Archive for January, 2012

My Best Investment

Sunday, January 29th, 2012

Every Wednesday there is a Money liftout in The Age and Sydney Morning Herald newspapers that has a profile of a prominent Australian. Their life stories are condensed into a couple of paragraphs before a section where they are asked a number of questions. Each person gets the same questions including one asking what has been their best investment.

There have been lots of answers involving houses bought in the mid ‘70s or shares in mining companies and even a couple of people who feel they have never really invested money. My favourite answer would have to be from a guy called Clive Hamilton who said his best investment was in the shares of a company that performed really badly. He sold them and used the money to take a woman out on a date. They have been married for many years.

I guess if I was asked this same question my answer would be the money spent on trips to Germany. I have been there four times, including the trip when my German wife, Claudia and I married there, and when we showed off our little chicken to the family just after she was born. They don’t speak much English and my German is scatty at best, but I have developed good relationships with my family despite the language barrier.

More importantly, my wife has been home regularly and our daughter has become a part of her German family’s life.

Yesterday we farewelled Claudia’s parents after a three week stay in Australia. Saying goodbye is always hard. Really, really hard. Especially when you don’t know when the next trip will be and how much our chicken will have grown up and changed in that time. It inevitably involves hugs, tears, an inability to speak from the massive lump in my throat and reciprocation from family members who rarely show such emotions.

The regular visits have meant that we feel quite close to our family, despite the distance.

We are really lucky to live in a time when contact with our European family is quick and easy (and free via email and Skype), and regular travel is do-able. It’s an investment in time, an investment in money and an investment in effort. And although they can’t be measured in percentages, the returns are great and will continue to be for many years to come.

What has been your best investment?

No Regrets

Sunday, January 22nd, 2012

I lost a mate this week, not someone I was really close to, but a 27 year old man I had a great deal of respect for. He spent his last days in a hospice and died with his Homer Simpson slippers on.

Coincidentally, I also saw something doing the rounds of Facebook written by a nurse who worked in palliative care about the top five regrets of the patients the nurse had cared for over the years.

The nurse wrote:

“When questioned about any regrets they had or anything they would do differently, common themes surfaced again and again. Here are the most common five:

1. I wish I’d had the courage to live a life true to myself, not the life others expected of me. This was the most common regret of all.
2. I wish I didn’t work so hard. This came from every male patient that I nursed.
3. I wish I’d had the courage to express my feelings.
4. I wish I had stayed in touch with my friends.
5. I wish that I had let myself be happier.”

It’s at times like when you lose a friend that you tend to reflect on your own life and mortality. You ask yourself if you would have the courage to stare death in the face. Would you try to go out with a bang? Would you regret anything?

My favourite quote, from a source I do not know, is – Nobody ever said on their deathbed “I wish I’d spent more time at the office.” It is a mantra I try to live by (and, yes, I am on leave from my full time job spending time with family as I write this). Of the five points above, it fits perfectly with number 2, and it also fits with how I define financial freedom for myself.

You may decide that financial freedom for you is different. Perhaps it involves owning rental properties, shares and expensive goods, maybe it’s about having enough to go on holiday every year, but it’s likely that most people would include an element of not having to work too hard within their personal definition.

There are many ways to achieve financial freedom, like marrying into money, receiving a large inheritance, or running a successful business. But these ways are not options for us all. What is an option for just about everyone is to have your finances sorted, and I’ve never met anyone who regretted doing that.

RIP Pete Veness

New Year’s Resolutions

Sunday, January 1st, 2012

They’re so easily made (particularly when it’s the champagne that’s doing the talking late on new year’s eve) so quickly broken (especially when you drank so much champagne you spent the first hour or two of 2012 hailing at the great porcelain alter). New year’s resolutions are probably best made sober and with a bit of thought if they are things you actually wish to achieve in the new year, rather than something that becomes a resolution again in 12 months time.

Quite often these self-promises relate to weight loss, fitness gain or telling that prick of a boss where he can shove his unpaid overtime. And a lot of new year’s resolutions are about money. Save up for a home deposit, pay off the car loan, get credit card spending under control, sort out that pile of paperwork that represents 10 years worth of superannuation – your new year’s resolutions may read something like these.

It’s all about goal setting, and like any goal you set for yourself, the more realistic it is, the greater the chance it will become reality. After all, a goal to lose 30kg before June is about as achievable as saving half your income in the same time frame. Aim for something closer to losing a kilo a month, or saving $500 every four weeks, and you will have a greater chance of getting there. The weight is more likely to stay off and the bank balance is more likely to be rising.

Then you have to work out how to actually do it. For the weight loss it can be a matter of replacing the chocolate eaten on the lounge in front of the laptop with eating a piece of fruit instead. Make a commitment to walk to the local shops for that loaf of bread or milk that’s run out once or twice a week rather than taking the car and you get the increase in exercise to help with the weight loss goal as well. For saving more, look to replace the chocolate with a piece of fruit and cut down on your fuel bill by walking a bit more. Hey, hang on, I’m messing with you, right? Funny thing is that lots of people who aim to shed a kilo or two have healthier bank balances as a side effect, and people who start saving money end up losing weight as well. Two birds, one stone.

The last thing to do before you lose your enthusiasm is to write down your goal to remind yourself of it and/or share it with someone who will encourage you to get there.

Everyone knows that so many diets or exercise regimes fail because they were too difficult to sustain over the long term. Many goals to save money can fail for the same reason. Make your new year’s resolutions realistic from the outset and you will get to where you want to be, albeit a little later than you might like.

Happy new year.