541 00:29:38,360 --> 00:29:42,880 Speaker 1: have less insurance, not in my experience anyway. They don't 542 00:29:42,920 --> 00:29:45,280 Speaker 1: actually suggest you buy less. And if you say to them, 543 00:29:45,320 --> 00:29:47,080 Speaker 1: maybe I should have less. If the doctor says that 544 00:29:47,120 --> 00:29:49,000 Speaker 1: they shouldn't smoke, and you said could I if I 545 00:29:49,040 --> 00:29:50,800 Speaker 1: had one a year, would it make a difference. They say, 546 00:29:50,920 --> 00:29:53,200 Speaker 1: just don't smoke at all. An insurance broker will say 547 00:29:53,200 --> 00:29:55,200 Speaker 1: the same thing. They will say. If you say, should 548 00:29:55,200 --> 00:29:57,760 Speaker 1: I still have all this insurance? They say, why not? 549 00:29:58,040 --> 00:29:59,920 Speaker 1: Just in case? But that's not an argument. That's not 550 00:30:00,000 --> 00:30:02,520 Speaker 1: a powerful argument, that's not a proper argument. I would 551 00:30:02,600 --> 00:30:06,960 Speaker 1: review your individual circumstance each year and be very careful 552 00:30:07,160 --> 00:30:10,400 Speaker 1: that you don't overensure. It's an oddly seductive thing when 553 00:30:10,400 --> 00:30:14,000 Speaker 1: they say, listen, you're insured for two billion or one million, 554 00:30:14,240 --> 00:30:16,080 Speaker 1: and the figures get high and it sounds great, and 555 00:30:16,120 --> 00:30:18,200 Speaker 1: you say, gosh, yes, I suppose I'm worth that. But 556 00:30:19,240 --> 00:30:22,360 Speaker 1: you pay through the nose for that. As Anthony says, 557 00:30:22,440 --> 00:30:24,400 Speaker 1: keep an eye on it, and keep an eye on 558 00:30:24,520 --> 00:30:29,120 Speaker 1: it as your life changes. If you've got a house 559 00:30:29,200 --> 00:30:33,719 Speaker 1: full of kids, that's one thing. If you don't, it's 560 00:30:33,720 --> 00:30:36,920 Speaker 1: a completely different set of circumstances. I have an advisor 561 00:30:37,000 --> 00:30:39,959 Speaker 1: on this show who says, basically, once you're in your 562 00:30:40,000 --> 00:30:43,960 Speaker 1: early sixties, if you have a substantial amount in super 563 00:30:44,920 --> 00:30:48,320 Speaker 1: you don't need life insurance at all because your super 564 00:30:48,360 --> 00:30:51,000 Speaker 1: fund can cover it, and you can save yourself thousands 565 00:30:51,080 --> 00:30:53,520 Speaker 1: a year which you could invest in your super fund. 566 00:30:54,040 --> 00:30:57,160 Speaker 1: There's a plan that we might think about for another day, 567 00:30:57,160 --> 00:30:58,960 Speaker 1: but we will leave that one hanging out there for 568 00:30:59,000 --> 00:31:02,120 Speaker 1: everyone to kick around until we talk again. Hey, Anthony, 569 00:31:02,160 --> 00:31:04,400 Speaker 1: thank you very much, lovely to have you on the show. 570 00:31:04,680 --> 00:31:06,280 Speaker 2: Thanks for having me. James been great. 571 00:31:07,080 --> 00:31:09,680 Speaker 1: That's Anthony Keenfolks. He's the Person of Finance writer on 572 00:31:09,720 --> 00:31:13,800 Speaker 1: News Corporation, colleague of mine. Do keep the emails coming. 573 00:31:14,120 --> 00:31:16,280 Speaker 1: If you want to support the show, just mention it 574 00:31:16,320 --> 00:31:18,600 Speaker 1: to one of the person. Just mention it to one 575 00:31:18,640 --> 00:31:21,760 Speaker 1: person this week. That's what we would really appreciate and 576 00:31:21,840 --> 00:31:24,160 Speaker 1: thank you very much if you do. If you'd like 577 00:31:24,200 --> 00:31:28,880 Speaker 1: to correspond, ask a question, complain, whatever you want. The 578 00:31:28,960 --> 00:31:32,120 Speaker 1: email is there the Money Puzzle at the Australian dot 579 00:31:32,160 --> 00:31:35,400 Speaker 1: com dot au and I will talk to you soon.