My Wife Found the Lord … But Not a Job

Hi Scott,
 
My short question is this:
 
Is it legal for a partner to refuse to get work? And who can I turn to if they continue to refuse to get work?
 
The longer question:
 
When we got married, my wife gave up her well-paying job for us to start a family. Our plan was for her to give up work, then return to work when the children were in school full time.
 
Fast forward six years, both the kids are in school full time, and I’ve asked her about getting a job. She refuses to get one, but has spent the last four years doing various TAFE courses. Also, while studying she got heavily involved with a church. During this time her commitment to the church was far superior to her commitment to her family, with her often attending church activities and leaving me and the kids at home late into the night.
 
The house is a pigsty and we haven’t had guests over for at least five years. I’m mentally stressed from being the sole breadwinner, as well as consistently looking after the children. If I leave, I’ll potentially lose the house and assets I've paid for (she brought nothing financially to the relationship). And she point blank refuses to participate in any marriage or financial counselling. Where can I turn?
 
Dennis
 
Hi Dennis
 
The short answer is, no it’s obviously not illegal for a partner to refuse to work!
 
I’m not a relationship counsellor, but one thing I can tell you: whatever decision you come to, don’t make it based on money.
 
There is a lot to unpack here … yet I don’t think your wife getting a job will solve your problems.
 
Your real problem is that you’re living in an unhappy marriage where your wife is getting at least some of her needs met by her faith and the church rather than you.
 
So the real question you need to ask yourself is this:
 
Are you willing to try and improve the relationship … or are you too bitter, twisted and hurt?
 
The only person that can answer this question is you. And even if you do decide to try and improve your relationship – perhaps by going to church with her – there’s obviously no guarantees from her side. If you come to the conclusion that the relationship is cooked, that’s your main concern … not the money.

Scott.

A warning to anyone who taps their card

“Would you like your receipt?” asked the cashier at my local IGA.
 
I shook my head. I always shake my head.
 
After all, most receipts are a waste of paper and ink. And I know that if I do take one, just to be nice, I’ll shove it in my pocket and it’ll invariably end up going through the wash and Liz will yell at me.
 
In fact, if I’m buying something cheap these days I don’t even hang around to get asked the question.
 
I’m tapping, and I’m going!
 
As soon as I hear the ‘beep’ I’m off. “Stop me if it doesn’t go through”, I say as I charge out of the store.  
 
Yet this week I got a shocking letter that has made me slow the hell down at the store.
 
Hi Scott,
 
My husband did a silly thing. He often goes to a local bakery for a chicken sandwich, paying with his debit card. Last week, he did his usual routine: ordered, tapped his card, entered his PIN, picked up the sandwich, and continued on with his day.
 
Over the weekend, he noticed the bakery had charged him $1,300, not $13. He called the bakery, thinking it was a mistake. However, the owner accused him of being a scammer and refused a refund!
 
He then disputed it with the bank. The bank said that entering his PIN meant he had authorised the charge. So we’re now out $1,300 for a sandwich!
 
Natasha
 
Struth!
 
Talk about a sh…nitzel sandwich.
 
Thankfully my bank flashes up the transaction on my Apple watch and phone after I leave the store.
 
Your husband should definitely get that feature.
 
Yet here’s what I’d do about your situation.
 
First, I’d gather the evidence: get the bank to verify the merchant was indeed the bakery, and then print off the statement. I’d hand it to the bakery and ask very politely that they reverse the transaction.
 
And if they refuse, I’d tell them that your next stop is to the police station where you’re intending to press charges for theft.
 
Tread Your Own Path!

The Barefoot Confession

Hi Scott,
 
I used to be a sucker for personal development. I was always taken by the idea of the freedom that would come with the ‘laptop lifestyle’. Over seven years I spent over $100,000 in course fees and coaching programs and amassed $50,000 in personal loans. Bye-bye house deposit! I ended up working on the side as well, holding down three jobs to feed my course junkie addiction.
 
It wasn’t until I met my partner that I realised that I was the product, and that it was just another variant of an MLM scheme. So, over the past three years I’ve followed your steps and paid off my debt, and now I have $50,000 in my savings – slowly on the way to a 20% house deposit! I am so proud of getting back on track, and I feel I am finally free of those who preyed on my insecurities and desires to make themselves wealthy. I’ll be forever grateful for your level-headed path to true freedom, and better relationships too.      
 
Thanks for the confessional, and thanks for your work.
 
Lisa
 
Hey Lisa
 
As Dr. Phil says, thank you for sharing.
 
Your story reminded me of one of the oldest and most famous tales from self-development, called Acres of Diamonds. It was written in the late 1880s, and it tells the story of a farmer who sells his land and goes searching for diamonds. The new owner discovers a diamond mine on that same land. The moral of the story is that wealth and success is in our own backyard. You’ve proven that.
 
Shine on you crazy diamond.
 
You Got This!

Scott.

We’ve Made $11,400 Profit in Four Months

Hi Scott
 
My husband and I recently started trading CFDs (Contracts for Difference) online. We started with $500 thinking that “if it’s a scam, we’ll only lose $500”. We talk to one of their brokers (who is in Switzerland) a few times a week and it’s going very well (we’ve ‘made’ A$11,400 profit in four months). We have done a withdrawal of $100 to see if we have ready access to the money, and it came through with no problems at all.
 
The broker is now asking us to invest more money – up to US$100,000. We don’t have that kind of money, so he has suggested we set up an SMSF and invest some of our super. We always seem to miss the boat on financial opportunities, so I wanted to get your view on whether we should do it.
 
Rick
 
Hi Rick
 
Somewhere – probably in a compound in Laos – your name is written on a whiteboard.
 
These scammers have got you on the hook … and now they’re attempting to reel you in.  
 
The big barramundi for them is your superannuation. They plan on stealing every last cent of it and leaving you with absolutely nothing.
 
This happens to a trusting, unsuspecting Aussie every single day.
 
My advice?
 
Contact IDCare (idcare.org, 1800 595 160) and tell them you’ve been scammed.
 
Why would you do this?
 
Because here’s the thing that most crooks have worked out: the best people to scam are those who have already been scammed.
 
That’s you!
 
So don’t let it keep happening. IDCare will help you safeguard your identity online, and hopefully ensure your name doesn’t appear on any more whiteboards.
 
Scott.

The Future Olympian

Hi Scott,
 
I’m a 19-year-old athlete training for a qualification spot in the LA 2028 Olympics. Since finishing school, I’ve been working a full-time job to pay for all the training, competitions, overseas travel and extra expenses that come with being an athlete. Recently, I’ve been getting frustrated with the numbers. I can always just pay for all the expenses, but I never seem to get anywhere financially. The tough call is that any extra time I choose to work means less time for training, and vice versa. I’d love to eventually start saving for a house or maybe uni. Any advice? 
 
Kayla
 
Hi Kayla
 
Do you know how rare it is to have a single, driving goal that gets you out of bed each morning?
 
That’s gold (or silver, bronze or, heck, just the absolute honour of competing for your country)!
 
What I like about where you’re currently at is that it’s finite: you either get there in 2028 or you don’t, and you move on with your life.
 
Look, life isn’t about accumulating as much money as possible, it’s about creating memories. And you’re currently working on something that, when you’re sitting in an aged care facility in sixty years’ time, will be one of your most cherished memories.
 
The main thing to focus on is not going backward financially. As long as you can keep your head above water, you should go all in for the next four years. Then, if you apply the same steely dedication to your post-athletic career, education and financial situation, you’ll have nothing to worry about.
 
Follow your dream.

Scott.

If the economy is so screwed … why is the share market at all-time highs?

I was in at the ABC the other day when a young Gen Z bloke who worked there (whose hairdo made him look like one of my alpacas) nailed me with a killer question:

“If the economy is so screwed … why is the share market at all-time highs?”
 
Great question!
 
He’s dead right, of course. For most people the economy is ‘stuffed’. And it’s not just a feeling. Over the last year household incomes in Australia have dropped by more than in almost any other country in the world.
 
Yet, while our politicians are busy flogging the supermarkets with their own $20-a-kilo lettuce leaves, it’s not making much of a difference. Prices keep going up.
 
It’s shocking, and depressing ... and yet it does beg the question:
 
Does the share market know something about the future that we don’t?
 
Nehhhy …  spits Pedro the alpaca.
 
In fact, the share market has predicted nine out of the last two recessions!
 
Seriously, though, the question of why the share market is at record highs right now has a long answer.
 
(Interest rates coming down? Donald Trump going up? Artificial intelligence replacing us all? Who the heck knows? Not this alpaca farmer.)
 
Yet the short answer is actually pretty darn simple:
 
Shares mostly go up.
 
That’s right. Most years shares go up. That’s because the share market is really just a collection of businesses that make a lot of money and compound it over time.
 
The chart below tells the story:

The other thing you should know is that the term ‘record highs’ is a newspaper headline writer’s best friend: each day the share market goes up by even a point, it’s a new record high! The next day it may dribble up another couple of points. Another record high!
 
Now it is true that the share market occasionally crashes (though no-one can accurately predict when it will happen). Yet, as the chart shows, shares always recover.
 
That’s why I told the ABC kid the same thing I tell everyone:
 
Follow the Barefoot Steps, and become an investor.
 
Just don’t wait for the alpaca-lypse!
 
Tread Your Own Path!

Investing in Nvidia

Hi Scott
 
Given that artificial intelligence is going to change the world, up-end entire industries and render millions of people unemployed (hopefully not me!), I am thinking about investing a large part of my superannuation into Nvidia, the AI chip maker that is dominating the industry. But I just wanted your thoughts first. Do you invest in it?
 
Gary
 
Hi Gary,
 
So we’re currently at peak AI hype.
 
Investors are obsessed with the potential of artificial intelligence … and the chance of making a quick buck has got them treating Nvidia like a casino chip:
 
Last week Nvidia became the world’s most valuable company. This week it suffered the biggest three-day loss of any company in history ($646 billion), according to Bloomberg.
 
Something tells me that the croupier hasn’t yet called “no more bets”.

So would I invest in Nvidia?
 
Yes, I would. In fact I do. I own Nvidia (among hundreds of other stocks) through my international index funds, and that’s enough for me.
 
But would I go balls and all into Nvidia at it these prices?
 
Well, you could ask ChatGPT … but I’m a strong no.

Revenge of the Dollarmite?

Hi Scott
 
I recently found out that the bank signed up my 18-year-old son for an $8,000 credit card. He was so excited to be a grown-up, to have a job making enough to earn spending money, and to cross the line of being an adult by being given a credit card. I don’t for the life of me understand why the banks feel $8,000 is a good starting amount for someone who has never had to prove they can pay it back!
 
Sadly our story ends with me finding out about the credit card via the post when the default notice arrived. In six months my son had spent all the large balance and kept it secret – he is 18 after all – but has no skills to be able to understand the outcome he has created. We are working with him now to resolve his debt, but it’s clear the banks are setting up young adults for failure by allowing this amount of credit.
 
Kate
 
Hi Kate,
 
I agree with you – eight grand is a lot of credit to start him off with.
 
Now I’m showing my age, but back in my day the banks had a student package that came with a credit card with a $500 limit. Then they ramped up the limit from there (kind of like a meth dealer does).
 
The real danger of getting a credit card when you’re a kid (and, post the COVID lockdown, 18 is the new 13) is that they’re effectively teaching him to view his available credit balance as his money. It’s not, of course, but that’s how they can effectively impose a 20% tax on everything he spends, hopefully for the rest of his life.
 
Yet thankfully your son screwed up … and as a result he was booted out of the brainwashing.
 
This is a very good thing, Kate.
 
Please keep the parental helicopter on the helipad and do not bail him out under any circumstances.
 
This is a life-changing, teachable moment.
 
First, explain the seriousness of a default notice: the bank could take legal action against him, and he now has a black mark on his credit file.
 
Second, have him calculate how much the credit card has actually cost him in interest. That’ll make him feel sick. Then jump on ASIC MoneySmart’s website and show him the bank’s plan for that $8,000 credit card. Making the minimum payments would take 61 years to pay off and $44,168 in interest.
 
Finally, when you’ve scared the living bejeezus out of him, have him call the bank and negotiate a payment plan to pay off every last cent of the debt.
 
Play your cards right and this may just be the best financial thing that ever happens to him.

Scott

I’m Disappointed in You, Barefoot

Scott,
 
You used to be informative. Now it’s very transparent that you are charging brands to advertise on their behalf. Not happy, Jan.
 
Jan
 
Hi Jan
 
Well I’m not happy with you, Jan.
 
You are referring to my recent column on the electric blanket I bought.
 
(I’m just trying to keep people’s beds HOT. So shoot me.)
 
For the record, all I did was write about a recommendation by CHOICE.
 
And I’ll have you know that I paid full pud for both the blanket and the CHOICE subscription.
 
For reasons I still don’t understand, my newspaper editor pays me way too much money to write about irrelevant things like electric blankets. Take it up with him, Jan.

Scott.

My Mother has a Lover

Hi Scott
 
My mother has been sending large amounts of money to a holiday fling for the last 14 years. She has almost lost her home, she’s drawn on her super, and I fear she will be in dire straits soon if this continues. It happened like this: in 2010 she met a young Casanova in Egypt, and a holiday fling quickly became a business partnership. My mother has zero business experience. She’s borrowed against her home to fund some outlandish ideas. She has been back a number of times and has seen where her money has gone – apparently! I’m not sure whether it was the car manufacturing plant or the haute couture fashion house. I wish I was kidding – these are examples of their ‘ventures’. Despite 14 years, hundreds of thousands of dollars and zero return, she’s even more optimistic now. In reality she is a teacher struggling to find a permanent position because she is past retirement age, is burdened with debts she can no longer afford, and has enough super to keep her until Christmas this year. And she will not listen to my concerns! I was hoping this was something I could report to the relevant authorities so they can intervene before she loses everything.
 
Linda
 
Hi Linda
 
That sounds like one hell of an expensive shag!
 
Still, you can’t call the cops. From the sounds of it, he’s not doing anything illegal (immoral perhaps, but not illegal). And you’ve tried talking sense to her, but clearly after 14 years that hasn’t worked.
 
So what can you do?
 
Well, you need to protect yourself emotionally and financially.
 
I’d suggest writing a letter to your mum explaining how much you love her and how concerned you are for her financially. Then detail the likely consequences of her actions. Paint her a picture of what her retirement will look like. How will she service her debts when she’s too old to work?
 
Understand her debts will die with her: you won’t inherit them … but that also means you won’t inherit any dough from her either. So double down on your Barefoot plan!

Scott

The new (better) Bali

“Don’t lick the tray table!” I warned my three-year-old as we boarded the plane to Tokyo.
 
His bottom lip dropped and he whined, “Are we there yet, Dad?”
 
“No, we’re still on the runway, mate”, I sighed.
 
Still, I knew that wedging myself into an economy seat next to germ-boy for the next 10 hours would be well worth it. After all, Japan is the thinking man’s Bali. (In fact, Bali was dethroned as Aussies’ favourite spot for international travel on last year’s Expedia ranking.)
 
So it’s official: Kuta is cringe … Kyoto is cool.
 
And the figures back this up: the number of Aussies visiting Japan in May this year is up a staggering 63% on last year, according to the Japan National Tourism Organization (JNTO).

Why?

Well, because for many Aussies Japan is a parallel world:
 
Everyone is impeccably polite and respectful.
 
Their subway system is cheap, clean, safe and on time (as in, to the second).
 
Their public toilets are cleaner than mine at home … and they sing when you flush them.
 
Yet the biggest thing you notice is that food is really cheap. Unlike in Australia, where you have to Afterpay a banana, in Japan we would load up on good-quality gyoza, sandwiches and bao buns from the 7-Eleven for A$3 a pop … or we’d grab a bowl of ramen at a restaurant for less than A$10.
 
This is a far cry from the go-go 80s when Tokyo was one of the most expensive cities in the world.
 
Yet with their economy a chopstick away from a recession, and the yen plummeting – it’s now 25% cheaper to visit than since before the bat-flu – Tokyo has actually become a shopper’s paradise (especially given that in most department stores you can shop tax-free simply by showing your passport).
 
Ring those bloody registers!
 
This explains why ‘G’day’ to a Japanese shop owner translates to ‘kerching’: Aussie tourists are (per capita) the biggest spenders in Japan, according to the JNTO.
 
Not that I got to do much shopping.
 
A few days into our trip, germ-boy predictably came down with a fever … and promptly gave influenza to his mother, sister and two brothers. They couldn’t lift their heads from their futons. So I spent the last week in a hotel room roughly the size of a Kia Carnival – with no windows or natural air – playing doctor Scott.
 
Sayonara, Tokyo!
 
Tread Your Own Path!

The Diamond Heist!

Barefoot,
 
I’m a jeweller, and I much prefer the authenticity of a real diamond. Yes, natural diamonds cost more (though only a small percentage are ‘blood diamonds’). However, they will also ultimately gain in value, whereas lab grown diamonds have no value once they become second hand.
 
Linda

Hey Linda,
 
I’d like you to put down your cute little magnifying glass, because I’m about to hit you with the bleeding obvious:
 
Literally no one buys a diamond ring with the thought that it will be rejected and then re-sold.
 
Didn’t you read the script? It clearly states “till death do us part”.
 
Nor is it seen as a financial investment that can easily be hocked off in a few years’ time when the Ford Territory needs a new set of tyres.
 
As any divorcee knows, the resale value of a mined diamond ring is roughly the same as that of a three-year-old laptop.  
 
Having said that, I grant it will have a higher resale value than a lab-grown diamond.
 
And if a potential suitor is stressed about pulling a hammy as they get down on one knee, I’d argue that they’d be more likely to hedge their bets with an ‘ethical’ diamond ring that’s 90% cheaper. (Although I must admit quite a few readers this week pointed out that the lab-grown diamond process uses all sorts of environmentally dodgy gases – not so ethical after all, apparently.)
 
Finally, mined diamonds are valuable only because De Beers has rigged the price for decades. As I said last week, there are said to be 39 billion stones in existence – more than five for every person on Earth 

Now that is a lot of supply!

Scott.

You Are NOT Setting a Good Example to Your Children, Barefoot

Hi Scott,
 
You said you want to set an example to your kids by putting your phone, keys and wallet in a bowl at the front door. This is not a good example, given all the crime now – you might as well put them out at the front gate. Place your valuables in the kitchen, as this is the most centrally travelled room in the house. But please not at the front door.
 
Reg
 
Hi Reg
 
Yes, it sure is dangerous out there.*
 
(*If you listen to Peter Dutton, who seems very angry, and very determined to be very angry.)
 
The problem is that the statistics show that over the last 10 years break-ins have been decreasing.
 
Nationally, the latest figures show that just 2% of households experienced a break-in. This figure has been trending down for a decade and is quite a bit lower than when they started collecting the data in 2008–09, when it was 3.3%.
 
It’s hardly Venezuela, Gonzuela.
 
That being said, if you were one of those 2% you’d understandably be very upset.
 
However, if a violent robber entered my house, I’d prefer it if they quickly found my wallet and the keys to the Toyota from the dish, and then nicked off … instead of playing a game of hide and seek with a machete.

 Scott.

How I Keep It Hot in the Bedroo

“Why am I so hot?” said Liz, bolting upright in bed the other night.
 
“Perhaps it’s early menopause?” I giggled back into the darkness.
 
Silence.
 
I could feel my wife’s (mental) temperature rising.
 
“I bought us an electric blanket,” I confessed. “It’s pretty toasty, right?”
 
“That is such an old person thing to do,” she said, rolling over and giving me a warm shoulder.
 
Truth be told, this night had been a long time coming. You see, I have PTSD from staying over at my grandparents’ house when I was a little tacker. As Nana would turn up the wiry electric blanket, my big sister would hiss at me, “Remember, if you wet the bed tonight you’re going to electrocute yourself”.
 
From that point on, I slept with one eye open.
 
Thankfully, I’m over that now (plus, I figure I’ve got another 25 years till my prostate starts playing up), so I’m good to go.
 
Yet there was one real problem:
 
Electric blankets are known to cause fires, which is quite terrifying really.
 
So how do you find a good one? (I mean, one that won’t take you from toasty to toasted.)
 
Well, I bought the Dimplex DreamEasy Electric Blanket, which cost $75.
 
Why?
 
Because the Dimplex scored the highest rating from CHOICE testers, and they don’t give them out easily.
 
They looked at heaps of electric blankets and put them all through a series of safety, comfort and electrical testing, which included taking thermal images to see how they disperse heat, measuring energy consumption (mine will apparently cost $61 to run through the 92 days of winter), and even building a custom-made rig that simulates 5,000 cycles of the cord flexing and pulling under a weight of 10 newtons (around 1kg).
 
Then they performed a current leakage test. ZZZZT!

Contrast this to the reviews you get from the Wild Wild West (aka the World Wide Web).
 
A report from the World Economic Forum (WEF) found that writing fake online reviews is a well-organised multibillion-dollar business. In response to this, in 2022 alone Amazon blocked more than 200 million suspected fake reviews and Google blocked or removed more than 115 million. Yet now artificial intelligence is being used to write fake reviews en masse and pollute the internet.
 
So here’s my take:
 
The sort of in-depth testing that CHOICE does across 200+ categories – without getting a kickback or even a freebie from the manufacturer – costs a lot of money. And that’s why I’m happy to pay my $84 annual membership. Not only does it save me hundreds of clams each year, it also keeps me warm in bed each night!
 
Tread Your Own Path! 

I’m off the Booze

Hi Scott,
 
I’ve been meaning to write to you for some time now. I work as a police officer and, as you could imagine, I have developed what might be called a bit of a habit of drinking. I never thought I had much of a problem, yet time went on. I read your response to a lady who wrote in asking about giving up drinking as a New Year’s resolution. Your reply mentioned a podcast by Dr Andrew Huberman. I watched the YouTube video and it made me open my eyes to how poisonous alcohol is and how little you need to drink to be considered chronic. I loved your reasons as well. I have not touched a drop since. I’ve found I’m sleeping better, and am calmer and less stressed as a result. I want to thank you because I don’t think I would have ever stopped if it wasn’t for you (and Dr Huberman). My life is so much better and my kids now have a better role model.
 
All the best, Nigel
 
Hi Nigel
 
If I had a dollar for every person who wrote to me saying they’d given up the grog after reading that article and listening to the podcast, I’d be able to shout Barnaby Joyce a night out on the turps. You got this!

Scott.

Barefoot Confession

Hi Scott,
 
I just have to get this off my chest. For the last five years I worked in a job where I only did about one hour’s worth of work each week (there was a six-week period each year where it was quite busy and I would do maybe two to four hours a day). The rest of the time I would browse the internet, go on 60-90 minute walks while listening to podcasts, prepare food in a makeshift mini kitchen I had set up, watch TV series and movies, play retro video games online, just whatever I wanted that wouldn't look too obvious that I wasn't doing anything - although I'm sure people knew. I even negotiated a pay rise for myself while doing all of this - from $70k to $78k. I left that job with an absolutely glowing reference from my boss that helped me get my current job, where I do actually work most of the day.
 
Cindy
 
Hi Cindy,
 
I could kind of see how this could happen if you were working from home.
 
(Employers think they can track workers via apps like Microsoft Teams and Gmail that mark you as ‘away’ if your mouse doesn’t move for a period of time. What they don’t know is that sneaky employees are buying an undetectable “mouse jiggler” on Amazon for $15, which has 4,555 glowing reviews on Amazon).
 
Yet you did this from the office!?
 
Hopefully they replaced you with a pot plant.  And if I were the owner of that business, I would have placed your old boss – who gave you a pay rise and a glowing reference – on permanent gardening leave!

Scott.

How to Earn 7.35% on Your Savings

Hi Scott,
 
I’m not your typical Barefoot reader. I’m a senior executive who reads the Australian Financial Review (AFR) and has a digital subscription to the Wall Street Journal. In other words, I’m well read! I have been lately interested in private credit, which has exploded in popularity since the GFC, after banks stopped lending to businesses. Specifically, I read about a new product by fund manager Pengana (and Mercer) called TermPlus which is currently paying 7.35% per annum. What are your thoughts on this?
 
Raymond
 
Hey Ray!
 
Well, you do sound like a very smart sausage.
 
Funnily enough, investing in private credit is a lot like buying snags: in both cases the key question you want to know is “what went into the sausage?”.
 
Was it pork? Chihuahua? Toenail clippings?

Similarly, I’d want to know who these fund managers loaned the money to, and, more importantly, how these borrowers are coping after 13 consecutive interest rate rises.
 
To scratch my itch, I went digging through their product disclosure statement (PDS), but alas it was like reading a Dr Suess book – completely nonsensical. The only thing that stood out was the fees, which are outrageously high – 1.94% per annum, plus an additional 1.01% performance fee. Talk about green eggs and ham!
 
Look, staying the hell away from whatever Wall Street is selling has served me well in my career – and private credit is being sold really hard now. It’s being touted as a way to earn much higher returns than a bank term deposit, without the risk of shares. If only it were that simple.
 
It’s not that simple.
 
The managers are making a fortune in fees, to be sure, but it’s the depositors who are ultimately taking the risks. And remember these funds are not guaranteed by the Australian  government, the way that traditional bank term deposits are up to $250,000.
 
Truth be told, I’m very conservative, but that’s because I still have PTSD from dealing with heartbroken retirees who were sold (supposedly low-risk) investments that were paying higher returns than bank deposits, and who ended up having their money frozen or lost.
 
My view?
 
A good term deposit will generate you roughly 5.25% per annum, guaranteed by the government. That seems like a decent place to park your short-term cash (money you don’t need in the next five years should be invested in low-cost index funds).
 
Phil, I know you’re well read, so perhaps I could point you to my son’s favorite nursery rhyme book and his favorite ditty, which makes a compelling case for the risk of private credit lending that their PDS doesn’t: “Ten fat sausages sizzling in a pan, one went ‘pop’ and another went … ‘BANG!’”.

Scott.

Which app is screwing you?

Imagine if the maps app on your phone was ‘dodgy’.
 
Without you knowing it, Google directed you to routes with toll roads … because they got a kickback from the toll road company.
 
Outrageous, right?!
 
Well, according to Small Business Ombudsman Bruce Billson, that’s what’s happening … with another app on your phone.
 
Can you guess which app is screwing you?
 
(Drum roll.)
 
That’s right, it’s your bank app. (It’s always the bloody banks.)
 
Here’s the sting:
 
Since we all became germophobes, tap-and-go payments have exploded. In fact we Aussies are now the biggest users of contactless payments in the world, according to banking research firm RFI Global.
 
Yet what most people don’t know is that, when they tap, their bank generally defaults that payment through Visa or MasterCard, who pays them a fee – instead of defaulting that payment through the much cheaper bank-owned EFTPOS.
 
Talk about a rort!
 
Getting slugged a surcharge of up to 2% on every transaction could be costing you upwards of two hundred clams a year (collectively a $1 billion-a-year rort, according to the Ombudsman).
 
So let me suggest two quick ways to make it much less likely you’ll be charged:
 
First, change your default payment on your phone.
 
On an iPhone, open ‘Settings’, go to ‘Wallet & Apple Pay’, then tap your debit card. Then look for ‘Payment Option’. It will generally have ‘MasterCard’ or ‘Visa’ preselected, but instead you should select ‘eftpos SAV’. (Not all cards allow you to do this, and if you’re on an android you’ll need to check with your bank, because it’s a bit tricker apparently.)
 
Second, pull out your physical card.
 
I know it’s annoying, but if you swipe and insert your card you can choose ‘cheque’ or ‘savings’ and it’ll go through the EFTPOS system, which at the bigger retailers means you’ll be less likely to be charged.
 
Here’s the problem though.
 
Let’s say you’re at my local fish’n’chip joint, which has a sign on the till that reads:
 
“Surcharge 1.5%.”
 
The 16-year-old goth with the nose ring and bad attitude doesn’t understand the intricacies of banking payment systems, nor the fact that you’ve chosen EFTPOS, which will result in her employer being charged less in fees. She’s going to hit you with the fee, because, well, just because.
 
So here’s what really needs to be done:
 
The Government needs to ban surcharges … the same way they have in the US and the UK.
 
That’s a rolled-gold vote winner a year out from an election, right?
 
(Hello, Minister for Financial Services Stephen Jones and Shadow Minister Luke Howarth!)
 
Tread Your Own Path!

Bob Brown Isn’t Dead!

Scott,
 
You think Bob Brown is dead? Shows how much you know about politics you flog!
 
Jim
 
Hey Jim,
 
I was joking … though hundreds of Greens supporters didn’t get it. Still, I think Old Bob is more alive than most of the current crop of Greens pollies. God bless his bamboo socks. 

Nervous Wife

Hi Scott,
 
My husband and I are both in our mid-forties and have a combined income of $210,000. We have paid off our mortgage, and we lease our cars through my husband’s work as part of a salary sacrifice program. We have no other debt and around $75,000 in savings. We have been paying extra into superannuation, and when he retires from his job as a firefighter he will retire with a lump sum payment that will be more than adequate.
 
But now my husband wants to invest in day trading, and has been doing a trading course to ‘educate’ himself. I’m not very investment savvy and would definitely be the more money cautious out of the two of us. This seems a bit risky to me, but when I say this he tells me that we need to make our money “work for us”. Do you think day trading is a smart way of making our money work, or can you suggest something else that we should consider?
 
Nervous Wife.

Dear Nervous Wife,
 
Ding! Ding! Ding!
 
I’m hearing a fire alarm, and your firefighting, risk-taking hubby is running towards the danger. The only problem is that if he begins day trading it’s your money that he’s going to set on fire.
 
Look, some of the savviest day traders I know have gone broke more than a few times. And these days it’s even harder because you’re trading against AI bots. It’s just not a game you can reliably win.
 
Allow me just one last analogy: you two have reached the top of the mountain. Yet, instead of sitting back and enjoying the view, your husband has pulled on a snowboard and is doing some tricks for some extra kicks. That’s crazy.
 
I’d gently remind him that your money is working for you, via your superannuation. I’d focus on how much you need to contribute to it to live comfortably. Once that is set up, I’d get him busy thinking about all the exciting things he could be doing with his time, rather than risking his money.
 
Enjoy the view, don’t let him screw it up!

Scott.