She's On The Money - Investing Q&A with Glen James: Your Questions Answered

Episode Date: August 20, 2024

Today, we’ve got something special for you—Glen James, author of The Quick-Start Guide to Investing, is here to tackle your most burning investment questions. From picking the right platform to investing for your kids and knowing when it’s time to level up from micro-investing. If you’re looking to up your investing game, this episode is for you! Acknowledgement of Country By Natarsha Bamblett aka Queen Acknowledgements. The advice shared on She's On The Money is general in nature and does not consider your individual circumstances. She's On The Money exists purely for educational purposes and should not be relied upon to make an investment or financial decision. If you do choose to buy a financial product, read the PDS, TMD and obtain appropriate financial advice tailored towards your needs.  Victoria Devine and She's On The Money are authorised representatives of Money Sherpa PTY LTD ABN - 321649 27708,  AFSL - 451289.See omnystudio.com/listener for privacy information.

Hello, my name is Natasha Nabanunga-Bamblett. I'm a proud Yorta Yorta, Kernai, Wolperi and Awadjeri woman. And before we get started on She's on the Money podcast, I would like to acknowledge the traditional custodians of the land of which this podcast is recorded on Awadjeri country, acknowledging the elders, the ancestors and the next generation coming through. As this podcast is about connecting, empowering, knowledge sharing and the storytelling of you to make a difference for today and lasting impact for tomorrow. Let's get into it. She's on the money. She's on the money.

hello and welcome to she's on the money the podcast for millennials who want financial freedom. I'm back with another episode that has been far too long between recordings. Mr. Glenn James from Money, Money, Money or M3 joins us. Hi, welcome to the show. Thank you so much. It's been a long time. You're one of the only guys I let on the show. So like you are welcome. Thank you. And hello to everyone who's listening. I know that we've got a lot of crossover listeners. We do. I'm so excited for this episode because one, you're visiting me down in Melbourne, which is really kind of you. But two, you've released another book. I have.

What is it called? It's called The Quick Start Guide to Investing. And you're doing that with my friend, Nick Bradley, who is now my friend, who was your friend. We went to America together last year and he's funny. He's like really funny. He's moving to Spain. I know. It's actually insane. He's just picked up his entire family and moved them to Spain. He's not only funny, as in not funny because he's moving to Spain, but funny in isolation, but also cool life story.

But it's weird, like I introduced you to my friend Nick and then you guys all went out for the football or something one night. Or maybe be more social, be more social. You were invited and you were like, no, I don't want to go out, I want to get ice cream and we're like, yeah, no worries, have fun on your own. We had hot dogs, Nick showed us American football. I had so much fun and I also learnt how to transfer money internationally

because Nick bought my footy ticket. Do they call it footy over there? I don't know. Yeah, football. Nick bought my football ticket and I had to give him cash back and it was a conundrum. I see the value in just being able to transfer money between our bank accounts, Glenn.

Totally. Like the American banking system, cooked, but that's not what we're here today to talk about. I'm also not here to really talk about your book either. No, I don't want to talk about the dumb book, but you anointed it. I did anoint it. Where in the book could I see my quote? Am I number one?

Yeah, the first page at the top. I like that I'm first page at the top, But, like, on the back, I didn't get the cover. No, because I wanted a comedian on the back. I wanted a comedian. But, like, why has a comedian got to endorse an investing book? Well, why does everything have to be so serious all the time? You are so lucky that you're good at investing content because otherwise, I don't know if I'd endorse this.

But I'm excited for this because this goes a little bit deeper than my investing book. And what we were saying before off air that this probably is a really good, like, if you've read Investing With She's On The Money and you want to kind of, like, take it a level up. Nick, he's a right nerd, but like speaks in really general terms. So like his content is really easy to follow and it's really highlighted. So you could just skip all the parts in this book that Glenn wrote and just focus on the Nick part. Yeah. And I think that that's a really good way to approach it. But we asked our community, Glenn, a heap of investing questions, and I was hoping that you would be open to answering a few of them on the show and having a general chat about investing because even though we're in the middle of a cost of living crisis, I feel like

so many people are still really interested in self-education and really interested in starting the process, even if it means they're just starting with 20 bucks. Yeah. And that's really good because there's a spectrum of life that we're all on and someone could be starting out with their career, starting out with their first job, still at school or in university and not having much money and want to invest. Or it could be the other end of the spectrum where like you've got more money than God, but a lot of people fit right in this middle part where things are tight, rent might be expensive, the mortgage repayments might be and have been increasing, or we might be trying to get out of consumer debt, but we still want

to invest. And one thing I'm a big fan of is, yes, putting your toe in the water. And I did a table in the book where if you earn, say, $70,000 a year, well, let's try and make it so we're not going to not invest, but maybe allocate 1% of our investing. So, $700 a year. Or if you earn $80,000, let's start with 1%. So, it just keeps us, even if it's $30 or $40 a month, you're still getting out of debt or you're still trying to keep things going along, but it keeps us interested and it keeps us engaged. Which I think is really important. Like for me, engagement with the process is more important than saving up a really big lump sum to start. I literally just finished recording an episode, Glenn, about getting back on track

with your investing plan this year. Cause so many of us set out to like invest in January and then it was February. And then all of a sudden it was July and we're like, Oh, we've fallen off the horse. Like maybe next year, but like investing doesn't have to have a start point. That's like so defined. We can actually just start investing today and putting ourselves in the best possible position. And I mean, right now, coming into the second half of the year, like a book called The Quick Start Guide to Investing feels like the book I actually need. Like if I'm not at the start of a year and I need some motivation, that's maybe not new you, new me vibes, but like, let's just get started. Glenn, you already have a book. Why did you want to write another one?

Because I wanted to just get to the point and- Why didn't you get to the point in your first book? Because with my first book, Sort Your Money Out, people would always ask me, oh, what do you think about money? Or how should I get out of debt? Or how should I build a budget? Or how should I set up superannuation? Here's my book, here's all my thoughts. But this book, it is smaller. So like I had a message from my cousin the other day and she said, Glenn, And everyone at work's talking about this Trader 3000 platform. What do you think?

I'm like, it sounds like rubbish. That sounds like a scam. Yeah, that's right. I said, I'm literally getting the book and I'm giving you a copy because that book is everything I think about investing. That's why I wrote my investing one because I think you were the same as me. I was so excited to write a book and I thought, I'm just going to put everything I know about money in this one and I'll be one and done.

That's right. I will never write another book again. the writing process is so challenging and I know you and I struggle with the same stuff so we were both like writing a book challenging as hell but then obviously the questions come and people want more and it's exciting to write another book because you can really niche down into a particular topic so like I was being rude before but that's maybe because I know you but also I'm really excited to dive into this but our community is also really excited to dive into this I'm going to use this as a little bit of a Q&A session. I'm asking the questions, you're answering them.

Glenn, I've got you captive. Krista has asked, at what point should you move from micro-investing to a big league investing platform? It's a very interesting and common question. And I actually think if the platform or the setup that you've got at the moment is working and the shoe fits, I don't know if you need to graduate. I mean, maybe if you were starting to build significant amounts of wealth, I think the question's always, and it's exactly what I covered in the strategy chapter of the book, the question needs to be more about what's your long-term strategy goals and why, and what ownership structure do we need to house that investment in? Then we can work on, okay, what's the best platform, app, brokerage account? Because what

you invest in and how you own the investment, whether it's in your own name, whether it's in your superannuation, whether it's in a trust, if you're a complex investor, whether it's an investment bond, whether it's a joint name account, whether it's in a company, all that stuff, how you own it, what you buy is more important than the actual underlying brokerage account or platform. But I think when the student is ready, the teacher will appear. That's fun. I think it was from like an old movie. Was it?

Karate Kid, maybe. Oh, Karate Kid. Like, don't quote me, but also quote me. I mean, I thought you were going to, like, quote, like, someone really knowledgeable. Gandhi. Yeah, you were going to be like, that's a Gandhi quote. Yeah. And I'm like, wow, deep.

And you were like, credit kid. And I was like, oh, okay. As an example, I think one of my hobbies is technology and- And purchasing useless technology. Exactly. Is that what you mean? Yes. So, I wanted to-

I'm glad I've seen it. When I set up my first podcast studio- This man is not lying. I wanted to get all these camera gear and, you know, you buy the first camera and you get to the point where you know it so well, the limitations appear the more that you know. And I know nothing. And then it's like, okay, so I'm now upgrading from a, maybe a little Sony handheld digital SLR. We're still there, yep. Yeah, I went to Blackmagic, which is like-

I remember that. Yeah, like really high end tech. Are you still using those? No. Good or bad investment? It was good at the time, but too complex for what I needed. So, now I'm back to Sony cameras from JB Hi-Fi. And I say that to say, with your investing, the more that you learn about the platform, what you're investing in, you know, in the book, we talk about building your portfolio.

Do you want a single share portfolio of 10 individual shares? Do you want a DIY three ETF simple portfolio? Or do you want a one and done investment in a box ETF portfolio? I feel like I'm on the same page as you about that, but that shouldn't be surprising to anyone who's ever heard us create content together because we're always like, yeah, that sounds about right. Well, my answer to the question is continue to learn about why you're investing, what you're investing in, what your investment strategy is, and then you'll start to see if there are any limitations to your current platform or brokerage account. There is a big discussion out there in personal finance land around chess sponsorship brokers and custodian waters. And I

went to town on it in the book, gave my two cents. I know what that two cents is. Can you just spoil it for us? How do you feel about chess sponsorship? Actually, backtrack for those listening who are like, hold up, hold up. This has gone real deep, real quick. What is chess sponsorship, Glenn? So, CHESS is the system at the ASX, Australian Securities Exchange, and CHESS is the system that electronically tracks purchases and assigns that to a dedicated number called a HIN, Holder Identification Number. Now, if I opened a brokerage account that was quote-unquote CHESS sponsored, it would be under the name of Glen James. I could then log in, purchase shares in, I don't know, Woolworths or whatever. And then on the ASX register, it would say, you know, 100 shares in Woolworths, HIN number Glenn James.

Yep. And then that's- That's just a way of tracking it. Yeah, directly on my personal name. With a whole heap of different investment apps and platforms, they have what we call an Omnibus HIN, which means, you know, if I created my own investing platform called the Glenn James investing platform- Omnibus sounds like something I get on in Bali to go to a club.

Sounds pretty fun. It's not that fun, but sorry. Do you like Bali? I do digress. Yes, I do like Bali. I've been a few times. Yeah, I'm going in November. Okay, well, we'll talk about that later.

Thanks for the invite. So, if I created a platform, and this is where the advantages are with micro-investing, I could have all these shareholders use my platform and we have one HIN or one listing with the ASX, and then that HIN is spread all through the different owners. now that money that we invest on the platform is held in custody or on trust so if the glenn james investment platform goes under quote unquote people's money isn't lost yeah now there is this thing in personal finance land and stockbroking land where there is a purist play that you must hold investments on your own hin for absolute security i push back on that to say

if you're going to have that logic, you need to be careful because everyone or most people's superannuation is effectively on a custodian model. If you buy ETFs, you are not buying the underlying shares, you're buying units in the ETF. The wealth is on custody on the ETF provider's balance sheet. And both you and I, Glenn, I think this probably tells people a lot because we obviously can't give advice on, well, what should I do, V? But you and I both own ETFs. And both of us have superannuation funds that operate under a custodial model and we are both comfortable with that. I don't have any of my wealth with a chess-sponsored broker. And the main thing is when you strip back and look at your strategy and how you're going to invest,

the main thing for me is paperwork and ease of administration. So, I have my investments on a platform and that platform has its own HIN with the registrar. And every year, I get a consolidated tax report. I don't have to keep records myself. And for me, every time there's a dividends paid, they get paid into the cash account and then they get sucked back up and I have to repurchase ETFs. I don't have to keep any records. And that's worthy of consideration because so many people get caught up in this purist model of going, that's the right thing to do. But the risk that is being carried in that decision a whole heap has to happen to the australian economy before you would be impacted like we're

talking banks falling down before that's a thing and i promise you there are bigger fish to fry when it comes to setting up your platform yeah and i think my thing and we will move on to the other questions but you know we've both had paid work with shares they're a platform or an app in australia and new zealand i don't want you to be scared by people online saying you've got to have a chess-sponsored broker and you've got to do it this way, let's accelerate people investing. On that, I also think it's really important to understand that when it's not chess-sponsored, it's more accessible. So, accessibility is something that to me is incredibly important in this investing world and a platform like Sharesies enables you to purchase fractions of

shares and that is never going to be possible if you want to be completely chess-sponsored individually. Like it's just not going to be an option. And so, for example, when we talked about before, if you are cleaning up your mess, if you are building your career, if things are tight and you still want skin in the game and you've got an income of $50,000 a year, 1% of year is $500. That's $41 a month. That's pretty achievable. You can't do that with a brokerage account. You've got to use an app or a platform. Yeah, exactly. Now, I will say as well, if you have a brokerage account and because you're a chest purist and you only buy shares that are direct in your name with the ASX, the moment you go onto your brokerage

account and buy direct shares in Tesla, Microsoft, Apple in the US, you're exiting the chess system. So, you're going back into custody. Most of the world operates in the custodian model. Yeah. It's not that common. Yeah. So, let's just have a shower and a chill pill, cold shower that is, and don't get scared by other people saying, you have to do this. Because one thing I was really proud of, which we'll put a link in the show notes, in the back of the book, I've got what we call an investing constitution. And what I challenge people to do is go through your investing constitution. So, an example here, you write down your goal, your why, your time horizon,

your asset allocation, the ownership structure, the investing strategy, how you're rebalancing what you're doing. So, when things get tough or when you hear people say, oh, do it this way or do it that way, you go, no, no. I've got my formula. I've got my strategy. I have my own plan. Thank you. Yeah. So, a lot of it is turning down the noise and being so clear on your own investing strategy. I think that's really important. All right. Let's move on to the next question because I feel like it does flow. Belle has asked, Glenn, how do I pick a platform? There are so many. I would say to Belle, how do you pick a car? There are so many. I want to know. So like if I wasn't in investment land and I didn't have any level of understanding

this, how do we understand what's a sham? Like before you were telling me off air that someone had asked you about an investing platform that both you and I immediately, we heard the name like scam, absolutely steer clear. But how do we get to being able to identify that and then picking a platform that works for us? Yeah. So, I think, again, I do sound like a broken record and this is why- That's okay. You haven't sounded like a broken record in a long time on my podcast. So, just bring it back. All right. We're bringing it back. Wicky, wicky, wicky. The old classics. The whole thing about this philosophy,

this book is to work out why you're investing. So, the why, how long you need to be invested for, what you're going to be investing in. Do you want to do direct equities? Do you want to do ETFs? Do you want to do one-stop shop? You nail that stuff and then you can go, okay, what do I want to invest in? So, it could be, well, I actually want some American equities, I want some Australian, or I just want to invest in Australia. So, we work out exactly what we want to invest in And then once we're clear on what we're investing in, and so if someone's thinking, like you've got older listeners who might be 10 years out from age 60, if someone's like, I just want to build wealth for retirement, well, the question is, we're probably looking

at superannuation for that. So, we're not really looking at an app or a platform. So, once you get clear on your strategy and the why and the what, then we can look at the how. A lot of the discussion online and everything you see always speaks to the how, and the execution is always the easiest part. Bill, if you're, for example, like, I'm really comfortable investing in the top 200 shares in Australia via an index, you've worked that out, you can go, okay, well, what do I look at? You could ask your friends and family, hey, what investment platform do you use and what do you like about it? Or you could ask people online. But the thing is, you've just got to be so careful that when you ask these questions, people's response isn't going to impact

your strategy or deter you from what you want to do. But I think any type of, if you want to get to the technical things, reputable platforms, they've got to be licensed in Australia. So, on their website at the very bottom, the front page of every money website, your website, she's on the money, my website, go to the very bottom of the front page. You'll have details of their license. Our websites have details of our license. And you can triple check that license as well. Look it up, Google it. Heck, send, probably don't, but do it, whatever. Ask us, and we'll say right in our Facebook group, people will tell you. Like, I think it's getting to a trusted community. We can't give personal advice. But for example, as a bit of a sales

thing for my audience. I've told people in my community, that's a scam. Don't do it. Yeah. I'll tell people if it's dodgy. I'll tell you if I think it's trash. But if it's not trash, we'll probably say, can't tell you. No, no, no. If it's trash, I'll be like, do not touch that with a 10-foot pole. Then if you send me something that is legitimate, I'll be like, hey, yeah, I had a look online. They have a credit license. I have no experience with this platform. Good luck. I can't give you advice. I can't tell you what to do and I never will because even though it's illegal, it's also for me quite unethical. I don't know your situation. That could be the perfect platform for

you or you might have a whole heap of stuff going on that I have no idea about and it doesn't make sense for you. It's irresponsible of us to have an opinion, but I will stop you from jumping into a scam. I won't tell anyone on my podcast or in my Facebook group what investment account that I use or what I invest in. What do you invest in? Well, I can't tell you, but in the book, we've got lots of practical examples, right? And I said to Nick, if we're using practical examples, I need to do a disclosure section at the back. To outline that they're not paid. So, like, for example, it's like disclosures. Glenn holds the following investments mentioned

in this book. They're some of the investments that I personally hold. I see how number one is Bitcoin. I did it in, well, don't read the other ones, gosh. Why? But I said listed alphabetically. I just did it alphabetically. Okay. So, Bitcoin's still number one. No worries. Yep. Glenn has active accounts with, don't you read them live? Oh, same as me.

Yeah. And Glenn's business, which hosts the podcast, has been paid or I've done corporate speaking with Amazon Aware Super. So, I think what I'm saying is, if you want to know what I use personally, buy the book, but- I like that. I like that. Or go to a reputable community like your Facebook group and ask other like-minded investors. Yeah, and have the conversation. Look at Google reviews. But also, don't take some random person's opinion as gospel. Like, do your own research, get comfortable with it.

Yeah. That leads me into, Glenn, I just saw a name in your book that we won't read on the show, but Kelly has asked, Glenn, how do I invest for my child? You've got a variety of options. I think it's one of the most complex areas. and number one, if you want to do it the right way, you have to set up a tax file number for your child. And then if you set up an investment account, so like heaps of investment platforms and companies, they allow you to click set up a child account, right? And it just mirrors the

account and it can be on trust for the child. Then what you basically have to do is you have to declare that income or dividends on the child's tax return. The problem is when you're a minor- You have a 49% tax rate. Yeah. And then it steps up to 60 and then back to 40. It's a cooked system. So, my personal view is- It's to stop the rich getting richer. So, I'm not that mad, but at the same time, make it easier for people trying to invest for their kids.

Yeah. It's a big discussion. I personally, for my niece and nephews, have an investment bond. I've got the view with – because I did a whole heap of research on all the options that you can do. And if you want, I can share a link to the blog. I would love that. In the show notes. And it will just step through. I think there's six different ways you can invest for your kids. And just quickly, I've resolved after doing all that research that healthy parents financially or financially healthy parents, they'll do, equals healthy financial kids.

And the only other thing as well that I think is really cool, if you're a little bit older and if you have kids and you're 40, for example, or in your 40s, and once you get to age 60, the kids are going to be coming, quote, unquote, online as adults. So, 18, 20, 30, whatever, you could actually set up a separate superannuation account in your name and just put money for the kids in there and just have that turn off the insurances, put them as a beneficiary. So, the estate planning is protected. It's very complex, but I like that option. But I honestly think- That sounds way too complex for me. Like not for me in general, but I think- Conceptually, yeah. As a concept, if you are a little bit overwhelmed with this space, I think the first thing I would do is go, what type of tax rate do I have as an individual? And how is this going to impact my child's investment? Because most investments are going to be kept in your personal name until the

child becomes 18 or until you decide to give them access to it. And that's going to put you in a position where if you are on the highest marginal tax rate, is that something that you want to consider? If you are on the highest marginal tax rate and you want something like an investment bond, have a look into them. They are not a bad option. I know you use them for your niece and nephew and we have recently established one for Harvey. So for me, it's a really good tool. It's quite tax effective and there's obviously a lot of benefits. There's also a little bit of a barrier to entry. You need to have a certain amount of money to be able to access it. It's not like a Sharesies where you can go on the platform and just start investing with as, you know, like a

cent. But at the end of the day, you need to have a look at all of these options. And I do talk about it in my book. I know you touched on it in your first book. Have you touched on it in your second book? What about the options? About investing for children. I didn't heaps touch on it. I did a little bit. So, in the strategy chapter, I did a deep analysis on the six ways that you can own things. So, in your own name, joint name, super, investment bond, company, and trust, and each of those things, I did a concept, I did how tax works year on year, I did how tax works when you sell the shares, and most importantly, estate planning for each option, and then the pros and cons of each. Which is all really important to understand before you're planning

on investing for a child anyway. I feel like lots of us like want to invest for our children and want to put them in the best possible position, but often it's to our demise. Maybe you're not investing for yourself first. You don't have an emergency fund for yourself. I think there are a lot of things that we need to be planning for and pouring from an empty cup is not possible. So like set your financial house up for you and then work out what you're planning on doing. You know, I'm a pragmatist to a fault. And, you know, when I was practicing as an advisor, and you're now a retired advisor. Slave. Welcome to the retirement club.

Thank you. The amount of people that we set up investments for kids when the child was born, four years down the track, oh, we need a new lounge, oh, we need something, and oh, we'll just take that money. Like, it doesn't, I don't know, like, it's just tough. And I just think build wealth in your own name. And distribute it to those kids later down the track. When they need it. You might want to help your child out. When they turn 18, they're switched on with money. Like, hey, let's set up a share investment account in your name. I'll seed it with five grand. I'll do that. Or they might be, oh, I'm free spirit. All right, we're going to pay for your flight to Europe. We want you to have this life-giving experience. Or I don't know, I just think financially healthy parents equals options for kids if they're not little brats and

you want to help them when they come online as an adult. True. All right. Moving on, Maddie has a question. She wants to know, Glenn, what are the downfalls of having multiple investing platforms? I have a few at the moment. It's just going to be record keeping. So, number one, if you've got, say, a traditional brokerage account, might be with one of the big banks, you're going to keep dividends records each year. Some of those brokerage accounts will not pay interest on cash that's in the cash account. need to check that with your investment app or platform. Another downfall is you may have investment overlap. So, if I've got, I don't know, a ComSec account over here and I'm invested in

IOZ, which is the Australian 200 index by BlackRock, top 200 companies weighted index. And then on my Sharesies account, I invest in VAS, which is the Vanguard Australian Share Index, which invests in the top 300 Australian companies. You've literally got overlap. I would probably say, and this is cool because when you get started, and we've all been guilty of this, we set up different investing apps and accounts and, oh, this is cool. I would say probably pick one that you like using the most, one that has the features that you like, one that might be really easy for reporting. The one I use, I just like it and it does the job and it's sweet. then you might go okay any in the money world we call it new money if you're investing new money

which is i've been paid it's been in my savings account then i've moved it onto the app or the platform you might decide that going forward any new money will be directed to this investment account and i'm going to just use this going forward you might be able to do an in specie transfer from the other investment account and move the etfs or shares across to the new one But I think it's just about having clear and clean housekeeping. The downsides, they're not really going to be hugely financially detrimental because if you're just holding ETFs and not doing new investments, well, the ETFs have internal fees, so you'll get that on either platform. The only downside would be if you're investing on one week and the next the other week

into the same underlying vibe for what it's worth, you might pay higher brokerage on one. But I shared some options in the book where if you go through this, set your strategy like, oh, crap, I've been building wealth in my super, but I should use this option instead or whatever reason. I talk about ways how we can unscramble that egg. Unscramble an egg. I would argue that's impossible. It's impossible, as Ralph Wiggum said. It is. But there are ways to slowly cut over.

But in my life, I've got one main platform per entity. so in my own name. I feel like that's the most important part of it for me right like when I look at that I go well if you've got multiple platforms I'm assuming you would across the board have the same risk tolerance which means you've probably picked very similar assets on both platforms and therefore the diversification is probably not having the intended impact. I would say that being really generalist about it you've probably picked an Australian ETF in one and probably something similar but maybe something different and you're just overlapping and it's not actually giving you the diversification.

Although, you've reminded me something of, which is cool. So, Nick Bradley, who was my co-author, who talks about advanced strategies like options trading and swing trading and, you know, trying to time the market. He's wild. He's great. I love him. So, what if, Maddy, you were like, oh, I really love investing and I want to do what all these people say.

So, basically, once we work out what our investment strategy is, part of that could be, I want to allocate 10% of my portfolio to individual companies. So, Speccy's or, oh, I saw this company, I think they're an up and comer. You may set up, Maddy, one of your accounts as, so if I had a total $20,000 investment account, we have, we'll call it $20,000 because Maddy's growing financially successfully, she might say, this account over here, I'm going to keep around $2,000 in it and I'm going to buy individual shares just because I want to be interested in investing. I want to buy JB Hi-Fi. I want to buy Coles, Woolworths. And the other one, she keeps her broad-based ETF long-term. I'm just building wealth over here because in this

other account, she's quarantined the money, which helps with behavior. And if she invests $2,000 in a single stock and that single stock gets flushed, it's not going to flush her whole portfolio. So, maybe depending how interested you are, Maddy, you could actually say, well, one of these accounts will be my long-term broad-based portfolio. The other one has 10% of my total value, which because I'm interested in individual shares, I'll do it that way. All right. Let's go to a really quick break, Glenn. And on the flip side, I have a few questions about mindset and your favorite income streams. And I also want to talk about reverse engineering some investment goals. So guys, don't go anywhere. All right, Glenn, we are back. And I have a

question from Claudia. Claudia says, Glenn James, what is your favorite passive income stream? Ooh, I reckon my book royalties. How much are you making from books? Not much. Yeah, I was about to say. Doesn't mean the most successful. Yeah, okay. That's true.

That's true. Why is it your favorite? Okay, so we hear about this stuff online all the time about passive income, right? And I see people post stories like, oh, I've got my passive income. I do affiliate marketing. Yeah. Or I was literally last night in the hotel, in the bath, looking up a new propeller for my boat.

The baths at the W, they're nice, hey? They're really nice, yeah. Yeah, really nice, like kind of woodlog fire vibes. Love it. And so this company that I purchased the propellers from, it was kind of their side business. That's really relatable, yeah. Yeah.

Well, we all need a propeller if you've got a boat. Don't at me, everyone. You've got a boat. Yeah. That must be nice. It is. Carry on. That's what I value.

It's your favourite passive income stream. Hey. Is that what you did with your income stream? I think so. Like you got a passive income stream and got a boat. Okay. Again, relatable. So, this guy that I purchased the propellers off, that's his side hustle, right?

That's his side thing. Now, I've seen people online say, I've got this passive income thing. I sell propellers on eBay or Marketplace. Okay. There's not much passive in boxing up a propeller, printing a postage label. It's actually just a business. It's pretty active. Yeah.

So, I honestly think the best passive income thing that you'll get on this island or anywhere in the world is investing in shares. Yeah, that's what I was going to say was mine. I mean, Claudia didn't ask me. She asked you, but like mine is- So, what's your favorite investing in shares? I would say it's my share portfolio because I don't do anything to it. And if tomorrow I stopped investing and stopped adding, I guess, because every month we add

a certain amount to it, if I stopped, it would still pay me. And I agree, like it's very cool to have book royalties, but like that depends on whether people are purchasing my book and marketing and branding. And I'm assuming at some point people are going to stop purchasing my book, whereas my shares are well diversified and kind of set and forget in the Australian share market and the international share market to be really clear. But I will say, so Claudia, I would say as well that if you're thinking about this stuff, What are you really good at in your life? Because sure, I've written a book, I've done online courses and all that stuff. There's a lot of active work to start with, but once it's launched,

it's pretty low maintenance. Everything that is going to create good passive income, I believe, takes really big initial investment. Not necessarily financial, but time, energy, effort, planning, research. Well, you think, so if someone's like, oh, I want to invest in shares because it's the only passive income game in town. There's got to be a trade of human capital. So, if you want to put, I don't know, $100 in your investing account, if you're on $33 an hour, that's three hours of your time. But also, it's probably more because $33 an hour is pre-tax. And that's kind of, you talked about mindset. I did a whole chapter in this book about establishing your investing mindset and

having the mindset of an investor and ask UVD, why do you invest? Because I want to be rich AF. Good answer. Rich versus wealthy. Acting rich will make you broke. So, as long as you don't act rich, that's fine. I mean, I've fallen into the trap of that, right? Like I think that I definitely have fallen into the trap historically of like lifestyle creep and enjoying life. And I don't regret that, but I feel like I'm making wealthier decisions now, which is really nice. But if I'm being frank, like I am investing because I want to be wealthy and I don't think that there should be any shame around that. I think that we should be more open with that. I think, you know, obviously in addition to creating wealth for me and my family, I feel like that to me is freedom of time. It is choice. It is giving my kids the best possible upbringing and experiences and setting them up so that they don't have to struggle financially. I mean, you can delve into it, but like if you said in a sentence, V, why do you like investing? I go, well, I know that every single month I'm creating a asset that is going to pay me and pay my family into the future.

And that to me is very sexy. I think that at the moment there seems to be a lot of shame because we are in the middle of a cost of living crisis. And like I laugh at you sometimes because you have your boat and a lot of people come for you for that online. I mean, they come for me when I fly business class on points. They come for me when I go to Europe. They come for me, you know, when I'm just doing day-to-day things. But I also think that we need to remember that that is also earned and it's not us showing it off in your face to be like, nah, nah.

It's actually us going, hey, we've done this ourselves from scratch. You can do it too. Like, I don't think I'm a genius and I know that you don't think you're a genius. In fact, I think we're both as baffled as each other that we've gotten this far. And I think that we need to look at it and go, well, actually, if Glenn and Victoria can do that for themselves, we can probably do something really similar. Yeah, and I would just say, you know, I'm speaking to your audience, but do you want the host of a money podcast who isn't financially successful? I mean, I'm not out there doing a hair growth podcast. Have you read the book?

Am I? No, no one will pay you for that. No, I'm not out there doing a Get Good Abs podcast. Oh, you could try. I could. Is it comedy? It is. It's fiction.

But have you read, and this is probably my favorite investing book, and it's probably showing my nerdier side, The Richest Man in Babylon. So, you probably haven't because you're Glennon. I have touched on it. You would have picked up the book and needed it out the window because you don't have the patience for it. But you might now. You might now.

But in that book, it says you would never take advice on buying a diamond from a bricklayer. And I think that that's a really important thing to carry, irrespective of whether we're talking about money content or content in general. like if you're going to get legal advice glenn are you going to ask your mate at the bar or are you going to go oh this is actually pretty serious i'm going to message vd in a crisis and be like yeah okay that's fair that's fair but i think it's really important to remember that like i would not want to take money advice from somebody who wasn't managing their money well like at the crux of it yeah i just want a bit of a mind game for your listeners and this is what i

talked about in like knowing your why with investing. Have you got a simple money mantra or vibe or plan for your life? And I share my three-point plan for managing money. What is it? Get rich and then number two is or die trying. Yeah. Okay. So, the first one, Glenn James's three-point plan managing money, I live on less than I earn. Like straight up, I don't- Which is honestly surprising. Yeah. I didn't see that coming for you. Really? I don't live on consumer debt. I don't have any personal loans. I live on less than I own. Okay. So, that's the first thing I do. The second thing I do is I give generously.

I love this. So, I very, you know, I've outspoken about, well, if you're struggling to make ends meet, it's not your time to give financially. You need to look after your family first. Yeah, 100%. you if you are in a position to help other people financially. Do it. I'm not talking about those people that go, oh, I volunteer instead of giving. No, you volunteered once for half a day at work three years ago. You don't volunteer. I feel like there's going to be some people who feel attacked, but okay, Glenn. So, I give generously. I'm a generous giver. The third thing I do is I

invest the rest. So, how should we be investing, Glenn? Well, however you like that's in line with your values. But I really spend a bit of time in this mindset thing. I actually don't invest to have my investing account make me rich. And that's- Weird, because I do. Yeah. So, let's walk down this garden path, shall we? What are you investing for then? Yep. So, I'm living on less than I earn, which means I'm having a good life. I'm buying propellers on eBay, not going to debt and all that stuff. I'm a generous giver. I invest the rest. So,

So, how I invest the rest and what I'm investing the rest for is my whole thing is I'm parking money long-term for the Glen of tomorrow and my only metrics- But I don't want to park it, Glen. I want to park it and see it get bigger and then that's for future V. So, my guardrails with parking it must be higher than cash and inflation and I'm happy to take the market risk. Okay. So, that's basically what I do.

Yeah, exactly. I know, like on the flip side, like for those of you listening along, Glenn and I are friends outside of podcast land and I mean, inside of podcast land as well. But I know what he holds and he holds a lot of stuff that I hold. So, I was shocked when he said, I'm not investing to create wealth. I was like, sir, you are. No. Well, but this is, so the mindset thing, I want to teach people about mindset. I'm not investing to get 100% return to make my life better overnight because- Oh, no. It's a long-term thing. Well, I've shared publicly on my podcast, I struggle with depression, anxiety. I'm collecting

all the things, right? And I know categorically that money doesn't fix your life. It makes it better. It gives you more options. So, what I do is I encourage people just to invest the rest after they've lived and give. I like that. Now, within that, I'm comfortable with market returns from broad-based indexes, and there's a heap of examples in the book where if I need my investing account to make lots of money so I can quit my job and my life's better, I would need to be hanging out in places in the investing world that is way too risky. Yeah, I'm not there for that. the questioner before who might have a hypothetical $20,000 portfolio. If she had a $20,000 portfolio and invested it in one unicorn and it got 100% return in a year, amazing return, that's an extra $20,000. That $20,000, while it's great, I'll take it, I'm not allergic to money,

that's not quote unquote life changing. So, we need to make sure, and this is why I wrote the career book first. I think you had Shell on the show. Yeah, I did. Yeah. She was way better than you on the show. Yeah, she really is. Sort your career out and make more money. The first investment you should make is in your career because that's the annuity that produces the income. So, you can change your human capital to money. So, if I think my life sucks and I hate my life, well, to save enough money so I can quit my job, I need to be investing six grand a month to build up this big portfolio. Because when you're starting, the capital you put in will do more than the returns you're getting to start with. And if it takes five years to build up that, and if you

did have five grand a month to invest, you're going through five years of hell. So, let's go back and build a life that we like and we love. If you hate your job and you're listening, you might not be able to change tomorrow, but you can tomorrow start to think about what would my life look like if I was doing something I love, because then the investing part isn't the answer to all my life problems. That's true. That is very true. I feel like it's about enjoying the journey. Thanks for coming to my TED Talk. No worries. Do I have to pay? No. Oh, thank you. That one was for free. It was. We were talking about mindset and we actually

have a mindset question from Chelsea. She's asked, how, Glenn, do I mentally shift away from saving $500 every month to investing that amount. She's struggling with it. So, I think what we need to do, Chelsea, is we get our house in order and you've seen it. I've talked about it in my Sound Financial House. It's in the book. We want to get to the point where we've got our emergency fund. We might have our budget and cashflow. We might have our insurances set up and we've got a good foundation. Then what we can do is say, okay, I save $500 a month, I want Chelsea to get really clear on her life goals. Now, whether that is I want to save up and buy a new lounge in a few months, whether I want to go to Europe, or I want to just build

wealth because I'm in this fortunate position. So, once we've got our emergency fund and she's in the great position to have $500 free per month, can we at least start to put the toe in the water because it's a behavioral thing. So, my challenge is, can you start by doing $100 a month investing for the long-term or do some type of thing that's like, all right, I need to do these lifestyle goals. So, I think over the next 12 months, it will cost me X. The rest is just going to be invested, but it's not all or nothing. You're allowed to start by doing $100 or $200 a month. So when I talk about in the book about starting with 1% of your income, if you are cleaning up your mess and all that stuff, I talk about now once we start to do what I call wholesale investing,

now that isn't what ASIC says that you've got over $500,000. In someone's life, $500 a month investing is real money. It's serious amounts, right? We need to be very strategic on how we're buying, who's owning it. So, is it in our own name? Is it in a joint name? Is it in superannuation? What we're buying? Then we can say, okay, we're very clear on our strategy. Let's now ratchet up within the next three or four months. I want to get to the point where I am doing that 500 a month. And I would say, Chelsea, even if you want to feel a little bit more comfortable, and if your emergency fund says three months of expenses is $10,000, make it $15,000 then start investing. You're allowed to have a higher emergency fund just because you want to.

Oh, 100%. And I feel like that mental shift away from saving to investing, often it's because you feel like you're losing something because it's further out of reach. So, making sure that you have your emergency fund set up and you are financially confident and you've got your cash flow going, that's going to mean that when you move into that investing space and that $500 that you've been saving each and every single month now becomes an investment, it doesn't hurt. It doesn't feel like you're missing anything. And I think that's then about making sure that you have enough clarity over that platform as well. So you can log in, you can see it, you can feel it. But often when I'm talking to people about starting their investing

journey, I say save it first because we don't want to find out that we couldn't afford to invest it and then we have to pull it out and it's not a good experience. Glenn, I'm running out of time, but I have another question for you. This one comes from Tara. I feel like this is a fun question. Glenn, if you had $50,000 today, what would you do with it? Oh, I would. I feel like everyone, it was in the investing question,

so I'm assuming she thinks you're going to invest, but I know you're not going to. Well, I would, like before we started recording, I said, oh, get Josh to bring in a tape measure because I'm about to build a new studio. You would buy a studio, would you? I'd probably do that. Or if it's investing- Would $50,000 build a Glenn James approved studio? No. And that's- This is the problem I've got. It's so annoying. Everything's expensive.

But what it does speak to is because I'm at the stage in my life, and a lot of your listeners are, where we're- Proper retiree. Well, we're established. So- You are. Yeah. I spent all my money. Yeah.

I'm being dumb. So did I. No, I didn't actually, but that's how I feel right now. I'm terrible at saving money. I'm a terrible saver. I'm a great investor, so I've trained myself to be a great investor. If $50,000 came into my lap tomorrow, it would only go towards income-producing assets, a little bit of giving and charity.

Are you going to hire your studio out to me? If you come up to Newcastle. I'll come up to Newcastle. Absolutely. I'll go to your studio. But yeah, it would be income-producing assets. Look, if it had to go into an ETF, I'd probably split it between IVV and IOZ because I like those two ETFs, Broad-Based Index Australia, the U.S. I don't hate to invest in, quote-unquote, global ETFs because I've got the view that, for right or wrong, don't do what you want, everyone.

Don't do what I do. Most of the big companies listed on the U.S. exchange operate all around the world. That is true. And I just want a simple portfolio. But everyone you speak to when it comes to investing will have a different view or vibe. Of course. And you've got to work out your own. That's right.

So, income-reducing assets, the best investment that anyone could ever make, I believe, would be their own business. Not everyone's cut out to do that. That's okay. She's hard. It is. So, it's income-generating is my studio or into ETFs, although I do want a new car. All right. Well, that's where we might leave it before this goes completely off track.

Glenn, where can we buy your book? Anywhere. Literally anywhere. Books are sold. Okay, that must be nice. Write a book and then it's anywhere. Okay. It's right next to yours, VD.

Thank you. Big W, QBD, Dimmix. It's also in the link in our show notes. It really is. So we've made it super, super easy for you. So, yeah, I just want to thank all your listeners for, you know, supporting what we do over at Money, Money, Money and our pod Vegas. And, yeah, I say to people, if you buy the book and you're not satisfied with it,

Take it back to the retailer, tell them it's faulty and see what happens. Oh, my gosh. Glenn James, get off my show. Thanks for coming in. See you, friends. Bye. The advice shared on She's On The Money is general in nature and does not consider your individual circumstances.

She's On The Money exists purely for educational purposes and should not be relied upon to make an investment or financial decision. If you do choose to buy a financial product, read the PDS, TMD and obtain appropriate financial advice tailored towards your needs. Victoria Devine and She's On The Money are authorised representatives of MoneySherpa PTY LTD ABN 321 649 27708 AFSL 451 289. Thanks for watching!