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Merry Christmas from Kym

Welcome to your Christmas 2022 Client Newsletter.

What a year we have experienced on many fronts! After experiencing reasonable global market conditions throughout 2021, we had reason to look forward to 2022 with a degree of positivity, but, as we all now know, it did not turn out to be the case. Whilst the new strains of the Covid virus resulted in a reboot of cases reported globally, the big ticket item that shocked the world in early 2022 was Russia’s unprovoked invasion of Ukraine which, according to the OECD, will reduce global GDP by USD 2.8 trillion lower in 2023 when compared to their forecasts in December 2021. There are many costs to Russia’s war, but this gives some sense of the worldwide price of the war in terms of economic output.

Another key factor slowing global growth is the generalised tightening of monetary policy i.e. interest rates increases globally, driven by the greater-than-expected overshoot of inflation targets. Strict lockdowns associated with China’s zero COVID-19 policy have also impacted the Chinese and global economy. Shutdowns and property market weakness are slowing China’s growth to just 3.2% in 2022.

We certainly hope that you, and your family will derive some insight and useful information from the variety of articles included with this Newsletter. If you think any of these articles may be of interest/use to other family members or friends, please feel free to share with them.

From all of us at CFG, thank you for entrusting us with your advice needs and please accept our very best wishes to you and yours for a safe, happy and joyous festive season.

We look forward to catching up with you in 2023.

Kym Cotter DFP
Director
Authorised Representative - No. 235659
Cotter Financial Group Pty Ltd ABN 70 617 495 502 is a Corporate Authorised Representative of Infocus Securities Australia Pty Ltd ABN 47 097 797 049 AFSL and Australian Credit Licence No. 236523 trading as Infocus Financial Advice

Money mantras from Warren Buffett

Billionaire investor Warren Buffett credits his father with being his greatest teacher. Buffett says his father, investor and four-term Republican congressman Howard Homan Buffett, set him on the path to his investment success. The best advice his father ever gave him: “It takes 20 years to build a reputation and 20 minutes to lose it.” Recalling that statement at crucial moments in life will change the way you do things, according to Buffett.

It wasn’t just this pithy piece of advice from his father that influenced Buffett’s investment approach and helped him on his way to becoming one of the world’s wealthiest people. Delving into books lying around h.is father’s office also contributed to his investment understanding and a lifelong love of reading that he credits with helping him develop his ideas.

As Australians gather to celebrate their father, poppa, or dear old Dad on September 4, we look at some of the wisdom the now 92-year-old Warren Buffett has passed on to the next generation of investors. Some of the Oracle of Omaha’s favourite sayings highlight the common sense principles that have underpinned his investment success. You can hardly argue with gems like: “Never invest in a business you cannot understand” or “Rule No.1 Is never lose money. Rule No.2 is never forget Rule No.1.”

Here are seven more of his favourite money mantras. They may just act as a handy reminder of how to remain rational about our investments in these times of economic uncertainty.

1) Be ready to embrace opportunity

“Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble.”

2) Buy for the long-term

“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”

3) Avoid debt

“When major declines occur, they offer extraordinary opportunities to those who are not handicapped by debt. No one can tell you when these things will happen. The light can at any time go from green to red without pausing at yellow.”

4) Focus on value

“Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”

5) Cultivate the right temperament

“The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the crowd or against the crowd.”

6) Look for companies with competitive advantage

“The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.”

7) Learn to love market volatility

“Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.”

Merry Christmas from Kym

10 tips for stress free travel

The holiday season can be stressful enough without adding travel troubles to the mix. Here are 10 ways to ensure you arrive safely and happily at your Christmas holiday destination.

1) Be an early bird
Maybe you love the spontaneity of a last-minute trip. Who doesn’t? But save it for another time of year. When everyone is jetting off to their favourite holiday destination or driving home for Christmas, the early bird gets the hassle-free holiday.

2) Pack once, pack well
Follow Santa’s lead and make a list and check it twice. No-one likes the feeling of arriving at their destination and discovering they’ve left their swimming costume or their phone charger at home. Grrrr. Group things together – toiletries, shirts, shoes – so it’s easy to locate things.

3) Travel with carry-on only
If possible, take carry-on bags only when flying. It not only chops out waiting times at the luggage carousel, but you get to the head of the taxi queue quicker. Plus, there’s no chance of luggage taking an unplanned detour enroute. Of course, if you are checking in luggage, take some basic toiletries and underwear in your carry-on in case your bags go AWOL.

4) Be prepared for hiccups
Stress levels rise when the unexpected goes down. Realise that traffic jams happen, flights get delayed or cancelled and weather can create havoc. When we’re prepared for the unexpected, we’re able to weather the storms in a better frame of mind. Allow yourself plenty of time to get to the airport or reach your destination. That way if the unexpected happens, you’re not stressing about missing a flight or Christmas dinner.

5) Snack wisely
Hitting the bar in the airport or munching on cakes and lollies on a road trip can make us feel worse-for-wear when we arrive. So, pack feel-good snacks such as protein or muesli bars, nuts, fruit, and plenty of water and resist the kids’ pleas to stop for Maccas.

6) Take breaks
Plan to enjoy the journey. Walk along the main street of a town or a beautiful beach rather than sitting in a petrol station café when you take a break from driving. See if you can discover something new along the way. Airport delays could be a chance to call a few friends and wish them Merry Christmas or read that book you’ve been meaning to start all year.

7) Breathe
If you feel the irritation rising or panic setting in, take a few deep breaths. It helps to reset your nervous system so you can carry on from a place of calm.

8) Build a buffer
Consider taking out travel insurance or having some extra dollars in the kitty can prevent financial stress from compounding travel stress.

9) Rest up
If you’re crossing time zones, prepare for the time in your destination. Either stay awake longer or bring music or meditations to lull you to sleep earlier. And if you have a long drive ahead, rest well beforehand.

10) Remember others
Collective stress can impact us too. Take steps to lower the stress levels of those around you by being kind to strangers and expressing appreciation to loved ones.

Money mantras from Warren Buffett

Boost your heart health

Ladies, maybe you are happy to listen to your heart in romantic matters. But what about for the sake of your health? Paying attention to your heart can actually make the difference between life and death.

Many women are familiar with the warning signs of a heart attack that are typically experienced by a man such as crushing chest pain. But in women the warning signs can show up quite differently.

Women are more likely to experience fatigue, breathlessness, and pain between the shoulder blades. Nausea or vomiting is also more common in women. Because the signs can be more subtle when women take action to get help it is often too little, too late.They may present late, be less likely to get the required investigations, and slower to begin taking preventative steps.That can impact their recovery after a heart attack. Women are twice as likely to die a year after having a heart attack.

The causes of heart disease are also changing. Smoking rates have fallen but cardiometabolic health has worsened. Our lifestyles make us more prone to diabetes, high blood pressure, obesity, and a sedentary way of living.

If recent headlines have you worried, here are four ways to show your heart a little more love.

1) Schedule a heart check

Over 45 years you’re eligible for a Medicare-funded heart health check with a GP. Your GP will run the ruler over your medical history, family history, lifestyle factors, check blood pressure, and do a blood test. From that information – and possibly other tests such as an electrocardiogram and calcium score – they can calculate your risk of having a heart attack in the next five years. If you’re high risk your doctor may recommend medication. Those who are lower risk can help their heart health by modifying their lifestyle.

2) Stop smoking

You only have a look at a cigarette packet to see the impact they have on your blood vessels. Smoking narrows and clogs blood vessels which has the effect of reducing blood supply and oxygen throughout the body. Statistics show the impact smoking can have on the health of your heart. People who smoke are four times more likely to die of heart disease and three times more likely to die of a heart attack.

3) Get active

Regular exercise has great benefits for your ticker. It lowers blood pressure and cholesterol and helps reduce stress. About half of the people with high blood pressure are unaware and half of those who are aware are undertreated. Plus, upping your activity levels can lower the risk of type 2 diabetes and keep your weight in check. Starting can be as simple as putting one foot in front of the other with a walking buddy or group.

4) Think nutritious and delicious

A healthier eating regime can begin with some quick food fixes. Cut down the salt, ditch the soft drinks and add more fruit and vegetables to your diet.

Your heart will thank you.

10 tips for stress free travel

Simple tips to reduce your electrici...

Simple tips to reduce your electricity bill

There’s no hiding it: inflation is running rampant. Prices are rising everywhere from supermarket shelves to the petrol bowser. But the one that seems to have most people spooked is the prospect of out-of-control power bills.

Federal Treasury is forecasting electricity bills are likely to rise by 20 per cent on average by year end and then a further 30 per cent in the 2023-24 financial year.

What can you do now to prevent a surge in your power bills later?

Go solar

If you’ve toyed with going solar the possibility of skyrocketing power bills could be the motivation you need to get it done. The Clean Energy Council reports it can cost from $2800 for a 2kW solar system to more than $14,000 for a 10kW system. While it won’t be an instant fix, it might provide the long-term reduction in power bills you need.

Contact your energy retailer

If it’s been a while since you reviewed your plan, make that call to your energy retailer.

Check what kind of contract you’re on and when it expires.
Find out if your prices are going up and if so, when and by how much.
Ask if they have a better deal for you; and
Find out if you’re eligible for any concessions or rebates on your energy costs.

Look around at other retailers

The best deal for you may be with another energy retailer. Try uploading your most recent bill on a comparison website to see if a switch could help reduce your energy costs.

Reduce your use

Cooling accounts for 20-50 per cent of household power usage on average. So as temperatures rise, one of the best ways to reduce your bill is by curbing your use of air-conditioning. Start by closing windows, doors, curtains, and blinds during the day to keep the house shaded and cool and open windows at night to allow cooler air to circulate. Use fans first and make air-con a last resort. If you must use air-con set it at 26 degrees and clean the filter. A clogged filter in your air-conditioner can force it to use 15 per cent more energy to operate.

If embracing the festive season means decking the halls with lights and lots of them, think LED. A fibre optic tree can help keep a cap on power bills and if dining outside or setting up lights around a pool – go solar if possible.

Your fridge is just one of the power-hungry appliances in the kitchen. To ensure it is operating as efficiently as possible make sure there is plenty of space around it, check the seals are keeping it firmly shut, don’t overfill it, and vacuum the fridge coils to keep it running at optimum efficiency.

Get into the habit of switching off appliances at the wall and if you know your family leaves lights burning when they could be off – install dimmers, timers, or sensors.

Finally, if you’re not on a flat energy plan avoid using appliances at peak use time. Set smart appliances to run overnight if possible.

Boost your heart health