Our top tips for safe investments
It’s been over a year since the world as we know it changed. We seemed to go from a fairly carefree lifestyle to one with restrictions placed on us at every turn.
And it was something we couldn’t escape from.
It seemed every time we turned on the TV, listened to the radio, or scrolled our socials that the ‘perils of the pandemic’ were being pushed in our faces.
So, it made sense that many of our clients, our investors, were feeling a little uneasy during this time.
The great news about the bigger financial picture for Australia
Australia is known as ‘the lucky country’. And perhaps we are right now. Not only have we fast-tracked ways to stop the spread of a virus, but our economy is bouncing back quickly.
Our Australian Government has released a $17.6 billion stimulus package to help our economy recover. And the Reserve Bank of Australia has cut interest rates to 0.5% and injected a further $8.8 billion into the market.
So, our economy is resilient and is looking like it will cope with the effects of COVID-19.
Our top 8 tips for investing in funds (shares, bonds, etc.) during and after the pandemic
- The market can be volatile, and if you’re not experienced, you may be shocked by how fast your fund can rise or fall. Be prepared and say strong in your financial decision-making.
- Partner with a team or put your faith in wealth managers who can keep an eye on your fund and help you make quick decisions.
- Take the emotion out of it and buy stocks on their value, not on your values.
- Diversify your investments and spread them across a range of stocks, bonds, metals etc., so it softens the blow if one crashes.
- To see a considerable boost on your returns, reinvest your dividends. This takes some patience and dedication.
- Remain persistent and be in it for the long haul. If your investment takes a hit momentarily after performing so well for so long, it’s likely to return to its former glory. Focus on your long-term goals.
- Invest in high-quality, cash-generating companies that haven’t been affected by the pandemic as much as others.
- Don’t make reactive decisions during this time. Markets tend to rise and fall over years, so bailing out too early may lead to you missing out on potential returns when everything stabilises.
Our top 5 tips for investing in property during and after the pandemic
- If you used mortgage deferments or Government relief during the pandemic, start to plan to come out the other side before the support disappears. Talk to tenants about paying rent again (if they ceased) or look for new tenants to occupy your investment property.
- Listen to the facts only from your trusted advisors, and don’t believe the media hype around the doom of an uncertain market. Look at the current vacancy and sales rates and what you can control right now.
- Don’t overcommit yourself or take risks. Landlords (investors) who appear calm don’t overcapitalise and have enough funds to survive a downturn for a little while (knowing it will bounce back, of course).
- If you’re looking to take advantage of investing in property, snap up the record-low interest rates. Remember, this may go up in the future, so remain comfortable in your budget.
- Look at the trends of where people are buying. With more people working from home, many took on ‘sea’ or ‘country’ changes and moved out of the city.
Economic markets and investments will recover during 2021
2020 became all about the battle. Battling the disease. Battling money. Battling uncertainty. 2021 is the year we’ll rebound.
If you’ve got any questions at all about investing, please contact us. Here’s a sample of FAQs our clients tend to ask before they work with us to secure their financial future:
- How do I make sure I’m financially secure for the future?
- How do I decide on an investment property and what type (residential, commercial)?
- How can I build my wealth in case this ever happens again?
- How do I decide what to invest in – funds or property?
- And much more.
What questions do you have? Feel free to contact our team at 1300 346 782 or at email@example.com