Most people's attitude to finance...

I came across this description in the interwebs today (UK Guardian money section), and it's just so true..

"...the more powerful driver, though, is a fear of being made a fool. John Lanchester described how most people's attitude to finance, of any sort, is to be confused in anticipation, before the explanation has even begun. He described it as being pre-baffled...

If you don't believe your judgment to be underpinned by comprehension, the next best thing is to make it the same judgment as everybody else. Realistically, how can you all be wrong?

Even now, when we've seen how easy it is to be all wrong at the same time – indeed, how much likelier it is that, travelling with a herd, you will end up wrong, this fear remains."

My firm belief is that the learned technique of questioning everything, especially finance related, is the number one/joint 1st criteria to get anywhere in the Western/developed world. To play the game, you gotta a) know there's a game, b) learn the rules of the game and c) learn which rules can be bent and which can be broken.

And to do that you gotta ask questions, even if you're frightened that asking the question might make you seem ignorant or foolish.
 
Probably right.

When you think that 95% of the population are poor, this sorta validates it.

It's the herd (I call it penguin :D, but is the same thing.) mentality.

Learning about finance, money, budgets, self-discipline, good debt/bad debt and so on is boring for most people, requires effort and sacrifice.

So does running a full marathon, or climbing Mt.Everest etc - very few do it as a % of the planet.

Property v shares is a good example; property is not an easy investment vehicle to be involved in.

Shares is a lot easier, and the gambler gene is strong amongst a lot of shares "investors" as well, so the majority of investors will be in shares, and only a few by comparison will be in IP's and/or both.
 
not only do you need to know there is a game

but you must be prepared to play.

And even when you are faced with obstacles - be prepared to continue on.
 
Probably right.

When you think that 95% of the population are poor, this sorta validates it.

It's the herd (I call it penguin :D, but is the same thing.) mentality.

Learning about finance, money, budgets, self-discipline, good debt/bad debt and so on is boring for most people, requires effort and sacrifice.

So does running a full marathon, or climbing Mt.Everest etc - very few do it as a % of the planet.

Property v shares is a good example; property is not an easy investment vehicle to be involved in.

Shares is a lot easier, and the gambler gene is strong amongst a lot of shares "investors" as well, so the majority of investors will be in shares, and only a few by comparison will be in IP's and/or both.

Yep, I think those observations are spot on.

I'm sure this is the same for all you others, but I've tried countless times to explain to friends and family how vitally important it is to take control of your own finances, put in place strategies and processes to streamline and improve CF, and too not rely on handouts from the government as a retirement plan and to leverage into investment....I usually get the vacant expression, thousand yard stare, with nodding of the head then 'Yeh I'll have to look into it.'

Yeh of course you will (sigh).
 
Yep, I think those observations are spot on.

I'm sure this is the same for all you others, but I've tried countless times to explain to friends and family how vitally important it is to take control of your own finances, put in place strategies and processes to streamline and improve CF, and too not rely on handouts from the government as a retirement plan and to leverage into investment....I usually get the vacant expression, thousand yard stare, with nodding of the head then 'Yeh I'll have to look into it.'

Yeh of course you will (sigh).

I've mentioned this before; my BIL has landed a job earning effectively $140k working in the mines. Hard work, away from home etc - but good dough; the most ever for him....and they are in loads of consumer debt, with a mortgage - always broke. Yer average Aussie family pretty much.

I said to him; "The trick is to pretend you don't earn this amount; live like you always have and spend none of it - pay off the cc and house and the car with it."

"yeah; you're right - I will".

So, 6 months later - I haven't seen him in that time - I hear from the other SIL a week or so ago that he is looking at buying a second hand motorbike for $10k. :eek::rolleyes:
 
Hi,

lot of friends I have, have balance approach to money.

Are in control of cc, clearly understand how to use it effectively (for int free period, points, etc)

Are always interested in investments, even if they cannot afford it right now, would work towards it

Always talk to others to see if they can get a discount for any item they plan to buy (i.e. get mates rates)

Not afraid to negotiate (at Good Guys, furniture places, waiving of annual fees for cc card, gym membership fees)

I would say, I have all of the above and I am really happy to be in control of my finances.

Only thing I lack in is: return on investment, i.e. havent made huge gains with investments I have made, but its a learning curve and more I learn, hopefully less mistakes I would do with investments

I am njoying this journey
 
Hi,
Are always interested in investments, even if they cannot afford it right now, would work towards it

Always talk to others to see if they can get a discount for any item they plan to buy (i.e. get mates rates)

Not afraid to negotiate (at Good Guys, furniture places, waiving of annual fees for cc card, gym membership fees)

I would say, I have all of the above and I am really happy to be in control of my finances.

Well done tvadera. Glad that you are on your way.

I'm also alot more interested in investments than my friends and family. I'm also a hardcore reader of books, including books about investing, which has helped buld my confidence in it and led me to take action.

I think another differentiator is my mindset (which I did have to develop). Using investments as a way to wealth (rather than just sticking with the herd) and focusing on just working for a living is a mindset which I think is unique to only a few, and what I think separates me from the herd and which motivates me to continue with investments, taking calculated risks, and using finance to leverage my money to purchase more income-producing assets.
 
When you think that 95% of the population are poor, this sorta validates it.

Yep - I just shake my head in disbelief when in situations like chatting to my neice-in-law the other day. She's 27 but can't afford to move out of home as is only working casual and has a $600/mth car loan.

On observing her parents' spending habits she "had" to buy a brand new car and now has herself in a financial pickle.

I have never bought a brand new car - can't see the point when a 2yr old, 30,000km job does just as well at 30%+ less.

My sister-in-law (her mother) - who I love dearly - made a joking comment about us being rich, when her and my bro-in-law combined make more money than us. They just don't seem to spend it very wisely ... goodness knows what they spend it on as they don't even have annual holidays away to show for it.
 
I have never bought a brand new car - can't see the point when a 2yr old, 30,000km job does just as well at 30%+ less.
For those who don't know; they take a massive drop in value as it drives out of the car yard.

If you don't believe that, then keep it for one day, and then take it back and see what you get as a trade-in.

Yes; you can get more selling it privately - another roadworthy, ads in mags ans websites, phone calls, and lots of tyre kicking P.I.T.A's. That's a monetary, time and emotional cost right there.

I think most folk have bought a new car at some point in life - or aspire to. I have; but not any more and never again. Our last (recent) purchase was a 3 year old Kluger with 33,000k on it...

Years ago I read in one of the many investing books I've read (I think it might have been John Burley) about the financial mistake of a new car purchase.

Since then I have never bought new, and since owning the workshop it has shown me a strong validation of that point.

A well-kept 2 year old car is almost as good as a brand new one.

I say almost, because most of the sorts of parts that deteriorate with age and use will not have done so by more than 30% - which is about what the car's value will have dropped in that time.

Some cars hold their value slightly better than others, but you know what I mean, so don't come on with some stupid miniscule stat variation, ok China? (He will; can't help himself; will fluff on about how good Mercs are, and how everyone should be driving one and nothing less).

Things like tyres and brakes are not included in this list, because they wear out all the time and always need replacing for the life of the car.
 
Marc, you type this stuff like its a universal fact. I don't think 95% of the population are poor. I don't think resi property investing is not easy. That's why it's such a mum and pop thing with people having very little knowledge of money, finance, investing etc doing well with property without much effort.

Your experience is not everyone's.

Probably right.

When you think that 95% of the population are poor, this sorta validates it.

It's the herd (I call it penguin :D, but is the same thing.) mentality.

Learning about finance, money, budgets, self-discipline, good debt/bad debt and so on is boring for most people, requires effort and sacrifice.

So does running a full marathon, or climbing Mt.Everest etc - very few do it as a % of the planet.

Property v shares is a good example; property is not an easy investment vehicle to be involved in.

Shares is a lot easier, and the gambler gene is strong amongst a lot of shares "investors" as well, so the majority of investors will be in shares, and only a few by comparison will be in IP's and/or both.
 
Marc, you type this stuff like its a universal fact. I don't think 95% of the population are poor. I don't think resi property investing is not easy. That's why it's such a mum and pop thing with people having very little knowledge of money, finance, investing etc doing well with property without much effort.

Your experience is not everyone's.
Good morning Mr. Happy Talk.

http://www.youtube.com/watch?v=291ET6Py6H8

I never said my experience was everyones' - just mine.

It depends on what you describe as poor.

Is the IT consultant who spends most of his income on lifestyle, but loses a contract and is one week from defaulting on the apartment rent poor? He sorta is.

Is the teacher who buys the $500k house and then finds the interest rates went up a bit too far and is now "house poor" and can't afford to go anywhere or buy stuff poor? He sorta is.

Not poor as in homeless, or on the dole, but still close to broke.

What % of the world's population retires and are self-funded completely?

And so on.....

2 years by my reckoning and not one positive statement or advice for others; what's the deal?
 
I saw your post as the usual negativity. I could ask you exactly the same question,but with much more credibility.

Anytime your persistent negativity or whingeing is questioned, you fire back with calling others negative for questioning it. WTF?

Poor? Very very few in this country are 'poor'. The vast majority are comfortable and positive, not poor.

Property investing is difficult? Oh no it's not. I can't think of an easier way to make money. No qualifications needed, no great skills, no huge amount of seed money, not much of anything required. You might find it 'not easy' but its really a very easy way for the average punter to get well ahead.

Btw, I've posted plenty of advice and kudos for others on here.

Not one? Get real Marc. Try to stay positive. It's all good.




Good morning Mr. Happy Talk.

I never said my experience was everyones' - just mine.

It depends what you describe as poor.

Is the IT consultant who spends most of his income on lifestyle, but loses a contract and is one week from defaulting on the apartment rent poor? He sorta is.

Is the teacher who buys the $500k house and then finds the interest rates went up a bit too far and is n ow "house poor" and can't afford to go anywhere or buy stuff poor? He sorta is.

Not poor as in homeless, or on the dole, but still close to broke.

And so on

2 years by my reckoning and not one positive statement or advice for others; what's the deal?
 
Anytime your persistent negativity or whingeing is questioned, you fire back with calling others negative for questioning it. WTF?
We'd be even, then.

Property investing is difficult? Oh no it's not. I can't think of an easier way to make money. No qualifications needed, no great skills,
I never said it was - I said that many folk think it is and don't do it.

no huge amount of seed money, not much of anything required.
What's the figure of "no huge amount"? You can buy a parcel of shares for what? A thousand? - any 18 year old can throw it together soon enough if they are inclined. But a property deposit...

You might find it 'not easy' but its really a very easy way for the average punter to get well ahead.
I've been saying it here for years.

Btw, I've posted plenty of advice and kudos for others on here.
Humor me; give me a recent example of you providing an investment tip or strategy, or anecdote of your experiences that others might learn from - success or failure. One will do...in the last 2 years.

Anti-Lib and Tony bashing doesn't count btw.

Not one? Get real Marc.
Bit of exaggeration I must admit. Two?
 
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I think most folk have bought a new car at some point in life - or aspire to. I have; but not any more and never again. Our last (recent) purchase was a 3 year old Kluger with 33,000k on it...

A few years back the wife and I decided to buy a new car. Two weeks later it was sideswiped in a roundabout (not our fault), just prior to driving it down south for a holiday. :mad:

End result, one to two year old cars will do nicely thank you very much.

BUT, if you want your dream car all specced out they way you want it, I still say do it once in your life.

Just don't come crying with the first scratch on the paintwork.
 
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