Beginner Asking for Advice - Low Risk Investment

LChagsz on 21/10/2022 - 08:38
Last edited 21/10/2022 - 09:51 by 1 other user

Hi guys
I've been in Australia for only 2 years and have little to no notion on investments here.
Usually, there not enough money left per month to think about that anyways. Whatever I don't spend, it just stays in my bank account, idle.
What do you recommend to start with, just so I get at least some interest back?
Lets say I have $100 extra per week, where would you put it, with very low risk?
I have a bank account with C.W. and that's it.

Sorry for the extremelly basic question. I don't know many people to ask that in person.
Regards.

Financial

Comments

  • Xistn on 21/10/2022 - 08:40
    +6

    Open a savings account, even $5 a week can go a very long way, just depends on your goal.

    • jv on 21/10/2022 - 11:14
      -3

      Nah, invest in fidget spinners…

  • Vulgar on 21/10/2022 - 08:44
    +1

    I'd recommend having a savings account with no monthly deposit requirement to waive the fee and investing it into an index fund at a regular frequency. If you use Superhero buying index funds is brokerage free.

  • AndyC1 on 21/10/2022 - 08:45

    Open a second bank account and transfer X amount to it each month.

  • CyberMurning on 21/10/2022 - 08:52
    +2

    get a second job
    stay away from club, pub, eating outside, cinema and …… ozb!
    get a third one if you still have free time

    • Mokr on 21/10/2022 - 10:16

      The RSL is a good way to meet a wife

      • onetwothreefour on 21/10/2022 - 11:27

        Get a job at the RSL then.

      • redfox1200 on 22/10/2022 - 08:05
        +1

        surely he would want to meet a single woman first, not someones wife

    • ThithLord on 21/10/2022 - 11:43
      +1

      But all I want, all I need, all I crave is a good pub fooeed

    • Donaldhump on 21/10/2022 - 13:54

      i eat outside every day in summer, last time I checked it was free

  • SBOB on 21/10/2022 - 09:27
    +7

    where would you put it, with very low risk?

    I have a bank account

    done.
    Pick a bank account with no fees and decent interest rate. Thats your 'very low risk' option achieved.

  • djkelly69 on 21/10/2022 - 09:49
    +4

    Given your low risk appetite, I would just recommend a high interest savings account. I don't think CBA has any great or even good ones. Pick a reputable online bank with high interest rates and no fees.

  • ForkSnorter on 21/10/2022 - 09:52
    -1

    Save the bulk of it for a deposit on an apartment (you probably won't be able to afford a house saving $100 a week).
    If the Commonwealth Bank goal saver account doesn't match the interest rate of some other banks, go into a branch and chat to the staff, they will probably push your interest rate up a bit. Otherwise try a different bank, such as Suncorp.

    Put 10% of that $100 per week in shares or cryptocurrency, just in case you get lucky. Commonwealth bank has an app/system called Commsec, which is free to register, then you pay a small fee to buy shares. I haven't tried I yet, but looks pretty good.

    • 1st-Amendment on 21/10/2022 - 11:07
      +4

      Put 10% of that $100 per week in shares or cryptocurrency

      He said 'low risk', not 'Ponzi Scheme'

    • whatwasherproblem on 21/10/2022 - 15:41
      +1

      Commonwealth bank has an app/system called Commsec, which is free to register, then you pay a small fee to buy shares. I haven't tried I yet, but looks pretty good.

      That 'small fee' is $10 or 1% of the buy order, whichever is highest. That's a tenth of OP's weekly save just going straight into the pockets of literal bankers.

      Shares aren't low-risk either, especially not with the current geo/political climate. There's every chance that you could wake up tomorrow to the ASX200 having lost 80% of its value because China's real estate system imploded overnight, the US finally erupted into civil war, and Britain wasn't able to kick the can of bankruptcy down the road for a day longer.

      • ForkSnorter on 21/10/2022 - 19:36

        Commsec pocket fee is only $2 per trade up for trades up to $1000. A diverse investment strategy is the most risk-free I heard.

        • SBOB on 21/10/2022 - 20:03

          CMCMarket is $0 for buys up to 1k, so even better :)

    • brendanm on 21/10/2022 - 16:30

      Put 10% of that $100 per week in shares or cryptocurrency

      Haha, $10 a week into shares? The brokerage fee alone would be a near 10% loss instantaneously, even if he only purchased shares once a year.

      • MITM on 21/10/2022 - 17:02

        Plenty of Stock apps with no brokerage. Plenty of shares at $10

      • ForkSnorter on 21/10/2022 - 19:39

        So are you saying that purchasing $500 worth of shares per year is risky? A waste of money? I don’t get your point. Brokerage fee of $2 is going to bankrupt him?

        • brendanm on 21/10/2022 - 20:05

          You suggested commbank. That's not a $2 brokerage. I don't consider it risky at all, but it sounds like op does.

          • ForkSnorter on 22/10/2022 - 07:05

            @brendanm: Commsec pocket app is $2 per trade.

            • brendanm on 22/10/2022 - 10:13

              @ForkSnorter: $10 a week. Perhaps he buys shares monthly, $2 a trade. $520 spent, $24 in fees. $496 worth of shares. If the value went up 10% (very unlikely as he has been buying monthly), he ends up with $545.60, less than 5% increase. That is a vest case scenario, much more likely that returns would be lower than that.

              • ForkSnorter on 22/10/2022 - 15:23

                @brendanm: Share market doesn’t work like that. Not everyone invests in boring safe shares like jb hif which are never going to take off. Startups are where you can make some money. Or promising tech companies. My friend bought $1000 of Tesla shares a number of years ago and they’re now worth over $10,000. Warren buffet is one of the richest people in the world, and all he does is buy shares.

                • brendanm on 22/10/2022 - 16:38

                  @ForkSnorter:

                  My friend bought $1000 of Tesla shares a number of years ago and they’re now worth over $10,000

                  Yes, this is how it happens with all start ups 😂 I bought some shares in a tech company at listing a few months ago, I'm down 83% on them today. Do you think that's a good investment strategy for op, to lose 83% of his investment?

                  is one of the richest people in the world, and all he does is buy shares.

                  Have a look at the shares he buys. Very rarely anything high risk. He also has billions, so if he makes a bad call, it isn't even a blip on the radar for him, not like most of us

                  Do you have shares or crypto?

                  • ForkSnorter on 22/10/2022 - 17:08

                    @brendanm: So are you saying nobody should invest in shares? In my opinion, diverse investments are the safest (property, shares, savings, etc.) Putting 10% of your disposable savings in a range of shares is not especially risky or bad advice as far as I’m concerned. I would still put 90% in a high interest savings account though.

                    • brendanm on 22/10/2022 - 17:14
                      +1

                      @ForkSnorter:

                      So are you saying nobody should invest in shares?

                      Please show where I said this?

                      my opinion, diverse investments are the safest

                      Do you have shares or crypto?

                      Putting 10% of your disposable savings in a range of shares is not especially risky or bad advice

                      It is when that would be $10 a week, and pretty much any profit is eaten in fees. In addition, you are suggesting putting the money into risky investments, in the hope of a windfall. This is only generally valid for.someone who really researches and knows what they are getting into, hardly worth the hours and hours invested, for the returns on $10.

                      • ForkSnorter on 22/10/2022 - 17:31

                        @brendanm: If you put your savings into the highest interest savings account, after paying tax on your interest, you’re left with about 2-3% gain, which at the current inflation rate means you’re losing money. I mean, nothing is easy but I sure as hell wish I’d put 10% of my savings in a diverse range of shares 20 years ago.

                        • brendanm on 22/10/2022 - 17:54

                          @ForkSnorter:

                          If you put your savings into the highest interest savings account, after paying tax on your interest, you’re left with about 2-3% gain, which at the current inflation rate means you’re losing money

                          I'm well aware of that. The same holds true with your suggestion, as I calculated for you above, but with the added risk of losing the money.

                          I sure as hell wish I’d put 10% of my savings in a diverse range of shares 20 years ago.

                          So you don't have any shares or crypto?

    • MITM on 21/10/2022 - 17:04

      @ForkSnorter Not going to be able to afford an apartment saving $100 week either

      • ForkSnorter on 21/10/2022 - 19:38

        Got to start somewhere.

        • redfox1200 on 22/10/2022 - 08:07

          better off focusing on earning more money than trying to save $100 a week.

  • payless69 on 21/10/2022 - 09:56

    Ing all the way but keep tabs on as things change all the time!

  • pao2x on 21/10/2022 - 10:03

    Put it in the highest interest savings account bank for low risk . ING and such for 4.05% interest

    • jv on 21/10/2022 - 11:13
      -2

      ING and such for 4.05% interest

      How much is inflation ?

      • pao2x on 21/10/2022 - 11:15
        +1

        Show me a safe investment with higher returns than inflation?

        edit- or even one that has reasonably good chance of beating inflation this year

        • jv on 21/10/2022 - 11:22

          Show me a safe investment with higher returns than inflation?

          https://www.realestate.com.au/buy

          • pao2x on 21/10/2022 - 11:30

            @jv: Sure buy one for $100 a week. You'll also be losing money for a while until the correction finishes.

            • jv on 21/10/2022 - 11:35
              +2

              @pao2x:

              until the correction finishes.

              🤣

  • Benoffie on 21/10/2022 - 10:14

    Agree with the others. Given the current savings rates, a high interest savings account is your best (and lowest risk) bet.

  • jv on 21/10/2022 - 11:12
    -1

    Lets say I have $100 extra per week, where would you put it

    Speak to a licenced financial advisor.

    • tallkid123 on 21/10/2022 - 11:40
      +1

      Exactly. I thought asking for financial advice in forums was banned everywhere?

      • jv on 21/10/2022 - 11:48

        It should be, otherwise I'd recommend the OP buy some debentures.

  • Drakesy on 21/10/2022 - 11:41
    +1

    Bank savings accounts are actually doing something for the first time in 8 years.
    Almost zero risk, better returns than the share market atm.

    • jv on 21/10/2022 - 11:49

      Bank savings accounts are actually doing something for the first time in 8 years.

      Not really, you are still going backwards with inflation being around 7%.

      Almost zero risk

      Because your a losing value in your money.

      • Drakesy on 21/10/2022 - 12:16
        +1

        Better than your shares going backwards while also getting hit with inflation ;).

        • jv on 21/10/2022 - 12:38

          I'll be fine, I bought Twitter…

        • onetwothreefour on 21/10/2022 - 13:50

          Shares going backwards is the best time to buy.

        • Leiothrix on 22/10/2022 - 08:07

          Shares aren't going backwards, they are on sale.

          It's the best time to buy.

      • Oofy Doofy on 21/10/2022 - 15:15

        Since when is inflation at 7%…..for the last financial year? The long term inflation rate, which is the only thing that matters, is in the 2% range as per usual.

  • ihbh on 21/10/2022 - 18:30

    You need to provide info such as your objectives, risk tolerance, age, etc.

    E.g. Will you need the spare money? If you want low risk, an option is in a low risk option in your super fund. Has advantage of low tax environment, but can't touch until retirement.

    • mrtin on 21/10/2022 - 23:25
      +2

      Personal advice is a recommendation or opinion tailored to your personal circumstances. It is more specific than general advice and takes into account your financial situation and goals.
      Only licensed financial advisers can legally provide financial advice. Ozb are exempt though I heard.

  • Mugsy on 22/10/2022 - 09:27

    First step of investment, make sure the transaction accounts you have are fee free, excess money in a savings account, and you've got your spending under control. Tip… if getting into an investment means that much to you, cutting off disposable income spending should be very easy.

    Profit = income - outgoings after all… get the outgoings under control then work on income.

    Second step of investment, educate yourself. I must have spent 5 years after Uni continuously educating myself on property, shares and business. Also be honest with the type of person you are. I came to the conclusion that business is not right for the type of person I am and shares moves too quickly… but property I excel at. I'm not super rich with property… I'd say above average and definitely sufficiently educated to work through transactions and costly risks that eventuate. But I've been educating myself on property for over 20yrs now.

  • kusala on 23/10/2022 - 01:57
    -1

    Receive 3% interest with ME Bank Everyday Transaction Account & Online Saving Account

    Bank and save with up to 3.00% p.a.

    Our variable interest rate is made up of a 0.05% p.a. base rate and a 2.95% bonus rate when you have an Everyday Transaction Account and meet our criteria:

    Have both our Online Savings Account and Everyday Transaction Account (you can open both at the same time). Make at least four tap & go™ purchases per month – which must be settled, not pending – using your Everyday Transaction Account. Bonus interest applies to balances up to $250,000 on each Online Savings Account you open (on accounts opened after 10 Aug 2015).

    https://www.mebank.com.au/banking/online-savings-account/

    • El-Rhi on 23/10/2022 - 07:32

      ING 4.05%, Virgin Money 3.9%, UBank 3.6%, MyState 3.6%.

      3% in this environment is extremely uncompetitive.

      • kusala on 23/10/2022 - 13:37

        I mentioned ME Bank as I have accounts with them. An annoying feature of ME Bank is that it doesn't have fully functioning Osko.

        Thank you for this information. I learned all these online savers require a minimum five purchases per month

        • UBank has the least conditions

        • My State requires $20 minimum deposit per month

        • Virgin Money requires 32 days withdrawal notice

        • ING requires requires $1,000 minimum deposit per month

      • kusala on 24/10/2022 - 14:04

        Just noticed that the UBank online saver requires $200 deposit per month into any UBank account.

        This means that My State probably has the least amount of conditions to obtain the bonus saver interest rate

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