22 Feb 2024 Podcast: Q&A – All Things Investing with Jess Clifford from Green Pockets
In this Q&A episode, Jess from GreenPockets answers questions from listeners alongside Evelyn, and discusses various financial and investing topics.
Jess emphasises the emotional risk in investing and suggests starting with small amounts.
She talks about maintaining a financial foundation and setting achievable retirement goals.
Jess also touches on tax-effective strategies and offers insights into Cryptocurrency.
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Podcast produced with Apiro
Please find a Podcast summary below with the interview highlights:
Jess and Evelyn discuss various aspects of investing, risk management, and financial planning, particularly focusing on young professionals and long-term goals like retirement. Key points include:
- Emotional Risk in Investing:
- Jess emphasizes managing emotional risk by starting small, holding through market downturns, and avoiding panic selling.
- Having an emergency fund of 3-6 months’ expenses is crucial before investing.
- Saving for Retirement:
- Frame retirement as “freedom” to make the concept more relatable.
- Jess advises against solely saving; instead, focus on investing for growth.
- Budget effectively, explore ways to increase income (e.g., side jobs), and channel additional earnings into investments.
- Superannuation (Super) vs. Index Funds:
- Super is tax-effective but inaccessible until retirement age. Young investors should focus on accessible investments like index funds for flexibility.
- Paying off high-interest debts should take priority before investing extra in super.
- Tax-Effective Strategies:
- Super is highly tax-efficient (15% tax on contributions), but individual circumstances dictate the best strategy.
- Consulting an accountant can help decide on structures like family trusts or joint investments for tax benefits.
- Cryptocurrency:
- Jess sees potential in crypto and blockchain but advises treating it like other investments: diversify, research, and avoid speculative altcoins.
- Established cryptocurrencies like Bitcoin and Ethereum are safer bets.
- Determining Financial Goals:
- Use the 4% Rule to estimate the investment portfolio needed for retirement (e.g., $60,000/year requires $1.5 million invested).
- Leverage investment calculators to plan contributions over time.
- Shift from growth-oriented to stable, income-generating investments as retirement nears to protect capital.
- Adjusting Strategies Over Time:
- Transition from high-risk to low-risk investments closer to retirement to sustain income without eroding capital.
The session concludes with practical advice and encouragement for listeners to use tools like investment calculators and seek professional guidance to tailor financial strategies.