September magazine

COVER STORY

CASH, SHARES OR PROPERTY – HOW TO TURN $1000 INTO $10,000

Had you invested $1000 in Fortescue Metals Group 10 years ago, it would now be worth $666,535. Hindsight is a beautiful thing. We might not have the ability to go back in time at Money, but we can certainly put together seven strategies to help you turn a $1000 into $10,000. Depending on how quickly you want to reach your $10K goal and how much risk you are willing to take we have strategies for both the conservative and aggressive investor. Money looks at investing your $1000 in foreign exchange, property, saving accounts, shares and more. So if you have a lazy grand sitting around – not doing much at all – put your money where your mouth is.

GIFTING MONEY AT WEDDINGS

Wedding Bells

Story Effie Zahos

The invitation reads, “I don’t want to offend but I have it all, household goods and so much more. To save you shopping, looking and buying, a gift of currency, I thought you’d like trying.” Offensive or good sense? This is probably one for the etiquette specialists, but what we do know, is institutions have caught on and now have products such as the “Matrimoney” account. Although these accounts may seem like a good idea, you need to do your homework before signing up, as there are some that take as much as 5.9% per cash gift transaction. Some sites suggest you pass these fees onto your guests, but where do you draw the line? Money takes a look at this interesting evolution of gifting cash as a wedding gift and things to be wary of should you choose to go down that path.

IN YOUR INTEREST

Paul Clitheroe follows the links between money and wine to promote MoneySmart Week’s message.

September 2 to 8 is MoneySmart Week and Paul, who is the chairman of the Australian government’s Financial Literacy Board, plays a key part in this week. Pauls believes the concept is really good. He is keen for people to spend a little more time on their finances – the primary aim of the week is to encourage people to go to the website www.moneysmartweek.org.au and do its money health check. Paul did it and was reminded that he could do better in a number of areas. Fortunately two areas the health check did not focus on were sailing and wine……

That feeling you’re going nowhere

Story Paul Clitheroe

Linda and her husband feel like they’re going nowhere with their finances. They’re looking at buying a house to help fund their retirement. Their combined income is $190,000pa. We have two kids in primary school. They have one investment property. Three years ago they gained $50,000 in equity as the house value went up. They invested in shares through a financial adviser. Their combined super is valued at around $180,000. Should we sell our shares, even though they’re worth less than when we started? Should we sell our investment property or hope its value increases? What sort of loan should we set up for the new one – principal and interest/fixed? Paul delivers his verdict.

Master plans

Story Maria Bekiaris

So you’ve just come off contract and it’s time to reassess your mobile phone plan. Sure, it’s not easy keeping up with all the latest mobile phone deals and quite frankly, it’s probably just as easy to put it in the “too hard box” and stay on your current deal. But did you know, just by doing a little research and shopping around, you could save yourself over $300 a year by switching to a better plan. Money outlines some of things you need to think about when shopping around such as pre-paid vs. post-paid and how your phone use affects which plan you should consider. Plus, we take a look at the best value unlimited plans and best plans under $30 a month.

Take a fresh look at your borrowings

Story Effie Zahos

Reassessing your borrowings every now and then can bring financial rewards. At the moment, the margin between the cheapest home loan and the most expensive is 1.78%. On a $300,000 mortgage that’s a yearly difference of over $4000 in repayments or $350 a month! So how do you know if your loan is in need of an overhaul? You need to ask yourself the following questions: “What do you owe and pay” and “do you have the right features?” Many home owners are unable to answer these questions and don’t know where to begin. Money comes to the rescue with some handy tips.

Don’t take the easy option with funeral insurance, writes Maria

Story Maria Bekiaris

Unfortunately, funerals are a fact of life. But sending off a loved one in style isn’t cheap and can cost anywhere between $4000 for a basic cremation to around $14,000 for a more elaborate funeral. Planning for a funeral can be difficult, but it’s important to understand what products are available and how they differ. Money looks at funeral insurance as well as some other alternatives that can help cover the cost of farewelling the dearly departed.

Taxing time

Story Anne Lampe

You’ve just received a letter from the tax office inviting you to have your tax affairs audited. Why you? What happens at an audit and what do you need to take? What happens if you have lost your receipts? So many questions! But don’t worry, Money explains what you need to do for a tax office interview.

The black is beautiful

Story Ross Greenwood

The idea of negative gearing has always been to deliberately lose money (because the interest bill is higher than the income you receive) with the intention of making a capital profit when you eventually sell. The beauty of this strategy is that you can claim the loss on that investment against other income (including salary and wages) while understanding that the timing of the sale (and therefore the timing of the capital gains tax) is entirely yours.. Money regular, Ross Greenwood says the time is ripe for gearing positively.

Interview with Colin Holt

Story Deborah Light

On our bleak retail horizon you can find lights amid the gloom. Some operators are seeking snug niches, including Colin Holt, co-founder of a small chain of boutique butchers. He’s just one of a new breed of posh food suppliers who are staking out relatively new retail territory; territory long abandoned by more traditional operators – including butchers, bakers, greengrocers and cake shops – who’d felt bullied out of business when Australia’s supermarket giants started weighing into fresh food decades ago. Deborah Light talks with Colin.

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