July 30, 2025 • 47 mins
In today's special edition to mark the online launch of The Australian's 'Wealth Vertical', wealth editor Julie-anne Sprague joins James Kirby to talk about how an experienced financial journalist sets about investing.
Wealth editor Julie-anne Sprague joins Associate Editor-Wealth in this episode.
In today's show, we cover:
- Do the very rich tell us anything useful?
- Financial advice: Getting it is one thing, using it is another
- Taking risks when you know how often things go wrong
- The way to start your wealth journey.
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:10):
Hello, and welcome to the Australians Money Puzzle podcast. I'm
James Kirby. Welcome aboard everybody, and welcome aboard to a
special edition of this podcast because it's a pretty special
day here at The Australian. We are launching a Wealth
Vertical now. A Wealth Vertical is a digital unit within
The Australian and it's going to be all about wealth
(00:31):
in all its dimensions. And many of the people that
you know and are familiar with from the podcasting myself
and James Gerard, of course Stuart Williams. You here on
Tuesday's Property podcast. You're going to see and read a
lot more from them in The Australian, and you're going
to hear a lot more from them in the podcast
(00:52):
because we are widening the offering basically substantially, so seizing
the opportunity to I've asked the Wealth editor of The Australian,
Julianne Spragged, to come on the show. She's going to
tell us about what's happening. And then when she's done that,
we're going to do something we haven't tried before. We're
actually going to talk about our own investing because both
(01:15):
of us have been in financial journalism most of our
lives and we have I hope, learned some very interesting
things that we do want to tell you about.
Speaker 2 (01:24):
Hi Julianne, Hi James, thanks for having me on.
Speaker 3 (01:27):
Greater Have You on Marshafield has going to be Confession's
going to be a confession session.
Speaker 1 (01:34):
Well partially confession and hopefully occasionally a part of celebration.
Tell us first, what's happening with Wealth on the Australian
and how our offering in all its multi media wonderfulness
is going to change.
Speaker 2 (01:50):
It is exciting.
Speaker 3 (01:52):
We had some research that came through said lots of
people want to be financially independent. People want to be
able to have this job because they want to have
a job for it to be a joy and not
a chore. And the concern though, is that a lot
of people aren't as financially literally as they want to be.
They don't know where to go to get a lot
(02:13):
of this information. They might see their mates or their
friends and they're getting ahead, or they've got investment portfolios
and things. I don't know the how, the why, the what,
and so what we want to do is create this
one stop hub, a place where you can get trusted information.
So that's no matter what stage of the financial journey
you are on. So there'll be information about investing, property, investing, superannuation,
(02:35):
retirement planning, all those bits about that are very important
for your life. But I don't know about you, James,
but you just get caught up, don't you.
Speaker 1 (02:43):
Yeah, you do. And we've always had a lot of
material and there's always like there's always been a good
materia coming in different ways in different parts is such
a big operation. And then we have podcasts, and then
we have like Baron's Top Advisors, we have videos and
we haven't put them all in the one place before,
(03:04):
so I think that's part of it. So I do
I recommend all the listeners have a look at this.
It's launching today and I don't think there's ever been
anything quite like it in media.
Speaker 3 (03:15):
Can I just say true for your listeners who love
to listen to you. Twice Withightly on the Money Puzzle,
we have put together a video series so that one
to see James Kirby in real life.
Speaker 1 (03:26):
We did it on before we started the show. We
were just laughing. The day we did it was the
worst day I can ever remember. Weather wise, I should say,
but we all flew in to do this video, folks,
and it was just so bad. It was unreal, and
we were all late, and all the flights, the two
flights before me were canceled on the two after. I mean,
(03:47):
it was a miracle that I got actually to that
session at all. But the videos will be on this site,
and we've done a whole series of masterclass videos which
capture some of the sort of core areas of in
and I recommend them to you. They will be distributed,
or at least they'll be published. To see the sequential
fashion in the days of head So look out for
(04:07):
that now, Juliane, since I've got you in the hot seat,
let's do this. I've been awfully careful on this show over.
I mean, we launched a show in twenty twenty three,
and I only kind of respond when we have listener questions.
I respond, So if someone says, do you have shares
in something? I'll answer. But I've never really expounded upon
my portfolio on air before. I'm happy to do it
(04:29):
on this show. We split it into shares here in
the first segment, and then we might talk about property,
and then we might talk about super which shares. It's
interesting Eric Johnson and I were just talking in the
office today. Eric's course associated her business. He was talking
about it's the Compseck was launched thirty years ago this
(04:51):
week and he'd been talking to the guy who launched
at Michael Katz and it was extraordinary about Compsack and
nap Trade and the other online brokers. When they came in,
they changed everything. Because I don't know when you bought
your first shares, but the day I bought shares the
first time, I bought two shares five hundred dollars to
each one Pacific Dunlop and National Australia Bank, and I
(05:15):
had to go in. I was twenty five. I had
to go in and sit in the reception of Potter
Warburg in Collin Street, and some unfortunate stockbroker came out
and talked to me about what I was doing. And
the diversification of my portfolio was that I bought two
shares rather than one, and one was terrific National Australia Bank.
It doubled in price and the other one went almost
(05:39):
to nothing. So it was a very good early adventure
in shared trading. Can you remember your first shares.
Speaker 3 (05:48):
I can remember the first discussion about shares. It was
my dad and I think I was eighteen or nineteen
at the time, so of an age where shares had
little value to me. You know, it was it was
(06:08):
you know, it was a time where you're studying university
and out at the pub and it was I'm trying
to remember which iteration it was, but it was Telstra. Oh, yes,
Now I don't know if yeah, I don't know if
it's T two or T three.
Speaker 1 (06:21):
Yeah, one of the floats.
Speaker 2 (06:24):
It was one of the floats.
Speaker 3 (06:25):
And Dad was saying to me, you've got to get in,
You've got to get these shares. And I said, well,
how much do I have to spend? And he said
two thousand dollars and I just I can still remember
just saying.
Speaker 2 (06:36):
To him, you are crazy.
Speaker 3 (06:38):
That is a lot of money and I'm not going
to be doing that. I look back and think, well,
just as well, that was Telstra. Imagine if he was
recommending CBA or something to me. I wish that I
had spent the two thousand dollars on CBA back then.
So I didn't buy shares. I came to it later.
I remember one of the first shares.
Speaker 2 (06:53):
We ever bought. My husband and I it was.
Speaker 3 (06:57):
And we'll get to property soon, but we were Actually
it was sort of boom times in Perth. It was
to two thousand and six, two thousand and seven around.
Speaker 1 (07:04):
Them, the mining boom.
Speaker 3 (07:06):
Mining boom was in peak property prices. It felt like
they were doubling every few weeks. They weren't, but that's
what it felt like when you were here. We were
trying to get our first place, and so we were
at a housing estate. It was roughly about thirty kilometers
north of Perth, and you had to camp out to
get the land. Wow, it was seven nights in the back.
Speaker 2 (07:26):
Of a ute.
Speaker 1 (07:27):
Wow like plots, I know, Yeah, that's like a story
from the gold Rush.
Speaker 2 (07:34):
One hundred percent. It was one hundred percent. And I
just remember seeing that.
Speaker 3 (07:36):
The property developer of the estate that we were buying
in was Pete and I was seeing this and I
could just I was like, day, I'm making so much
money and I can't believe I have to be sleeping
in the back of a You ticket land, we should
buy shares, and so we did buy shares in the developer.
I look back on that now and think that's probably not.
Speaker 2 (07:54):
The smartest thing to do. I was probably doubling down.
Speaker 3 (07:56):
On the investment.
Speaker 2 (07:56):
We bought the land and he bought the developer.
Speaker 1 (07:58):
I probably should have for people to do that, though.
They gravitate towards what they understand. If the factory at
the corner over your street seems to be going great,
and you realize it's on the stock exchange, then if
I don't you, it's like bottom up investing. I actually
had a marvelous example of bottom up investing. I was
involved in a startup which was called well Mid Clothes,
(08:19):
and it was an online clothing retailer. They had been
going for a while and they got in a widget
basically a piece of software called after pay, and they
put it on, they installed it or whatever one evening,
and the next morning they got all these orders that
they'd never got before. And I remember thinking, that's very interesting.
(08:43):
There's like hard evidence from the ground bottom up, if
you know what I mean. I knew the top down,
and I knew the story from top down, and we
all know that the view of the market or whatever,
you know, the big picture. But when I heard that,
I remember thinking, this is no joke. This after fably
is something and that was an example. I remember getting
into after Pay and it went really well and it
(09:03):
was a really good investment. And that was something that
came through almost like you know the street. But that
doesn't happen very often, can I.
Speaker 2 (09:12):
Ask you though? And sorry, we're going to go down.
We'll go down different rabbit holes.
Speaker 3 (09:16):
But say so, if you got on too after pay early, goodbye,
good tip by you. What happened then in the pandemic
after pay dropped, there was a it just dropped like
a star. I can't remember exactly what it went down to,
about eight dollars or something like that, that's right. And
I remember being pretty smug because I didn't buy after pay,
and I remember thinking, hah, I knew this was all
(09:37):
sort of smokes and mirrors and this is all going
to be cactus and toast. And then it just rebounded
nothing else because ye locked down and everyone started shopping.
That's right, you know, ended up at one hundred bucks
or something.
Speaker 1 (09:47):
To it was magnificent, stark. That is a magnificent trade. Really,
I mean it was always wild and I didn't stay
till the end, you know, so you always leave something
out of the table. But was probably what are the
best stocks they ever bought from me? I probably got out.
I did get out too soon, but it was a
terrific stock. I did well, you did well.
Speaker 3 (10:06):
I did well, So to your point, and maybe that's
the lessons here for people if they want to start
investing in stocks, is maybe it is smart to invest
in what you know or have a sense of what
the market is. So the one I did well on
was coals. So this was before West Farmers bought Coals,
and I remember going there Coals. I still have my
coal's name badge from my university job on the delicatessen.
(10:30):
No one will slice purtidos thinner than I can slice it.
Speaker 1 (10:32):
Fel oh, very fantastic.
Speaker 3 (10:35):
But it was went gym up so before West Farmers
had bought Coals. Obviously it's on its own ownership now,
but it was in the Doldrums. It wasn't a great supermarket,
and I can just remember thinking this is a duopoli,
that this there's not enough supermarkets in this country and
it's not going to be down in the Doldrums forever.
So I remember getting in early and the West Farmers
came in and then spruced her.
Speaker 1 (10:53):
Up best farmers come in and paid an enormous amount
for it, right smack at that two hours before GFC.
So I think one of the things that's useful folks
about share investing is ideally if you can if you
do understand the stock, it helps enormously at least your
connection to it is better. Anyone can start and play.
(11:14):
Basically you can buy a stock or two stocks this.
You can always buy exchange traded funds as well, which
is what I generally meant. If someone says to me
what stocks should I buy and they don't know anything,
they've never done anything, I always say, buy an exchange
traded fund by the AX.
Speaker 3 (11:29):
I'll ask you about that now, though, because I'm in
this basket where I think I need to do better
with my stocks.
Speaker 2 (11:35):
You know, I've just sort of almost.
Speaker 3 (11:36):
Played with them rather than proper investing anythink and ATF
the way to go. Atfs have exploded so much that
I now find them incredibly confusing. There's almost too many ETFs.
Which one are you're back?
Speaker 1 (11:49):
Yeah, they've drifted from the original proposal. Absolutely. The original
proposal was really good, you know, it was by the market.
Just buy the ASX two hundred or buy the S
and P five hundred plus vanilla, and whatever happened to
that market happened to your ETF. So if you both
the ASX two hundred ETF a year ago, you'd have
made fourteen percent, because the ASX two hundred med fourteen
(12:10):
percent in the twelve months to June thirty, being you know,
ten percent plus four percent for your dividends. I think
that's still the dominant model. The problem is with these guys,
you know, Julianne, they can't sit down and leave good alone.
They got to keep coming up with things, right they
you know, there's seven hundred people in Vanguard. What did
they all do? Well? Guess what? They get new ideas
(12:33):
and they go into the boss and they say, hey, boss,
guess what, I've got something in mind that would be
really good. And so that ETF thing is drifting. So
I think when we talk about ETFs on the show,
certainly I always make the points plain vanilla ETFs, and
I would say to most people most of the time,
if you're starting with shares, ETFs are great. And if
(12:53):
they had been around when I was starting buying shares,
it would have been so much better than buying two shares,
one of which turned out to be great and one
of which turned out to be useless, and you don't
that's the sort of risks you don't want to take.
Speaker 3 (13:04):
If you could go back in time, just pretend that
ETFs where they, you would have bought an index ATF
I would.
Speaker 1 (13:08):
I would suggest to anyone starting get some ETFs, hold
them for a year, start to understand how it all works,
Watch how you get your dividends come through, and how
it works with tax and everything else, and get a
handle on it. And you've you know, you're taking very
little risk because you're just taking you're just buying the market.
And then after a while, when you're a bit more
sure of it, it doesn't have to take forever. It could
(13:29):
take six months, it could take a year. Then you
can start to strike out and you can say, okay,
this time, I'm going to buy direct shares because personally,
I think ten shares is about as much as anyone
should have. That's as much as you can hold in
your head. Really, I should be if you've got I
always say, if you've got chairs, I should be able
(13:50):
to ask you what are they and how much are
they today? And unless you're you know, got a photographic
memory or something. I reckon about ten shares is about
as much as the one should have, and it is enough.
It can really you can diversify. You can buy banks
and miners and tech companies and everything else. That's something
I would say. The other part I would say is
that at a certain point you've got to get serious
(14:11):
about shares if you're a long term investor, especially if
you're thinking of building your own portfolio or your self
managed super fund, and at that point then you don't
have to have a connection with them. It's all about
the numbers, you know, It's all about is this share
good value? At the moment it's the old Roger Montgomery
thing about value and Roger of courses. Another person's off
and on the show rights for the Australian will be
(14:32):
involved in our new vertical. He's whole thing that you know,
you're buying a piece of a company, you're buying a
little TV bit of the company. So what really matters
is their company and how is the company going.
Speaker 3 (14:44):
My problem, I reckon is because we're in newsrooms and
we cover a lot of stories. We cover a lot
of stories about stocks that go absolutely bananas. They deliver
incredible returns. But for every one of those stories, we're
all doing stories or when things go wrong, yes, and
we should when he's a collapsing and share prices are tanking,
(15:05):
and so it does leave you sort of kind of
clinging to the sidelines because you don't know which way
to go.
Speaker 2 (15:10):
You know too much, You almost know too much.
Speaker 3 (15:12):
I have threatened to do it, and maybe for this
new vertical I should. I was going to create a
list of when I had met a billionaire or rich.
Speaker 2 (15:23):
This does.
Speaker 3 (15:23):
My former job was editing rich lists for the Financial Review,
and I look at some of the share price growth
and I think, if I had bought shares when I
met that rich list, yes, would I be in fact
talking to you on this podcast today at the book, James,
I'm not sure. I was with Andrew Forrest in the
Pilborough in two thousand and six having a look at
what would become four to Skew Metal screwp. He's looking
(15:44):
at the dusty Pilborough.
Speaker 1 (15:45):
And oh, what a great story, Yeah, and.
Speaker 3 (15:47):
Asking me whether it is the most beautiful thing I've
ever seen. And I'm looking at a concrete pylon in
the middle of nowhere, and I'm thinking I've seen prettier things,
you know, but I could see why he.
Speaker 1 (15:57):
The share is republic a dollar or something at the time,
I think that could have been less.
Speaker 2 (16:01):
Yeah, pretty sure. I emailed someone just.
Speaker 3 (16:04):
The other week actually, just to get a comment for
a story, and I said, oh, I just want to
look back the last time, you know, we'd spoke properly,
and it was a couple of years ago. And if
I had bought shares in that particular company, Promedicus, I
think I worked out if I bought a thousand shares,
I would have my three hundred thousand dollars. You know
what I could have should at James.
Speaker 1 (16:25):
Well, as you say, the thing is, it's all about risk.
So if you buy the ETFs, this is the minimum
risk approach to shares, and then after that it's a
question of the more risk you take, then the more
likely you will have volatility. And volatility, as you know, folks,
basically means it's going to go way up or way down.
(16:45):
So for every pro Medicus, there's ninety nine little medical
device companies that go nowhere. And maybe we'll leave it
just there, because that's the point we really want to
make about shares. We'll have a break and we will
come back and we will talk about what everybody loves
to talk about. Property. Back in a moment. Hello, Welcome
(17:09):
back to the Australians Money Puzzle podcast. James Kirby here
with Julianne Spragg. Julian is the Wealth editor of The Australian,
and we are talking on the occasion of the launch
of a new Wealth vertical on The Australian, which is
going to be really terrific and I'm delighted to see
it because it's basically putting a lot of effort and
(17:29):
investment and people into the area that we've been working
on here for some time on the Money Puzzle, and
the Money Puzzle too actually, as I say, is effectively
being relaunched inside this Wealth vertical. This week you'll see
a lot more episodes, some new voices involved here, and
we'll do some shows a wider nature than we've been
(17:51):
doing to this point. Now. As you know, Tuesday's Property
Show is becoming very popular and I've dealt with property
for a long time and one of the things I
want to talk to Juliane about is again something of
a confessional in the way that we talked about shares there,
and by the way in the first part we were
all very smart talking about how the shares we had
(18:12):
that were great and that there were big winners. I
do want to mention that I've had some absolute duds.
I had Great Southern Plantations, which was one of the
worst shares in the history of the world. And even
at the moment in my little ten portfolio, I have
I think a dud, and I just won't sell it
because it keeps teasing me that it's going to get better,
which is Ramsey Healthcare hearing me loud and clear, Ramsey Healthcare.
(18:34):
Now on the property, you can't make mistakes on property
like you can make mistakes on shares, can you, Julianne,
It's a different story. It's a big commitment. That's the
first thing, isn't it to explain to people. It's a
big commitment. It's illiquid, it takes a lot of effort,
it takes a lot of commitments. I mean, you needed
an almost like you almost need like a settled lifestyle
(18:55):
and a really clear model to do property. You can't
play with it like you can play with shares.
Speaker 3 (19:01):
I think also it's the sums of what's involved. At
the beginning our shares, you might be able to sort
of do five ten thousand or build up to a
fifty thousand or one hundred thousand portfolio. As I mentioned earlier,
when we brought out the shares and the property developer,
we were camping out for this block of land at
the time. And I know people who are looking into
property now will be thinking, oh, heavens, I wish I
(19:23):
could get a block of land for that. But I
think the block of land was around two hundreds, two
hundred and twenty thousand, something like that, and that, just
for me in my twenties was an extraordinary sum of money.
The loon hadn't built the house on it yet you
got to build the house, and it's what I just
remember thinking, this is so much debt and how are
we going to manage every little penny.
Speaker 1 (19:41):
Yeah, you're taking on a burden. You are taking on
a burden when you buy a house. It's really hard.
I mean, in my family, we're at that point where
my adult kids are starting to look at the property market.
And you know, the thing is the course, the prices.
When I say the prices, I'm not saying that in
a vague, sort of simplistic way. What I mean is
(20:01):
the price of property as a multiple of the income
that they are making, or anyone is making, has changed
so immensely that it really has changed the game. I
met out that the first house a boat in Melbourne
as a home was an inner city cottage basically, and
it was three and a half times my income income.
(20:21):
My income at the time was fifty grand and I
could buy a house in inner city in Melbourne for
three and a half times my income the same house
to buy that house stay, which is there, if someone
wanted to buy it at three and a half times
their income, they'd have to make three hundred thousand dollars
a year. And the thing is, how many people make
(20:42):
three hundred thousand dollars a year? Not many. And so
the point I'm making is it's become so expensive, and
I mean that in a very thorough way. I mean
that as a multiple of income, as a measure internationally,
as a measure historically. And you've did something recently, bar
was it UBS where they were making the point that
(21:03):
our wealth is so tied up now in property.
Speaker 3 (21:06):
Yes, so UBS sort of tracked global wealth and in
one of their most recent reports. It does highlight Australians
really are some of the wealthiest people on the planet.
And I find this really interesting when you read it,
because I think if you talk to most people and said,
you know, you're really rich in global terms.
Speaker 2 (21:24):
People you don't feel rich.
Speaker 3 (21:26):
It is because it's all tied up in these assets
and you've got debt attached to it and all those
sorts of things. But what ubs that They made the
point that there's a disproportionate amount of wealth tied up
in property for Australians without property prices are some of
the highest in the world, and so our wealth is
tied in to that. And then we have this conundrum.
So as you mentioned, so you were able to get
(21:48):
into property three four times your earnings, your kids now
have to have ten eleven times earnings.
Speaker 1 (21:54):
That's right, And how.
Speaker 3 (21:55):
Do we fix that? How do you fix that problem?
And so I'm approaching this so my daughter's much younger,
orders six, and if property prices keep going how they
have been going, I love her daily, But does that
mean she's with me for life, for the end or
what am I doing?
Speaker 2 (22:09):
Now?
Speaker 1 (22:09):
Their deposit will be larger than the value of the
homes we bought. I mean, that's happening already. It is.
It's really tough. And I mean, and my guys do
turn around to me and they say yeah, yeah, and
they're saying like, I don't know if I want to
do this, And of course I am saying you must,
because it's not going to get cheaper. I'm sorry, but
it's not going to get cheaper. Well.
Speaker 2 (22:30):
I spoke to a property developer.
Speaker 3 (22:32):
This was before I actually had my daughter, and he
said to me, he said, oh, are you planning to
have kids? And my face must have had This was
such a random thing to ask me for you know,
we're doing this news interview. And said, I don't need
to pry. I'm just the reason I'm asking is that
you need to have a plan. So for every child
you have, you should have an investment property for that child,
because then you'll need to sell that investment property to
(22:54):
provide the deposit for your children to get into the
property market.
Speaker 2 (22:57):
This was his thing.
Speaker 1 (22:58):
Yeah, And I mean, it's a terrible, brutally rational way
to approach it, but it's true.
Speaker 3 (23:04):
So I just had one child and I haven't bought
the investment property, but we are looking into it because
it's sort of thinking about where to go.
Speaker 1 (23:10):
With that, and in a way, we're chasing our tails,
so we all run off and we stretch ourselves to
buy investment property so that we can catch up with
the property prices. We are pushing the prices higher by
investing in property, but we're doing it because we're worried
that prices will be so high for our own kids
when they go to buy home. It's hard work, but
(23:30):
I'm a pragmatist at heart, and I think that's it, right,
that's the game. So the game is there, and what
we're hoping to do on the show always is help
and inform people what is going on out there, insights
into what you can really how you can play it.
Speaker 3 (23:46):
Yeah, with everything that we've just spoken about, so these
are conversations that happen around dining room tables across the country,
and it's not lost on the politicians. And I do
wonder if you've got labor in control. They obviously a
few years back, tried to float, you know, run up
the flagpole different ideas on changing capital gains tax and
(24:08):
yet a whole bunch of other things, and it didn't
go down. Very well. I do wonder if we're in
an environment. You know they're going after now super and
we'll get to a super discussion soon. But whether you
think that some of these tax leaders and trying to
work on a policy sense to get properly markets tamed
will be on the agenda.
Speaker 1 (24:27):
I mean, they've been re elected with an enhanced majority.
If they are ever going to tackle this issue, this
is the time to tackle it. I think there's an
appetite for it, and I think even people who are
totally pro investment know that the system is terribly upside
down and it favors older Australians against younger Australians. The
super system does, but so does the property system, and
(24:49):
it favors homeowners over renters beyond a doubt. You can
have a ten million dollar house on Sydney Harbor. You
can have a twenty million dollar house on Sydney Harbor
and you can get the pension that is. So that's
something that could be reassessed and we know Tanya Plipper
six Social Services Department is looking at that. We know
(25:09):
that they're looking at the Labor Party is looking at
capital gains tax. Again, that's property if you hold a
property for more than a year, you only have to
pay twenty five percent CGT. That discount is I think
that I think these are I think these are sitting
ducks actually, Juliana. I think that this is where they're
gonna this is where they're going to peel wealth taxes from.
(25:29):
And it's all again it's around property. And of course
it's around property because going back to what you said
at the start, that's the cornerstone of our wealth. But
you know, we are getting to a point where it's
I would say it's backfiring. But if you are an
investor now and you buy an apartment in Sydney for
a million dollars and you're getting two percent rental yield
(25:53):
and you're that's hopeless. It's hopeless. I mean as an investment,
everyone loses, the rental losers they're paying so much. The
investor loses, they're paying so much for the property. The
yield is going to be really low, and then the
game becomes almost exclusively a game of hoping you get
the capital gains tax at the end. So I think
something has to crack here.
Speaker 3 (26:14):
I agree, Yeah, I think it's just going to be what, Yeah,
what is it?
Speaker 1 (26:20):
Going to be well, we will be covering that very closely. Indeed,
don't you worry, we will not miss a beat on
that one on property and property taxes. But you know,
I've had lots of people on the show. We talk
about tax and we talk about the restraints if you like,
that are in place for investors, and you will always
have restraints. And when you have a labor government in
particularly for a second term, they have a very clear
(26:41):
agenda and often that agenda is not pro investor. Occasionally
it can be. Under certain under the Keating regime, he
managed to do both. I don't think it's pro investor
at the moment in any way under say Jim Chalmers.
But when you have people on the show that I've
talked to, the one thing that I find with the
is they kind of whatever the obstacles are, they're determined
(27:04):
to overcome them. They will say I'm going to do
it anyway.
Speaker 2 (27:08):
Yeah.
Speaker 3 (27:08):
So with what we know, and there's probably changes of that,
there's going to be political pressure to do something. And
you mentioned so you've got your there's adult kids.
Speaker 2 (27:16):
In your house and one of them is looking at property.
Speaker 1 (27:18):
Yes, yes, indeed, what's your.
Speaker 2 (27:20):
Advice and how are you trying to guide them?
Speaker 1 (27:22):
My advice always is that that there's two entirely different
issues in property. One is buying a home and one's
buying an investment in property. If you're buying a home,
a lot of things that we talk about on the
show are have to be seen through that filter, because
there's this enormous thing if you buy a home. Number one,
you're not paying rent anymore. If you buy a home,
(27:44):
you immediately enter the privileged arena of the property owner.
In Australia, where there is an where there's exemption from
capital gains tax, where even when you get when you're older,
there's an exemption from the pension. The whole system is
loaded in favor of the homeowner. And that's why I
support things that some people think are controversial, like, for instance,
(28:06):
tapping super to buy a home. But the way I
look at it is the system is so tilted in
favor of the homeowner. It would be much more important
to own a home than to have an extra twenty
or fifty grand or whatever in super. If it's coming
down to that, then really the home is so important.
So I kind of separate that very and you can
buy an apartment. The point I'm making there is that
(28:27):
we know houses are much much better investments and apartments
in the main, But when you're buying a property as
a home, the first thing, and the major thing is
to just buy it. Do it, do it, don't be
I was thirty three when we bought our first home.
Because I'd lived all around.
Speaker 3 (28:44):
The world, I would say that I agree with you,
But because when I look back, I think, gosh that
one of the top tips for people would be to
talk to me about when I'm buying property and then
run the other way.
Speaker 1 (28:57):
I have this.
Speaker 3 (28:58):
Uncanny ability to buy at the top.
Speaker 1 (29:01):
That's perth for you.
Speaker 2 (29:02):
No, it's very sickly, it's perfectly.
Speaker 1 (29:04):
It is notoriously so.
Speaker 3 (29:06):
But if I look back, it doesn't really matter, because
it does. I would have made a lot more money
if I had not bought at the top. But it
goes down and then it comes back up again, and
it goes up, and then it goes down and it
goes up. So if I had never have gotten on
the property ladder, it would be eyewatering to think about
(29:26):
trying to do it. Now.
Speaker 1 (29:27):
That's right, I know, it's really that is the thing
I'm saying to people on the show all the time,
just start and as you say, if it's a home,
it's so different. Okay, you know you've got a mortgage. Okay,
last year was really good. For what's happening this year.
All prices are down. You don't care about that. It's
your home. You're living there and years past and you know,
guess what, every five years it's higher than it was
(29:49):
at the start of the five year period. So yeah,
it's a different things.
Speaker 2 (29:53):
And you get in.
Speaker 3 (29:53):
I still remember that very first distill mentions. It was
twenty five thirty k's out of Perth. You know, it
was a frontier types. The fences hadn't even been built yet.
You know, the first week in this house, this is.
Speaker 1 (30:04):
Everyone did everyone have a rifle of a rifle beside them?
Speaker 3 (30:10):
It was Actually, it was so fantastic because you got
to know your neighbors in this camp at this random situation.
We've got seven nights out to get the land, and
then you all built the houses together and there's this
real camaraderie. But I remember the first summer in that house.
It's person it's the out of suburbs, and so we
didn't have money for the air. We had no air
conditioning for the first couple of years, and for summer
(30:32):
we so I bought these two dollars water bottles, the
spray water bottles, and we had a pedestal fan at
the foot of the bed and you would just lie
back and you'd wait for the fan to just kind
of get near you, and then you go sprits.
Speaker 2 (30:43):
It splits the water bottle and.
Speaker 3 (30:45):
Then you just get this spray of water to try
and help you sleep, you know, in those forty degree days.
Speaker 1 (30:51):
Good for you. So you did it the hard way,
telling us you did it. You did it the hard way.
Speaker 3 (30:55):
You know sometimes and I know this gets thrown around
a little bit, but you sort of think it's just
you do sort of sometimes you've got to kind of
roll up your slaves, do it tough for a bit
and get in and then find your way.
Speaker 2 (31:05):
Now we're not still in that.
Speaker 3 (31:06):
We sold that property and you know we've moved to
Melbourne and Sydney and back again. Many properties down the
line now. But we do talk to people gens to
get frustrated that there's a sense that everything has to
be perfect.
Speaker 1 (31:18):
Yes, and Stewart Williams on the show has said more
than once. He doesn't say this young he doesn't stand
back and say this younger generation aren't prepared to do
it tough. But what he does say is that people
are much more skeptical and cautious about the renovator opportunity
than they used to be. That's because, among other things,
(31:39):
there was a shortage of treaties in COVID and some
people got terribly caught, and there was a thirty percent
inflation of course in building materials. But that is over now.
But is that part is over broadly, But there's still
that fear in the market about not just about renovating
a house, but whether your plans can be execut in
(32:00):
the way that you think because of both shortage still
some residual shortage of trades and the price going up
all the time.
Speaker 3 (32:09):
In defense of the younger generation, I will say in
our coverage coming up in this new Wealth body of
call that we're launching, keep an eye out.
Speaker 2 (32:16):
We've got a story. We've chattered this. I want to say, kid,
but it's twenty six. He's not a kid. He's twenty
six year old, and he has made sacrifices.
Speaker 3 (32:25):
All of his friends have gone out and you know,
there are music festivals and are off doing things or
they've got new cars, and he hasn't done any of that.
He's sort of head down the backside up, and he's
got quite a few investment properties and counting.
Speaker 2 (32:37):
He's just really rolled up his slaves. So we'll yeah,
story to life.
Speaker 1 (32:41):
Yeah, okay, look forward to seeing that one. All right, Now,
what we might do here. We've talked a little bit
about shares and starting and shares and what you must
do to get going in the share market. We've talked
a little about property and how to start in property
and that, as I say, there enormous division between a
(33:03):
home and an investment property. And we didn't talk much
about investment property except to say obviously investment property is
a different game out together. It's just basically about the price.
So the price you make your profit when you buy.
You manage it as best you can for as little
cost as you can, and that is a different game
than buying a home. In the last second, if we're
going to talk about super because this is often where
(33:25):
it all rose for everybody. The reason you are investing,
as Julie Anne said at the start, and I do
sincerely believe this. It's a great way to be. You
can enjoy your job a lot more if you don't
have to worry about whether you need to be paid
or not. That's one thing. The second thing is that
we're all going to need super. It's become extremely expensive
(33:47):
for what the country. As Julie Anne said at the
start of the show, what sort of super are you
going to have? How are you going to start it,
how are you going to approach it? Let's talk about
that in a moment ago. Hello, Welcome back to The
Australian's Money Puzzle podcast. James Kirby, Associate Editor Wealth on
(34:08):
The Australian, talking to Julie An Spragg, the Wealth editor
of The Australian, on the occasion of the launch of
our Wealth vertical on The Australian, which we, by the way,
have been working on for a long time. Julianne has
been working on this since April April, and it's now.
Speaker 3 (34:24):
About that very first I came across worked at the
Financial Review and then had a since talkback radio believe
it or not, James, and then took up this opportunity. Yeah,
it feels nice to be back on the tools to
be honest with the mar headphines, it's.
Speaker 1 (34:38):
A wonderful thing that journalism has that sort of widened,
that we can do videos and we can do podcasts
and we can write as we always did. And this
is what this vertical is all about, getting you the
reader or the listener or the viewer, and getting what
we know through in different ways. Now this segment, I
just want to talk about super And the first thing
you need to know, folks, is that I have gone
(35:00):
separate ways on super She's with big super, a big
super fund, which just sends her a statement every now
and again. Or she can go online and she says, oh,
there you are. It's gone up again. Isn't that nice?
And I do my own So I have a self
managed super fund since two o sixty year before the GFC.
(35:21):
Who I caught it tights, Yes, So.
Speaker 3 (35:25):
So then I mean, you know where you live, so
you can send your own statements this that's fair enough
because this is real confessional time. This is such a confession.
I don't think I've got a statement from my super
fund in probably three years because we moved.
Speaker 2 (35:42):
Yes, So that gives you.
Speaker 3 (35:44):
An understanding of how little I have paid attention.
Speaker 1 (35:49):
And you would be in a very large group of
people who are not engaged, as they say, with their
super fund.
Speaker 3 (35:59):
Why what would I be when I have so much
going on in my life, James?
Speaker 2 (36:04):
But what I love about this job.
Speaker 3 (36:05):
So I've started here, We're building the New World vertical,
getting across a lot of this information. And what's coming
across clear to me is people start to really care
about their super when they hit the mid fifties, because
in your mid fifties, you're thinking about we want to
retire and what.
Speaker 1 (36:21):
Is that balance? What to do?
Speaker 3 (36:23):
And I think we have a real I don't know
if it's an issue because I think there's a compulsory
superannuation system was set up that there's now a lot
of people are younger people who will have these balances
going forward. But I do feel like there's this moment
where we have to get people a little bit more
interested and engaged because you can make all these little
micro decisions along the way that can really reckon.
Speaker 2 (36:46):
And I've on evenly focused on it. I reckon because
of this job.
Speaker 1 (36:48):
Yes, yes, well, And the other thing is people, Yeah,
as you say, look, you can try all you like,
but you know, when I was twenty five or thirty
or probably thirty five. As for super, I didn't care.
I did not care. I mean, to me, it was
unimaginable that it would ever be an issue. As you say,
I think around maybe when you have kids, well maybe
(37:10):
when you have kids you sober up in so many ways,
but you certainly sober up in terms of money, and
you say, ooh gosh, I'm going to have to have
money if I want to. You know, it's almost My
approach had always been I want to have money because
I want to get that out of the way. I
just don't want it to be an issue. I don't
want to be worrying about that. I don't want There
are plenty of other things I want to do. I
don't want it to be an obstacle because in my
(37:32):
experience I often found that people it was people who
actually didn't manage money very well that talked about it
the most.
Speaker 3 (37:40):
Yeah, I think I come at it from a point
of view of I'm a fiercely independent person. Anyone who
knows me will tell you that. And I also so
I feel like carry that with money habits in that
I don't want to have to rely on anybody else.
I don't want to have to rely on the government
to provide a pension for me. Right, if they want
to throw money my way, we can have a whole
other conversation. I think there needs to be quite a
(38:02):
big overhaul some of it, particularly that the middle class
welfare that goes out. There's this sense I feel like
we've bred entitlement, you know, through GFC and then the pandemic.
Speaker 1 (38:11):
This sent majority of every situation depends on the system.
Two and a half many people get a pension.
Speaker 3 (38:17):
Yeah, I would like to be able to just be
confident enough that we've got things sitting there.
Speaker 2 (38:21):
But I will say that I think you're right. I
think in your twenties.
Speaker 3 (38:24):
Or thirties, it seems like it's this sort of it's
not fake money, but because you don't get to see it,
touch it, feel it, it gets quarantined. You can't touch it
until you're back. When you're in your twenties, you feel
like you have to be a real old person. And
then you sort of, as you mentioned, you have kids,
you get focused on it, but you've got to raise children,
and you might then now be in a situation where
your kids are a bit older. You've got aging parents,
(38:46):
you need to look after them. The superannuation system, James,
I think it's actually quite complex. It's simple but complex
at the same time, it's not simple.
Speaker 1 (38:54):
It's it's absolutely battery in its complexities, and it's full
of interns.
Speaker 3 (38:58):
Yeah, there's some simple there's some simple things you can do,
but there's there's complexity of the system. And I think
because it just seems all too hard and we're all
too busy, then you just sort of push it in the.
Speaker 1 (39:07):
Yes it's too hard basket. But as you say, yeah,
and certainly I think the irony is, of course, if
you certainly get interested in fifty five. I don't want
to say it's too late, but it's there is a
danger that it's too late, because it's all about compounding
and it's all about it's all about starting early. And
that's one thing about the compulsitory system, which I by
the way, I think twelve percent is too high, but
(39:29):
because everyone must buy law, I do, yes, Why do
you think it's too hot? I think at that point
we are getting to a level where people should have
more control of their own money. I think a compulsory
system was good. I thought it was useful. I think
it's climb too high at this stage. There's no way
(39:49):
it should go any higher than this. There's still you know,
there's still talk it was supposed to go to fifteen
percent in the area and it's not. You know, I
think in some ways there's all sorts of other things
around it, that there are other issues that people should
be able to spend their money on. Well, there's an
element of sort of patriarchal sort of thing here. You know,
we know what's good for you, but it is actually
(40:10):
their money.
Speaker 3 (40:12):
It's more the what you want is these nest eggs
at the end, right, you want to make sure that
we have enough money?
Speaker 1 (40:17):
Yes, at the end?
Speaker 2 (40:19):
Gosh, where do we go?
Speaker 3 (40:20):
And all these conversations. I think there needs to also
just be an overhaul of the oversight of Super. I
think Super was set up as this retirement saving scheme
and now it's what is it, four point two trillion
dollars under management?
Speaker 1 (40:30):
That's right, with no regulator.
Speaker 3 (40:32):
We've seen the collapse of first Guardian and Shield and
I honestly the pits of my stomach that's not going
to be the last. And less governments and regulators start
to really pay closer attention.
Speaker 1 (40:41):
There are the falling over each other. But the problem
is there isn't actually someone, There is no single regulator
charge with watching super and it's a four trillion dollar
system anyway, So we digress.
Speaker 2 (40:51):
But so let's go back to I'm not in my fifties. Yeah,
thank you for noticing.
Speaker 1 (40:58):
So what's look at you?
Speaker 3 (40:59):
So now now that I think, now that I'm thoroughly engaged,
what should I be doing then with my super?
Speaker 1 (41:07):
Well, I really do think you should. Well, first of all,
make off your mind how you want to live when
you're older. Are you happy? You don't have to do anything?
You can just you can have a government pension if
you want it, I know, but it's there. So I
think about how much should you have in super? Well,
actually you don't have to have anything, right as a
government pension that's not enough for most people. After that,
(41:30):
then it's a question of how much do you want?
I mean, I say, the twelve percent is I think
the limit really on compulsory super. But having said that,
I would have always contributed over and above the mandatory
level because personally I wanted to have as much SUPER
as possible in my.
Speaker 3 (41:50):
So now that makes more sense to me because I
thought you were sort of advocating that we don't need
to be saving as much as we did. It's more
for you about the context. So it's like you should
be in control of your money and where you're investing.
Speaker 1 (42:00):
Actually that's me. And again that was part of the
thing with the South managed super fund for me. And
I started it in two o six and I started
it with sixty thousand dollars, which is approximately one fifth
of the amount I would recommend that you start super
Fun with today. How about that? Yeah, so there you
(42:21):
are the confidence of it, which is the confidence of
youth personally. I set it up because we were setting
up a startup which was called Eureka Report, which you
sit around and it was all about, well, the core
of it was about self managed super funds for them,
and I thought, if you're going to have a job
like running a publication based on that, you should walk
(42:42):
the talk. And so I started once so I could
learn it and really know what it was when I
wrote about it and that sort of thing, and that's
why I did it. I had actually been involved in
Big super I had actually been on the Fairfax super
Fun board as a employee representative when I was a
little baby reporter on BRW, I suppose it was. That
(43:04):
was very interesting. It was really interesting to see how
big super works. Yeah, and I learned a lot, and
I learned a lot of its failings.
Speaker 3 (43:13):
Is the only reason I mean a big super fund
is so I wanted to find a financial planner that
was going to be fefa service. So I remember at
the time, it was sort of two thousand dollars paid
for someone to do that because I didn't want to
be tipped into all these products because they were getting
kickbacks and this. And we got this financial plan done up,
and this advisor said, this fund will be a good
fund for you with all the growth. You know, I'm
paying someone for the advice. Great, and we set it
(43:35):
all up and I have done nothing else.
Speaker 1 (43:40):
I was wondering where you're going to say that. I
wonder how often that happens. People go into planners, they
spend thousands, and they get in on the documents, they
stick them in the drawer and go, yeah, we really
should do that.
Speaker 2 (43:51):
It's on a USB stick.
Speaker 3 (43:53):
Then the insurances were connected to it. It always you know,
it was very thorough at the time. Yeah, and then
you know, we you know, we got on with life,
we were on this journey. Then you know we're going
on IVF journey and so that if you want to
know where to go.
Speaker 2 (44:07):
And so this is what I'm trying to say.
Speaker 3 (44:10):
Why I think it's really exciting that we've set up
the world vertical is I think there's a lot of
people who are in a similar situation where life just
gets hectic and chaotic and busy, and you try your
best and you set things up, and then there's there's
timeshe we think, Okay, I probably need to smarten up here,
probably need to pay more attention to this.
Speaker 2 (44:28):
As you mentioned, James.
Speaker 3 (44:29):
Like, it's about what you want into the future, and
I would like to have a really lovely retirement or.
Speaker 2 (44:34):
Even if I'm not retiring.
Speaker 3 (44:35):
So I do say to people one of the lessons
I have from the rich list is I don't really retire.
There's lots of people who could have retired very early
and they don't. They found their passion and they work
and all those sorts of things. So it's not necessarily
about not working, but it's also working because you want
to or you've got passions and those sorts of things.
And being financially independent. I think that's at the core.
Speaker 1 (44:55):
That's terrific and I think that's what it's all about.
That's what that verticul is all about. And folks, that's
what the show is all about. The money puzzle. You know,
Julian was talking about advice and by the way, get advice.
Of course, get advice. Here's the thing. It costs on
average three to four thousand dollars a year to get
financial advice in Australia, and that is, by the way,
a minimum figure because the number of advisors is shrinking rapidly.
(45:18):
I mean there's only half the number there was ten
years ago in the market. The point I'm making is
that this show exists for you, and the people on
this show are talking to me and talking to you
through me on all aspects of investing and the listener
questions we do every week. I get top advisors in
(45:40):
to answer those questions. That's what the show is all about.
It's about you and where you're going. And this article
will be very much in the same area. And I'm
hoping that if you do listen to the show, come
and have a look at the vertical on the Australian.
It launches today. It's something that has never been tried
on the Australian or across financial media, and I think
it's going to be really useful. All right. I think
(46:02):
we might leave it there, Julia, and great to have
you on the show.
Speaker 2 (46:05):
Okay, So I've got a laundry list here, so I
need to go and fix up my super work on
an investment property, probably build that share portfolio.
Speaker 3 (46:15):
Look, I think maybe in the journey, maybe I'm gonna
have to do you know, the juliannesparrag diaries or something
like that, like things that I've just learned from starting
here and being focused more on the personal side of wealth.
Speaker 2 (46:26):
As you mentioned.
Speaker 3 (46:27):
So we've both been financed journals for the really long
period time.
Speaker 2 (46:30):
You know this stuff.
Speaker 3 (46:31):
But you know better than the mechanic with the broken
down car. You know I've got.
Speaker 1 (46:35):
The trick is to get started, isn't it. The trick
is to get started, all right? Terrific. Now, folks, keep
those emails rolling, love to see them. And as I said,
if you're sending in a question, send in two or
three at the same time. I love to see a
couple of questions from the same listener. It makes a
lot of sense. It's very efficient as well. The email
(46:55):
is the money puzzle at the Australian dot com dot
au talk to you soon.
Speaker 3 (47:01):
Only the fellnd sap of the wood s
Hello, and welcome to the Australians Money Puzzle podcast. I'm
James Kirby. Welcome aboard everybody, and welcome aboard to a
special edition of this podcast because it's a pretty special
day here at The Australian. We are launching a Wealth
Vertical now. A Wealth Vertical is a digital unit within
The Australian and it's going to be all about wealth
(00:31):
in all its dimensions. And many of the people that
you know and are familiar with from the podcasting myself
and James Gerard, of course Stuart Williams. You here on
Tuesday's Property podcast. You're going to see and read a
lot more from them in The Australian, and you're going
to hear a lot more from them in the podcast
(00:52):
because we are widening the offering basically substantially, so seizing
the opportunity to I've asked the Wealth editor of The Australian,
Julianne Spragged, to come on the show. She's going to
tell us about what's happening. And then when she's done that,
we're going to do something we haven't tried before. We're
actually going to talk about our own investing because both
(01:15):
of us have been in financial journalism most of our
lives and we have I hope, learned some very interesting
things that we do want to tell you about.
Speaker 2 (01:24):
Hi Julianne, Hi James, thanks for having me on.
Speaker 3 (01:27):
Greater Have You on Marshafield has going to be Confession's
going to be a confession session.
Speaker 1 (01:34):
Well partially confession and hopefully occasionally a part of celebration.
Tell us first, what's happening with Wealth on the Australian
and how our offering in all its multi media wonderfulness
is going to change.
Speaker 2 (01:50):
It is exciting.
Speaker 3 (01:52):
We had some research that came through said lots of
people want to be financially independent. People want to be
able to have this job because they want to have
a job for it to be a joy and not
a chore. And the concern though, is that a lot
of people aren't as financially literally as they want to be.
They don't know where to go to get a lot
(02:13):
of this information. They might see their mates or their
friends and they're getting ahead, or they've got investment portfolios
and things. I don't know the how, the why, the what,
and so what we want to do is create this
one stop hub, a place where you can get trusted information.
So that's no matter what stage of the financial journey
you are on. So there'll be information about investing, property, investing, superannuation,
(02:35):
retirement planning, all those bits about that are very important
for your life. But I don't know about you, James,
but you just get caught up, don't you.
Speaker 1 (02:43):
Yeah, you do. And we've always had a lot of
material and there's always like there's always been a good
materia coming in different ways in different parts is such
a big operation. And then we have podcasts, and then
we have like Baron's Top Advisors, we have videos and
we haven't put them all in the one place before,
(03:04):
so I think that's part of it. So I do
I recommend all the listeners have a look at this.
It's launching today and I don't think there's ever been
anything quite like it in media.
Speaker 3 (03:15):
Can I just say true for your listeners who love
to listen to you. Twice Withightly on the Money Puzzle,
we have put together a video series so that one
to see James Kirby in real life.
Speaker 1 (03:26):
We did it on before we started the show. We
were just laughing. The day we did it was the
worst day I can ever remember. Weather wise, I should say,
but we all flew in to do this video, folks,
and it was just so bad. It was unreal, and
we were all late, and all the flights, the two
flights before me were canceled on the two after. I mean,
(03:47):
it was a miracle that I got actually to that
session at all. But the videos will be on this site,
and we've done a whole series of masterclass videos which
capture some of the sort of core areas of in
and I recommend them to you. They will be distributed,
or at least they'll be published. To see the sequential
fashion in the days of head So look out for
(04:07):
that now, Juliane, since I've got you in the hot seat,
let's do this. I've been awfully careful on this show over.
I mean, we launched a show in twenty twenty three,
and I only kind of respond when we have listener questions.
I respond, So if someone says, do you have shares
in something? I'll answer. But I've never really expounded upon
my portfolio on air before. I'm happy to do it
(04:29):
on this show. We split it into shares here in
the first segment, and then we might talk about property,
and then we might talk about super which shares. It's
interesting Eric Johnson and I were just talking in the
office today. Eric's course associated her business. He was talking
about it's the Compseck was launched thirty years ago this
(04:51):
week and he'd been talking to the guy who launched
at Michael Katz and it was extraordinary about Compsack and
nap Trade and the other online brokers. When they came in,
they changed everything. Because I don't know when you bought
your first shares, but the day I bought shares the
first time, I bought two shares five hundred dollars to
each one Pacific Dunlop and National Australia Bank, and I
(05:15):
had to go in. I was twenty five. I had
to go in and sit in the reception of Potter
Warburg in Collin Street, and some unfortunate stockbroker came out
and talked to me about what I was doing. And
the diversification of my portfolio was that I bought two
shares rather than one, and one was terrific National Australia Bank.
It doubled in price and the other one went almost
(05:39):
to nothing. So it was a very good early adventure
in shared trading. Can you remember your first shares.
Speaker 3 (05:48):
I can remember the first discussion about shares. It was
my dad and I think I was eighteen or nineteen
at the time, so of an age where shares had
little value to me. You know, it was it was
(06:08):
you know, it was a time where you're studying university
and out at the pub and it was I'm trying
to remember which iteration it was, but it was Telstra. Oh, yes,
Now I don't know if yeah, I don't know if
it's T two or T three.
Speaker 1 (06:21):
Yeah, one of the floats.
Speaker 2 (06:24):
It was one of the floats.
Speaker 3 (06:25):
And Dad was saying to me, you've got to get in,
You've got to get these shares. And I said, well,
how much do I have to spend? And he said
two thousand dollars and I just I can still remember
just saying.
Speaker 2 (06:36):
To him, you are crazy.
Speaker 3 (06:38):
That is a lot of money and I'm not going
to be doing that. I look back and think, well,
just as well, that was Telstra. Imagine if he was
recommending CBA or something to me. I wish that I
had spent the two thousand dollars on CBA back then.
So I didn't buy shares. I came to it later.
I remember one of the first shares.
Speaker 2 (06:53):
We ever bought. My husband and I it was.
Speaker 3 (06:57):
And we'll get to property soon, but we were Actually
it was sort of boom times in Perth. It was
to two thousand and six, two thousand and seven around.
Speaker 1 (07:04):
Them, the mining boom.
Speaker 3 (07:06):
Mining boom was in peak property prices. It felt like
they were doubling every few weeks. They weren't, but that's
what it felt like when you were here. We were
trying to get our first place, and so we were
at a housing estate. It was roughly about thirty kilometers
north of Perth, and you had to camp out to
get the land. Wow, it was seven nights in the back.
Speaker 2 (07:26):
Of a ute.
Speaker 1 (07:27):
Wow like plots, I know, Yeah, that's like a story
from the gold Rush.
Speaker 2 (07:34):
One hundred percent. It was one hundred percent. And I
just remember seeing that.
Speaker 3 (07:36):
The property developer of the estate that we were buying
in was Pete and I was seeing this and I
could just I was like, day, I'm making so much
money and I can't believe I have to be sleeping
in the back of a You ticket land, we should
buy shares, and so we did buy shares in the developer.
I look back on that now and think that's probably not.
Speaker 2 (07:54):
The smartest thing to do. I was probably doubling down.
Speaker 3 (07:56):
On the investment.
Speaker 2 (07:56):
We bought the land and he bought the developer.
Speaker 1 (07:58):
I probably should have for people to do that, though.
They gravitate towards what they understand. If the factory at
the corner over your street seems to be going great,
and you realize it's on the stock exchange, then if
I don't you, it's like bottom up investing. I actually
had a marvelous example of bottom up investing. I was
involved in a startup which was called well Mid Clothes,
(08:19):
and it was an online clothing retailer. They had been
going for a while and they got in a widget
basically a piece of software called after pay, and they
put it on, they installed it or whatever one evening,
and the next morning they got all these orders that
they'd never got before. And I remember thinking, that's very interesting.
(08:43):
There's like hard evidence from the ground bottom up, if
you know what I mean. I knew the top down,
and I knew the story from top down, and we
all know that the view of the market or whatever,
you know, the big picture. But when I heard that,
I remember thinking, this is no joke. This after fably
is something and that was an example. I remember getting
into after Pay and it went really well and it
(09:03):
was a really good investment. And that was something that
came through almost like you know the street. But that
doesn't happen very often, can I.
Speaker 2 (09:12):
Ask you though? And sorry, we're going to go down.
We'll go down different rabbit holes.
Speaker 3 (09:16):
But say so, if you got on too after pay early, goodbye,
good tip by you. What happened then in the pandemic
after pay dropped, there was a it just dropped like
a star. I can't remember exactly what it went down to,
about eight dollars or something like that, that's right. And
I remember being pretty smug because I didn't buy after pay,
and I remember thinking, hah, I knew this was all
(09:37):
sort of smokes and mirrors and this is all going
to be cactus and toast. And then it just rebounded
nothing else because ye locked down and everyone started shopping.
That's right, you know, ended up at one hundred bucks
or something.
Speaker 1 (09:47):
To it was magnificent, stark. That is a magnificent trade. Really,
I mean it was always wild and I didn't stay
till the end, you know, so you always leave something
out of the table. But was probably what are the
best stocks they ever bought from me? I probably got out.
I did get out too soon, but it was a
terrific stock. I did well, you did well.
Speaker 3 (10:06):
I did well, So to your point, and maybe that's
the lessons here for people if they want to start
investing in stocks, is maybe it is smart to invest
in what you know or have a sense of what
the market is. So the one I did well on
was coals. So this was before West Farmers bought Coals,
and I remember going there Coals. I still have my
coal's name badge from my university job on the delicatessen.
(10:30):
No one will slice purtidos thinner than I can slice it.
Speaker 1 (10:32):
Fel oh, very fantastic.
Speaker 3 (10:35):
But it was went gym up so before West Farmers
had bought Coals. Obviously it's on its own ownership now,
but it was in the Doldrums. It wasn't a great supermarket,
and I can just remember thinking this is a duopoli,
that this there's not enough supermarkets in this country and
it's not going to be down in the Doldrums forever.
So I remember getting in early and the West Farmers
came in and then spruced her.
Speaker 1 (10:53):
Up best farmers come in and paid an enormous amount
for it, right smack at that two hours before GFC.
So I think one of the things that's useful folks
about share investing is ideally if you can if you
do understand the stock, it helps enormously at least your
connection to it is better. Anyone can start and play.
(11:14):
Basically you can buy a stock or two stocks this.
You can always buy exchange traded funds as well, which
is what I generally meant. If someone says to me
what stocks should I buy and they don't know anything,
they've never done anything, I always say, buy an exchange
traded fund by the AX.
Speaker 3 (11:29):
I'll ask you about that now, though, because I'm in
this basket where I think I need to do better
with my stocks.
Speaker 2 (11:35):
You know, I've just sort of almost.
Speaker 3 (11:36):
Played with them rather than proper investing anythink and ATF
the way to go. Atfs have exploded so much that
I now find them incredibly confusing. There's almost too many ETFs.
Which one are you're back?
Speaker 1 (11:49):
Yeah, they've drifted from the original proposal. Absolutely. The original
proposal was really good, you know, it was by the market.
Just buy the ASX two hundred or buy the S
and P five hundred plus vanilla, and whatever happened to
that market happened to your ETF. So if you both
the ASX two hundred ETF a year ago, you'd have
made fourteen percent, because the ASX two hundred med fourteen
(12:10):
percent in the twelve months to June thirty, being you know,
ten percent plus four percent for your dividends. I think
that's still the dominant model. The problem is with these guys,
you know, Julianne, they can't sit down and leave good alone.
They got to keep coming up with things, right they
you know, there's seven hundred people in Vanguard. What did
they all do? Well? Guess what? They get new ideas
(12:33):
and they go into the boss and they say, hey, boss,
guess what, I've got something in mind that would be
really good. And so that ETF thing is drifting. So
I think when we talk about ETFs on the show,
certainly I always make the points plain vanilla ETFs, and
I would say to most people most of the time,
if you're starting with shares, ETFs are great. And if
(12:53):
they had been around when I was starting buying shares,
it would have been so much better than buying two shares,
one of which turned out to be great and one
of which turned out to be useless, and you don't
that's the sort of risks you don't want to take.
Speaker 3 (13:04):
If you could go back in time, just pretend that
ETFs where they, you would have bought an index ATF
I would.
Speaker 1 (13:08):
I would suggest to anyone starting get some ETFs, hold
them for a year, start to understand how it all works,
Watch how you get your dividends come through, and how
it works with tax and everything else, and get a
handle on it. And you've you know, you're taking very
little risk because you're just taking you're just buying the market.
And then after a while, when you're a bit more
sure of it, it doesn't have to take forever. It could
(13:29):
take six months, it could take a year. Then you
can start to strike out and you can say, okay,
this time, I'm going to buy direct shares because personally,
I think ten shares is about as much as anyone
should have. That's as much as you can hold in
your head. Really, I should be if you've got I
always say, if you've got chairs, I should be able
(13:50):
to ask you what are they and how much are
they today? And unless you're you know, got a photographic
memory or something. I reckon about ten shares is about
as much as the one should have, and it is enough.
It can really you can diversify. You can buy banks
and miners and tech companies and everything else. That's something
I would say. The other part I would say is
that at a certain point you've got to get serious
(14:11):
about shares if you're a long term investor, especially if
you're thinking of building your own portfolio or your self
managed super fund, and at that point then you don't
have to have a connection with them. It's all about
the numbers, you know, It's all about is this share
good value? At the moment it's the old Roger Montgomery
thing about value and Roger of courses. Another person's off
and on the show rights for the Australian will be
(14:32):
involved in our new vertical. He's whole thing that you know,
you're buying a piece of a company, you're buying a
little TV bit of the company. So what really matters
is their company and how is the company going.
Speaker 3 (14:44):
My problem, I reckon is because we're in newsrooms and
we cover a lot of stories. We cover a lot
of stories about stocks that go absolutely bananas. They deliver
incredible returns. But for every one of those stories, we're
all doing stories or when things go wrong, yes, and
we should when he's a collapsing and share prices are tanking,
(15:05):
and so it does leave you sort of kind of
clinging to the sidelines because you don't know which way
to go.
Speaker 2 (15:10):
You know too much, You almost know too much.
Speaker 3 (15:12):
I have threatened to do it, and maybe for this
new vertical I should. I was going to create a
list of when I had met a billionaire or rich.
Speaker 2 (15:23):
This does.
Speaker 3 (15:23):
My former job was editing rich lists for the Financial Review,
and I look at some of the share price growth
and I think, if I had bought shares when I
met that rich list, yes, would I be in fact
talking to you on this podcast today at the book, James,
I'm not sure. I was with Andrew Forrest in the
Pilborough in two thousand and six having a look at
what would become four to Skew Metal screwp. He's looking
(15:44):
at the dusty Pilborough.
Speaker 1 (15:45):
And oh, what a great story, Yeah, and.
Speaker 3 (15:47):
Asking me whether it is the most beautiful thing I've
ever seen. And I'm looking at a concrete pylon in
the middle of nowhere, and I'm thinking I've seen prettier things,
you know, but I could see why he.
Speaker 1 (15:57):
The share is republic a dollar or something at the time,
I think that could have been less.
Speaker 2 (16:01):
Yeah, pretty sure. I emailed someone just.
Speaker 3 (16:04):
The other week actually, just to get a comment for
a story, and I said, oh, I just want to
look back the last time, you know, we'd spoke properly,
and it was a couple of years ago. And if
I had bought shares in that particular company, Promedicus, I
think I worked out if I bought a thousand shares,
I would have my three hundred thousand dollars. You know
what I could have should at James.
Speaker 1 (16:25):
Well, as you say, the thing is, it's all about risk.
So if you buy the ETFs, this is the minimum
risk approach to shares, and then after that it's a
question of the more risk you take, then the more
likely you will have volatility. And volatility, as you know, folks,
basically means it's going to go way up or way down.
(16:45):
So for every pro Medicus, there's ninety nine little medical
device companies that go nowhere. And maybe we'll leave it
just there, because that's the point we really want to
make about shares. We'll have a break and we will
come back and we will talk about what everybody loves
to talk about. Property. Back in a moment. Hello, Welcome
(17:09):
back to the Australians Money Puzzle podcast. James Kirby here
with Julianne Spragg. Julian is the Wealth editor of The Australian,
and we are talking on the occasion of the launch
of a new Wealth vertical on The Australian, which is
going to be really terrific and I'm delighted to see
it because it's basically putting a lot of effort and
(17:29):
investment and people into the area that we've been working
on here for some time on the Money Puzzle, and
the Money Puzzle too actually, as I say, is effectively
being relaunched inside this Wealth vertical. This week you'll see
a lot more episodes, some new voices involved here, and
we'll do some shows a wider nature than we've been
(17:51):
doing to this point. Now. As you know, Tuesday's Property
Show is becoming very popular and I've dealt with property
for a long time and one of the things I
want to talk to Juliane about is again something of
a confessional in the way that we talked about shares there,
and by the way in the first part we were
all very smart talking about how the shares we had
(18:12):
that were great and that there were big winners. I
do want to mention that I've had some absolute duds.
I had Great Southern Plantations, which was one of the
worst shares in the history of the world. And even
at the moment in my little ten portfolio, I have
I think a dud, and I just won't sell it
because it keeps teasing me that it's going to get better,
which is Ramsey Healthcare hearing me loud and clear, Ramsey Healthcare.
(18:34):
Now on the property, you can't make mistakes on property
like you can make mistakes on shares, can you, Julianne,
It's a different story. It's a big commitment. That's the
first thing, isn't it to explain to people. It's a
big commitment. It's illiquid, it takes a lot of effort,
it takes a lot of commitments. I mean, you needed
an almost like you almost need like a settled lifestyle
(18:55):
and a really clear model to do property. You can't
play with it like you can play with shares.
Speaker 3 (19:01):
I think also it's the sums of what's involved. At
the beginning our shares, you might be able to sort
of do five ten thousand or build up to a
fifty thousand or one hundred thousand portfolio. As I mentioned earlier,
when we brought out the shares and the property developer,
we were camping out for this block of land at
the time. And I know people who are looking into
property now will be thinking, oh, heavens, I wish I
(19:23):
could get a block of land for that. But I
think the block of land was around two hundreds, two
hundred and twenty thousand, something like that, and that, just
for me in my twenties was an extraordinary sum of money.
The loon hadn't built the house on it yet you
got to build the house, and it's what I just
remember thinking, this is so much debt and how are
we going to manage every little penny.
Speaker 1 (19:41):
Yeah, you're taking on a burden. You are taking on
a burden when you buy a house. It's really hard.
I mean, in my family, we're at that point where
my adult kids are starting to look at the property market.
And you know, the thing is the course, the prices.
When I say the prices, I'm not saying that in
a vague, sort of simplistic way. What I mean is
(20:01):
the price of property as a multiple of the income
that they are making, or anyone is making, has changed
so immensely that it really has changed the game. I
met out that the first house a boat in Melbourne
as a home was an inner city cottage basically, and
it was three and a half times my income income.
(20:21):
My income at the time was fifty grand and I
could buy a house in inner city in Melbourne for
three and a half times my income the same house
to buy that house stay, which is there, if someone
wanted to buy it at three and a half times
their income, they'd have to make three hundred thousand dollars
a year. And the thing is, how many people make
(20:42):
three hundred thousand dollars a year? Not many. And so
the point I'm making is it's become so expensive, and
I mean that in a very thorough way. I mean
that as a multiple of income, as a measure internationally,
as a measure historically. And you've did something recently, bar
was it UBS where they were making the point that
(21:03):
our wealth is so tied up now in property.
Speaker 3 (21:06):
Yes, so UBS sort of tracked global wealth and in
one of their most recent reports. It does highlight Australians
really are some of the wealthiest people on the planet.
And I find this really interesting when you read it,
because I think if you talk to most people and said,
you know, you're really rich in global terms.
Speaker 2 (21:24):
People you don't feel rich.
Speaker 3 (21:26):
It is because it's all tied up in these assets
and you've got debt attached to it and all those
sorts of things. But what ubs that They made the
point that there's a disproportionate amount of wealth tied up
in property for Australians without property prices are some of
the highest in the world, and so our wealth is
tied in to that. And then we have this conundrum.
So as you mentioned, so you were able to get
(21:48):
into property three four times your earnings, your kids now
have to have ten eleven times earnings.
Speaker 1 (21:54):
That's right, And how.
Speaker 3 (21:55):
Do we fix that? How do you fix that problem?
And so I'm approaching this so my daughter's much younger,
orders six, and if property prices keep going how they
have been going, I love her daily, But does that
mean she's with me for life, for the end or
what am I doing?
Speaker 2 (22:09):
Now?
Speaker 1 (22:09):
Their deposit will be larger than the value of the
homes we bought. I mean, that's happening already. It is.
It's really tough. And I mean, and my guys do
turn around to me and they say yeah, yeah, and
they're saying like, I don't know if I want to
do this, And of course I am saying you must,
because it's not going to get cheaper. I'm sorry, but
it's not going to get cheaper. Well.
Speaker 2 (22:30):
I spoke to a property developer.
Speaker 3 (22:32):
This was before I actually had my daughter, and he
said to me, he said, oh, are you planning to
have kids? And my face must have had This was
such a random thing to ask me for you know,
we're doing this news interview. And said, I don't need
to pry. I'm just the reason I'm asking is that
you need to have a plan. So for every child
you have, you should have an investment property for that child,
because then you'll need to sell that investment property to
(22:54):
provide the deposit for your children to get into the
property market.
Speaker 2 (22:57):
This was his thing.
Speaker 1 (22:58):
Yeah, And I mean, it's a terrible, brutally rational way
to approach it, but it's true.
Speaker 3 (23:04):
So I just had one child and I haven't bought
the investment property, but we are looking into it because
it's sort of thinking about where to go.
Speaker 1 (23:10):
With that, and in a way, we're chasing our tails,
so we all run off and we stretch ourselves to
buy investment property so that we can catch up with
the property prices. We are pushing the prices higher by
investing in property, but we're doing it because we're worried
that prices will be so high for our own kids
when they go to buy home. It's hard work, but
(23:30):
I'm a pragmatist at heart, and I think that's it, right,
that's the game. So the game is there, and what
we're hoping to do on the show always is help
and inform people what is going on out there, insights
into what you can really how you can play it.
Speaker 3 (23:46):
Yeah, with everything that we've just spoken about, so these
are conversations that happen around dining room tables across the country,
and it's not lost on the politicians. And I do
wonder if you've got labor in control. They obviously a
few years back, tried to float, you know, run up
the flagpole different ideas on changing capital gains tax and
(24:08):
yet a whole bunch of other things, and it didn't
go down. Very well. I do wonder if we're in
an environment. You know they're going after now super and
we'll get to a super discussion soon. But whether you
think that some of these tax leaders and trying to
work on a policy sense to get properly markets tamed
will be on the agenda.
Speaker 1 (24:27):
I mean, they've been re elected with an enhanced majority.
If they are ever going to tackle this issue, this
is the time to tackle it. I think there's an
appetite for it, and I think even people who are
totally pro investment know that the system is terribly upside
down and it favors older Australians against younger Australians. The
super system does, but so does the property system, and
(24:49):
it favors homeowners over renters beyond a doubt. You can
have a ten million dollar house on Sydney Harbor. You
can have a twenty million dollar house on Sydney Harbor
and you can get the pension that is. So that's
something that could be reassessed and we know Tanya Plipper
six Social Services Department is looking at that. We know
(25:09):
that they're looking at the Labor Party is looking at
capital gains tax. Again, that's property if you hold a
property for more than a year, you only have to
pay twenty five percent CGT. That discount is I think
that I think these are I think these are sitting
ducks actually, Juliana. I think that this is where they're
gonna this is where they're going to peel wealth taxes from.
(25:29):
And it's all again it's around property. And of course
it's around property because going back to what you said
at the start, that's the cornerstone of our wealth. But
you know, we are getting to a point where it's
I would say it's backfiring. But if you are an
investor now and you buy an apartment in Sydney for
a million dollars and you're getting two percent rental yield
(25:53):
and you're that's hopeless. It's hopeless. I mean as an investment,
everyone loses, the rental losers they're paying so much. The
investor loses, they're paying so much for the property. The
yield is going to be really low, and then the
game becomes almost exclusively a game of hoping you get
the capital gains tax at the end. So I think
something has to crack here.
Speaker 3 (26:14):
I agree, Yeah, I think it's just going to be what, Yeah,
what is it?
Speaker 1 (26:20):
Going to be well, we will be covering that very closely. Indeed,
don't you worry, we will not miss a beat on
that one on property and property taxes. But you know,
I've had lots of people on the show. We talk
about tax and we talk about the restraints if you like,
that are in place for investors, and you will always
have restraints. And when you have a labor government in
particularly for a second term, they have a very clear
(26:41):
agenda and often that agenda is not pro investor. Occasionally
it can be. Under certain under the Keating regime, he
managed to do both. I don't think it's pro investor
at the moment in any way under say Jim Chalmers.
But when you have people on the show that I've
talked to, the one thing that I find with the
is they kind of whatever the obstacles are, they're determined
(27:04):
to overcome them. They will say I'm going to do
it anyway.
Speaker 2 (27:08):
Yeah.
Speaker 3 (27:08):
So with what we know, and there's probably changes of that,
there's going to be political pressure to do something. And
you mentioned so you've got your there's adult kids.
Speaker 2 (27:16):
In your house and one of them is looking at property.
Speaker 1 (27:18):
Yes, yes, indeed, what's your.
Speaker 2 (27:20):
Advice and how are you trying to guide them?
Speaker 1 (27:22):
My advice always is that that there's two entirely different
issues in property. One is buying a home and one's
buying an investment in property. If you're buying a home,
a lot of things that we talk about on the
show are have to be seen through that filter, because
there's this enormous thing if you buy a home. Number one,
you're not paying rent anymore. If you buy a home,
(27:44):
you immediately enter the privileged arena of the property owner.
In Australia, where there is an where there's exemption from
capital gains tax, where even when you get when you're older,
there's an exemption from the pension. The whole system is
loaded in favor of the homeowner. And that's why I
support things that some people think are controversial, like, for instance,
(28:06):
tapping super to buy a home. But the way I
look at it is the system is so tilted in
favor of the homeowner. It would be much more important
to own a home than to have an extra twenty
or fifty grand or whatever in super. If it's coming
down to that, then really the home is so important.
So I kind of separate that very and you can
buy an apartment. The point I'm making there is that
(28:27):
we know houses are much much better investments and apartments
in the main, But when you're buying a property as
a home, the first thing, and the major thing is
to just buy it. Do it, do it, don't be
I was thirty three when we bought our first home.
Because I'd lived all around.
Speaker 3 (28:44):
The world, I would say that I agree with you,
But because when I look back, I think, gosh that
one of the top tips for people would be to
talk to me about when I'm buying property and then
run the other way.
Speaker 1 (28:57):
I have this.
Speaker 3 (28:58):
Uncanny ability to buy at the top.
Speaker 1 (29:01):
That's perth for you.
Speaker 2 (29:02):
No, it's very sickly, it's perfectly.
Speaker 1 (29:04):
It is notoriously so.
Speaker 3 (29:06):
But if I look back, it doesn't really matter, because
it does. I would have made a lot more money
if I had not bought at the top. But it
goes down and then it comes back up again, and
it goes up, and then it goes down and it
goes up. So if I had never have gotten on
the property ladder, it would be eyewatering to think about
(29:26):
trying to do it. Now.
Speaker 1 (29:27):
That's right, I know, it's really that is the thing
I'm saying to people on the show all the time,
just start and as you say, if it's a home,
it's so different. Okay, you know you've got a mortgage. Okay,
last year was really good. For what's happening this year.
All prices are down. You don't care about that. It's
your home. You're living there and years past and you know,
guess what, every five years it's higher than it was
(29:49):
at the start of the five year period. So yeah,
it's a different things.
Speaker 2 (29:53):
And you get in.
Speaker 3 (29:53):
I still remember that very first distill mentions. It was
twenty five thirty k's out of Perth. You know, it
was a frontier types. The fences hadn't even been built yet.
You know, the first week in this house, this is.
Speaker 1 (30:04):
Everyone did everyone have a rifle of a rifle beside them?
Speaker 3 (30:10):
It was Actually, it was so fantastic because you got
to know your neighbors in this camp at this random situation.
We've got seven nights out to get the land, and
then you all built the houses together and there's this
real camaraderie. But I remember the first summer in that house.
It's person it's the out of suburbs, and so we
didn't have money for the air. We had no air
conditioning for the first couple of years, and for summer
(30:32):
we so I bought these two dollars water bottles, the
spray water bottles, and we had a pedestal fan at
the foot of the bed and you would just lie
back and you'd wait for the fan to just kind
of get near you, and then you go sprits.
Speaker 2 (30:43):
It splits the water bottle and.
Speaker 3 (30:45):
Then you just get this spray of water to try
and help you sleep, you know, in those forty degree days.
Speaker 1 (30:51):
Good for you. So you did it the hard way,
telling us you did it. You did it the hard way.
Speaker 3 (30:55):
You know sometimes and I know this gets thrown around
a little bit, but you sort of think it's just
you do sort of sometimes you've got to kind of
roll up your slaves, do it tough for a bit
and get in and then find your way.
Speaker 2 (31:05):
Now we're not still in that.
Speaker 3 (31:06):
We sold that property and you know we've moved to
Melbourne and Sydney and back again. Many properties down the
line now. But we do talk to people gens to
get frustrated that there's a sense that everything has to
be perfect.
Speaker 1 (31:18):
Yes, and Stewart Williams on the show has said more
than once. He doesn't say this young he doesn't stand
back and say this younger generation aren't prepared to do
it tough. But what he does say is that people
are much more skeptical and cautious about the renovator opportunity
than they used to be. That's because, among other things,
(31:39):
there was a shortage of treaties in COVID and some
people got terribly caught, and there was a thirty percent
inflation of course in building materials. But that is over now.
But is that part is over broadly, But there's still
that fear in the market about not just about renovating
a house, but whether your plans can be execut in
(32:00):
the way that you think because of both shortage still
some residual shortage of trades and the price going up
all the time.
Speaker 3 (32:09):
In defense of the younger generation, I will say in
our coverage coming up in this new Wealth body of
call that we're launching, keep an eye out.
Speaker 2 (32:16):
We've got a story. We've chattered this. I want to say, kid,
but it's twenty six. He's not a kid. He's twenty
six year old, and he has made sacrifices.
Speaker 3 (32:25):
All of his friends have gone out and you know,
there are music festivals and are off doing things or
they've got new cars, and he hasn't done any of that.
He's sort of head down the backside up, and he's
got quite a few investment properties and counting.
Speaker 2 (32:37):
He's just really rolled up his slaves. So we'll yeah,
story to life.
Speaker 1 (32:41):
Yeah, okay, look forward to seeing that one. All right, Now,
what we might do here. We've talked a little bit
about shares and starting and shares and what you must
do to get going in the share market. We've talked
a little about property and how to start in property
and that, as I say, there enormous division between a
(33:03):
home and an investment property. And we didn't talk much
about investment property except to say obviously investment property is
a different game out together. It's just basically about the price.
So the price you make your profit when you buy.
You manage it as best you can for as little
cost as you can, and that is a different game
than buying a home. In the last second, if we're
going to talk about super because this is often where
(33:25):
it all rose for everybody. The reason you are investing,
as Julie Anne said at the start, and I do
sincerely believe this. It's a great way to be. You
can enjoy your job a lot more if you don't
have to worry about whether you need to be paid
or not. That's one thing. The second thing is that
we're all going to need super. It's become extremely expensive
(33:47):
for what the country. As Julie Anne said at the
start of the show, what sort of super are you
going to have? How are you going to start it,
how are you going to approach it? Let's talk about
that in a moment ago. Hello, Welcome back to The
Australian's Money Puzzle podcast. James Kirby, Associate Editor Wealth on
(34:08):
The Australian, talking to Julie An Spragg, the Wealth editor
of The Australian, on the occasion of the launch of
our Wealth vertical on The Australian, which we, by the way,
have been working on for a long time. Julianne has
been working on this since April April, and it's now.
Speaker 3 (34:24):
About that very first I came across worked at the
Financial Review and then had a since talkback radio believe
it or not, James, and then took up this opportunity. Yeah,
it feels nice to be back on the tools to
be honest with the mar headphines, it's.
Speaker 1 (34:38):
A wonderful thing that journalism has that sort of widened,
that we can do videos and we can do podcasts
and we can write as we always did. And this
is what this vertical is all about, getting you the
reader or the listener or the viewer, and getting what
we know through in different ways. Now this segment, I
just want to talk about super And the first thing
you need to know, folks, is that I have gone
(35:00):
separate ways on super She's with big super, a big
super fund, which just sends her a statement every now
and again. Or she can go online and she says, oh,
there you are. It's gone up again. Isn't that nice?
And I do my own So I have a self
managed super fund since two o sixty year before the GFC.
(35:21):
Who I caught it tights, Yes, So.
Speaker 3 (35:25):
So then I mean, you know where you live, so
you can send your own statements this that's fair enough
because this is real confessional time. This is such a confession.
I don't think I've got a statement from my super
fund in probably three years because we moved.
Speaker 2 (35:42):
Yes, So that gives you.
Speaker 3 (35:44):
An understanding of how little I have paid attention.
Speaker 1 (35:49):
And you would be in a very large group of
people who are not engaged, as they say, with their
super fund.
Speaker 3 (35:59):
Why what would I be when I have so much
going on in my life, James?
Speaker 2 (36:04):
But what I love about this job.
Speaker 3 (36:05):
So I've started here, We're building the New World vertical,
getting across a lot of this information. And what's coming
across clear to me is people start to really care
about their super when they hit the mid fifties, because
in your mid fifties, you're thinking about we want to
retire and what.
Speaker 1 (36:21):
Is that balance? What to do?
Speaker 3 (36:23):
And I think we have a real I don't know
if it's an issue because I think there's a compulsory
superannuation system was set up that there's now a lot
of people are younger people who will have these balances
going forward. But I do feel like there's this moment
where we have to get people a little bit more
interested and engaged because you can make all these little
micro decisions along the way that can really reckon.
Speaker 2 (36:46):
And I've on evenly focused on it. I reckon because
of this job.
Speaker 1 (36:48):
Yes, yes, well, And the other thing is people, Yeah,
as you say, look, you can try all you like,
but you know, when I was twenty five or thirty
or probably thirty five. As for super, I didn't care.
I did not care. I mean, to me, it was
unimaginable that it would ever be an issue. As you say,
I think around maybe when you have kids, well maybe
(37:10):
when you have kids you sober up in so many ways,
but you certainly sober up in terms of money, and
you say, ooh gosh, I'm going to have to have
money if I want to. You know, it's almost My
approach had always been I want to have money because
I want to get that out of the way. I
just don't want it to be an issue. I don't
want to be worrying about that. I don't want There
are plenty of other things I want to do. I
don't want it to be an obstacle because in my
(37:32):
experience I often found that people it was people who
actually didn't manage money very well that talked about it
the most.
Speaker 3 (37:40):
Yeah, I think I come at it from a point
of view of I'm a fiercely independent person. Anyone who
knows me will tell you that. And I also so
I feel like carry that with money habits in that
I don't want to have to rely on anybody else.
I don't want to have to rely on the government
to provide a pension for me. Right, if they want
to throw money my way, we can have a whole
other conversation. I think there needs to be quite a
(38:02):
big overhaul some of it, particularly that the middle class
welfare that goes out. There's this sense I feel like
we've bred entitlement, you know, through GFC and then the pandemic.
Speaker 1 (38:11):
This sent majority of every situation depends on the system.
Two and a half many people get a pension.
Speaker 3 (38:17):
Yeah, I would like to be able to just be
confident enough that we've got things sitting there.
Speaker 2 (38:21):
But I will say that I think you're right. I
think in your twenties.
Speaker 3 (38:24):
Or thirties, it seems like it's this sort of it's
not fake money, but because you don't get to see it,
touch it, feel it, it gets quarantined. You can't touch it
until you're back. When you're in your twenties, you feel
like you have to be a real old person. And
then you sort of, as you mentioned, you have kids,
you get focused on it, but you've got to raise children,
and you might then now be in a situation where
your kids are a bit older. You've got aging parents,
(38:46):
you need to look after them. The superannuation system, James,
I think it's actually quite complex. It's simple but complex
at the same time, it's not simple.
Speaker 1 (38:54):
It's it's absolutely battery in its complexities, and it's full
of interns.
Speaker 3 (38:58):
Yeah, there's some simple there's some simple things you can do,
but there's there's complexity of the system. And I think
because it just seems all too hard and we're all
too busy, then you just sort of push it in the.
Speaker 1 (39:07):
Yes it's too hard basket. But as you say, yeah,
and certainly I think the irony is, of course, if
you certainly get interested in fifty five. I don't want
to say it's too late, but it's there is a
danger that it's too late, because it's all about compounding
and it's all about it's all about starting early. And
that's one thing about the compulsitory system, which I by
the way, I think twelve percent is too high, but
(39:29):
because everyone must buy law, I do, yes, Why do
you think it's too hot? I think at that point
we are getting to a level where people should have
more control of their own money. I think a compulsory
system was good. I thought it was useful. I think
it's climb too high at this stage. There's no way
(39:49):
it should go any higher than this. There's still you know,
there's still talk it was supposed to go to fifteen
percent in the area and it's not. You know, I
think in some ways there's all sorts of other things
around it, that there are other issues that people should
be able to spend their money on. Well, there's an
element of sort of patriarchal sort of thing here. You know,
we know what's good for you, but it is actually
(40:10):
their money.
Speaker 3 (40:12):
It's more the what you want is these nest eggs
at the end, right, you want to make sure that
we have enough money?
Speaker 1 (40:17):
Yes, at the end?
Speaker 2 (40:19):
Gosh, where do we go?
Speaker 3 (40:20):
And all these conversations. I think there needs to also
just be an overhaul of the oversight of Super. I
think Super was set up as this retirement saving scheme
and now it's what is it, four point two trillion
dollars under management?
Speaker 1 (40:30):
That's right, with no regulator.
Speaker 3 (40:32):
We've seen the collapse of first Guardian and Shield and
I honestly the pits of my stomach that's not going
to be the last. And less governments and regulators start
to really pay closer attention.
Speaker 1 (40:41):
There are the falling over each other. But the problem
is there isn't actually someone, There is no single regulator
charge with watching super and it's a four trillion dollar
system anyway, So we digress.
Speaker 2 (40:51):
But so let's go back to I'm not in my fifties. Yeah,
thank you for noticing.
Speaker 1 (40:58):
So what's look at you?
Speaker 3 (40:59):
So now now that I think, now that I'm thoroughly engaged,
what should I be doing then with my super?
Speaker 1 (41:07):
Well, I really do think you should. Well, first of all,
make off your mind how you want to live when
you're older. Are you happy? You don't have to do anything?
You can just you can have a government pension if
you want it, I know, but it's there. So I
think about how much should you have in super? Well,
actually you don't have to have anything, right as a
government pension that's not enough for most people. After that,
(41:30):
then it's a question of how much do you want?
I mean, I say, the twelve percent is I think
the limit really on compulsory super. But having said that,
I would have always contributed over and above the mandatory
level because personally I wanted to have as much SUPER
as possible in my.
Speaker 3 (41:50):
So now that makes more sense to me because I
thought you were sort of advocating that we don't need
to be saving as much as we did. It's more
for you about the context. So it's like you should
be in control of your money and where you're investing.
Speaker 1 (42:00):
Actually that's me. And again that was part of the
thing with the South managed super fund for me. And
I started it in two o six and I started
it with sixty thousand dollars, which is approximately one fifth
of the amount I would recommend that you start super
Fun with today. How about that? Yeah, so there you
(42:21):
are the confidence of it, which is the confidence of
youth personally. I set it up because we were setting
up a startup which was called Eureka Report, which you
sit around and it was all about, well, the core
of it was about self managed super funds for them,
and I thought, if you're going to have a job
like running a publication based on that, you should walk
(42:42):
the talk. And so I started once so I could
learn it and really know what it was when I
wrote about it and that sort of thing, and that's
why I did it. I had actually been involved in
Big super I had actually been on the Fairfax super
Fun board as a employee representative when I was a
little baby reporter on BRW, I suppose it was. That
(43:04):
was very interesting. It was really interesting to see how
big super works. Yeah, and I learned a lot, and
I learned a lot of its failings.
Speaker 3 (43:13):
Is the only reason I mean a big super fund
is so I wanted to find a financial planner that
was going to be fefa service. So I remember at
the time, it was sort of two thousand dollars paid
for someone to do that because I didn't want to
be tipped into all these products because they were getting
kickbacks and this. And we got this financial plan done up,
and this advisor said, this fund will be a good
fund for you with all the growth. You know, I'm
paying someone for the advice. Great, and we set it
(43:35):
all up and I have done nothing else.
Speaker 1 (43:40):
I was wondering where you're going to say that. I
wonder how often that happens. People go into planners, they
spend thousands, and they get in on the documents, they
stick them in the drawer and go, yeah, we really
should do that.
Speaker 2 (43:51):
It's on a USB stick.
Speaker 3 (43:53):
Then the insurances were connected to it. It always you know,
it was very thorough at the time. Yeah, and then
you know, we you know, we got on with life,
we were on this journey. Then you know we're going
on IVF journey and so that if you want to
know where to go.
Speaker 2 (44:07):
And so this is what I'm trying to say.
Speaker 3 (44:10):
Why I think it's really exciting that we've set up
the world vertical is I think there's a lot of
people who are in a similar situation where life just
gets hectic and chaotic and busy, and you try your
best and you set things up, and then there's there's
timeshe we think, Okay, I probably need to smarten up here,
probably need to pay more attention to this.
Speaker 2 (44:28):
As you mentioned, James.
Speaker 3 (44:29):
Like, it's about what you want into the future, and
I would like to have a really lovely retirement or.
Speaker 2 (44:34):
Even if I'm not retiring.
Speaker 3 (44:35):
So I do say to people one of the lessons
I have from the rich list is I don't really retire.
There's lots of people who could have retired very early
and they don't. They found their passion and they work
and all those sorts of things. So it's not necessarily
about not working, but it's also working because you want
to or you've got passions and those sorts of things.
And being financially independent. I think that's at the core.
Speaker 1 (44:55):
That's terrific and I think that's what it's all about.
That's what that verticul is all about. And folks, that's
what the show is all about. The money puzzle. You know,
Julian was talking about advice and by the way, get advice.
Of course, get advice. Here's the thing. It costs on
average three to four thousand dollars a year to get
financial advice in Australia, and that is, by the way,
a minimum figure because the number of advisors is shrinking rapidly.
(45:18):
I mean there's only half the number there was ten
years ago in the market. The point I'm making is
that this show exists for you, and the people on
this show are talking to me and talking to you
through me on all aspects of investing and the listener
questions we do every week. I get top advisors in
(45:40):
to answer those questions. That's what the show is all about.
It's about you and where you're going. And this article
will be very much in the same area. And I'm
hoping that if you do listen to the show, come
and have a look at the vertical on the Australian.
It launches today. It's something that has never been tried
on the Australian or across financial media, and I think
it's going to be really useful. All right. I think
(46:02):
we might leave it there, Julia, and great to have
you on the show.
Speaker 2 (46:05):
Okay, So I've got a laundry list here, so I
need to go and fix up my super work on
an investment property, probably build that share portfolio.
Speaker 3 (46:15):
Look, I think maybe in the journey, maybe I'm gonna
have to do you know, the juliannesparrag diaries or something
like that, like things that I've just learned from starting
here and being focused more on the personal side of wealth.
Speaker 2 (46:26):
As you mentioned.
Speaker 3 (46:27):
So we've both been financed journals for the really long
period time.
Speaker 2 (46:30):
You know this stuff.
Speaker 3 (46:31):
But you know better than the mechanic with the broken
down car. You know I've got.
Speaker 1 (46:35):
The trick is to get started, isn't it. The trick
is to get started, all right? Terrific. Now, folks, keep
those emails rolling, love to see them. And as I said,
if you're sending in a question, send in two or
three at the same time. I love to see a
couple of questions from the same listener. It makes a
lot of sense. It's very efficient as well. The email
(46:55):
is the money puzzle at the Australian dot com dot
au talk to you soon.
Speaker 3 (47:01):
Only the fellnd sap of the wood s
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