Can I share something with you? I’m an impatient person who dislikes waiting. That could be waiting in traffic, on hold on the phone or in a queue at the supermarket. To be honest, it could be anywhere and anything. I just don’t like waiting. I know I’m not the only...
I often hear my clients tell me they want to be in the “best super fund” and make sure they do the “best investments”. Whilst I understand where this sentiment is coming from, I normally point to the fact that it’s simply not possible to be in the best super fund every month, quarter or year. Let me explain using a recent analogy I found myself making the other day. I was watching the AFL footy finals and please bear with me, whether you like the AFL or not, I think this comparison is reasonable.
Our brains are wired to focus on the bad and the power of bad governs people’s moods, drives marketing campaigns, and dominates news and politics. What can we do about this when investing?
What do the interest rate increases mean to your investments? Interest rate increases will affect different investments in different ways.
Headlining at the moment are Russia’s invasion of Ukraine, house prices and rising interest rates, dropping share values and so on. Naturally, many people I speak to are worrying about all of this as well as how it might be impacting their own nest eggs and investments.
What you’re essentially doing before retirement in your “super phase” is having your employer contribute your superannuation, possibly top it up yourself with a sweet tax benefit, then letting time and compound interest do their thing. Then, once you are eligible to access your super, you switch it up to “pension phase” and access your money tax free.
The most pertinent thing to do right now is to consider your existing risk profile. Consider the issues and unknowns, revisit your goals and objectives, reflect on your investment timeframe and weigh up some best/worst case scenarios. Then position yourself in case a storm comes through.
When investing it can be OK to ride a skateboard down a steep slope. But if you’re going to do it, it’s good to fully appreciate the risks and it’s probably best to avoid it as you get closer to retirement!