2019: A year of unexpected twists and turns!

Posted on Tuesday, December 10, 2019
2019 has been a year of unexpected outcomes.   On reflection, if you’d told me 12 months ago that we were going to have three interest rate cuts, Scott Morrison was going to win the election, and the property market was going to boom, I simply wouldn’t have believed you.   And yet, here we are.   2019 has brought three interest rate cuts, leaving us at all-time lows, and I’m expecting two more cuts in 2020.   2019 brought us a Scomo election victory that dusted fears around changes to negative gearing and franking credits, and brought with it tax relief.   2019 brought us a year of change and innovation, with services like HaloGo now delivering fuel to your doorstep on-demand, and Malvern Auto Tech doubling its car servicing business due to the enormous number of ride-sharing cars now on the road.   What 2019 didn’t bring however, was cost of living relief. Sure, you might feel a little wealthier because you’re paying a bit less mortgage ... Read the rest of entry »

Save some coin this Christmas: cut the crap

Posted on Wednesday, November 27, 2019
Last Monday marked one month until Christmas day.   Christmas is a joyous time of year where we get to catch up with friends and family, and spend stupid amounts of money that we’re not prepared for, which will catch up to us come January.   That’s why the time is right to have a conversation with family and friends about the terms and conditions for buying each other gifts, so that you’re all on the same page.   In my view, there’s not a lot of point in adults buying other adults Christmas gifts that they don’t want, don’t need, and will probably never use. As a result, it might be an idea to save yourself some cash by suggesting a ‘kids only’ Christmas gift rule among your friends and family.   If you get major push-back on that, maybe suggest a Kris Kringle or Bad Santa type setup, where everyone buys one gift of a certain value, and everyone also receives just one.   If you get resistance to that idea as well, I’d sug ... Read the rest of entry »

It's time to take some financial advice from Millennials!

Posted on Wednesday, November 20, 2019
Millennials cop a lot of flak for spending their cash on smashed avocado and holidays, rather than saving to buy a home. However there’s a new financially-savvy Millennial trend that’s putting the rest of us to shame: buy now, pay later. In the old days, it was called LayBy, but over the last decade or so people switched to credit cards to make purchases and pay for them later. Enter the new wave of buy now, pay later – things like AfterPay and Zip Pay – and they’re being lapped up by the younger generations. Why? One possible explanation is that younger people aren’t interested in being fleeced by banks in the form of credit card interest, which can often sit around the 20% mark. Also, they don’t want to run the risk of tarnishing their credit history by missing credit card payments, and have no interest in paying annual fees, merchant fees, or racking up frequent flyer points. What they do like is 10 weeks of no fees and no interest with these buy now, pay later ... Read the rest of entry »

To tip? Or not to tip? No way!

Posted on Wednesday, November 13, 2019
To tip? Or not to tip? That is the question.   But in my view, it’s got a very simple answer: no.   Lots of things in our culture are becoming increasingly Americanised, with Halloween a couple of weeks ago a good case study. But one thing we don’t need to see creeping in is tipping.   The main reason for that, in my opinion, is that in Australia people are mostly paid a fair wage for the work that they do. Even our lowest paid workers are the beneficiaries of the highest minimum wage in the world. As a result, there’s generally no need to tip just to say, “thanks for doing your job”.   However, in the age of social media, there’s a new and better way to tip: leave a good review. A positive review on Facebook, Google or TripAdvisor for a business that provided amazing service is going to be far more valuable than slinging an extra tenner their way.   Similarly, jumping on your personal Facebook page, or your local buy, swap and sell p ... Read the rest of entry »

Assessing eligibility for the pension against the family home

Posted on Wednesday, November 6, 2019
At what point should the value of the family home be taken into account when assessing an individual’s or a couple’s entitlement for the pension? There’s been a proposal from an ACT academic to reduce the pension for older people whose homes are valued at more than $2 million. He says this would save the federal budget about $6.3 billion. I think this is an interesting conversation. From a technical economic perspective, taking into account all assets (including the family home) when assessing eligibility for the pension is the right thing to do. At the moment, all assets except the family home are taken into account. But if a government were to place a value cap on properties, whose assessment of value would be taken into account? Would it be based on rates notices? Or tax returns (which many pensioners no longer lodge)? Or something else? From a political perspective, making these sorts of changes to pension eligibility would be political suicide. No government – or opposition & ... Read the rest of entry »