Should We Forgive Our Prodigal Son?

Hi Scott,
 
My husband and I loaned our son and his partner, who have two small children, $30,000 as a deposit on a house. At the time we explained to them that we were not well off, that we were still paying off our own mortgage, that the money was to help them secure a home, and that they could eventually pay us back using their own house as collateral.  
 
 Well, they squandered it (we still don’t really know what on) and my son is very remorseful, though his partner not so much. So no house and $30,000 gone! My husband and I are now at odds – he says our son has to be accountable and pay it back. I’m feeling awful about it all and just want the old relationship with my son back, so I want to write off the loan as a gift (albeit ill spent) and move on with our life. Hubs says a firm NO. So, should we forgive and forget, or make them scrimp and save to pay it back over countless years?
 
Loving Mum

Hello Loving Mum
 
Oh, I really feel for you.
 
All you were trying to do was help your son, and it’s not only strained your relationship with him but is causing friction in your own marriage … and to top it off it’s cost you thirty grand!
 
So what do I think?
 
I think you should sit down with your husband and let him know that you agree it’s time you put yourselves first. After all, this is clearly eating you both up inside (a lot more than it is your son, or he’d be paying it off!).
 
I would also suggest to your hubby that the quickest way to get rid of this ugly angry feeling is to forgive the loan and move on – not for your son’s sake, but for yours. After all, you’re still grandparents to his kids, and he’s still your son.
 
But never, ever loan him another cent.

Scott.

My wildest testimonial ever

The prisoner stared deep into my eye sockets, leant back in his chair, and slowly raised his hand.
 
“Can I share something?” he asked.
 
“Shhhh … ure” I said nervously, looking at the other inmates sitting around the prison table.
 
“Before I got locked up in here, I read your book, and I set up all my Barefoot Buckets. But I also added another bucket that I named … ‘Drugs’. And it worked like magic. I never missed my rent or my rego, and I always had plenty of money for my drugs”, he said triumphantly.
 
Weirdest testimonial ever.
 
However, as I looked around the room, all the hardened crims were nodding their heads approvingly.
 
Then I hit them with it.
 
“The Barefoot Benchmark is to try and live off 60% of your income”, I announced.
 
“And then you set up savings buckets for treating yourself (Splurge, 10%), long-term savings goals (Smile, 10%) and putting out financial fires (Fire Extinguisher, 20%).”
 
Folded arms.
 
In a cost of living crisis, who the hell can live off 60% of their income?
 
Answer? Not many.
 
In fact, after reading my book, people write to me all the time – OFTEN IN ALL CAPS! – telling me how deluded I am. You can sense the murderous rage exploding out of each exclamation mark!
 
Yet today I was sitting across from men who had literally killed people.
 
So, reading the room, I told the inmates that the percentage splits don’t really matter, suggesting they use it more as an exercise to find out just how much it costs you to keep your high beams on.
 
I explained that things may be so tight that some people could be only putting $2 into their Smile bucket. What really matters is that you set up all the buckets and put the entire plan on autopilot. And that is the ultimate get-out-of-jail-free card.
 
Final tip: don’t do drugs … or at least try not to get caught.
 
Tread Your Own Path!

The no diet, no exercise plan

Imagine you have a friend who is morbidly obese.

They come to you and confess: “I can’t keep living like this, I’ve decided to take action.”
 
Then they explain their plan:
 
“There are two things I will not do: diet or exercise.
 
“However, I’ve been researching on the internet and I’ve come up with two amazing solutions: first, I’m going to drink 100ml of castor oil each night, which an ad I read promises will ‘burn my fat like a blowtorch’. And I’ve also bought some electrode pulsing pads that I saw on The Morning Show. All I have to do is stick one to each of my butt cheeks and they simulate running a marathon, all while I sit on the couch and watch Larry on the telly.”
 
Okay, so what I’ve just described is like both of the major parties’ policies on tackling housing affordability.
 
The fact is that neither Labor nor the Coalition wants to do anything that will cause house prices to fall … and become more affordable.
 
Why not?
 
Well, think of it from a politician’s point of view: a third of voters own their own home outright, another third are paying their home off, while the final third rent. In other words, the overwhelming majority of voters want to see their homes rise in value.
 
So that means that politicians need to play a game of legislative limbo and come up with pole-dancing property policies that really don’t achieve anything.

 And the closest match to those pulsating electrode pads has to be the Government’s signature housing policy, the Help to Buy Scheme, which encourages low-income earners with just a 2% deposit to buy a home. Now I don’t need your vote, so I’ll tell you this is a dumb idea: broke people shouldn’t buy homes.
 
So I know what you’re thinking …  
 
You’re thinking it’s easy for me to take potshots at obese people, and politicians (or both, hello Clive Palmer!), yet it’s much harder to come up with anything constructive myself.  
 
So let me give it a go.
 
The biggest losers from our housing dumpster fire, ironically, are not voters.
 
It’s Aussie kids.
 
Specifically, more than 76,000 Aussie children under the age of 18 who sought help from homelessness services in 2022–23. Almost 16,000 of these kids were alone – unaccompanied by a parent or caregiver. The other 60,000 kids sought help with their family, according to Homelessness Australia.
 
Know this: the long-term trauma of a childhood spent without a stable roof over your head, of constantly moving schools, and   absorbing the impact of Mum or Dad being constantly stressed about where they will live, is real and it’s long lasting.
 
Now this is something the Government can fix … but again, politically, it’s not really a vote-winner.
 
Many years ago politicians decided it was a better vote-grabber to give tax breaks to investors to provide private rentals, rather than build more public housing.
 
It hasn’t worked.
 
Who’s going to vote for the people who don’t get a vote?
 
Tread Your Own Path!

The Millionaire Mentor?

Hi Scott,
 
I’ve only just turned 18, but my question is actually for my 16-year-old brother. Recently, he has become increasingly interested in building his own business and learning how to be successful. A couple of weeks ago he found a ‘mentor’ who is apparently successful and is helping him start his own business.
 
He was giving his advice for free to my brother, but has now decided there should be something in it for him (which is fair enough). However, what he wants is $1,200 for three months of mentoring, or $400 each month from my brother. This is a lot of money for a 16-year-old still at school, who in a year of working on his business has not gotten a single client yet.
 
My parents have talked to him about it but he is adamant about it being beneficial. It is not my place to do anything but I do not want him to get scammed or waste his money. What should I do?
 
Sarah
 
Hi Sarah,
 
First up, your little brother is blessed to have such a loving, protective big sister looking out for him.
 
So what do I think you should do?
 
Well, it sounds like your brother is young, hungry and impressionable … like most 16-year-old boys. So I’d help him get some perspective by asking him the following question:
 
How successful is this mentor if he has to resort to putting the hard word on a schoolkid?
 
Answer: not very.
 
I’d also point out that a successful businessman would set their price before they started a project, rather than retrospectively plucking a figure out of their backside months after, as he’s apparently done.
 
Your little brother is learning a lot from this mentor, but unfortunately it’s how not to behave in business.
 
So what do you do?
 
When I was your brother’s age I fell in love with books, because they were my mentors. I could escape into someone else’s world and learn from their mistakes, wins and wisdom.
 
So, what I’d do is to go to a bookshop and buy him these books:
 
How to Get Rich, by Felix Dennis (one of the UK’s richest self-made men).
 
Shoe Dog, by Phil Knight (the founder of Nike).
 
Oh, and I’d also throw in the classic How to Win Friends and Influence People by Dale Carnegie, and of course The Barefoot Investor!
 
Finally, let me just say this: when you’re young, the best mentors are older people who take the time and effort to see the potential that you don’t yet see in yourself. That sounds like you, big sister.

Scott.

For love, not money

Dear Scott,
 
I am a 58-year-old woman. I own an apartment in Sydney with about $1 million in equity and have $200,000 in super, though I have no savings. For the past 20 years I have run a reasonably successful small business. Two years ago I married a rich older Asian guy, eight years my senior. His offer on the table was that he pays for pretty much all my day-to-day expenses, and when he dies I will inherit his monthly (ex-diplomat) pension of US$5,000 per month until the day I die! We live half at his place in Asia (I run the business remotely) and half at mine in Sydney. He does not want to combine any assets, nor move to Australia, and he wants to keep his assets and cash separate as all this will go to his daughter and grandson.
 
Yet now I’m jack of spending half the year in Asia at his house, and I want to move to Sydney, pay off my mortgage, find a lower cost home in rural Australia, and settle. He will not contribute to this move. Should I see a financial accountant or a family lawyer, or both?
 
The Wanderer
 
Hi Wanderer
 
Your husband has an old-school defined benefit pension (which defines the payout: $US5,000 a month, probably increasing with inflation, for the rest of his life … or to his surviving partner). They’re so generous that almost no employers offer them now. Still, most of these plans are very clear: if you are not classified as his de facto when he kicks the bucket, you won’t be entitled to receive his pension.
 
Come to think of it, that would be a very attractive thing to put on a Tinder profile:
 
“89-year-old seeks fun-loving hot 25-year-old. I like long wheelchair pushes along the beach … and when I kick the bucket I can offer you a $5,000 a month pension, indexed to inflation, for the rest of your life.”
 
OH BEHAVE, BAREFOOT!
 
Hey, I’m just pointing out that there’s a lot of hungry young people doing OnlyFans earning a lot less.
 
All jokes aside. You’ve got a million bucks and, in your words, a decent business that affords you a decent living. You’ve got 20 (or so) years to do whatever the hell you want to do. So my advice would be to only stay with him if you love him – don’t do it just for the money.
 
After all, the old bugger might end up outliving you!

Scott.

An embarrassing confession

Let’s start off today with an embarrassing confession:
 
I’ve sat twiddling my thumbs for years when I could have earned a 30% return on my money. Seriously, the thought of it almost makes me want to hang up my footprints in shame.
 
What investment am I talking about?
 
Installing solar panels.
 
I’ve just had them hooked up to the shearing shed, and the only thing I can keep thinking is … why didn’t I do it earlier?
 
Well, upon reflection, it turns out that I had the same excuses people give me about not investing in the share market:
 
First, it was all a bit boring and a bit complicated.  
 
Second, I’d heard stories of cowboys and scammers ripping people off (which always happens when the government throws money at something).
 
And third, over the past decade we’ve had four kids, so life is busy … you know?
 
Okay, so all my excuses were not only pathetic – they were also costing me money.
 
Yet all that changed a few months back when I read this book:*
 
The Good Solar Guide: 7 Steps to Tiny Bills for Australian Homeowners, by Finn Peacock
 
* Actually, I just skimmed the book and then handed it to my 11-year-old, who read it cover to cover that weekend. (This is the start of a very long downhill slide of me relying on my children.)
 
The book does a good job covering the basics of solar, and steps out how to save big bucks.
 
So here’s what I did:
 
First, I went to solarquotes.com.au (this is Finn Peacock’s own website – which I fully admit feels a bit ‘suss’ –  but the not-for-profit consumer champion CHOICE also uses this site for their recommendations). After typing in my postcode, I was given three quotes for installers in my area.
 
Second, I stalked those companies’ user reviews on SolarQuotes, ProductReview, Google and Facebook. Two cut the mustard, one didn’t. (Still, that’s a better strike rate than Tinder.)
 
Finally, they both called me within the week and booked in a site visit. When they arrived I explained that the brains of the outfit was currently at primary school. It didn’t matter: they poked around the place, took some photos, grabbed a copy of my latest electricity bill, and were gone within 30 minutes.
 
A few days later they emailed through their quotes: they’d both designed basically the same system and came within a few hundred bucks of each other.
 
Look, the numbers don’t lie: in most cases you’ll get a better return from installing solar than you will from most other investments. Learn from my mistakes, and get your kids onto it! Seriously, it’s child’s play. Hello sunshine!
 
Tread Your Own Path!

Bank CEO is OUTRAGED

Hi Scott,
 
Another one of your predictions is coming true, with the Government planning on scrapping surcharge fees. I read in the paper today that the NAB CEO said he was horrified after he was slugged with a 10% surcharge for a coffee! Change is coming!
 
Krishna
 
Hi Krishna
 
Wake up and smell the coffee!

Up until now the Government hasn’t given a frappé-latte about the billions of dollars in surcharge fees we’ve been slugged over the years.
 
So what’s changed?
 
Albo knows he’s in more muck than a Werribee duck, and he needs to do something about the cost of living before the coming election.
 
Then there’s the (new) NAB CEO. If he meets his target this year, he’ll earn $5,000,000. Do you really think a 50 cent surcharge is enough to blow the froth off his coffee?
 
Please.
 
Look, until they ban surcharge fees, the only hope of getting around the percentage-based surcharge is (annoyingly) to pull out your card and stick it in the machine, or swipe and select ‘cheque’ or ‘savings’ to go through the EFTPOS system, which means you hopefully will be charged only 30 cents or so for the transaction.

Scott.

You’re Telling me NOT to Invest in the Stock Market?

Scott,
 
I’m 50 years old and confused. You recently said: “Don’t save up a deposit in the share market; instead park that money in an online saver or term deposit”. But isn’t the point of investing in shares that you can have the financial freedom to do what you want, like buy a dream house?
 
Barry

Hi Barry,

How would you feel if after years of saving you found your dream home to buy … and that same day the share market fell and wiped out 25% of your deposit savings?
 
You’d be pretty bummed, I’d reckon.
 
I’m not saying that’s going to happen to you, but I am saying that it’s happened at least once before.
 
That’s why the Barefoot Steps are very clear: until you own a home, the majority of your long-term investments should be via your super. In other words, save for your deposit in a high-interest online saver or a term deposit – not in shares.

Scott.

Warren Buffett’s $5.4 BILLION Warning to investors

Scott,
 
Why haven’t you written about your idol Warren Buffett selling BILLIONS of dollars worth of his Bank of America shares? Sounds like he knows something we don’t …
 
Chris
 
Hi Chris,
 
So I’m guessing you picked this up from that prestigious financial news digest Daily Mail – which ran this typical Daily Mail headline this week:
 
“Warren Buffett’s $5.4 BILLION warning to investors after he dumps popular stock – and Wall Street better pay attention”
 
“Oh my god”, I thought to myself.
 
Then I spat out my coffee and violently jerked my mouse towards the headline on the screen.
 
DOUBLE-CLICK!
 
However, as I read the actual article, I started frowning. Shockingly, it didn’t live up to the headline.
 
(Does it ever?)
 
Yes, it’s true that Buffett has sold $5.4 billion in Bank of America shares (well, the actual figure is $7 billion, but … close enough).
 
So, is he sending investors a warning?
 
No.
 
How can I be so sure?
 
Well, firstly, because the 94-year-old has said publicly thousands of times over his career:
 
“I have never made any investment decision based on an economic prediction.”
 
So there’s that.

Yet what was missing from the headline was context:
 
His Bank of America sale represents … just 0.7% of Berkshire’s overall assets.
 
(And he still owns a whopping 882 million Bank of America shares, worth US$33.7 billion.) A more likely explanation is that he was taking a profit, given the stock is up 70% since October.
 
Anyway, just for kicks, I decided to get my Daily Mail on and ask ChatGPT to come up with a clickbaity headline on Buffett that investors could actually use.
 
Here’s what it came up with:
 
“Shocking Move: Warren Buffett Bets His Entire Fortune on Just ONE Stock”
 
It’s true.
 
For context, in his will, the 94-year-old billionaire is investing his inheritance into one low-cost index fund.
 
The reason is that Buffett argues that index funds are the best investment for everyone and advises that we should be buying them consistently throughout our lives, saying:
 
“The temptation when you see bad headlines in newspapers is to say, well, maybe I should skip a year or something. Just keep buying.”

Scott.

This is going to hurt

This week, I found myself standing in my underwear while a man took photos of me.
 
“Oh, this doesn’t look good” he said, getting right up in my grill. “Best we freeze this sunspot off,” said my doctor, walking back to his desk.
 
He returned with a giant metal canister and pointed it at my temple, Terminator style.
 
“This … is going to hurt”, he said matter of factly.
 
“Hey! You are not supposed to say that!” I protested.

Yet it was too late. I felt a stinging sensation for a couple of seconds … and then it was all over.
 
Contrast this approach to that of another doctor – our Federal Treasurer, Dr Jim Chalmers.
 
(He’s not a medical doctor, he’s a doctor of political science … in other words, he’s a spin-doctor).
 
In the past few weeks the Treasurer has thrown a little bit of inner Karen at the Reserve Bank, whining that they are ‘smashing the economy’ by their decision not to cut interest rates.
 
I actually agree with Jim.  
 
There is no doubt that interest rates are hurting our economy, just as they are in other parts of the world, like the United States, the United Kingdom and New Zealand, all of which, it has to be said, have higher rates than us right now.
 
Having said that, the Treasurer is doing the equivalent of protesting against a sting on the side of the forehead, while the Reserve Bank is focused on eliminating a potentially cancerous melanoma … in the form of entrenched inflation.
 
As we’ve experienced since Covid, the effects of runaway inflation are cancerous to the economy … and they hurt people on the lowest incomes the most.
 
So now I’m going to pick up a giant metal canister and aim it at your temple:
 
Too many people (and journalists!) have anchored their expectations to ultra-low interest rates. It’s high time we pulled up that anchor and sailed into the sea of sustained higher rates.
 
(And to be clear, I expect them to be consistently higher than we’ve experienced in the past few years, whether it’s Labor, the Coalition or the Breakdancing Party – don’t discount her: Raygun has better name recognition than Albo or Whatshisname).
 
Last week, RBA Governor Michele Bullock spoke about the small number of borrowers who can’t make ends meet, suggesting that some “may ultimately make the difficult decision to sell their homes”.
 
That’s the “this is going to hurt” line my doctor gave me. Which is a ballsy thing to say in her position, but also good advice: if I had a dollar for every time I’d told people in financial stress that they need to consider selling their home, I could rent a house in Ouyen (for a week).
 
Yet, as a spin doctor (especially one on the eve of an election), Jim sadly can’t say that. Still, if the thought of that causes you heart palpitations, right now is a very good time to get a financial check-up!
 
Tread Your Own Path!

Blowing Smoke Up Your Backside

Hi Scott,
 
Your financial advice, as always, is second to none … but this short email is to confirm you also scored a bull’s-eye with your suggestion a few weeks ago to Bella to buy Allen Carr’s book to help her husband give up smoking. Years ago, I was so addicted to cigarettes that, even after watching BOTH my mum and brother die prematurely from smoking-related illnesses, I STILL wasn’t able to quit.
 
But then I bought a copy of that book –   and quit immediately after reading the last page. This was after smoking a pack a day for about 20 years and genuinely believing that life wasn’t worth living if I couldn’t smoke. Not to mention the fact that I had tried EVERY SINGLE other method in an attempt to quit.
 
Keep up the good work, and never stop recommending Allen Carr’s book to smokers. As a former confirmed smoker, I can only describe the feeling of genuinely never wanting another cigarette again after finishing the book as magic. I hope Bella and her husband take your advice and I wish them the same success.
 
Andy
 
Thanks, Andy!
 
I aim to be helpful in these pages. If this helps people escape the prison of addiction, it’s a good day for me. Well done for giving up the darts.

Scott.

Barefoot Book Week!

Hi Scott, 
 
Book Week time again and Barefoot was the only person Hamish wanted to dress as! He has read Barefoot Kids and is now nearly finished your original Barefoot Investor book. He has all his buckets and a great plan. Keep inspiring my kids, please!
 
Nicky

View fullsize

Hey Nicky,
 
I absolutely love Book Week (and Father’s Day).  
 
Every year I get kids who dress up as me (well, except for my kids, who think I’m super embarrassing).
 
Please thank Hamish for reading both books, and let him know that I think he’s a legend.
 
(And a shout-out to all the other kids who had a Barefoot Book Week too.)

Scott.

Guru Predicts Tesla Shares will Go Up 1,000 per cent

Hi Scott,
 
I’m wondering if you have changed your tune on investing in Tesla? Ark Invest guru Cathie Wood has just added to her stake in the company in anticipation of the robot taxi revolution. She forecasts it will be a $10 trillion global market, says Tesla will capture the bulk of that, and predicts it will boost Tesla’s share price tenfold. Elon is obviously a genius and he has said that robot taxis are the future for Tesla. So, given the share price has been whacked recently, is now the time to buy some shares?
 
Trevor
 
Hi Trevor
 
Well, paint me red and call me Randy, but I’m shocked.
 
For years I’ve been highly skeptical that fully autonomous driving would happen.
 
Yet I’m happy to admit I was wrong.
 
Waymo, Google’s robotaxi company, has not only got driverless taxicabs, they’re now taking 100,000 paid rides each week in the US (up from 50,000 a few months ago).
 
Even better, they’re safer than us humanoids. Well, at least the company claims that their robots are much safer: they’ve recorded just 0.4 injury-causing collisions per million miles driven, whereas humans are involved in 2.78 per million miles.
 
So, in major cities at least, it looks like robotaxis really are the next big thing.  
 
Yet it’s here that guru stock picker Cathie Wood and I conk out.  
 
I wouldn’t want Cathie in the cockpit of my portfolio: her Ark Invest has destroyed US$14 billion in wealth over the past decade, according to Morningstar, which tracks her funds.
 
And, looking over her Tesla research, I can understand why. It’s pure spin from a fund manager who is trying to boost the stock price of a company she already owns.  
 
How did she come up with the ‘1,000 per cent’ return assessment?
 
Well, Cathie is predicting that, in less than five years, an unbelievable 90% of Tesla’s future earnings will come from something that doesn’t exist yet:
 
Robotaxis.
 
To be fair, Elon Musk announced that Tesla was on track to have 1 million robot taxis on the road … by 2020.
 
Today?
 
Tesla has zero robotaxis. In fact, the fine print on their website says that Tesla’s Autopilot feature “does not make the vehicle autonomous”.
 
Now I don’t doubt that Tesla will move into robotaxis … but this brings us to the crucial point: 
 
Will these robots make investors rich?
 
On this point, I’m still very sceptical. After all, in China, the main selling point of robotaxis is that they’re cheap as chips. According to a report in the Global Times, base fares start as low as 4 yuan (83 cents), compared with 18 yuan ($3.73) for a taxi driven by a smelly human.

That sounds like a driverless race to the bottom to me.

Scott.

Speaking Gigs

Hi Scott,

“Hands up if you want to come on a trip with Dad to the … GOLD COAST?” I yelled.

All hands shot up around the family dinner table (apart from Liz, whose arms were firmly folded).

“And what about if we went to … Hawaii? Who’d want to come along with good old Dad?” I roared.

“Oh me! Me! Me! Pick me, Dad!” shrieked my eight-year-old, pushing his hand higher than his three siblings’ hands and almost dislocating his shoulder in the process.

“Well, I’ve just signed with a speaking agency and they’re putting me forward for corporate keynotes”, I told the kids.

Blank stares.

Then again, I haven’t done a paid gig since I became a dad – by choice – so my kids have no concept of me being a public speaker (or having a career away from the farm, to be honest). So I explained that we’d be heading to some pretty fancy places. Sometimes on a plane. And we’d stay in fancy hotels. And have a fancy buffet breakfast. And after the speech we’d go somewhere awesome …  like Wet’n’Wild!    

“I’m doing 10 speeches a year”, I announced, like I was Willy Wonka.

(Yes, my decision to do corporate speaking is largely motivated by the opportunity to peel off one of my kids and spend some rare one-on-one time with them – Disneyland-dad style.)

So I’ve spent a hundred hours or so creating a speech for big corporates, but I’ll give you the guts of it:

Basically, since writing the bestselling book in Australian history, I’ve had thousands of people write to me and tell me what they got out of it. Patterns emerge. Here are the three things that people say really moved the dial for them.

First, it was the buckets (of course).

Second, it was the clarity of the Barefoot Steps to instantly know what to do next.

Finally, it was doing the Barefoot Date Nights, where people actually changed their financial lives.

(Okay, so there’s a little more than that, of course, but that’s the gist of it.)
The really cool thing about doing this speech is that it inspires people to start doing them again … and, at times like this, that’s a bloody good thing!

The only problem?

Thus far, it’s the mining companies that have shown the most interest in booking me.

“So, kids, who wants to go to the middle of nowhere and sleep in a donga with Daddy?” quipped Liz.

No hands went up.

Tread Your Own Path!

P.S. I actually love talking to miners (even if my minors don’t want to come). In fact, on my last speaking trip I ended up on the front page of the Kalgoorlie Miner after landing in the local jail (speaking to the soon-to-be-released prisoners)!

P.P.S If you’re a big corporate with a conference coming up (Hamilton Island? Hawaii? Heck, I’ll even take Wollongong at this stage), click here for more details on booking me as a speaker: www.barefootinvestor.com/speaking.

Mum Won’t Give Me $30,000 Because of YOU, Barefoot

Hi Scott,
 
My mum is withholding a $30,000 inheritance for me from my late great aunt because she thinks I wouldn’t use it the ‘Barefoot way’. I’m a 26-year-old woman, living with my partner, and we have money of our own saved up for a house deposit. I told my mum that, if she gives me the $30,000 from my great aunt, I would also put it in our high-interest savings account to earn interest until we buy a house. But she says you would tell me to invest it in shares or use it to pay off my HECS. Is that true? Until I agree to the ‘Barefoot Way’, she’s not going to let me have it.
 
Olivia
 
Hey Olivia
 
Order! Order!
 
Judge Barefoot is in the house. Please all rise, while I give the verdict:
 
In the matter between you and your mother, I find in favour of …. YOU!
 
You are up to Barefoot Step 4: Buy Your Home, so you should definitely put the inheritance towards your house deposit savings in an online saver.
 
Once you’ve done that, you’ll move up to Step 5: Increase Your Super to 15%. That’s when you’ll be tax-effectively investing long term into the share market via your low-cost super fund.

Well done, and please say g’day to your mum for me!

Scott.

Artificial Intelligence Stole $300,000 From Me

Hi Scott,
 
I have just read your response to Craig regarding Robert Irwin and Trade 6000 Alrex. I just want to confirm what you have said and warn Craig to ignore this and any other get-rich-quick offers on the internet. I got sucked in by a deep-fake advertisement of Elon Musk and lost over $300,000 – plus at least five years of my life going through stress with the follow-up scams telling me it could be recovered.   Without going into the whole catastrophe, just be aware that it starts off as such an amazingly easy process – you think to yourself “Why isn’t everyone doing it?” The answer is because not everyone is as gullible as me! Please do not use my name.
 
Anonymous
 
Hi Anonymous,
 
Thanks for sharing.
 
Scam losses are like cockroaches: for every one who admits it, there are hundreds hiding in the dark.
 
Your experience mirrors the hundreds of conversations I’ve had with other victims.
 
Losing the dough is financially shocking and in many cases life-changing.  
 
And, as you’ve said, dealing with the follow-up scams (“We can recover some money for you … if you give us more money”) can go on for years and can give victims PTSD.  
 
(Which is why anyone who has been scammed should go to IDCARE.org – call 1800 595 160 – and have them douse their online profile with hospital-grade bleach.)
 
The money loss is one thing, but by far the biggest losses I see with scam victims is with their mental health. Most of the time their self-confidence is shattered by the experience – their sense of shame and disgust eats away at them.
 
I totally understand why you don’t want to share this experience publicly. However, I’m pleading with you to share it with a counsellor, who can help you move forward. The scammers stole your money – don’t let them rob you of your future.

Scott.

My Husband Has Been an Addict for 31 Years

Hi Scott,
 
My partner and I, both in our mid-forties, have been Barefooters for years. We live in the outer south-eastern suburbs of Melbourne and have two kids, aged 10 and 13. We should have our mortgage paid off within the next two years, currently have no other debts, and have discussed plans to invest in Vanguard. My partner is focused on eliminating debt and growing our financial future but, sadly, he is not ‘investing’ in his physical health. He’s now heading into his 31st year of smoking and doesn’t want to give it up. I’m hoping you might be able to provide him with the motivation – for financial reasons – to butt out for good!
 
Bella
 
Hey Bella!
 
I’ve had a lot of experience helping addicts, so let me tell you the bad news first:
 
Beating them up about how much money they’re wasting on their drug of choice will not only not work; it will more than likely stress them out and make them use more!
 
To a non-addicted brain, this sounds completely ludicrous, but not to anyone who is in a pit of addiction.
 
This is as true for those who are sending thousands of dollars up in smoke as it is for gambling addicts losing hundreds of thousands of dollars a year.
 
What would I do?
 
Well, it sounds simple: if you treat the addiction the money will sort itself out.
 
And how the hell do you do that after 31 years of smoking?
 
Easy.
 
First, in the Father’s Day cards get your two kids to write about how much they love their dad, but also how afraid they are that he’ll get sick and be lost to them.
 
Second, get your kids to buy him a very special Father’s Day present:
 
Allen Carr’s Easy Way to Quit Smoking Without Willpower
 
(This book has 7,680 reviews on Amazon with a 4.6 star rating and has been around in various forms for 40 years.)
 
Finally, give him the peace and quiet to read the book.  
 
Health is the ultimate form of wealth.
 
Good luck!

Scott.

Haters gonna hate

God Dang!
 
Last week I wrote about my road trip through the most dangerous city in America. While I came out of it whistling Dixie, I didn’t realise the violence that would be waiting in my inbox this week:
 
“You know what I really hate? When Australians try to make themselves feel better about their boring, rotten country that is too scared to leave the monarchy, by insulting the US.” 
 
“I’d rather drive a Mustang than a Holden. Do they even make any cars in Australia anymore?”
 
“I can only hope this crap you’ve written was in fact deep-fake Scott Pape.”
 
“No one gives a rodent’s rectum about your political views. They are an abuse of the platform you have developed.”

“Is your goal to get a safe Labor Party seat?”
 
(I’ve been labelled a radical lefty, a right-wing nut, and a gun-toting country hick – which is probably the closest.)
 
And these were the slightly nicer ‘PG’ responses I could publish. The worst emails I got this week were actually threats designed to make me ‘rethink’ my political views.
 
But don’t cry for me, Arkansas.
 
I’ve been writing this column for 21 years, and I’ve copped more curry than an Indian chef:
 
Industry super funds hate it when I question them about their expensive fees, their empire-building, and their aggressive valuations on unlisted investments.
 
Insurance companies don’t like what I’ve written about their rubbish policies and their price-gouging.
 
And the banks … well, let’s just say to this day I still have nightmares about the Dollarmites mascots murdering me in my sleep!
 
Anyway, my mother always says “You can’t please everyone”.
 
That’s true but, in the classic mum sense, it’s a way of sugarcoating the truth:
 
The fact is, if you’re out there trying to make a difference, you’re going to piss a lot of people off (especially rich people and companies who have an army of lawyers who threaten to sue … which happens more than you think).
 
Yet my job isn’t to kowtow to yanks (or cranks), to fluff up my social media (don’t use it), or build my brand (whatever that means). Truth be told, I never got into this game to be popular … which turned out to be a very wise decision!
 
Tread Your Own Path!

Crikey!

Hi Scott,
 
I don’t want to make a huge mistake with what little I have ... so is this Trade 6000 Alrex, as recently revealed by Robert Irwin, still worth a try? I can find $375, but this is scary. What if I go there via a scam website that looks real and so lose everything? Advice please!

Craig
 
Hey Craig,

It’s a scam, man.
 
Robert Irwin handles crocodiles, he’s not an investor.
 
They’ve deep-faked him, the same way they did me.
 
If you deal with these crooks they’ll rip your bloody arms off.

Scott.

Have We Bred a Monster?

Hi Scott,
 
My teenage daughter has had a private school education. This has cost my husband and I (average working-class people) upwards of $40,000 per year. Early on we saved hard to pay off our modest house and were pleased we could offer our only child a private education. We were looking forward to her finishing secondary school this year, going to the local uni, and thus giving us a break from the inexorable fees! 
 
But now she wants to attend university in another city – at $40,000 per year for a live-in college – to get the ‘full city experience’. (I commute each day to the city but she insists it is too far for her to commute to a uni nearer to home.) She says she is desperate to leave home, and will move to the city with or without our help. She has no idea of how to be financially independent! Is this ‘normal’ privileged teenage behaviour or have we bred a monster?
 
Patty
 
Hi Patty,
 
You’ve bred a monster.
 
Look, even though 18 is the new 13 for COVID-kids, she’s biologically an adult, so you can have a grown-up conversation with her.
 
Here’s how:
 
Explain that you have already spent upwards of $500,000 (pre-tax) on her education … and now you have to focus on saving for your retirement.
 
However, there is absolutely no reason she should be deprived of what she calls the ‘big city experience’.  In fact, part of that experience should involve working a minimum-wage job, occasionally drinking from a goon bag, and sometimes dining on two-minute noodles to make her money stretch.
 
In other words, I’d not only encourage her to move to the city, I’d help pack her bags. The education she’ll receive will make her a much more grounded human being. (And if she can’t hack it, then she can always go to the local uni!)
 
Scott.