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7 Best Investments for Young Australians (2024)
Buckle up, we’re about to go through a college education in five minutes…also known as What You Weren’t Taught At School 🚌.
The world is changing fast: The once-great ‘Collective West’ is now watching the shadows of the ‘Emerging Markets’ grow taller. The snowball we all live in is speeding up as Iran and Saudi Arabia make up and witness the US dollar’s status as reserve currency shifting in real-time.
According to Tom Luongo’s description in his blog post, it’s like Wiley-Coyote was suddenly slammed against the side of a parked car. Changes in global leadership, currency prices, and the regions where money has the greatest influence have suddenly stalled in suspense.
(If that all sounds like mambo jumbo, head head to The Duran on YouTube to brush up on your geopolitics.)
This flash guide is for you if you’re on the hunt for tried-and-true methods that still work today, even with the world upside-down. These are investment options for young Aussie investors like yourself.
Table of Contents:
- Compound Interest: Myth or Dead
- Emergency Savings Work
- Mastery Works
- Know Where You’re At
- 1. Dragon’s Gold
- 2. Domains
- 3. Real Estate
- 4. ETFs
- 5. Index Funds
- 6. Crypto
- 7. Bitcoin ATMs
- Spreading Your Bets
Compound Interest: Myth or Dead? 🏴☠️☠️
Like a pirate’s tale from the Caribbean, there are stories of treasure troves of gleaming jewels, accumulated from a wise young Aussie who started saving a penny a day at age 14.
We’ve all seen the commercials where two people, Amy and Sam, earn the same amount of money yet Alice retires with thousands more because her super fund earned more money.
In the long run, compound interest may have a profound effect on your investment’s value due to its mysterious and potent nature.
If you start saving early in life, even if it’s only a little bit, your money will have more time to develop into a larger sum. With compound interest, even a little initial investment may provide substantial returns down the road.
And using an exchange-traded fund, you may get started with as little as $500, and with a managed fund, you’ll need at least $1,000.
Emergency Savings Work 🚨
The earlier you begin saving for a down payment or retirement, the better off you will be in the long run.
In this day and age, being a young person is challenging. Expenses such as rent, food, and higher education are all high, and the housing situation deserves no more comment.
Even if it takes a few hundred years of giving up our $20 weekly smashed avocado fixation to save enough for a home deposit, that doesn’t mean you can’t start saving today.
Learning stuff, growing communities, having principles.
We won’t lecture too much here. But the following things should be somewhere on your mind:
- 🌴 Mastering that one skill for the next 5-10 years that will eventually make you an expert.
- 🌴 Finding ways to develop your social skills and opportunities to integrate with high-trust communities.
- 🌴 Doing everything you can to bolster your physical, spiritual, and mental health.
Grow these things in your youth, and money tends to naturally flow in abundance later 🌞. The trick is just staying on the narrow path without losing faith.
Know Where You’re At
Before you go racing off… 🏎️
When considering purchasing shares, what steps should be taken first?
Make sure your financial house is in order before you go off at top speed. Even if you and I have a HECS/HELP payment looming over our heads, there is something you can do right now to alleviate some of the stress: make sure your bills are paid and your credit card doesn’t have a tonne of debt.
Even if you manage to make a fortune in the stock market, the power company might still cut off your electricity at any time. You may start exploring your options in “finance land” if you’ve established yourself financially and have a few hundred bucks to put away.
Have you considered SUPERANNUATIONS?
Yes, you won’t be able to get into your retirement fund until you’re older, but the earlier you start saving, the more you’ll have. There is a $27,500 annual cap on superannuation contributions as of now (inclusive of employer contributions and personal contributions).
You may alter your super strategy to meet your demands and save money by consolidating your super so that you have only one account.
1. Dragon’s Gold 🔥 🐲
In a word, it’s golden.
Gold’s value and importance to human history have been recognised for millennia, garnering it worldwide esteem. The first gold coins were minted during the reign of King Croesus of Lydia, around a century after gold-plated coins first entered circulation in 650 B.C.
Throughout the course of history, people have kept gold for different reasons. The fact that cultures and then economies have given gold value helps explain why it has persisted in value.
Gold’s reputation as a backup currency in times of monetary crisis means it may be used as a hedge against economic instability even when its value fluctuates.
Proven performance record
Unlike other assets like paper money, coins, and so on, gold’s value has remained relatively stable throughout time. It’s a way for families to keep their wealth secure and pass it down through the generations. Its unique properties have been appreciated by people from all walks of life for millennia.
Gold’s corrosion resistance and malleability from being melted over a standard flame make it a good choice for currency.
Gold has always been a superb inflation hedge due to its historical tendency to increase in value when the general price level rises. At moments of growing inflation during the last 50 years, gold prices soared while stock markets collapsed.
Due to the fact that gold is often priced in fiat currency units, it tends to rise along with everything else when the value of fiat money drops owing to inflation. Gold is often regarded as a reliable store of value.
2. Domains 🗺️
Not Game of Thrones domains, we’re talking online websites.
Domains and URLs have the potential to develop into substantial passive revenue sources. Here’s an illustration: privacyaustralia.net. ‘Traffic’ refers to the people who view these pages. The site generates revenue by directing users to the answers and resources they seek.
Also, you have the option of putting your money into established websites that brings in the right kind of consumers. Certain specialisations are profitable in any economic climate. Especially if it includes data from both the EM and Collective West markets.
They may be found mostly in the field of technology. Those that are already successful will always want first-rate internet tools to help them expand their businesses. This includes both the finest web hosting and the greatest trading applications.
One to watch
Investing in powerful, high-authority domains may lead to steady flows of visitors that are less susceptible to fluctuations in exchange rates or the stock market. If you already own a successful site, there are ways to bolster its strengths as an asset long term.
The ability to turn domain names into long-term investments is crucial for website owners. eToro, like many other large corporations, recognises the need of a strong online presence.
3. Real Estate (the kind that never goes out of style 🕶️…)
There will never be a day when real estate isn’t needed…
People will always have a need for a roof over their heads, therefore accommodation businesses will always be in demand.
There is a severe shortage of rental houses in the AU compared to the high demand for them. So, even in the same city, people’s lifestyle choices may vary greatly from one another.
There are numerous good reasons why they are not as simple and cheap. Rents have risen as a result of the growing demand for housing in smaller towns and cities around the United Kingdom. Dubai is just one example of a fantastic international destination.
Renting out a house might result in big income. As a real estate investor, you can’t ignore rental revenue as a source of profit. The profitability of a property may be inferred from the amount of rent collected.
It’s also directly related to your monthly rent. The formula is easy to remember: annual rent / property value. Yet, the highest rental will make it a fantastic long-term as set for those looking to invest in Aussie real estate (REITs Australia – What Are They?). Due to a shortage of housing stock, the Australian real estate market has emerged victorious.
With such great tax benefits!
Making money isn’t the goal; maintaining money is. Although paying property taxes may be a hassle, investors who own investment property can reap a number of tax advantages.
Potential tax breaks may be obtained via real estate investments. There is also the possibility of deducting a large portion of the money spent on acquiring and maintaining the assets. This may provide huge tax benefits for company owners, allowing you to keep more of your money. There is a rationale to Blackrock’s massive real estate purchases.
Most often characterised by long-term constancy:
Since their creation in 1993, exchange-traded funds (10 Best ETFs In Australia) have been flocked to by investors looking for an alternative to mutual funds.
These instruments, which are a basket of assets designed to mimic an index’s performance with fewer management expenses and more transparent intraday pricing, might be valuable for institutional and individual investors alike.
Get exposure to many stock markets, sectors, or investing strategies with a single ETF. The goal of exchange-traded funds is to track the performance of an index or a group of stocks, or even an entire country’s or group of countries’ stock market.
The ETF has the diversification benefits of a mutual fund with the simplicity of a stock. Actively managed mutual funds often have higher expense ratios than passively managed ETFs.
5. Index Funds
An index, as described by Investopedia, is a standardised way to quantify the aggregate worth of a group of assets.
Indices are a tool for gauging the market as a whole since they follow the performance of a group of securities assumed to be broadly representative of that group.
The Standard & Poor’s 500 Index is a widely used example of such a market cap-weighted stock index since it tracks 500 of the largest U.S. public businesses listed on the New York Stock Exchange (NYSE).
Cryptocurrency will gain support in developing economies. People in countries with friendly and trustworthy governments have less of a need to use cryptocurrencies. Traditional banking systems are sufficient when there is no need for trust, which is why Bitcoin is so appealing.
That example, someone in the United States or Europe could be interested in cryptocurrencies as a hobby or for school, but using it for anything else is probably too much for them.
Benefits emerging nations
But, there is an urgent demand for cryptocurrencies in other parts of the world where people are wary of their governments and institutions.
Those in a nation where hyperinflation is rampant, like Venezuela, would be tempted to put their wages into Bitcoin in order to preserve some of their buying power.
When a country’s own currency is collapsing and it’s not possible to purchase foreign fiat currencies, a decentralised monetary system is the only option left. It’s hardly surprising that those who can’t use conventional banks would be interested in buying cryptocurrencies (2 billion individuals worldwide do not have a bank account).
Nigeria, an African country, is a prime example of the ways in which Bitcoin is more than simply a speculative asset and may one day replace traditional financial institutions. According to data compiled by Paxful, in 2020 Nigerians traded £50 million worth of cryptocurrencies monthly.
7. Bitcoin ATMs
You didn’t see that one coming.
Having a Bitcoin ATM (a lucrative automated affiliate scheme) might be quite lucrative if you get in early. This is a very fresh and lucrative industry; you should not be alarmed.
To explain how it functions: BTMs allow for the seamless conversion of fiat cash to and from cryptocurrency. Consumers appreciate BTMs even more during times of heightened inflation.
When you deposit funds into a cryptocurrency trading platform via an exchange, those funds are effectively held by the exchange and not you. There were individuals who lost tens of thousands of dollars in the FTX exchange crash, and I saw it happen.
Because of this, BTMs are one of the greatest and safest option for your customers who want to invest in cryptocurrencies.
Reduces the need for banks!
Seeing as they’re crashing everywhere, this is why Bitcoin ATMs are so popular: Older folks who don’t participate in conversations Those juggling many sources of income and necessitating frequent currency exchanges
Money may be deposited and withdrawn from BTMs even if the user does not have a bank account. BTMs cater to customers who like to make purchases with actual cash. To avoid long wait times at a bank, users may use BTMs to make withdrawals of up to £50,000 each day. They allow for quick transfers of money across borders. Such a fantastic time saver!
These ATMs and the stores that are affiliated with them sell bitcoin to customers. Your machine will buy bitcoin from an online exchange, at its own risk and cost, and use that cryptocurrency as the product it sells (BTM).
The bitcoin we bought from them is marked up and resold to you at a profit. Between fifteen and twenty percent will be added to the price of a Coin before it reaches your customers’ hands. The typical margin for profit while selling bitcoin will be about 15%, or £150 for every £1,000 invested. The typical 6-month income is £15,000.
According to our training and the experience of our affiliated partners, most of our machines take 6 months to attain regular performance after installation and make £15,000 per month in bitcoin sales.
Based on this information, the BTM would bring in £2,500 per month.
Spreading Your Bets
Exchange-traded funds often distribute earnings to their investors. It all depends on the ETF, however distributions might be made quarterly, annually, or monthly.
Investing in index funds rather than choosing individual stocks is a more secure strategy. When you invest in an index fund, rather than having your money depending on the success of a single company as with a single stock, you spread your risk over the performance of many different firms.
If you invest heavily in a small number of really successful businesses (Small Business Tools and Reviews), you may get a very strong return on your money.
Takeaway 📚 🤠
We want for this manual to be of use to you. There are certain constants and many novelties in the world of finance. To sum up, you must be well-informed and prepared.
Common questions about investing for young Australians…
Why are the Euro, Pound, AU Dollar, and US Dollar becoming so volatile?
I’ve written a lot on the hollowing out of European and American industrial might right now.
The battle being waged by the United States, United Kingdom, European Union, and North Atlantic Treaty Organization against what is progressively becoming the Rest of the World is hastening this hollowing.
What was formerly known as the BRICS countries is now headed by China, Saudi Arabia, and Russia. Whether it’s manufacturing or oil or energy, China, Saudi Arabia, and Russia are all important industrial powers (How to Invest in Commodities in Australia).
Collective West bloc vs Emerging Markets bloc as a result of all this and the increasing craziness of laws regarding farms, food, and locking people in their houses in 2020. Central banking control is tied to the value of gasoline and is already weak.
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