Let’s control what we can
In many places around the world only the rich ‘play’ the finance markets. Other people would never dream of having spare money to invest. Australia is different. We have a retirement savings system called ‘Superannuation’. Everybody in Australia who has worked at some point (made more than $450 in a month) has been paid super.
This puts us in a peculiar position. Most Australians have investments in the share market (via superannuation) and they need to consider what that means for them.
Superannuation is your money, you have given up wage increases for this ‘forced savings’ with the accompanying tax breaks and believe me, when you hit retirement you will be glad you have it. But, being your money, you need to take responsibility for it and know where it is invested.
How do we invest when the world is such a unknown place?
As investors, we cannot control the actions of world leaders. We don’t get a vote on whether North Korea will decide to send a missile towards Guam or how the U.S. would respond. An action like this would absolutely have an effect on the financial markets around the world, but it is completely out of our hands.
So why invest at all? Would it be prudent to not take part in the financial markets, just in case? In short, no. Interest rates are at historical lows, this means that if you choose not to take part in the finance markets and only invest in cash you take on another kind of risk. Cash investments do not grow, and given that you may spend 30 years or more in retirement, we need to make sure that your retirement savings last. We need a better return than we can get from cash.
What we can do is make sure that our superannuation/investment portfolios are invested strategically. Making sure our portfolios are invested into good quality companies who have a track record of success. This means, not buying companies that are too expensive for the return that you can expect. If like most people you don’t buy direct shares with your super, using a money manager that has a clear and understandable investment strategy taking into account all of the above considerations.
Through years of financial planning experience Smart Happy Money have put together an investment philosophy that we believe will set our clients up for financial success.
Here it is…
Investing isn’t magic. By following a few fundamentals, you can achieve peace of mind and a positive investment experience.
Our advice is built on sound investment principles such as:
Invest; don’t speculate. Set your plan for the long-term and don’t be distracted by the media ‘noise’ trying to drag you off your path.
Practice smart diversification. Hold a range of investments across asset classes, regions and management styles.
Keep costs low. A large ongoing cost can dramatically lower your final result. Keep costs low while still receiving the service you need.
At Smart Happy Money, we develop portfolios for our clients that we believe will help them achieve their goals. Our clients invest in portfolios that are long-term, focus on capital preservation, take advantage of class, region and management style to ensure a smoother and happier investment experience.
While each client is different and we do not offer one ‘product’ solution to all; l believe that having this underlying philosophy will help our clients become financially secure and smooth out their investment experience.
We cannot control many of the events around the world that impact investment markets but we can however, take steps to ensure that our portfolios are built on solid ground and are ready to withstand any shocks from outside the ‘usual’ investment universe.
Have a great day.
Ben Graham-Nellor
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Ben Graham-Nellor is an advisor, coach, blogger and speaker who has worked in the financial services industry for over 15 years. He believes that by educating and advising people today, they can improve their tomorrow.
Ben Graham-Nellor is a Sub Authorised Representative (291391) of BGN Financial Management PTY LTD (ABN 45 672 104 196) which is a corporate authorised representative (468796) of Professional Investment Services Pty Ltd (ABN 11 074 608 558) which is the holder of Australian Financial Services License No.234951. Website|www.centrepointalliance.com.au/PIS
smart.happy.money is a trading name of BGN Financial Management PTY LTD
This information has been provided as general advice. We have not considered your financial circumstances, needs or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication.
ben@smarthappymoney.com.au