Put that $10,000 to work

Money Magazine Australia - - FROM THE EDITOR -

If you had a lazy $10,000, where would you in­vest it? Af­ter Best of the Best, our awards edi­tion that comes out in De­cem­ber, this is­sue would have to be my next favourite. Not only do our reg­u­lar ex­perts an­swer some of the most pop­u­lar ques­tions that our read­ers keep ask­ing but they let you in on where they’re investing their own cash. And as Sam Hen­der­son points out, the ad­vice they give their clients is not al­ways what they would do them­selves. As he says on page 41, “I’m go­ing to go out on a limb and select a more po­ten­tially volatile in­vest­ment, and one I wouldn’t rec­om­mend for my clients”. This year a few of them have di­alled up the risk, which isn’t sur­pris­ing given the dis­mal re­turns earned on bank ac­counts.

While cash and fixed in­ter­est should play a part in any di­ver­si­fied portfolio (see page 70), record low in­ter­est rates and a low growth out­look are mak­ing it ex­cep­tion­ally hard for those liv­ing on a fixed in­come. Ac­cord­ing to data from com­par­i­son site Mozo, three out of five sav­ings ac­counts are now pay­ing on­go­ing rates un­der 2%. There are only three providers of­fer­ing on­go­ing sav­ing rates of 3% – AMP, RAMS and Aus­tralian Unity.

While one should never sim­ply fol­low some­one else’s steps, es­pe­cially when it comes to investing, this is­sue is a great way of start­ing a conversation with your­self. If you’re short on cash then th­ese strate­gies could eas­ily work just as well with $2000 or so.

If you’re look­ing for other conversation

starters, Vita Palestrant’s story on the cost of dy­ing (page 42) is sure to give you plenty of ma­te­rial – $20,000 to say good­bye! Surely there are cheaper ways to move on. Greg Hoff­man gets you think­ing whether you’re a “first-level” or “sec­ond-level” thinker. If you want share­mar­ket suc­cess you need to be on that sec­ond level. See page 82 to find out if you have the traits.

Don’t for­get to check out our Su­per Booster cam­paign. Your chance to win one of five $1000 prizes for your su­per fund closes on Septem­ber 15. All you have to do is pledge some ex­tra money for your su­per be­fore then and de­scribe your dream re­tire­ment in 25 words or less. See su­per­boos­t­er­day.com.au.

Effie Za­hos, Ed­i­tor, Money magazine

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