John Cameron's personal blog

Serious discussion about your financial position now - and in the future.

What you need to know on Sequencing and Retirement Income

What you need to know on Sequencing and Retirement Income - John Cameron - The West Australian on August 21, 2016, 6:00 am. Video Presentation & Article: Different decades, different investment returns.

Securing Your Future' was the most viewed material on The West Australian’s website yesterday. It’s the online version of The West’s financial planning supplement.  Read more here: 

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Security Of What – Capital Or Income?

Security is something keenly sought by investors, and is particularly important to people at or near retirement.

However, our whole approach to security is being challenged by the current climate of low interest rates, where there are trillions of dollars invested in bonds world-wide, that are earning negative returns.

Closer to home, term deposits attract around 3%pa, while a diversified portfolio of shares can show around 6% to 8% after allowing for tax credits. Investments can be made directly, or via managed funds deliberately managed to harvest a stream of dividends.

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Budgeting – Boring But Essential.

One of the most powerful tools in financial planning is the boring old household budget – especially on the expenses side.

While there are many reasons why people get into financial difficulty, one of the most common is overspending. And, before you can control your spending, you need to know what you are spending, and where it is going.

Also, your spending is the one thing over which you have the greatest control. You can’t control interest rates, or the stockmarket, or your future job security (and hence income). In this age of uncertainty, it makes sense to have a good handle on the things that you can control – such as spending.

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The Missing Link In Macroeconomics

Ever since the GFC, economists have struggled to explain events, to direct policy, or to accurately predict trends.

Could it be that their models (theories?) are missing something vital?

According to Richard Koo, economist with Nomura Research Institute, the answer is definitely, “yes”.

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Is Brexit A Tale Of Foxes, Hedgehogs And Forecasters?

Remember the Brexit crash? Probably not, as it was all over in a flash, and markets are now well above their pre Brexit level.

All of this happened despite predictions of woe by high profile “experts” who looked and sounded good in short grabs on the television and in the press. They had the ability (or more accurately “seemed” to have the ability) to cut through all the complexities and bundle everything into a few well turned phrases.

However, these forecasts of doom have joined the long list of failed forecasts.

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