Well done Mavis & Doris & of course Gina & let’s not forget Mark

Well done Mavis & Doris & of course Gina & let’s not forget Mark

Mavis & Doris could be [we hope not] the names of two elderly shareholders of Campbell Brothers. According to James from the Courier Mail, Mavis is worth about 25m & Doris about 21m. They didn’t become that wealthy by leaving their money in term deposits or having property on Sydney harbor. They were related to the original founders who have certainly left a legacy.

As Campbell Brothers have just announced a special  50%increase in dividends  this will certainly help them push their walking frames around. Mavis & Doris are part owners & shareholders of a business which started life making soaps & now is a worldwide, world class company & laboratory for analyzing mining assays.

Gina  hit the headlines this week as being wealthy & some even suggested she might own the world. Again she certainly chose her Dad well but she has maximised her opportunity. She or rather her Trust is a shareholder in a major business & company. 

Mark of course sold some shares @ $38 each & made the top wealthy 20 as a billionaire.  

The above mentioned are just a few extreme individuals who have done very well out of being shareholders of businesses, risking their capital & their efforts & being rewarded for doing so.

This global & national & individual discussion at the moment is concerning interest rates. Sheila who is on an European canal today & is retired doesn’t want her interest from her deposits to drop any lower as that would drop her income & lifestyle down.

In fact as the clock ticks she along with Mavis & Doris & the government will find that their living & nursing costs will increase. Inflation is a sneaky way Governments pay off debts & elsewhere say Japan  they have been low for 20 years.

This is not good in a low interest world. I.e. There is a longevity risk in having all of your funds in cash or Term deposits or even annuities.

We aren’t convinced that there will be a low interest environment in the future as governments who would rather pay low Real interest rates are in the case of Creek or other governments case prefer to pay nothing & default are currently told by the bond rates to pay more. Hence the cost of money for all debts could rise.

We are also not convinced that the banks need the RBA as they reduced their mortgage rate by less than the RBA did on the cash rate.

Both Margaret & Linda mentioned this week that they might live to 100. Hence they each need a tailored portfolio both for their short term peace of mind & for the longer term.

Margaret today wanted a good return but no risk. Well just ask the Creeks if they want to leave their money in the bank. Just ask the Creek government & the Euro zone what if there is a ‘run’ on the Creek Banks. The UK government found out with Northern Rock Building Society in the very recent past.

What are we suggesting?. Simply ignore the headlines & concentrate on what it is that you control. We suggested to Margaret who wanted to capture some of her savings outside super [ because you can’t access it & the legislative risk] that there are several things she could do.

 E.g. paying down debt.

We have previously suggested that we have  13 more smart strategies before June 30.

Other Essentials  includes remaining healthy & minimising visiting the misnamed Health system.

She also wanted to leave 1m to her grandchildren when she is 100. Her term life cover which admittedly covers her after her super cover doesn’t will be prohibitive & actually expires at age 99. She did mention & ask for the very old Whole of Life product that in fact she used to sell. However that is another unintended consequence of government rule mongering.

However a few shares in Campbell Brothers or very maybe Facebook or an equity portfolio might create an estate. Margaret’s house will be needed to look after her first. Margaret also suggested Platinum which we can’t disagree with.

We are certainly only suggesting a percentage in equities as a recent investment seminar was titled that the benefits of shares are forgotten.

 In our own case if we make it to 100 then maybe 38% of our portfolio should be in shares.  How that % is allocated is another exercise. However as a Taurus we are bullish by nature & have a little more.

Lets discuss how much for you & welcome for lunch any day here.

There could be smart strategies to do before June 30. If you have a large debt & hence a large income then our PCMS* where ‘the taxx girl  subsidises your debt’ is for you & is for all seasons.

DYI is often suggested but is that your trade? You could call us on 3848 1088.

John McAuliffe