Episode 51: Is your daily coffee really destroying your financial future?

Jul 2, 2019 | Personal Finance, Podcast Episodes, Stock Market

There has been an uproar online surrounding a daily coffee purchase being the reason people aren’t saving the amount of money they need for retirement. If you look at the maths, the amount spent on a daily coffee over a lifetime adds up to a hefty bill. But is it worth cutting out something you love? 

The way we see it is, if you love your daily coffee and are forced to give it up, you’re going to start resenting saving money. Instead, look at other expenses in your life, that you don’t particularly get as much satisfaction from, and save there.

As financial planners, our opinion in cutting out coffee in order to save for a retirement plan isn’t as simple as it sounds. The money saved from not purchasing two daily coffees does not turn into automatic savings, with a return, to become retirement savings. All aspects of our lifestyle add up to factors that impact our finances. It’s more important to have a savings habit to create savings that aren’t making you feel deprived, and then putting those savings into a retirement plan. Focus on the basic principle of creating a savings habit. 

This Week’s Investor Exchange Round Table Covered:

  • Brett discusses capital raising by A-REITs being at an all-time high. A-REITs are an investment trust that owns and usually operates a portfolio of income-producing property. Figures from JP Morgan state that Australia’s major players have raised 2.1 billion this year. Listen in for more on A-REITs performance. (14:56)
  • Joel explains tax-deferred income, which occurs when the regular income distributions from A-REITs are generated from rental earnings. These distributions may have a ‘tax-deferred’ component, which happens if a property trust’s distributable earnings are higher than its taxable income. (20:46)
  • Joel discusses some crazy evaluations on certain stocks, including businesses that are trading at around 80 times their historical sales. What that means is you would have to wait 80 years for the level of sales the company is generating to equal the investment you made in that stock. Listen in for more on our strategy on shorting these types of stocks. (32:21)

You Cannot Be Serious:

Looking at some spectacular marketing fails, we came across Horizon Fitness’ ‘Free Joining Fee’. Is it free or is there a fee? 

A domestic violence article in The Daily Mirror, with the headline ‘1 in 4 Women Will be Beaten by Their Husbands”, is placed above an advertisement featuring Sylvester Stallone, telling women to “Treat Him on Father’s Day” with a work out supplement. Talk about bad taste!

There’s a new trend on social media and online dating, following the ‘booty call’, that’s being called the ‘foodie call’. A study shows 33% of single women report going on a date, just for a free meal!

Listener Questions:

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The post Episode 51: Is your daily coffee really destroying your financial future? appeared first on The Investor Exchange.

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The Investor Exchange

The Investor Exchange is weekly podcast where the expert panel share banter, tips and insights on how to grow and manage wealth.

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