Stay Ahead of the Game: January's Must-Know News for Aussie Investors
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Shares tipped to lift 4-7% in 2023
The past year hasn’t been one to remember for Aussie shares. As I write, the ASX 200 index has gained just 1.4% over the past year. Add in dividends, and the total returns are a lot healthier at 6.09%. Even so, the local sharemarket has certainly had better years.
However, it’s not a bad result by global standards. The MSCI ex Australia Index, which measures returns on international shares, turned in a 12-month loss of 12.2%.
The good news is that CommSec is tipping the Australian sharemarket to lift 4-7% over the coming 12 months.
This prediction does hinge on inflation pressures, rate hikes and China’s economic recovery. But as CommSec points out, Aussie shares have attractive valuations, and dividend yields remain strong at around 4.23%.
Are you getting fleeced on your savings?
Australians are collectively sitting on a record $1.33 trillion in personal savings. And despite a string of rate hikes in 2022, many savers are earning less than 1% interest on their spare change.
At a time when inflation is 7.3% that means the purchasing power of your cash is going backwards in a big way.
There are plenty of opportunities to earn more, and they don’t have to involve the hassle of switching to a new bank.
RateCity says it may be possible to ramp up returns on your savings by 3%, simply by opening a new savings account with the same bank
As a guide, the table below shows that Westpac’s eSaver is paying a rate of 0.85%. Move to a Westpac Life savings account, and your money could earn a far more exciting 3.75%.
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Big four banks: maximum ongoing rates for existing customers
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|||
|
BONUS SAVERS |
|||
|
|
1-May-22 |
Today |
Difference |
|
CBA GoalSaver |
0.25% |
3.25% |
3.00% |
|
Westpac Life |
0.25% |
3.75% |
3.50% |
|
NAB Reward Saver |
0.25% |
3.25% |
3.00% |
|
ANZ Progress Saver |
0.15% |
2.50% |
2.35% |
|
ONLINE SAVERS |
|||
|
|
1-May-22 |
Today |
Difference |
|
CBA NetBank Saver |
0.05% |
1.60% |
1.55% |
|
Westpac eSaver |
0.05% |
0.85% |
0.80% |
|
NAB iSaver |
0.05% |
1.10% |
1.05% |
|
ANZ Online Saver |
0.05% |
0.60% |
0.55% |
|
OTHER |
|||
|
|
1-May-22 |
Today |
Difference |
|
Westpac Spend&Save |
2.00% |
4.35% |
2.35% |
|
ANZ Plus Save |
0.50% |
3.75% |
3.25% |
Source: RateCity.com.au. Note: monthly conditions apply for some ongoing rates.
The chance to triple the rate on personal savings is always welcome. Bear high inflation in mind though. It reinforces the strategy of using savings accounts for rainy day money – or a short term parking spot while you decide where to invest.
Tesla boss breaks world record
There’s a world record for just about everything these days. And Guinness World Records has announced that Elon Musk has officially broken the record for the largest loss of personal fortune in history.
Musk has lost an estimated $US182 billion ($A263 billion) since late 2021, lapping the previous record for worst loss of fortune of $58.6 billion ($A85 billion), set by Japanese tech investor Masayoshi Son in 2000.
The plunge in Musk’s wealth has largely been attributed to the poor performance of Tesla stock. Nonetheless, he’s still the world’s second richest person behind Bernard Arnault, founder of luxury goods conglomerate LVMH (Louis Vuitton Moët Hennessy), who has an estimated net worth of $US190 billion ($276 billion).
These sorts of numbers are hard for most of us to get our head around. But it’s a powerful reminder of the value of diversifying your wealth across different assets to reduce risk and smooth out returns – even if you’re a billionaire.
Paul Clitheroe is Chairman of InvestSMART, Chair of the Ecstra Foundation and chief commentator for Money Magazine.
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