What's the funniest/worst excuse you've heard for NOT investing from people?

[BayView]

The trouble is.... what if 50% of people who take their actions go bankrupt, and since you're only asking the ones that survived (this is called survivor bias) then you'll get an incorrect grasp of risk.

Also, if you ask about something in a speculative bubble - of course people that bought into that thing at the time did well - .com millionaires were the thing in the late 90s - bubbles work really well up until they burst.

HG, It all comes back to the onus on the investor.

If I learn about a particular thing; say driving a car (or investing), it's up to me to practice driving to get better in the back streets and in the Coles carpark (say; equivalent to buying a cheaper-end price range 2 bed unit in a normal suburb) before I go out onto the shark infested roads, and I would do it with someone in the car next to me for guidance (a mentor, or this forum, or read books etc).

Then, once I am educated and competent enough, I do it on my own, and hopefully I have the INTELLIGENCE to drive (invest) with safety and caution.

Anyone who listens to the 22 year old driver (newbie or reckless investor or investor with no success) who says; "Yeah, driving (investing) is easy; go as fast as you can everywhere - I do and have had no worries" is asking for death.

Or; listen to the old nanna who has never driven a car (the "armchair investor" or gloom and doomer - there's a few on this site) who sits there and says "I never drive (invest) it's too dangerous. I've seen too many people get hurt".

While she is correct that it is dangerous, she never gets to go anywhere and have a life - the investor never gets rich.

Or, listen to the car salesman (Mortgage Broker or Financial Advisor) who flogs the newbie driver (investor) a car (slick loan or over-priced property or managed fund with high fees) and says how great it is to drive, but never explains the road dangers, and maybe doesn't even drive (invest) himself.

So, HG, while you are demonstrating such noble concern for everyone about losing their shirts, it comes back to the same thing; investing has risk, but the educated people learn to minimise the risks and make money in all markets.

Asking the survivors what they do is smart; the survivors are educated, but have still made mistakes, so we learn from them, learn how to protect our endevours, and make money.

Many of us here are talking from a position of having driven in a few Bathurst 1000's, and tell people how to drive safely.

 

[skater]

Wow! What a great analogy.

 

[steveadl]

I'll second that, nice one Marc.

 

[BayView]

Thanks; I thought it was just another one of my useless ramblings, designed to annoy HG.

 

[Perchy]

My work mate said "Investing is just another word for gambling."

Had a real estate agent say the same thing tp me when I bought shares (that went up multiple times in value)...

 

[RumpledElf]

Friends of mine are telling me to fix my IP up and sell it, not rent it out. Eww, you'll get tenants, why would you want to do that?

They own quite possibly dozens of vacant allotments close to their house, including several vacant houses that they've collected over the last 5 or 6 years. They pay rates on all of them, they have to maintain all of them, and they only earn money whenever they kill a cow that eats the grass from them. But they don't want neighbours, so they won't rent any of them out or resell them, and they haven't had any urge to get the separate blocks merged together into acreage so they pay less rates. They intend to sell the lot Real Soon Now and move to Tasmania.

 

[want2bewealthy]

Oh here's another from my SISTER of all people, she's supposed to be proud, so youd think anyway. .

I didnt even get a congratulations, not even a word from her then a few days later I bought it up and she says to me. .

"ohh half a million dollars in debt. . I couldnt handle that, its not a good idea. . Id be too uncomfortable with that"

This is laughable. . coming from someone who lives a pay to pay existance and has dreams of home ownership but isnt financially fit enough to be able to service a loan, even though she and her partner earn a combined income of 3 times mine. .
Funny that huh

 

[Alex P Keaton]

A co-worker paid off his ppor about 10 years ago after getting an inheritance from his parents, he also got a nice little redundancy package as well. I couldn't believe what I was hearing he was having a convo with the new guy talking about how he has fully paid off his mortgage, and he was sounding so very proud of himself with how well he is doing financially. I'm thinking quietly to myself ohhhh please!! your nuts.

He works a 2nd job as well and guess what he does with his money, he puts it in the bank. I asked him if he has thought about investing his money, but he's told me a few times that he his happy to put the money in the bank.

If only I was in his position!! He could easily have 10 ips by now, but he just puts it into his measly bank account. What does he end up earning after inflation eats away at it.... lol. He's crazy!!

 

[Petal]

Oh here's another from my SISTER of all people, she's supposed to be proud, so youd think anyway. .

I didnt even get a congratulations, not even a word from her then a few days later I bought it up and she says to me. .

"ohh half a million dollars in debt. . I couldnt handle that, its not a good idea. . Id be too uncomfortable with that"

This is laughable. . coming from someone who lives a pay to pay existance and has dreams of home ownership but isnt financially fit enough to be able to service a loan, even though she and her partner earn a combined income of 3 times mine. .
Funny that huh

W2BW, you will find that the most unsupportive are often family members as they feel you are "getting above your station in life" so don't give it a second thought. Keep doing what you are doing and keep talking to us who WILL support and encourage you. I have just been re reading Jan's book "Building Wealth Story by Story" which is definitely my favourite of all of her books!! If you can get a chance pick yourself up a copy and you will love it!!

 

[Rixter]

What does he end up earning after inflation eats away at it.... lol. He's crazy!!

Not only inflation but taxation as well.

 

[Alex P Keaton]

W2BW, you will find that the most unsupportive are often family members as they feel you are "getting above your station in life" so don't give it a second thought. Keep doing what you are doing and keep talking to us who WILL support and encourage you. I have just been re reading Jan's book "Building Wealth Story by Story" which is definitely my favourite of all of her books!! If you can get a chance pick yourself up a copy and you will love it!!

I finally got around to ordering her other book.





Mum and dad thought i was better off buying my ppor first afterall thats why i moved in with them so as to save for my first ppor. But over the past few months I've been gradually educating them about ip and easing into the topic about what my goals are and what i want to achieve through ip to get them used to the idea that im better off buying ip's first and renting.

They see how much effort i am putting into educating myself and how much i have learnt and are supportive of me. I know I have a long way to go, but I have made a good start and will learn more through experience... when I jump in and start buying ips. I am eager to buy now but not yet financially ready. Half way there.

The other thing is my parents had a bad experience with an ip. They signed up for an ip off a salesperson at "one of those seminars" mum regrets she didnt listen to her intuition about investing in that suburb. They had trouble finding a tenant, there were undesirables living nearby everything went wrong and ended up having to sell at a loss. Anyway she is a bit concerned about me investing in suburbs she doesnt know much about, I have told her dont worry I will do my dd make I'll choose correctly. They also know that I wont go jumping into everything. lol everytime I go to a seminar they say to me... dont go signing up for anything, I assure them I wont.

 

[Alex P Keaton]

Not only inflation but taxation as well.

yeah rather than do that he'd be far better off salary sacrificing through super seeing he'll prob retire in 5 - 10 years.

 

[ernie]

A co-worker paid off his ppor about 10 years ago after getting an inheritance from his parents, he also got a nice little redundancy package as well. I couldn't believe what I was hearing he was having a convo with the new guy talking about how he has fully paid off his mortgage, and he was sounding so very proud of himself with how well he is doing financially. I'm thinking quietly to myself ohhhh please!! your nuts.

He works a 2nd job as well and guess what he does with his money, he puts it in the bank. I asked him if he has thought about investing his money, but he's told me a few times that he his happy to put the money in the bank.

If only I was in his position!! He could easily have 10 ips by now, but he just puts it into his measly bank account. What does he end up earning after inflation eats away at it.... lol. He's crazy!!

Well at least your co-worker paid off his mortgage and saves his earnings. Certainly heaps better than most who just go round and round the earn-spend cycle. Perhaps he just needs some sort of catalyst for the lightbulb in his head to switch on.

I have a co-worker who is very similar to the one you describe. Puts his money into an online savings account because of the high interest. When I asked him about investing, he said he's tried a few times before but got burned so retreated to the safety of the bank account. Although he is aware of the fact that he could be earning much more if he invested, he says he just doesn't want to lose any more money. Seems the pain of losing money overrides the joy of making money. He's a great bloke who knows the value of money, budgeting and saving and has paid off his home so I don't think he'll ever be in trouble financially. Hopefully someday he'll get enough courage to try investing again and get better results but at worst he'll have the capital gain from his PPOR and all the money he's saved away.

 

[Aaron Sice]

I have a co-worker who is very similar to the one you describe. Puts his money into an online savings account because of the high interest. When I asked him about investing, he said he's tried a few times before but got burned so retreated to the safety of the bank account. Although he is aware of the fact that he could be earning much more if he invested, he says he just doesn't want to lose any more money. Seems the pain of losing money overrides the joy of making money. He's a great bloke who knows the value of money, budgeting and saving and has paid off his home so I don't think he'll ever be in trouble financially. Hopefully someday he'll get enough courage to try investing again and get better results but at worst he'll have the capital gain from his PPOR and all the money he's saved away.

nothing wrong with this approach, it's just conservative.

if everyone was half as good as this with their finances the world would be >

 

[steveadl]

I have a co-worker who is very similar to the one you describe. Puts his money into an online savings account because of the high interest. When I asked him about investing, he said he's tried a few times before but got burned so retreated to the safety of the bank account. Although he is aware of the fact that he could be earning much more if he invested, he says he just doesn't want to lose any more money. Seems the pain of losing money overrides the joy of making money. He's a great bloke who knows the value of money, budgeting and saving and has paid off his home so I don't think he'll ever be in trouble financially. Hopefully someday he'll get enough courage to try investing again and get better results but at worst he'll have the capital gain from his PPOR and all the money he's saved away.

Just a guess, but it sounds like he's had some bad runs on the stock market. He should read a property book.

 

[joeExpat]

If only I was in his position!! He could easily have 10 ips by now, but he just puts it into his measly bank account. What does he end up earning after inflation eats away at it.... lol. He's crazy!!

Cash is probably the best place for money right now, he's far from crazy.
Leveraging into 10 IPs would backfire in the current environment. He'll be in a much better position in 3 years than someone who did that.

 

[McBrain]

Cash is probably the best place for money right now, he's far from crazy.
Leveraging into 10 IPs would backfire in the current environment. He'll be in a much better position in 3 years than someone who did that.

That's a bit of a general statement!

I'm sure there are many here who could do much better than bank returns with minimal risk?

 

[ernie]

Just a guess, but it sounds like he's had some bad runs on the stock market. He should read a property book.

Got it in 1!

Risk-averse guy, so is spooked by the relatively large amount of money required to buy into property.

 

[steveadl]

Got it in 1!

Risk-averse guy, so is spooked by the relatively large amount of money required to buy into property.

Explain to him it's relatively less of his own money in property, and there's extremely little chance of a margin call. You could also do what I do with people - buy them a copy of Jan's 'More Wealth' and let them go through it in their own time. Then they come to you.

 

[BayView]

That's a bit of a general statement!

I'm sure there are many here who could do much better than bank returns with minimal risk?

mmmm...Bank interest rates.

8% about now for an on-line account? or maybe a few Term Deposits? I wouldn't know these days.

Factor in less tax, and inflation erosion of your capital - call it about 6.6% if you are on the lowest tax rate.

That's a staggering 1.4% nett.

I only need one rent increase of around $10 per week per property this year, and I've killed that percentage. One IP just had a $30 p/w increase.

Did I mention all the tax benefits and maybe a few % of cap growth as well?

I'm sellin' up the portfolio tomorrow! I think I've still got ING on speed-dial.