Noel News 18 May 2022

The only common denominator of happy people…is gratitude.

Welcome to our May newsletter

It’s only a few days to the election and right now the outcome is looking uncertain, but obviously with a swing to Labor. Everybody I know is sick of all the promises, and the continual staged media appearances. I’m also stunned by all the promises being thrown around. The reality is just so different.

Labor has promised to put a nurse full-time in every age care home, but nurses are in short supply now. Where will they come from and what will that do the cost of nursing home fees? The Coalition has promised so much I’ve lost track of it, while Labor and the Greens are promising to build thousands of affordable homes. This begs the question as how they will find the land, the tradespeople, and the materials. That won’t change on Sunday morning.

Photo by Ernie Journeys

But on top of that is roaring inflation. Everybody wants a better deal for the worker, but that’s not as simple as it sounds. A pay rise of $20 a week is only $13.10 when tax is taken out which won’t even go close to catching up with rising prices. But the employer is faced with compulsory superannuation rising from 10% to 10.5% on 1 July – also casual wages of $450 a month are currently exempt from compulsory super. From 1 July superannuation must be paid on these.

This means the employer is faced with an increasing wages bill, plus more compulsory superannuation, and if they are a large employer more payroll tax. It’s a lose lose for everybody. But to make it worse, everybody I know is having trouble finding staff.


Superannuation as a house deposit

Just a week before the election the Coalition announced a controversial policy which would allow first home buyers to access 40% of their superannuation up to a maximum of $50,000 to use as a deposit for a home. Similar ideas have been floated for years, and I’ve always been strongly opposed to them. My reasoning has been that the goal of someone in superannuation is to get the highest return on their money possible, while a borrower for a home should be looking for the lowest interest rate possible I believe these ideas are incompatible. And I was horrified at allowing people to withdraw up to $10,000 from the super twice because of the pandemic.

There is no doubt that every single incentive for first home buyers pushes up the price of houses. But having said that I took the trouble to do the numbers and the outcome was much better than I could have ever imagined.

Photo by Maria Ziegler on Unsplash

The assumptions I used are that the home costs $550,000, the purchasers are a couple both working, and both have $80,000 in super which I think could be on the high side. Stamp duty varies from state to state and you can do your own calculations on Google. I have used Queensland numbers.

Where Stamp duty  is zero up to $500,000 or first home buyers – the trouble for them is finding a house at that price. Notice that stamp duty and mortgage insurance take $16,000 out of their deposit. I have used a 5% deposit which rounds up to $28,000. If they both draw 40% of the superannuation as a house deposit, they would have $64,000. Add this to their available deposit of $28,000 and they have $92,000 available. It’s a good sum to start off with and does enable mortgage insurance to be drastically reduced.

When mortgage insurance of $5000 is factored in, they need a loan of $474,000. Repayments of 4% per annum would be $2,263 a month (or $520 a week) over 30 years.

First home buyers normally live in a house for around eight years. If we assume the house increases by 4% per annum it should be worth $750,000 in eight years, by which time the debt should be down to $400,000. When they sell then they must repay the amount they withdrew from the super adjusted for the capital gain on the home. The $32,000 each they took from their super becomes $44,000 each if we use a rate of 4% per annum to match the house increase.

If they sell the house for $750,000, and repay the loan plus the amount back to their super, they should have $380,000 over. That means their initial stake of $28,000, which was their deposit, has grown to $380,000 over eight years.

The numbers work well because they are receiving 4% per annum in capital gain on the house, and the debt is reducing because the repayments are going to reduce it instead of paying rent.

True, the $64,000 deposit they withdrew from super would be worth $118,000 after eight years if their superannuation does 8% per annum. This means the superannuation is $54,000 less than they would have if the deposit was kept in super instead of being borrowed from it. But they are still miles better off.

Labor has a scheme for first home buyers whereby the government becomes a partner in your purchase. It’s means tested, and places are limited, but it could be quite a good option for people of lower means and who do not have a big chunk of money in superannuation.

The fact remains that housing affordability is a problem in most of the world. It was created by central banks winding down rates to ridiculous levels, even negative in some parts of Europe, which caused the boom in asset prices. This widened the gap between the haves and have-nots because those with assets saw their investments rise in value, while those with no assets saw prices climbing even more out of the reach. There is no easy answer.



Under current rules people downsizing can contribute up to $300,000 each into superannuation as a one-off contribution irrespective of their current superannuation balance. One of the requirements is that they must be at least 65 years of age. This was to be reduced to 60 from 1 July, but recently the government announced this would become 55 from 1 July – Labor immediately promised to match that if elected.

This is not a new concept – the downsizing provisions were announced in the May 2017 budget. In announcing the change, then Treasurer Scott Morrison said, “the measure reduces a barrier to downsizing for older people … It may also enable more effective use of housing stock – freeing up larger homes for younger, growing families.” At the time I wrote that it may be an ineffective measure as a home occupied by a downsizing couple would probably be quite different to the normal starter home.

In any event I just don’t see the point of reducing the age qualification to 55. From 1 July anybody can make non-concessional contributions to super until they reach 75 years of age. You don’t need any special provisions to put the proceeds from a house into super unless your superannuation balance is $1.7 million or over. In any event 55 is not when most people downsize – in my experience it tends to be more like 65.

Photo by wayhomestudio on freepik

And downsizing has its challenges. It would normally cost at least $150,000 to change from one home to another, and you could lose part of your age pension. Think about a couple with a $1.2 million home, with assessable assets $500,000 and who were receiving a pension of $601.90 each a fortnight. That’s $31,298 a year.

If they downsized to an $800,000 home and freed up $400,000 of funds their assessable assets would rise to $900,000 and they would lose almost all of the pension. That’s a loss of pension of $150,000 over five years. It may be possible to reduce the pain of this somewhat by investing part of that money in a lifetime pension were only 60% of the sum invested counts for the assets test.

I can’t stress enough how important it is to take expert advice before you get too committed to downsizing. Our book Downsizing Made Simple is a great resource. It’s available from my website.


Don’t miss out on these

Inflation is pushing up household costs, which can make it a tough road for seniors on fixed incomes. Yes, there are a wide range of concessions available, but the rules for eligibility can be complex, and in many cases retirees don’t even know the concessions exist. To make it more complex, the benefits vary from state to state and from local authority to local authority.

Enter a magnificent new resource from National Seniors Australia: the Concessions Calculator at


Input some very basic details, such as the state you live in, and you can see at a glance the entire range of concessions you may be able to qualify for.

The best known concession cards are the Pensioner Concession Card, which is automatically issued to anybody receiving an age pension, and the Health Care Card, which is available to people of a younger age receiving some form of income support. Many people assume these cards offer the same benefits across Australia, but in fact the benefits of these cards are inconsistent. For example, a Pensioner Concession Card in New South Wales entitles you to a low income household rebate of $285 a year, plus a gas rebate of $121 and a council rates rebate of $425. South Australia instead offers a cost of living concession for homeowners of $217.20, an electricity concession of $233.60 and a rates concession of $320.30 a year.

The Seniors Card is a state-based concession card that is easy to obtain, because the main eligibility requirement is that you reach a certain age. Again, the benefits of the card vary by state. For example, in Western Australia the card gets you a cost-of-living rebate, a local government rebate and even a spectacle subsidy. In Queensland, benefits include 33% discount on your car registration, a $340.85 electricity rebate and a gas rebate (but only for reticulated natural gas). New South Wales and Victoria offer very little.

The Commonwealth Seniors Health Card (CSHC) is the card that is most prized by self-funded retirees, but given the number of emails I get regarding eligibility for it, it’s one of the least understood.

The first thing you need to understand is that the CSHC is not asset-tested, it is only income-tested. The income cut-off points are currently $57,761 for a single and $92,416 for a couple, and your income is calculated using your taxable income as per your tax return, plus any deemed income.

But this is where it gets confusing. Under the CSHC rules, Centrelink only deems superannuation that produces an income stream. Superannuation funds in accumulation mode are not tested at all, because they are not producing a taxable income, and you are not drawing an income from them.

The changes announced by the Prime Minister last week take the single cut-off to $90,000 and the couples cut-off to $144,000. These new limits will come into place on 1 July 2022.

Jack and Jill have a share portfolio of $900,000, producing an income of $34,000 a year, plus franking credits of $10,000, so their Adjusted Taxable Income is $44,000 a year. They also have very large superannuation balances, but since the Turnbull government restricted the amount that could be held in the tax-free pension mode to $1.6 million back in 2016, they are most unlikely to have more than $1.7 million each in pension mode, unless their super fund has been performing spectacularly well.

The deemed value of their super would be $74,720 a year which, when added to their ATI, gives them a total income for CHSC purposes of $118,720. So this year they are over the cut-off for the CSHC, but next year they – and a huge number of other self-funded retirees – will be able to pick up a CSHC and its generous concessions.

Many people are not aware of the proposed changes. You could be one of them, so don’t forget to check with Centrelink and use the deeming calculator on my website.

Browsing this calculator could be one of the best investments of time you make. You’ll be surprised at the range of concessions available, and how they vary from state to state. I picked up $400 a year in rebates that I never knew existed as I was researching this column. You can’t afford to miss out.


A great podcast for you

My son, James, recently visited us in Brisbane with his young family. He lives in Los Angeles so it was the first time we had seen each other in almost three years – and it’s such a timely reminder to cherish every moment you have.

Many of you subscribe to his podcast, Win the Day with James Whittaker. While in Brisbane, James invited me into the studio for an interview. The episode has just been released.

We spoke about my upbringing and what it was like feeling ‘stupid’ compared to my classmates. We then went into my career and journey to media contributor, which led to Making Money Made Simple and the formation of our business, Whittaker Macnaught.

In addition, I shared:

  • The important handwritten message that’s been hanging in my office for 37 years
  • What led to Making Money Made Simple becoming so popular
  • My tips for a happy business (and marriage), and
  • How to achieve financial freedom.

We covered a lot in this conversion and I’m sure you’ll enjoy it.

You can access it now wherever you listen to podcasts, or click the links below:

Apple Podcasts (audio)
Spotify (audio)
YouTube (video)

Be sure to leave a comment to let us know your thoughts on the episode.


From the Mail Box

Photo by Rinck Content Studio on Unsplash 

Hi Noel,

In the late 1980’s, I bought your book Making Money Made Simple and read it cover to cover. It made a huge impression on me and changed me from someone who spent all of their income into a dedicated investor. I put in place a financial plan and followed it religiously. I am pleased to say that I retired last month, just before my 54th birthday with a multi million dollar portfolio of shares that more than comfortably meets my family\’s living expenses. I could not have done this without your advice.


The other morning as we walked home from Pilates and passed a group of high school children waiting at the bus stop I remarked to Geraldine “I would love to be 16 and know what I know now.” And then it occurred to me – all the stuff I’ve learnt about finances and life have been written down in my books like Beginners Guide to Wealth, Making Money Made Simple and Retirement Made Simple. You don’t have to wait a life time to acquire the knowledge – it’s available right now.


Another Scam

I am 70 years old and currently on leave from my job as a local Itinerant Support Teacher of Deaf and Hearing Impaired people aged birth to 18years. I consider myself “switched on” and very competent.

I almost got caught by a scammer when selling on Gumtree recently.

I advertised an item for sale on Gumtree, the fake buyer contacted me via my add on Gumtree wanting to purchase my item and requesting future correspondence via email. The buyer wanted to use PayPal to pay for the item and have the item shipped to “his son” via an independent “mover”. Correspondence pre-porting to come from PayPal followed. “PayPal” said the payment $2550 had been received into my account and would be released pending proof, from me, of a portion $950 (mover’s cost) being direct deposited into the “mover’s” business account, bank details were given. On receipt of proof of this deposit the $1600 (item’s cost) would be released by PayPal to me and the mover would contact me to arrange pick up of the item. I checked the details with PayPal and discovered it was all fraudulent.

I deleted the add and then reposted it. Within an hour I had two more offers of purchase and both requested that I correspond via personal email. I replied via Gumtree that I would only correspond via Gumtree. No more correspondence occurred.


And Finally

Photo by Markus Winkler on Unsplash 

A cook that leaves Arby’s to work at McDonald’s.

The act of torching a mortgage.

What a crook sees through.

What a bullfighter tries to do.

Workers who put together kitchen cabinets.

What the bank robbers did when their bag was full of money.

What a man in a boat does.

What you see from the Eiffel Tower.

Two physicians.

A helper on a farm.

What trees do in the spring.

What you do to relax your wife.

What the owner of a seafood store does.

Brought litigation against a government official.


I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker

Noel News 8 April 2022

Do not regret growing older.
It is a privilege denied to many.

Welcome to another newsletter.

It was always going to be an election budget, and there were some good things in it. But the cash handouts are fiscal irresponsibility at its worst. Think about it: the Treasurer revealed that there would be a deficit of $78 billion in the forthcoming 12 months. This is money we, as a nation, have to borrow.

One of the first rules of good money management is to avoid bad debt, and use good debt. Bad debt is when we borrow for consumption, such as travel, clothing, or a wedding, and good debt is when we borrow for assets such as property and shares, which will provide lasting benefit. I have no problem whatsoever with government borrowing for roads, infrastructure and other items that have a long-term payback, but I see no point in cash handouts for the sole purpose of getting the government back into power.

Take the decision to cut petrol excise by 22c a litre. Petrol accounts for no more than 4% of most household budgets but it’s the one that is always in the news, and thanks to huge signs everywhere, is the  one commodity for which everyone knows the exact price. The price of petrol can generate strong emotions but there are ways to reduce the cost of it. The major motoring organisations have associations with petrol stations to provide a discount of between four and five cents a litre. And there are apps such as the 7 Eleven fuel app, which lets you lock in today’s fuel price for the next seven days with no penalty. We’ve been using it for years and have saved a bundle.

Where I live, it’s normal for petrol to fluctuate by 30c a litre or more over the cycle. So you can expect your 22c a litre discount to vanish in the next few cycles. Even though this measure has been announced as for six months only, the cost will be a staggering $3 billion – all borrowed. Think what you could do with $3 billion towards flood mitigation programs.

Then there is $1.5 billion used to give 6 million welfare recipients a once-only payment of $250. Let’s face it, that kind of money won’t change their lives one bit. Wouldn’t it be better to use that kind of money to provide better dental facilities or improve aged care?

These are just expensive band-aids. They won’t do anything to slow down inflation, which is the actual problem here. Despite the official figure of 3%, I am told the average rise in groceries and fruit and vegetables is nearer 10% – ignoring the current post-flood highs. A cash payment of $250 now, combined with six months of slightly less expensive petrol won’t do a thing to change it.

The big issue about to be felt by most Australians is interest rates. We are in a unique position where inflation is running at more than 5%, at least in the real world, and interest rates are at historic lows. It’s a virtual certainty that we’ll see at least an interest rate rise of a full 1% in the coming year. Thanks to low interest rates, and rapid housing price rises, the average mortgage in Australia is now a breathtaking $600,000. A rate rise of just 1% would add $6000 a year or $115 a week to the average family’s mortgage repayments. How will people cope with that?

There are also budget moves to help first homeowners, but the problem with all these schemes is that they drive up house prices by increasing the number of potential purchasers. And it gets worse – the government is encouraging single homebuyers to borrow on just a 2% deposit, with no mortgage insurance. In that scenario a person can buy a home costing $400,000, with starting equity of just  $8,000. Offering home loans to couples with just 5% deposit is bad enough, to entice single people to borrow with just 2% deposit is as bad as it gets.  At least a couple may have the income of one of them to fall back on if for some reason one of the breadwinners is unable to work. Single people don’t have that luxury.

Think what would happen if that house falls in value by just 10% – and this is not unknown, especially in some regional areas – they are $32,000 underwater. If they’re forced to sell the property because of rising interest rates they could be suffering a big capital loss. It won’t affect the lender, who is covered by the government’s own mortgage insurance scheme. So how does that help struggling homebuyers?

Let’s have some straight talk.  The global financial crisis was born when President Bill Clinton instructed mortgage lenders in America to reduce lending standards so that poorer people had a chance of home ownership.  Consequently, hundreds of thousands of Americans were lured into buying homes they couldn’t afford, and most of them lost what little they had.  That’s the last thing we want to happen in Australia.


How to sleep better

In a recent Noel News, I mentioned that my son James was interviewing the world’s leading sleep doctor, Dr Michael Breus.

Many of you submitted questions that Dr Breus has answered, and the episode has just gone live. It’s fantastic.

If you’re having trouble sleeping, or simply want the latest science-backed tips to sleeping better, you’ll love it.


The war in Ukraine

I’d like to share this episode of the Magellan In The Know podcast:

Episode 20: War in Europe

Russia’s invasion of Ukraine has sent geopolitical and economic shockwaves around the globe, creating new risks to the investment outlook. A combination of strong western government and corporate responses has drastic implications for commodities, food security and raises the possibility that NATO nations may be drawn into a wider conflict. But as Russia’s military fails to meet its objectives, what does a settlement look like, and what are the implications for a Russian president whose aspirations of a resurrected Russian empire appear to be collapsing?
The participants are former US Deputy Assistant Secretary of Defence for Russia, Ukraine and Eurasia Evelyn Farkas, and former Deputy Director of the CIA Michael Morell dissect and shed light on the situation with Magellan’s Head of Macro and Portfolio Manager Arvid Streimann. 

This is just a brilliant podcast and I can’t think of any better people to be giving their views on the situation.



Scammers are more active than ever, and their techniques are getting smarter and more personalised. It’s rare for a day to pass in which I don’t get a call from “Amazon”, but I’ve never heard what they want to say, because I immediately hang up. And if you try to call back the number the phone call appeared to come from, a recorded message says that the number does not exist.

Last week I got an indication of how clever they are becoming. A close friend told me that her mother, Enid, had received a call from “Amazon” to tell her that there had been a purchase of an iPhone 11 for $900 on her account, which she needed to approve. Enid denied the purchase, so they told her they were transferring the call to the “Australian Cyber Fraud Department”. The next person she spoke to told Enid that she was a victim of cyber crime, but luckily they had caught it in time, and she could help him catch the scammers. All she needed to do was open her computer and log on to a website.

Like most seniors, Enid is very trusting. She opened the website, still on the phone, but unbeknown to her it installed a program that gave the scammer access to her computer. He then instructed her to check her online bank account, which enabled him to see the balance, and gave him all the information he needed to operate on the account. Her screen then went black, and he showed her a screenshot of her bank account showing $15,000 had been deposited. It had not really been deposited, but the scammers are getting so sophisticated they can manipulate a photo of your bank account to make it look as though transactions have actually happened.

He then claimed the scammer must still be online, and that to help catch them, Enid needed to go to her local branch and withdraw $15,000 in cash. Of course, being a law-abiding person, she was keen to help. He kept her on the phone even while she was driving to the bank, and stressed she should tell nobody about any of this. When she questioned the amount, saying the bank wouldn’t let her take out that much cash, he told her to tell them it was to buy a car.

Enid fell for it, but she was getting very stressed, so fortunately she called in at her daughter’s house to ask her to come to the bank with her. When her daughter, my friend, found out what was happening, she grabbed her mum’s phone and asked the caller who he was. When challenged like this, he simply hung up. Enid immediately rang the bank and discovered that her daily limit of $2500 had already been transferred out of her account. Apparently, there is a slim chance this can be recovered. Luckily, Enid and her daughter were able to prevent the larger cash withdrawal from happening, and the bank also promptly blocked internet banking to prevent any further withdrawals. Later, Enid also discovered a request had been sent from her internet banking account to increase the daily limit.

Enid is an intelligent woman, but the scammers have this down to a fine art. The only defence is to be aware of it. Never accept phone calls from people you don’t know.

And there was still one more expense: the family had to pay $130 to get Enid’s computer completely cleaned of malware. All in all, it was a very expensive morning.


And finally – some thoughts on politicians

We hang the petty thieves and appoint the great ones to public office.
– Aesop, Greek slave & fable author

Those who are too smart to engage in politics are punished by being governed by those who are dumber.
– Plato, ancient Greek Philosopher

Politicians are the same all over. They promise to build a bridge even where there is no river.
– Nikita Khrushchev, Russian Soviet politician

Politicians are people who, when they see light at the end of the tunnel, go out and buy some more tunnel.
– John Quinton, American actor/writer

Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other.
– Oscar Ameringer, “the Mark Twain of American Socialism.”

The Democrats are the party that says government will make you smarter, taller, richer, and remove the crabgrass on your lawn.
The Republicans are the party that says government doesn’t work and then they get elected and prove it.
– P.J. O’Rourke, American comedian and writer.

I offered my opponents a deal: “if they stop telling lies about me, I will stop telling the truth about them”.
– Adlai Stevenson, campaign speech, 1952..

A politician is a fellow who will lay down your life for his country.
– Texas Guinan. 19th century American businessman

I have come to the conclusion that politics is too serious a matter to be left to the politicians.
– Charles de Gaulle, French general & politician

Instead of giving a politician the keys to the city, it might be better to change the locks.
– Doug Larson (English middle-distance runner who won gold medals at the 1924 Olympic Games in Paris , 1902-1981)

The problem with political jokes is they get elected.
– Variously attributed to Will Rogers and George Bernard Shaw


I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker



Six monthly pension changes now announced.

Today’s newsletter is just a special bulletin. Its purpose to give you the details of the latest pension changes which take effect on 20th of March, and also give you the tools to do your own calculations.  The age pension calculator on my website has been updated with these changes. So don’t forget to use it.

The amount of age pension payable is adjusted twice a year. The current adjustment which commences from 20 March is an increase in the age pension, not an adjustment to the taper rates, but it does flow through. The levels at which the pension starts to reduce, both for the asset test and the income test have remained unchanged, but the effect of the increased pension means the cut-off points, when no pension is payable have increased. This could enable more people to get an age pension because the asset test cut-off number is now higher. A summary of the changes is as follows.

I would like to acknowledge the great work done by MyPension Manager who prepare the charts for my website, and which really give you a great overview of the way the pension works. Their website is and I recommend them without reservation to anybody who is trying to get advice about pensions at a reasonable cost.

Income Test

From 20 March 2022 a single pensioner can earn $180 a fortnight and still be eligible for the full single pension of $987.60 a fortnight, including all supplements. They can also earn $150 a week from personal exertion – this is not included in the income test. Once income exceeds $180 a fortnight, the pension reduces by $0.50 for every additional dollar earned.

From 20 March 2022 a pensioner couple can earn $320 a fortnight combined and still be eligible for the full pension of $1488.80 a fortnight, including all supplements. They can also earn $150 a fortnight each from personal exertion – this is not included in the income test. Once income exceeds $320 a fortnight, the pension reduces by $0.50 for every additional dollar earned.

Assets Test

From 20 March 2022 the full pension is available, under the assets test, for homeowner singles whose assessable assets are under $270,500 – for homeowner couples the number is $405,000. The numbers for non-homeowners are $487,000 and $621,500 respectively.

Once assessable assets exceed the lower threshold, the pension reduces by $3 fortnight for each $1000 by which assessable assets exceed the lower threshold.

A single homeowner can have up to $599,750 of assessable assets and receive a part pension – for a single non-homeowner the lower threshold is $816,250. For a couple, the higher threshold to $901,500 for a homeowner and $1,118,000 for a non-homeowner.

Some Pension Basics

I’ll give you a quick refresher of the way the pension system works. You are tested on both an asset test and an income test and the one that gives you the lowest pension is the one they use. There is a pension calculator on my website to enable you to do your own calculations.

Money in superannuation, and financial investments such as bank accounts and shares are assessed at their current value and are also given a deemed income. There is a deeming calculator on my website. Just bear in mind the income test is of no relevance if you are asset tested.

Everybody is allowed a basic income before the pension starts to reduce but on top of that a person can earn $150 a week from employment or from their own business without any effect on their pension. Once again this is only relevant if you are income tested. For example, if a couple had assessable assets of $780,000, plus their own home, they would qualify for a pension of $181.90 under the assets test. But if you look at the charts you could see that they could earn around $2600 a fortnight with no effect on their pension because they are asset tested. This is an area of confusion for many people.

Cars, caravans, furniture and personal effects are all counted for the asset test but don’t make the mistake of using replacement value when you listing them for Centrelink. Personal effects and furniture should be valued at what you would get from them at a garage sale on a wet day. This puts a limit of $5000 on these items for most people. Similarly, cars and caravans are valued at wholesale second hand value.

You can reduce your assessable assets by spending money on home renovations, and travel, and also give away $10,000 a year with a maximum of $30,000 over five years.

People who are over the assets test and wish to get a part pension, often to get the pensioner concession card, could investigate one of the new lifetime income products whereby only 60% of the initial value is counted for the asset test. Let’s assume a couple had assessable assets of $1 million which takes them over the $901,500 limit at which no pension becomes payable. If they invested say $300,000 in one of these new products their assessable assets would fall by $120,000. At that asset level they would get a fortnightly pension of $106.80 each, the income from the product they have just invested in, and the pensioner concession card. Just bear in mind that these are lifetime products so make sure you take expert advice before you commit to one. They are increasing in popularity, and have the full support of the government. They are discussed in great detail in my book Retirement Made Simple.

Other Concession Cards

The Commonwealth Seniors Health Card (CSHC) is prized by self-funded retirees because it offers a range of concessions from the federal government. However, access to concessions from state and local governments is usually limited.

There is another card, the Low Income Health Card (LIHC), which is not generally understood, but which can provide access to additional concessions. These benefits vary from state to state, but in some cases can be valuable. There are also some private businesses that offer concessions to LIHC  holders.

A person can have both cards if they meet the eligibility criteria.

For the LIHC you must be an Australian resident who is living in Australia, and have income below the cut-off points. The same requirements apply for the CSHC but in addition, you must be of pensionable age, and not be receiving any income support payment from Centrelink or Department of Veterans Affairs. There is no assets test at all for either card.

Both cards are income tested but the income limits and definition of income are different. The one factor common to both is that deemed income from account-based pensions is included. Because deeming rates have become so low many retirees can hold substantial amounts in an account-based pension and still satisfy the income test for both cards.

CSHC: The income limits are 57,761 for a single, $92,416 for a couple combined and $115,522 for a couple separated due to illness. The income includes Adjusted Taxable Income (ATI) and deemed income from account-based pensions. If a couple had $2.5 million in superannuation in account based pensions, and an ATI of $25,000 per annum, they would qualify easily because the deemed income  would be $54 470 [JP1] a year which when added to their $25,000 per annum give them a total income for CSHC purposes of $79,470. And remember that money in superannuation in accumulation mode is not counted because it produces no taxable income and is not subject to deeming for CSHC purposes.

LIHC: Qualification is established by measuring assessable income over an eight week period before the claim is made. The initial eight week limits are $5152 for a single and $8,856 for a couple. This equates to an annual figure of $33,488 and $57,564 respectively. The card is valid for one year after which a fresh  application must be made –  the income limits are more generous for the renewal. They become $6440 for a single and $11,070 for a couple.

The income test is based on the Centrelink definition of income rather than taxable income and includes salary or wages, deemed income on financial investments on account based pensions and income support payments. A quirk in the regulations is when couples are applying, and neither receive a pension, the deeming thresholds are applied to each member of the couple separately and are then added together.

Case study:

Jack and Jill are of pensionable age. He has $1.4 million in an account-based pension and she has $800,000 in an account based pension. They receive no pension because they are over the assets test. They apply for the CSHC in January 2022. Their ATI was just $5000 being dividends from shares worth $60,000 which are owned by Jack. The deemed income from their $2.2 million in account based pensions is $47,720 a year making total income for CSHC purposes of $52,720. They are way under the cut-off figure for a couple and so easy qualify for the CSHC.

They also decide to apply for the LIHC to obtain additional concessions from state and local governments and some private businesses. To be eligible their combined income in the eight week period before claiming must be below $8,856. Because they do not receive any age pension the demining is calculated on each member of the couple separately. For Jack this includes his account based pension and the shares, while for Jill it is just her account based pension. The deemed income is $30,428 for Jack and for $16,928 for Jill. This totals  $47,356  a year or $910.70 per week. This means for an eight week period their total income is $7,285.60. This is under the cut-off figure so they qualify for the LIHC as well as the  CSHC.
I appreciate this is somewhat complex but it could be worth taking the time to understand it. Everybody likes a concession.

And Finally

I do know you love the jokes at the end of my newsletter so I am including one even though this is a special bulletin.

The roundest knight at King Arthur’s round table was Sir Cumference.  He acquired his size from too much pi.

I thought I saw an eye doctor on an Alaskan island, but it turned out to be an optical Aleutian.

She was only a whisky maker, but he loved her still.

A rubber band pistol was confiscated from algebra class because it was a weapon of math disruption.

The butcher backed into the meat grinder and got a little behind in his work.

No matter how much you push the envelope, it’ll still be stationery.

A dog gave birth to puppies near the road and was cited for littering.

A grenade thrown into a kitchen in France would result in Linoleum Blownapart.

Two silk worms had a race.  They ended up in a tie.

Time flies like an arrow.  Fruit flies like a banana.

A hole has been found in the nudist camp wall.  The police are looking into it.

Atheism is a non-prophet organization.

Two hats were hanging on a hat rack in the hallway.  One hat said to the other, ‘You stay here, I’ll go on a head.’

I wondered why the baseball kept getting bigger.  Then it hit me.

A sign on the lawn at a drug rehab center said: ‘Keep off the Grass.’

A small boy swallowed some coins and was taken to a hospital.  When his grandmother telephoned to ask how he was, a nurse said, ‘No change yet.’

A chicken crossing the road is poultry in motion.

It’s not that the man did not know how to juggle, he just didn’t have the balls to do it.

The short fortune-teller who escaped from prison was a small medium at large.

The man who survived mustard gas and pepper spray is now a seasoned veteran.

A backward poet writes inverse.

In democracy it’s your vote that counts. In feudalism it’s your count that votes.

When cannibals ate a missionary, they got a taste of religion.

Don’t join dangerous cults: Practice safe sects!

Noel News 9 March 2022

Education is not the learning of facts,
but the training of the mind to think.

Welcome to another newsletter.

When I wrote the last one, I had no idea that a war in Ukraine would be taking place by the end of February. These events, and all the scary media that accompanies them, terrify people. Naturally this has been accompanied by massive falls in markets all around the world. As usual, I’m getting a raft of emails from people asking whether they should quit their investments before it’s too late. The other question many are asking is what likely effect the situation in the Ukraine may have on stock markets.

It is normal to feel apprehensive when the market has a downturn, especially when accompanied by the threat of war. I understand that. But I am comforted by the latest research from my long-term friend, Ashley Owen of Stanford Brown Private Wealth. Ashley has analysed 27 military crises since the 1930s (including the German invasion of Poland that led to WW2, Pearl Harbour, the Korean War, Vietnam, the September 11 attacks, and several Russian military invasions and attacks), tracking share market reactions with a particular focus on US and Australian markets.

Photo Source

His conclusion is that sudden military crises inevitably trigger abrupt selloffs in share markets, but almost all recover to above their pre-crisis levels within a few months, including during WW2.

The reason for this consistent rebound is that military activities generally lead to increases in demand, spending, company revenues and profits. They are therefore positive for share markets, especially Australia, since military activity leads to higher commodities prices. The initial share selloffs are an understandable human reaction to the shock of the event, and the associated alarm, stoked by the media reaction. Historically, however, military crises have consistently represented buying opportunities for long term investors.

In times like these,  it’s useful to restate some fundamental investment principles:

  1. The major factor that determines your wealth is the rate of return you can achieve. You will never get a decent return leaving money in the bank, which means you need to move to assets such as local and international shares that historically have given the best returns. Because these assets offer liquidity, they are also volatile, which means it is normal to expect regular and sometimes unexpected market movements.
  2. You have to stay in the market. It’s tempting to want to cash out and sit on the sidelines waiting for markets to bounce back, but historically the bigger the fall the bigger and faster the bounce-back. Almost invariably, people who try to time the market miss the bounce-back and find themselves stranded.
  3. Volatility is normal. The Australian share market has averaged 9% per annum (income and growth) over the last 120 years. But that doesn’t mean you earn a steady 9% every year: in some years it may give you 15% to 20%; in other years you may lose 10% or more. That’s the nature of markets. Returns tend to even out over time across the market as a whole.
  4. The price of a share does not always reflect the value of the company. Some quality companies (like Sonic Health and Suncorp, to mention just two) have recently fallen around 10%, yet their balance sheets are still in good shape and they should remain good long-term businesses. Investors can act in strange ways: they love to buy when the market is booming and shares are fully priced, but shy away when prices fall and the same shares are at sale prices. This means that sometimes you can pick up good shares at a discount.
  5. Investment is a marathon, not a sprint. To quote Professor Paul Marsh of the London School of Business, “The long-run attractiveness of equities, in my view, is undiminished. You should take a long term view, and the long run is at least 20 years. You should focus on time in the market, not on timing the market.”

It’s impossible to say exactly when the current market turbulence will settle. However, we can be confident that the share market will eventually recover — it always has done. Good quality companies running real businesses and making sustainable earnings and dividends should recover well, as they will once again be sought by investors.

This might be a good time to go and play with the Stock Market Calculator on my website. It lets you enter a notional sum as well as a notional starting and finishing date and see what your money would be worth if it matched the All Ordinaries Accumulation Index which includes income and growth. The example, if you invested $100,000 in January 2016 it would now be worth $184,000 – a compound gain of 10.7% per annum. If the money had been invested in January 2019 the final value would be $138,000 – a compound gain of 11.33% per annum. You can never judge the performance of share-based investments over the short term – it’s the long-term that counts.

Retirement Made Simple – Now on Audible

Now can you plan for retirement while gardening or doing the dishes. Audiobooks are a great way to while away the mundane or routine tasks of life while learning at the same time.

I’m delighted to announce that Retirement Made Simple is now available on Audible. It’s been read by Daniel Moore who has done a fantastic job, and I know you will enjoy it. When access it through Audible you will need to sign up for a monthly commitment, but this can be cancelled without penalty on short notice.

Click here to listen to a sample chapter:

It’s amazing how much more you pick up when it’s read to you. It also gives you the chance to absorb the knowledge while you are travelling, gardening or walking.

Major Superannuation Changes

Legislation has finally been passed to give effect to several of the key superannuation changes proposed in the 2021 Federal Budget. This is great news for retirees, and people approaching retirement, as they open the door to some worthwhile strategies.

The changes include the removal of the work test requirement for non-concessional contributions for people aged between 67 and 75, and the extension of eligibility for individuals under 75 at the beginning of the financial year to make non–concessional contributions using the bring forward rules. Furthermore, eligibility to make downsizer contributions has been extended to those aged 60 and over. Let’s examine them in detail.

The work test will no longer need to be met by individuals aged between 67 and 75 when making salary sacrificed contributions and personal non-concessional contributions. However, the work test will still need to be met to claim a tax deduction for personal concessional contributions. Apart from the downsizing contribution, no non-concessional contributions may be made once total superannuation balance reaches $1.7 million. Concessional contributions can be made irrespective of the total superannuation balance, and there is a contribution cap of [j1] $27,500 a year – this includes superannuation from all sources including the employer contribution.

There will no tapering of the bring forward rule for those approaching 75. This means that if a person’s age is less than 75 on the prior 1 July and they meet the ordinary eligibility criteria including that which relates to the total superannuation balance, the bring forward rule may be triggered. This could enable a person to put up to an additional $330,000 into their superannuation provided the bring forward rule has not been used in the previous three years. Contributions will need to be received no later than 28 days after the month the person turns 75. However, if a person turns 75 in June, they will not be permitted to trigger the bring forward rule in July the following financial year. In short, the individual must be 74 or under at some time during the financial year to be able to use the bring forward rule.

The ability to withdraw money from superannuation and then re-contribute it as a non-concessional contribution can be a useful tool in reducing the death tax (ie tax paid on death benefit lump sums received by non-dependent adult children), as it could convert a substantial portion of the taxable component to the tax-free component. Furthermore, if there was a substantial imbalance in the superannuation balances of a couple, one partner could withdraw say $330,000 and contribute it to their partner’s superannuation as long as the partner’s super is not in excess of $1.7 million.

The ability to make downsizer contribution at age 60 has significant benefits in certain cases. For starters, it would enable people with high superannuation balances to put another $300,000 each of the super because the $1.7 million limit on non-concessional contributions does not apply to the downsizer contribution.

It would also assist people to maximise the amount they can have in superannuation from the sale of their home. Hypothetically, a couple could make total contributions of $630,000 each from the proceeds of the sale of the property. The first contribution would be $330,000 using the bring forward rules, the second contribution would be the downsizer contribution of $300,000. This is where advice is important, because the terms of sale may have to be tailored to create a situation that maximises the total contributions can be made.

Keep in mind that tax-deductible concessional contributions can be used to reduce capital gains tax in some cases. This would be particularly relevant if the person had less than $500,000 in super at the end of the previous financial year, and had not been making concessional contributions because they had been out of the workforce for several years. Possibly as much as $100,000 could be contributed to superannuation using the catch up concessional contribution strategy. This could eliminate CGT on sale of an asset.

Photo by Katarzyna Grabowska on Unsplash


Case study:

John and Daisy both age 66 are retired. They intend to sell an investment property which may result in a taxable capital gain of $400,000.  This will reduce to $200,000 after application of the 50% discount, and will be split $100,000 to each party. They have arranged their affairs so that both have less than $500,000 in their individual super accounts. They make catch-up contributions of $100,000 each, four years at $25,000 a year, and then claim a tax deduction of $100,000 each. This eliminates the entire taxable capital gain – the only cost is $15,000 each in contributions tax.

Of course, this begs the question as to what would happen if their superannuation balances were over $500,000 limit. This is aware forward planning is important. Once they reach 60, and of satisfied a condition of release, they can withdraw money from their super, and re-contribute it. So as the years pass, they could be withdrawing money from one account and contributing it to the other person’s super. They could then prior to 30 June, withdraw sufficient amount tax-free, and place the money in the bank. This could lower both balances to $500,000 at June 30, and when the new financial year arrived simply re-contribute $300,000 each in need, using the bring forward rule.

Given that money in superannuation is not assessed by Centrelink until the holder reaches pensionable age, or starts an income from their superannuation, the ability to contribute large chunks of money to superannuation may be highly effective if there was an age difference between the members of a couple. By holding the superannuation in the younger person’s name the older person may qualify for a part pension.

This is just overview of the opportunities available – expert advice should always be taken.

A Tale of Two Credit Cards

Photo by Dietmar Becker on Unsplash

As a loyal Virgin flyer my preferred credit cards for years have been the Virgin Velocity ones as they give me valuable Virgin frequent flyer points. However due to my lack of flying for the last two years I find myself with many points but nowhere to go. Now that borders are open, visiting our son James in Los Angeles will become a priority which means we will probably need to fly Qantas. My challenge was to get myself a credit card that was linked to Qantas.

After doing the research I opted for the Citibank Qantas card and filled in their very sparse application form online. There was room for minimal information. I got a response telling me that they needed more information, which I expected, and I responded telling them that I had contacted my accountant to get what they wanted. Next day they advised my application had been rejected. No reason given. I went to their complaints section and filed a complaint about declining an application for a card while the applicant was getting the information requested. It was ignored.

Then it occurred to me that I have an American Express Virgin card now and maybe they could help. It took just one phone call to American Express to get instant approval to replace my Virgin card with the Qantas card. Within 48 hours the card on my Apple wallet had been changed and in four working days later the new card arrived in the mail. What a contrast in service!

Dangers of DIY

There is no question that interest rates are on the way up. But the most realistic estimates are a maximum rise of 1.5% over the next two years, which does little to assist retirees who are unwilling or unable to take advantage of the returns offered by superannuation.

Even with interest rates rising, returns from cash and term deposits will probably remain well below historical levels for several years. The obvious solution for retirees is to seek expert advice to improve their situation. However, the sad reality is that the federal government has effectively neutered the financial advisory system with a range of well-meaning but totally ineffective compliance measures.

The outcome is that advice has become out of reach for all those people who don’t have enough money to justify spending at least $5000 for a consultation – or are not prepared to. The high initial cost covers the time spent researching the client’s resources in depth, and then preparing the paperwork that is now required. The document that must be prepared is called a Statement of Advice, and it normally runs to over 100 pages – it is also unintelligible to most clients.

The high cost of advice has led to many retirees doing their own research on the Internet. While this may be useful in certain specific cases it also leaves them open to bad decisions and – even worse –to becoming the victims of scams.

Photo by Beth Macdonald on Unsplash

Just last week I received an email from a bloke telling me that he had sold a property and been searching the web to find ways to invest the money. He was attracted by an investment in Commonwealth bonds, maturing next year, offering 5.5%, and was emailing me for my opinion. My response was, “That sounds too good to be true, but tell me more – if that’s available I wouldn’t mind some for myself”. He sent me the email he had received from a company he had found on the internet, which gave details of the alleged investment.

I checked with a friend, who really knows his bonds. He pointed out that the two bonds in question were old Commonwealth Bonds that were nearing the end of their life, hence maturing next year. Their respective rates were 5.5% and 4.75%, reflecting the high interest states that were current when they were issued.

But even though the maturity value of a bond is fixed, the daily value varies in line with prevailing interest rates. My enquirer would need to pay $108 for a $100 bond paying 5.5% and redeemable next year. The other bond had a coupon rate of 4.75% and was redeemable in 2027. The current price of that was $116 for the $100 bond.

By “investing” in these bonds he would receive the full coupon amounts of $100 on maturity but would be faced with a capital loss of between 8% and 16% because of the premium he would have paid to buy these products. There is no such thing as a free lunch: the market had priced them to yield 1% for the 2023 bond, and around 1.5% for the 2027 Bond.

I pointed out to him that his “safe” investment in government bonds would give him a guaranteed capital loss, and an overall return no better than he was getting at the bank. Given his age and investment goals, superannuation would be a much more effective investment for him, with all the decisions made by experts and not by somebody inexperienced researching the web to see what they could find.

And finally…

Words and their alternative meanings:

Abacus — Swedish swear word

Alaska — Consult my girlfriend

Awestruck — Where a cockney puts his ponies

Barbecue — A long line of dolls

Buoyant — An ant which isn’t a girl

Chairs — Toast by the Queen

Chuckling — A very short throw

Colonnade — A fizzy enema

Delight — Make things go darker

Equip — Online joke

Extractor Fan — Person who used to like farm machinery

Gelatine — Device for beheading jelly babies

Godspeed — It’s raining

Granary — Old folks’ home

Hiding — A bell you can’t reach

Impeccable — Bird proof

Intelligent — A man on TV

Intense — Camping

Khaki — Device for starting car

Knowing — Unable to fly

Laminated — Pregnant sheep

Photo by Ambitious Creative Co. – Rick Barrett on Unsplash

Lassé fair — A sheepdog festival

Maisonette — Tiny freemason

Megahertz — Extremely painful

Metabolics — Unimpressed with metaphysics

Microbe — Tiny dressing gown

Minimal — Small shopping centre

Mirth — A French moth

Motorway — Britain’s leading mote removal company

Negligent — Male lingerie

Nicotine — To arrest a youth

Octagon — A dead octopus

Paintings — Jamaican paracetamol

Parasites — View from the Eiffel Tower

Physiology — The study of effervescence

Plaintiff — Argument with flight attendant

Primark — The first coat of paint applied by Noah

Property — Decent cuppa

Scandal — Footwear to be ashamed of

Snuff Box — Coffin

Stopcock — Chastity belt

Trumped — Talked down to by a xenophobic, mentally challenged, sexist bigot

Tumbling — jewellery for your belly button

Ukraine — Machine for lifting female sheep

Umlaut — Hesitant thug

Warehouse — To forget your address

Xerox — French archaeology


I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker


Noel News 26 Jan 2022

Never begrudge the money you spend on your own education.

Welcome to another new year.

It’s hard to believe that January is almost over. The last eight weeks have been very busy ones for me due to the dramas of getting the audible book of Retirement Made Simple finished and in publishable form. Dealing with Amazon in America is a nightmare. On top of that is the writing of my new book 10 Simple Steps to Financial Freedom which should be released in April. It’s been tough going because I am trying to write for people with no financial knowledge whatsoever. However, the manuscript is now finished and will be with the editor this week. Watch this space.

To make matters worse share markets around the world are having a bad time, and I’m receiving the normal barrage of emails telling me to get out before the big depression comes. I ignore them – I regard myself as a long-term investor, and realise that I’m not smart enough to pick the top and bottom of the market, and therefore am leaving things as they are.

And it’s tricky, the problems with panicking and getting out of the market whenever it has one of its normal bad spells are the transaction costs and possible tax issues depending on which entity holds the assets. But to make it worse, you then need to decide when the best time is to get back in. History tells us that when markets turn upwards it happens rapidly – most people who cashed in with the intention of getting back miss the upturn.

Keep in mind that the share market, even though it may end up with say 10% for the year, usually has down spots along the way. The attached graph shows this perfectly.

Returns are based on price only and exclude dividends.
Returns are shown for calendar years from 1994 – 2017.

Source: FactSet, MSCI, JP Morgan Asset Management 

Land Tax Grab

Land tax is levied by each state based on the value of the land you hold in that state. The rates vary from state to state, and your own home is normally exempt. Queensland is attempting to make history by including the value of properties you hold in other states in the calculation of land tax. In Queensland right now the first $599, 999 is tax free but then increases to 1% in the dollar up to $1 million. The land tax on $1 million is $4500 +1.65% on land in excess of that up to $3 million. Companies and trusts pay higher rates.

Now a person in Queensland could have an investment property with a land valuation of $599,900 and pay no land tax. However, that person may have other investment properties in other states – as the law stands now those other properties are not added to their land holdings for Queensland land tax purposes.

Under the proposed changes if you had properties with unimproved land values of $1 million in other states your land tax would rise from zero to $4500. And this would be in addition to the Land Tax you would be already paying to the other states.

The government claims it’s goal is to discourage investors from southern states buying in Queensland and pushing up prices for first home buyers. If that’s the case it would certainly do what it’s intended because it would be a huge  disincentive for interstate buyers to buy an investment property in Queensland. But I’ve noticed that governments tend to copy each other. If the tax hike  works in Queensland you can bet your socks that the other states will jump on the bandwagon and start amalgamating all landholdings for land tax purposes. It has the potential to send land tax bills sky high and make the returns from residential property even less attractive.

Factor X

Almost 40 years ago, economist Dr Don Stammer coined the term Factor X, which he defined as “a powerful influence that was not even thought about when the year began … but which has a big effect on business conditions.”

X-Factor effects on investors can be positive or negative. Recent negative examples are the near-meltdown of global banking in 2008, and the initial effects from the outbreak of COVID-19 in 2020. In contrast, X-Factors resulted in better-than-expected returns in 1991, when Australia’s trend inflation collapsed, and in 1998 and 2008 when our economy showed unexpected resilience during the Asian financial crisis and the global financial crisis, respectively.

Obviously COVID-19 was the X-Factor last year, but Dr Stammer has broken interesting grounds with his choice for 2021. He calls it “the fracturing of the long-dominant view that low inflation is here to stay.” In layman’s terms, this means that there are two different views in economic circles about where inflation is going, and what central banks can do about it.

It was simpler in the “good old days.” The economy would boom, inflation would become rampant, the central bank would exercise a combination of credit squeeze and raising rates and, lo and behold: “the recession we had to have.”

Things are much more complex today. Even before COVID-19 hit, interest rates were at record lows in most countries in the world. Then when the pandemic began, governments printed trillions of dollars to protect their economies. As a result, asset prices went crazy and widened the gap between the haves and the have-nots even further.

And booming asset prices were not the end of it. Thanks to a combination of COVID-19 and the relentless move to drive the world to renewables irrespective of the cost, we now have massive shortages — which of course drive-up prices. A classic example is the link between gas prices, which are soaring, and the shortage of nitrogen-based fertiliser: the EU is facing a fertiliser crisis that may soon become a food crisis. The rising price of gas, combined with the shortage of urea, drives up food prices.

There is no doubt that inflation is rampant. In Australia, builders cannot complete houses because they can’t get materials; restaurant owners are paying huge sums to get staff; it takes months to get a car, and food prices are going crazy. On top of that, petrol prices have been at record highs.

The big question is whether this is temporary, or whether it is part of a long-term trend. According to Dr Stammer, the world has changed. The US inflation rate in the 12 months to November was 6.8% – the highest in 40 years; Canada, Korea and New Zealand have already raised their cash rates.

Australia’s Reserve Bank is between a rock and a hard place. The purpose of increasing interest rates is to slow down the economy, but this inflation is caused by lack of supply, not by excess demand. In any event, there have been few, if any, instances in which inflation has been successfully stabilised without recession. Increasing interest rates and putting up the average worker’s mortgage repayments won’t do a thing to fix the inflation that is upon us right now. Nonetheless, increasing rates appears to be what central banks all around the world are doing; therefore, at some stage it will happen here, so be prepared.

Dr Stammer points out that the existence of one or more Factor Xs does not – and should not – stop people forming a view on where the economy, inflation, shares, property, interest rates and exchange rates seem to be heading. Instead, it’s a reminder that investors always need to allow for the surprises and over-reactions that drive returns up or down at short notice. Risk-management – including sensible diversification – is always important to successful investing.

Health Matters

The last 50 pages of my book Retirement Made Simple cover all the material about healthy ageing that I have gathered over the last 40 years. It says “I appreciate that forming new relationships may be challenging as you get older, especially if you have moved to a new area. But don’t underestimate the importance of what researchers call “low stakes casual friendships.”

Most of us effectively live in a kind of village: most of our social activities are carried out near where we live, that is, at local shops, restaurants and cafés, parks, health studios, accountants and doctors. If you are open to chatting to people you’ll be amazed how much you can learn and how much fun it can be.”

This was reinforced in the latest edition of the Blue Zones newsletter which says:

“While diet, exercise, and overall health all seem like they’d be the best predictors of how long you’ll live, Julianne Holt-Lundstad at Brigham Young University found that the following are three important predictors of longevity:
Drinking/smoking habits: Are you a moderate drinker? Do you or don’t you smoke? Did you quit?
Close relationships: These are your closest friends, the people you can call on a bad day, the friends you know will support you in bad times.
Social integration: These are the interactions with people as you move through your day and includes both strong and weak bonds. It could be the coffee barista you see on your daily commute, the postman, or the woman behind you in line at the grocery store.

The face-to-face interactions you have on a daily basis are one of the strongest predictors of how long you’ll live. “ 

This is such an important topic – all the research is going in the same direction.

Smoking and Body Corporates

There’s been much publicity in the media about a recent ruling that would seem to prohibit, or at least restrict, smoking in areas that are strata title or group title. What is normally written in the newspapers never covers the full picture, and I’ve taken the time the research it in depth.

The matter was somewhat unusual because it was between two owners – normally disputes are between two tenants or between an owner and a tenant. In this case one owner lived above the other one, and the owner above claimed the one in the unit below him chain smoked and the smoke rising was causing him grief. You may think that’s a “nuisance” and nuisance has been the major issue when these kinds of issues have come to light in the past. In this case the adjudicator took a different view and described the cigarette smoking as a potential “hazard” and said there was ample evidence that a hazard was something that had the potential to cause harm. And the dangers of passive smoking are well known.

Like most legal decisions this raises many new issues. Given that smoke rises, what is the position if the owner of a penthouse wishes to smoke. Is smoke from a barbecue to be regarded as a hazard, and if people live in a townhouse where the properties are side-by-side how far from the fence does a person have to be before they can smoke. It’s a can of worms.

Electric Vehicles

I have written before that I think electric vehicles are way too expensive right now, and anybody contemplating buying one should not be in rush. I know that some state governments are thinking of reducing registration fees to encourage electric vehicle purchase, but to the best of my knowledge these will be for the lower priced EV’s.

The other issue is the superiority of Tesla technology – they are away in front of everybody else and look like staying that way. A feature I love with my Tesla is “dog mode”. If I park the car to go shopping I just put the car into dog mode and it keeps the inside at 22°. It also puts up a sign “don’t worry, my owner will be back soon and meanwhile the car is at 22°.” I don’t think any other cars can do that.

I thought you’d enjoy this extract from an article from Wired magazine. It gives a view on what’s happening in America:

In the United States EVs made up just 4 percent of vehicles sale last year. While the world falls in love with electric cars, the US is holding out. If it’s not careful, the knock-on impact on the rest of the world could be huge. Transportation is the biggest single contributor to greenhouse gas emissions in the US, and the country in turn is the second-largest contributor to global carbon emissions.

“Since EVs use emerging battery technologies, they face several significant technical, economic, and social barriers to adoption, limiting EV penetration in the US,” says Pradeep K. Chintagunta, Professor of Marketing at the Chicago Booth School of Business, who with colleagues researched ways to incentivize EV adoption. Those barriers include resistance from consumers who are used to the ability to quickly fill up with gas and go, a lack of awareness of the strengths of EVs, and price problems: An electric Ford Focus costs nearly twice the amount of a gas-guzzling one.

“There’s one major protagonist who has influenced that: Donald J Trump,” says independent EV analyst Matthias Schmidt. Trump’s administration paused the adoption of EVs for four years, setting back the development in a country that was already lagging behind. Now President Joe Biden, who said in August 2021 he wanted EVs to make up half of all sales by the end of the decade, is building on the work done by the ZEV Alliance, a lobby group of 10 US states, and several countries to promote zero-emission vehicles.

But the EV industry in the US has had to start from scratch, and Bank of America forecasts that EVs will make up just 20 percent of the car market by 2030, rather than 50 percent. A large number of these vehicles are expected to be “compliance cars”—vehicles built by manufacturers solely as a box-ticking exercise to meet the strictest emission standards in the country, in California.


Last month I did a podcast with Elizabeth McIntyre who is the group CEO of Think Brick Australia. I don’t normally like my own podcasts but I think this one came out particularly well.

We cover a range of issues including financial basic principles. I do hope you enjoy it.

Need Better Sleep?

We spend one-third of our lives asleep. Yet, people rarely think about what they can do to optimise their sleep — which has been especially disruptive given the turmoil with Covid over the last two years.

My son, James, who many of you know, will soon be sitting down to interview the world’s #1 sleep expert, Dr Michael Breus. If you have any questions you’d like answered, email his EA Jan ( directly so they can include them.

It’s a follow up to their popular episode ‘Sleep Your Way to the Top’ available here:

Podcast / blog:


And finally…

Sanjay Thakrar, CEO at Euro Exim Bank Ltd, got economists thinking when he said:

“A cyclist is a disaster for a country’s economy.
He does not buy a car and does not take a car loan.
Does not buy car insurance.
Does not buy fuel.
Does not send his car for servicing and repairs.
Does not use paid parking.
Does not become obese.

Yes …and well, damn it! …healthy people are not needed for an economy.
They do not buy drugs.
They do not go to hospitals and doctors.
They add nothing to a country’s GDP.

On the contrary, every new McDonald’s outlet creates at least 30 jobs:
10 cardiologists,
10 dentists,
10 weight-loss experts, apart from people working in McDonald’s outlets.

So, choose wisely: A bicycle or a Mcdonald’s?

Walkers are even worse.
Those people do not even buy a bicycle!


I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker


Noel News 13 Dec 2021

Life can only be understood backwards,
but it must be lived forwards.

Welcome to our last newsletter of 2021

It has certainly been an interesting year. If you cast your mind back to March 2020 the stock market was in freefall, and most people were predicting major permanent job losses. Since then, the market has boomed and one of the biggest problems the world has are shortages.

Until recently I had never heard of AdBlue which is a diesel exhaust fluid. It’s made from urea which has become scarce, and once it runs out it will cripple a large portion of the Australian truck fleet. One of my golfing mates has a Mercedes sedan and, because of emissions control, has to add AdBlue to his diesel fuel through a separate tank in the car. He says that the car will not start if he cannot get the additive

In last Thursday’s Australian Robert Gottliebsen wrote “the software-control apparatus inserted into the trucks is built in such a way that is almost impossible to drive the truck without using the AdBlue system. But it is not difficult to adjust trucks so they can run without the system, but of course there will be a lot more pollutant which will understandably cause community outrage. However, once severe food shortages and price rises develop that outrage is likely to swing towards the food situation”. All I can say is watch this space.

Many countries are reporting serious staff shortages. This will be rectified here somewhat when borders open properly, and people from overseas will be able to come to Australia without onerous quarantine restrictions but I’m now receiving reports from restaurant owners that many staff are refusing to get vaccinated which has become a condition of employment. The big question will be how they earn an income. With critical job shortages making front-page headlines every day, I wonder how they will go at Centrelink if they apply for the dole.


But there are two things that trouble me. The first is the rise in buy now pay later. Credit cards are going out of favour, but a huge number of BNPL organisations are taking their place.

A basic principle of becoming financially secure is to spend less than you earn, and save something out of every pay. Anybody who uses buy now pay later to fund their purchases, is mortgaging their future. If you can’t live on your present income, how will you possibly survive if future incomes are reduced because of loan repayments. These buy now pay later schemes might sound great but there are heavy penalties if you get behind. Once you get trapped in debt, it’s very hard to get out of it.


The other issue is the increasing numbers of people gambling with crypto currencies. Crypto appeals to many people because it is anonymous and therefore, at least in theory, safe from the watchful eyes of the tax office. However, last week the government announced plans to regulate the crypto industry but given the slow pace the governments work I wouldn’t be holding my breath.

Crypto currency itself is a growing field which will develop as time passes.  But what concerns me greatly is the growing percentage of Australians, especially younger ones, who are trading crypto. The Australian Financial Review of 4 December had a huge article headed “young betting the house on NFT frenzy” with a story about people who were trading crypto as a way to get a house deposit.

They need to understand that trading is high risk. The problem is that there are no objective ways to guide you in buying or selling. If I buy a property I can look at its location, price and potential, if I buy shares I can look at the financials, management and level of debt. When trading crypto the sole criterion is whether someone else will buy at a higher price than I paid from it.

Another issue for cryptocurrencies is there is no consumer protection available. If you lose your Bitcoin password, you have lost your Bitcoin – there is no head office you can ring to recover your password. If you sign up with a dud website and lose all your money, the government won’t come to your aid. Buying Bitcoin is caveat emptor: there’s no protection, or safety net, or recourse.

And the reports are growing about the number of scams in the crypto space. I get emails every day offering to teach me how to trade Bitcoin and make a fortune. But if these people are successfully trading Bitcoin and making a fortune, why would they be cold calling you and me?

Buying cryptocurrencies is a gamble. You should never “invest” money that you aren’t prepared to lose in them; and you should run a mile from anybody who offers to trade on your behalf, or teach you “the secret”.

But if you are still determined to go ahead, your first port of call should be the ASIC Money Smart website, where a search on “cryptocurrency” will provide you with loads of information, as well as an analysis of the types of cryptocurrencies that are available. There are also details of all the crypto scams that are growing in number.

The Power of Time

I get a lot of emails telling me how really my book has changed their lives, one that arrived last week was extremely special because even included a graph of the progress made over a lifetime of work. Above all it shows the power of compounding mixed with time.

Here is the email.

“Just a note of thanks. Many years ago, back in the late 80’s, read Making Money Made Simple. As best I could, tried to put your guidance into practice. A mortgage and very high interest rates made it difficult to save money to invest. I did push money into superannuation along the way, and it has served me well. Over 30 years later, I turn 60 at the end of the year, and retirement is knocking on the door. Luckily, there should be enough money to enjoy my retirement years. I did take to recording net wealth, refer attached chart.
It shows what can be done, even without a university education. Interestingly, my net worth after 10 years in the workforce compared to what I had after 40 years was 1%. And the net worth after 20 years in the work force compared to what I had after 40 years was 6%. Money makes money I guess.

So keep up the good work of educating people out there. There are a few young people I’d like to help, if they will listen. And the recommendations will be to start by reading your book. And for them to live not just within their means, but well within their means, save and invest the balance. And keep repeating.
 Thanks again”

Electric Vehicles

I’m going to devote a fair bit of space in this newsletter to electric vehicles. The world is moving very quickly to replace internal combustion engine (ICE) vehicles with environmentally friendly electric vehicles (EVs). But as always, the devil is in the detail.

A major problem is generating the electricity to power EVs on our roads in the next few years. EVs are only zero emission if they are made and powered with electricity from renewables, but that’s a long way off. In the meantime, coal-fired stations will continue to do the heavy lifting. At least EVs are more efficient than ICE vehicles.

An issue that appears to have been overlooked is how EV charging points will be supplied to people living in apartment complexes. Chargers would have to be in the building’s car park; will special meters need to be installed to record the extra power use? And when EVs are the norm, will the entire building’s electricity supply have to be upgraded to cope with the EV charging needs of its residents? If so, who will pay the cost? Imagine the headaches for residents of an older building with hundreds of apartments!

There is a huge potential effect on apartment valuations. Almost certainly, apartment buyers will be looking for EV facilities already in the building – if the building has no such facilities now, will sellers find themselves forced to discount the price in expectation of future costs to bring the building up to speed? Worse still, what if the building is not able to be converted to cater for electric vehicles?


My own EV experience

As electric cars are the way the future I thought it may be useful to you all if I related my own journey with them. Just keep in mind I am not a car expert, but I have no axe to grind as nobody is paying me, so what follows is simply what I have experienced.

We have been Lexus owners for many years and they have served us well. But in 2019 I was having a chat to a friend who was raving about his Tesla. We ended up having a drive in it and I was hooked on its comfort, speed, and smoothness.

It is well accepted that human beings make decisions on emotion and try to justify with logic later. My logic was that I was approaching 80 years of age, and a self-driving car must be a much better proposition than doing it all myself as the years passed. So, I traded in my beloved Lexus SUV for a Tesla model X. That’s their big SUV and we chose that because we have 11 grandchildren in Brisbane and thought it would be useful to take them around.

The much hyped self driving did not live up to expectations and I doubt that truly self-driving cars will be available in my lifetime. For starters, the Tesla needs roads with white lines to guide it, which rules out most suburban streets and it really has trouble with traffic lights and roundabouts. I noticed there has also been a subtle change in terminology – what was once auto drive has now become auto steer.

The good news is that it’s a delight to drive, is extremely comfortable, and is brilliant on freeways, and tunnels. It’s also great in the rain. Last week I had a speech at the Gold Coast and was driving home at 4 PM in rain so heavy it was almost impossible to see. I just put the car on auto steer and it did all the work. It turned out there was a major incident up further and the car quickly diverted me to another freeway so I still made it home on time. It’s also very cheap to refuel but as my father always taught me – the cheapest part of the car is the petrol.

Two and a half years later I am still enjoying the car but next year we will be changing our vehicles. The Tesla X is way too big for us, and it’s almost impossible to drive it into a shopping centre car park because the way they design the ramps, scratching the wheel rims is almost a certainty. And we never seem to have more than four grandchildren at once so the extra space is not needed.

The major problem is range. Currently, there are about 3000 public charging points in Australia, but not all EV chargers are equal. The one I have in my garage at home, which cost about $1500 and requires three-phase power, has a charge rate of around 100 km an hour. Public charging stations vary — the best I have encountered will charge at about 200 km an hour: if your vehicle has a top range of 400 km, that’s a wait of at least two hours to continue your trip. And that assumes you can find a fast charger on your preferred route, and there are spaces available for you to use right away.

So as much as we love the Tesla we have decided we need an SUV with a decent range. We keep talking about all the country trips we would like to make, but the practicalities make an electric vehicle an impossibility until their range improves and charging stations replace service stations. We have decided to replace Geraldine’s Lexus sedan with a new Lexus NX hybrid which has a range of at least 900 km and can be refuelled quickly at any service station. This will enable us to do all the country trips that have been denied to us for the last two years. I love Teslas so will be buying the new Y when is arrives next year. It’s a much smaller SUV with a range of 550 kms.

If you are considering changing to an EV hasten slowly. Right now, they are far too expensive, and prices must fall as years pass. And from my limited research of other electric vehicles Tesla appears to be way in the lead. My X is simply a flat base with four wheels and a large boot front and back. The motors are somewhere near the wheels.

In the last week, I have inspected the new Lexus EV, Mazda  EV and Hyundai EV. I was gobsmacked to discover that each one has an engine under the bonnet. Apparently, they have just taken a normal ICE vehicle and replaced the petrol or diesel engine with an electric engine. Nothing else has been changed.  So you still have a transmission hump and all the other bits that go with an ordinary vehicle.

They are light years behind the Tesla technology. The new Tesla Y is coming off plants in Texas, Shanghai, and Berlin right now and is forecast to be the biggest selling car of 2022. Kia intend to launch the EV6 pop sometime next year and they claim the battery will allow it to be charged at 350 kW an hour which means it can go from 10% to 80% in just 18 minutes. That’s fantastic – the only problem is finding a charger that can deliver power at that speed. It will also have a range of 510 km if you pay the money for the large battery.

Two things we know for sure. Prices will drop, range will increase and possibly the other manufacturers will catch up the Tesla as far as the technology goes. My advice is don’t rush in.

This month’s edition of Wheels has a huge section on electric vehicles. The more research you can do the better outcome you will have.


A fortnight ago I did a podcast for Your Life Choices with John Deeks which covered reflections on the year to date and predictions for next year. It was released on the weekend and I thought it would be great to include in this newsletter. It’s only 16 minutes but I think you’ll enjoy it. It covers much of the stuff which is in this newsletter.

Listen to the podcast here:


Or here:


Christmas Books

As we think about stocking up for Christmas keep in mind that a book is one of the best gifts you can give. It’s an inexpensive present, and if chosen wisely can give benefit to the recipient for many years to come. Here are two of my favourites:

Money: The True Story of a Made-Up Thing by Jacob Goldstein is a fascinating read. The author guides us through the history of money from the time of Aristotle, through the barter system, to the invention of various sorts of paper money.

Did you know there was a time in America when many banks printed their own currency? Many put out Christmas bank notes adorned with pictures of Santa Claus! Naturally, money’s history is interspersed with tales of financial crises, and how they were handled.

The book also covers the creation and abolition of the gold standard, and finishes with a detailed description of the start of cryptocurrencies and where they may be heading. It’s the perfect present for anybody interested in the financial system.

Morgan Housel’s Psychology of Money is described as “timeless lessons on wealth, greed, and happiness.” Its 19 chapters each contain a major lesson.

I particularly like the way Housel stresses the importance of compounding on your long-term financial plan. He writes: “compounding works best when you can give a plan years or decades to grow. This is true for not only savings but careers and relationships. Endurance is key. And when you consider our tendency to change who we are over time, balance at every point in your life becomes a strategy to avoid future regret and encourage endurance.”

I really loved this book, and enjoyed the fact that I got a double benefit: it reinforced many of the things I’ve learnt over my own life, and opened my eyes to other issues I have not considered. Highly recommended for just about anyone.


As I said in my last newsletter I have now got the facilities to do special orders. Just…

  • …go to my website and choose exactly what you want.
  • Do not process or pay for the order.
  • Email me at telling me exactly what book or books you want, where you would like the books sent to, and how you would like them to be  autographed.
  • I will then send you an invoice, you can bank the money in our bank account.
  • I will prepare and post the books from my home.

Just keep in mind that shipping costs are high, and we do offer free postage on orders over $35 within Australia. However, I can’t give you free postage if you want books sent to multiple addresses.


The main books I would see as Christmas gifts are:



Making Money Made Simple

…which is the perfect book for people who need to learn about money.


Beginners Guide to Wealth

 …which really is about success principles and how to live a successful life.


Retirement Made Simple

…which is designed for anyone contemplating retirement.


For bundles;
Making Money Made Simple and Beginners Guide To Wealth are the perfect fit.

I must say it gives me a real feeling of satisfaction action to autograph a book to somebody – I know the fantastic long-term benefits it may bring.

And finally…

As we count down to Christmas, it’s time to have some fun and recognise those who have made unique contributions to the world of money in 2021.

Let’s start with Bitcoin. I gave it the Golden Tulip Award in 2017 for the fastest growing “asset class” when it rose 1671% in just one year. Then in 2018 it scored the Shrinking Tulip Award when it plunged from US$19,650 to just US$3225. Today I’m giving it the Phoenix Award because it rose 163% for the year to US$48,807. This does include a fall of 25% in the last month. As I’ve often said: you pay your money and you take your chances.

The Ebenezer Scrooge Award for the most heartless assault on the vulnerable in our society goes to Beforepay – an organisation which lets you “Get access to your wages instantly. It’s quick and easy to use and there’s no hidden fees.” I first heard about them on the ABC television program Gruen. It showed one of their advertisements, showing how a person with little food in the fridge could replenish their supplies very quickly by putting it on Beforepay. Another ad showed a couple dining out in an expensive restaurant with the guy opting for something cheap because he was broke; Beforepay showed him how to order lobster immediately to impress his date. Their website says, “There’s no interest or hidden fees. Just a 5% fixed transaction fee and flexible repayments with instalments across up to four pay cycles.” I reckon that’s an interest rate of around 36%. Old Scrooge would be jealous.

The Shih Tzu Trophy for the most hackneyed excuse of the year goes to con woman Melissa Caddick, who bought herself a diamond ring with the $1.15 million her parents had given her to buy them a house. One investor handed Caddick a cheque for $450,000 made out to ComSec but, to cover up the fact she had lied about having a ComSec account, Caddick said that somehow her dog had got hold of the cheque and eaten it. Caddick, along with a big chunk of the investors’ money, disappeared in November 2020 after a raid on her home.  Ruff justice!

And finally, for the sixth year running, the Red Kelpie Award (for long-term, loyal and meritorious conduct) goes to … the Australian Stock Market. The kelpie normally gives us an exciting year but despite all the gloomy headlines it was steady as she goes and upwards all the way. The index stood at 6851 on 1 January and at 7300 on the date of writing. That’s a total return for the year of 15%, made up of 11% capital growth and 4% income. Okay, it hasn’t given us the excitement of Bitcoin, but I’d rather have my long-term future in the index. Most people don’t know that it has been the best performing index in the world over the last 120 years. That’s one hell of a track record.

I hope you have enjoyed the latest edition of Noel News and wish you and your family a Merry Christmas and prosperous New Year.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker


Noel News 11 Nov

Everybody is a genius, but if you judge a fish by its ability to climb a tree, it will live its whole life believing it is stupid.

Welcome to our November newsletter

Can you believe it’s almost Christmas? I guess the major topics right now are interest rates and inflation. There is no doubt we have reached the bottom of the interest rate cycle, and rates will start to move upwards again.

I see that most major banks are already increasing their fixed interest rates. Maybe that’s something that’s worth exploring if you have a housing loan. Just be aware that taking out a fixed rate is like taking out insurance – there is always a cost. Many fixed-rate loans have heavy fees for early exit so make sure you do your homework if you’re thinking of changing. I am happy to recommend a good mortgage broker if you need one.

What makes predicting interest rates so difficult is the effect that energy prices have on everything. They are an essential input in most businesses, and are taking an increasingly bigger chunk of household expenditure. The price of energy matters for the same reason as tax rates matter. Both are unavoidable costs – and we can produce more of everything if costs are low or at least stable.

Fuel prices have been rising worldwide, and may soon rise further. Last week Bank of America raised its Brent crude oil forecast to $120 by mid-2022. That would be a price unseen since 2012. Natural gas is similarly spiking, as was coal until a recent retreat.

The IMF expects oil prices to increase by nearly 60% this year compared to their 2020 low, while commodity prices like food and metals could climb by almost 30%.

The Association of Superannuation Funds of Australia (ASFA) says accelerating cost of living pressures are impacting on retirees with the highest annual increase in retiree budgets since 2010.Their September quarter 2021 figures indicate that couples aged around 65 living a comfortable retirement need to spend $63,799 per year and singles $45,239, up by 0.9 per cent and 1.0 per cent respectively on the previous quarter.

ASFA points out that automotive fuel prices reached a record level in the September 2021 quarter, leaping 7.1% due to higher global oil prices amid economic recovery and supply disruptions. Over the past twelve months automotive fuel prices rose sharply (+24.6%) with a strong increase in the price of motor vehicles (+6.2%) as well. Property rates rose 3.3%, which is the largest rise since 2016. Many councils increased rates after implementing smaller rises, rebates or rate freezes last year.

Furthermore, the supply chains are in a mess. Apple have reported that supply chain problems have already cost it over $6 billion in revenues and have warned of worse to come. The output of Japanese carmakers fell nearly 50% last month, while Ford has announced a shutdown at a plant in Mexico. Late last month the New York Times reported the global economic rebound is being put at risk because of the “semiconductor crisis, which is forcing many carmakers to eliminate shifts or temporarily shut down assembly lines because of supply shortages. This could be enough to put some smaller countries into recession.”

AlixPartners have estimated that 7.7 million fewer vehicles will be produced this year because of shortages. This will cost the car industry $210 billion in lost revenue.

It’s affecting so many businesses in Australia. Last week Domino’s Pizza shares tumbled because of the impact on the business because of shortages, Ingham’s said rising fees and transport costs meant a possible increase in the price of chicken nuggets and schnitzels, and Reece Plumbing flagged potential rises in plumbing materials. Talk to any builder and you’ll find them battling cost pressures due to material and staff shortages while most restaurants are having great trouble getting staff.

This all adds up to cost pressures everywhere, but I fail to see the point of the Reserve Bank putting interest rates up. After all the purpose of putting rates up is to slow demand, but so much of the present demand is due to supply shortages, while at the same time households are copping a massive hammering due to increased petrol prices. Think how much worse things will get when all the cost increases in the pipeline come through.

It may be worthwhile stocking up sooner rather than later for Christmas. A friend in the wine business tells me that French Champagne will be almost impossible to get in a couple of weeks. If you are an Australian wine drinker, you should be okay – we have a massive oversupply because of the boycotts from China.

Christmas Books

As we think about stocking up for Christmas keep in mind that a book is one of the best gifts you can give. It’s an inexpensive present, and if chosen wisely can give benefit to the recipient for many years to come.

Recently I have been receiving emails asking about special orders. One person wanted five copies of Making Money Made Simple as a Christmas present for the tradies working on the their new home. Another person wanted four books as presents to their grandchildren with each one individually autographed. While the book store on my website is comprehensive, it’s not built for individual orders. But there is a way out but it requires you communicating directly with me and not using our website.

If you would like a special bundle, or to have a book specifically autographed to a person as a Christmas gift, I will do that for you. This is how it will work:

  • Just go to my website and choose exactly what you want.  Do not process or pay for the order.
  • Email me at telling me exactly what book or books you want, where you would like the books sent to, and how you would like them to be  autographed.
  • I will then send you an invoice, you can bank the money in our bank account.
  • I will prepare and post the books from my home.

Just keep in mind that shipping costs are high, and we do offer free postage on orders over $35 within Australia. However, I can’t give you free postage if you want books sent to multiple addresses.


The main books I would see as Christmas gifts are:



Making Money Made Simple

…which is the perfect book for people who need to learn about money.


Beginners Guide to Wealth

 …which really is about success principles and how to live a successful life.


Retirement Made Simple

…which is designed for anyone contemplating retirement.


For bundles;
Making Money Made Simple and Beginners Guide To Wealth are the perfect fit.

In the next section I give an example of the powerful effect a book can have on somebody’s life. This is something you can do this Christmas if you wish. Remember the old saying “if you give a person a fish you feed them for a day – if you teach them how to fish you feed them for a lifetime.”



The following email I received recently is a good example of the huge effect you can have on people’s lives by introducing them to good books:

My wife and I attended one of your seminars at the University of Queensland in 2011/12 – we were 18 years old. We then read both the Beginners Guide to Wealth and Making Money Made Simple.

These books have acted as our authoritative guide to personal finance with great effect. We are on track towards owning our home within 10 years, own a share portfolio and have more or less implemented the majority of your recommendations.

Many of our family and friends have purchased your books following our recommendation. So thank you for helping us to achieve financial freedom so early in our lives. 

Estate Planning Matters

As the population ages, new relationships between seniors are becoming common. As a result, I’m regularly asked what steps to take to prevent your assets going to the wrong person. There is no easy answer, and a further complication is that estate planning rules vary from state to state. However, if there is any chance of problems on the horizon, take expert legal advice sooner rather than later. Good advice now can save a fortune in costs down the track.

In any event, it’s useful to know some basic estate planning principles.

Assets in joint names, such as property, will usually go to the surviving partner irrespective of the terms of the will. One way around this is to hold any properties as tenants in common – you are then free to bequeath your share to a person of your choice. Though of course this is best implemented at purchase.

Next, you need to understand that your superannuation is not necessarily disposed of by your will – it is the trustee of your super fund who usually determines who gets the money. So consider a binding death benefit nomination, which specifies your chosen beneficiaries. Do take advice, as done wrong they can lead to unnecessary tax bills, and can still be challenged.

One super solution is to withdraw your money tax-free before you die, and deposit it in your bank account. This prevents possible challenges, and eliminates the possibility of the 17% death tax (levied on the taxable component of your fund left to a non-dependent). If this is your plan, you’ll still need good advice about what to do with the money. Options include making an absolute gift to someone of your choice, or investing the money in insurance bonds, which also sit outside the will and can be left to a nominated beneficiary.

Think about Harry, aged 85, a wealthy retiree now happily re-married after a nasty divorce, who wants to leave bequests to his children from both marriages. He is aware that there is acrimony between some family members, and it is important to him that his assets be split as he wishes, not eroded by family legal battles.

He invests $250,000 in his own name in each of five separate investment bonds, naming each of the five children as the beneficiary of one bond upon his death.  Because an investment bond is technically a life policy, the distribution of the proceeds cannot be challenged. Harry can sleep soundly, knowing he has solved the potential problem in advance.

Another option is an Inter Vivos Trust. This is a vehicle created by a living person for the benefit of another person. Also known as a living trust, this trust has a duration that is determined at the trust’s creation and can entail the distribution of assets to the beneficiary during or after the deceased’s lifetime.

A related possibility is to leave the money via one or more testamentary trusts. When the will-maker dies, the assets go to a testamentary trust (or trusts) and are not held by any of the beneficiaries personally. This keeps the assets separate in the event of divorce or bankruptcy, and has taxation advantages if everything goes well.

As beneficiaries of the testamentary trust, there is no restriction on using the trust’s money for the benefit of grandchildren, including expenses such as school fees and uniforms. That means the first $19,200 of such non–tax-deductible items could be paid from pre-tax dollars from the trust, instead of from after-tax dollars. Furthermore, when the children die, the grandchildren can continue to be beneficiaries of the trust.

Covid Tests for Travel

Pre-departure Covid tests

As the world begins to reopens, many countries are making it a condition of entry that visitors show a negative result from a Covid-19 PCR test taken 48 to 72 hours before your flight to that country. That list includes Singapore, Thailand, Canada, Ireland, the UAE, Italy,  Denmark, Switzerland and over a dozen other European countries.

It’s a Covid-19 PCR (polymerase chain reaction) test administered by a pathology clinic – one generally listed by clinics as an ‘international travel Covid test’, and which provides the results as a document that’s recognised both at the airport checkin desk and on arrival at your destination. While being highly accurate, PCR tests are also highly expensive. In Australia, regardless of which pathology service you use, the tests all cost around $150 per person.

Not all countries require a Covid test to enter; and some will accept a cheaper antigen or lateral flow test, including the United Kingdom (which last month switched from PCR testing) and the USA.

While Australians travelling overseas are not required to present a negative COVID-19 PCR test at check-in to meet Australian outbound travel requirements,  some countries and airlines do require the presentation of a pre-departure test result at airport check-in before you will be allowed to board your flight. This is why it is vital to check before going to the Australian airport.

On-arrival Covid tests

Your destination may also require that a test to be taken on arrival. For example, in Singapore the going rate right now is $160. The test is done at Changi Airport after which you must  go straight to your accommodation and self-isolate until receiving a negative result.

Another Covid PCR test before you fly home

Even when visiting a country which doesn’t need any form of Covid testing to enter, you’re still up for a test before returning to Australia. The Australian Government currently requires that all travellers from overseas – including fully-vaccinated Australian citizens, residents and their families – take a Covid-19 PCR test 72 hours before the departure of their flight home.

“Passengers travelling to Australia must be tested for Covid-19, 72 hours or less before the scheduled flight departure, and display evidence of a negative test result at the time of check-in,” the Department of Health says, specifying that “Covid-19 PCR testing is required.”

The cost of Covid-19 PCR tests varies not only from country to country, but in some cases depends on how quickly you need the results.

For example, test centres at San Francisco airport can charge US$90 for a 24-hour turnaround to $250 for a result in 90 minutes.

In London you could be looking at £65-85, and upwards of $120 in Singapore.

The cost of Covid testing for international travel

In a three-test scenario, with tests needed for flights there and back, as well as on arrival at your destination, the cost of Covid PCR testing can be close to $500 per passenger.

A holiday for a family of four could see almost $2,000 added to the bill – all before airfares, accommodation, meals, activities and general spending money are taken into account.The more common two-test scenario – one ahead of the flight there, another before the flight home – could be close to $300 per passenger.

It’s obviously hoped that 2022, with increasing vaccination rates around the world backed up by booster shot programs and a continued drive for travel to bounce back, will see many PCR tests replaced by rapid antigen tests which are both quicker and less expensive.

But, at least for now, the cost of Covid testing looks to be an unavoidable part of the new norm in post-pandemic travel.

With acknowledgment to Executive Traveller – a great free online resource.

And finally…

Dad, are we pyromaniacs? Yes, we arson.

What do you call a pig with laryngitis? Disgruntled.

Writing my name in cursive is my signature move.

Why do bees stay in their hives during winter? Swarm.

If you’re bad at haggling, you’ll end up paying the price.

A commander walks into a bar and orders everyone around.

I lost my job as a stage designer. I left without making a scene.

Never buy flowers from a monk. Only you can prevent florist friars.

How much did the pirate pay to get his ears pierced? A buccaneer

I once worked at a cheap pizza shop to get by. I kneaded the dough.

I lost my girlfriend’s audiobook, and now I’ll never hear the end of it.

Why is ‘dark’ spelled with a k and not c? Because you can’t see in the dark.

Why is it unwise to share your secrets with a clock? Well, time will tell.

When I told my contractor I didn’t want carpeted steps, they gave me a blank stare.

Prison is just one word to you, but for some people, it’s a whole sentence.

Scientists got together to study the effects of alcohol on a person’s walk, and the result was staggering.

I’m trying to organize a hide and seek tournament, but good players are really hard to find.

I got over my addiction to chocolate, marshmallows, and nuts. I won’t lie, it was a rocky road.

What do you say to comfort a friend who’s struggling with grammar? There, their, they’re.

I went to the toy store and asked the assistant where the Schwarzenegger dolls are and he replied, “Aisle B, back.”

What did the surgeon say to the patient who insisted on closing up their own incision? Suture self.

I’ve started telling everyone about the benefits of eating dried grapes. It’s all about raisin awareness.


I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker


Noel News 11 Oct

“You are in the right place at the perfect time. Keep enjoying the pursuit of your potential.”

Welcome to our October newsletter

We are now entering the last quarter of this year and I predict it is going to be a challenging one. We are in a unique situation right now with four states virtually Covid free, New South Wales attempting to move back to normality whatever that means, and Victoria coping with an ever-increasing number of cases. New South Wales and Victoria have accepted that it’s impossible to have a zero Covid environment and they are now focused on how to handle that. The other four states are reluctant to open their borders for fear of being overwhelmed by cases brought in from overseas travellers. Remember, it just took one limo driver to infect over 1000 people in New South Wales.

Everybody agrees that we cannot stay in lockdown forever but coming out of lockdown and opening up the economy requires us to accept that there will be deaths from Covid just as there used to be deaths from flu every year. I reckon the big test will come in the next few weeks as we watch how New South Wales handles the responsibility of being the first state to attempt to find a way out of this. Watch this space.

Housing markets are under extreme pressure as the top of the boom seems to be over, and the government is putting pressure on lenders to reduce the amount that can be lent. Blind Freddy can see the main problem with the housing market is the amount of government stimulus that has been provided in the last few years.

Not only did they slash interest rates to the lowest in history, they also took another range of initiatives to make it easier to buy that first home. All that stimulation increased the number of buyers, and the obvious result was that house prices started rising quickly. Once property prices start rising, the media start talking about a property boom and everybody jumps on the bandwagon for fear of missing out.

It’s not that long ago that the government introduced a scheme which would allow a limited number of first home buyers to buy a home without mortgage insurance – they were also also encouraging lenders to accept a lower deposit. On top is that is the scheme which has recently been expanded allowing people to make temporary contributions to super so they can save a deposit quicker.

And of course the politicians jumped on the bandwagon. In a recent newsletter I wrote that the prize for the most ill-conceived idea of the year must go to Liberal MP Tim Wilson for very publicly campaigning for first home buyers to be allowed to access part of their superannuation for a house deposit.

As my good friend Ashley Owen pointed out in last week’s Firstlinks:

      “The 30-year boom in house prices rising well ahead of income growth is nearing an end. House prices can continue to keep on rising at rates above incomes only if interest rates continue to decline further. Interest rates have not only ended their 30-year decline, they are now more likely to rise than fall from here. The only question is when – and it will be soon.”

Remember we all have short memories. This is an extract from the Australian less than three years ago!

The share market has had a wobbly quarter. A great resource is my Stock Market Calculator which enables you to pick any starting and finishing date, choose a notional sum, and work out what you would have if your portfolio tracked the All Ordinaries Accumulation Index which includes both income and growth.

Let’s suppose you invested $100,000 on 1 July 2020. The calculator tells us that your portfolio  would have grown to $129,000, an increase of 29% for those 12 months. Unfortunately, the last three months have not been as kind to us but remember share ownership is a long-term game and the price you pay for liquidity is volatility. Hang in there.

The power of deferring retirement

According to a recent report by Terry Rawnsley of KPMG, many older workers are deferring retirement. As result, over the last 20 years, the expected retirement age in Australia  has risen to 65.2 for men and 64.3 for women. KPMG’s report attributes this to a range of factors, including strong labour market conditions, which help to retain older workers in jobs, changing social attitudes towards older workers, and an increasing trend towards part-time work among older workers.

COVID-19 has played a part too. With overseas travel virtually impossible for over 18 months, many older workers think they are better served by working longer than sitting at home with nowhere to go. Some need to top up cash reserves, because their income has been reduced by COVID-19. Others – a large percentage of the office workforce – are now happily working from home; while it has its challenges, many people find it beats both the office environment and the grind of commuting every day to and from an office.

But there’s more to it than any of these reasons. Pensionable age – that’s the age that you can access the pension – is increasing to 67 for people born after 1 January 1957, so anybody who wants to retire before their pensionable age needs to ensure they have enough capital to live on until they are eligible for a pension.

And there’s an even bigger factor. Because of the way the mathematics works, the largest increase in any long-term compounding investment, including your superannuation fund, comes at the end of the period. Remember, every time your portfolio doubles in size, there is more growth in the final double than the sum of all the other doubles combined.

The numbers are mind-blowing. Think about a person aged 60, earning $100,000 a year, with $500,000 in super. If their fund earns 8% per annum, the balance would be $800,000 in another five years. That’s an increase of 60% in your superannuation just by working another five years.

The financial side is important, and obviously the longer you can defer your retirement the more your superannuation should grow, and the longer it will last. It is highly recommended to do some sort of work after you retire. Ideally, it could be some kind of part-time work that will add meaning to your life, as well as boosting your superannuation, or it could be voluntary work, or even working on a hobby. It’s not all about the money.

But the pension rules are geared to encourage us to work a little: the first $150 a week you earn from a business or personal employment is exempt from Centrelink’s income test. Let’s look at a couple of pensionable age, who have assessable assets of $405,000 made up of $380,000 in super, and the balance in car and personal effects. If they draw down the standard minimum of 5% a year from their superannuation, that gives them income of $19,000 a year. If they also each earn $7,800pa from paid work, they would be eligible to receive the full pension of $37,923 a year. That means a total tax-free income of $72,523 a year.

But the big picture is that one of the biggest decisions you will make in your life is when you retire. There is a wealth of research telling us that those who prepare and plan for retirement tend to have a much happier, healthier retirement than those who suddenly find themselves out of work with no plans. Ideally, retirement should not be something which is thrust upon you, but something you move into gradually. And remember, the longer you can delay starting to draw on your superannuation, the more it will grow.


Crypto is becoming a big deal at the moment.’s latest research shows that 17% of Australians now own crypto, up from 5% just three years ago. Interestingly, the main investors are young people of all sexes, and women.

Of course Bitcoin is the most well-known crypto, and some people claim it will become a new world currency. Even august institutions such as Forbes are now forecasting that one Bitcoin will reach a value of US $100,000 by the end of 2021. It’s anybody’s guess, but one thing is certain: there is a major impediment to Bitcoin becoming a new global currency, and that is volatility. At date of writing, one Bitcoin was worth US $56,650 – that’s an increase of 393% over the last year, but a fall of almost 6% over the last six months.

An essential element of any currency is stability. If I receive $4,000 in my pay packet today, I would expect that over the next six months what that would buy would be fairly stable. I would not expect a 6% fall in my purchasing power in just six months.

But Bitcoin is just the tip of the iceberg. My son James, who is based in in Los Angeles, tells me the hottest crypto play right now is non-fungible tokens, or NFT’s. He said, “Can you believe, I went out with a friend the other night and he paid $50 for a digital monkey? And he sold it two weeks later for $20,000!”

NFT’s are goods or assets that aren’t interchangeable: it’s creating or having something that you can’t replace with something else. Fungibles are things, like Bitcoin, that you can interchange – one for another. Non-fungible tokens are units of data stored on a blockchain and certified as a unique digital asset and, accordingly, non-interchangeable. You can look at them as a digital equivalent of private collectables, where each piece has a different value.

Obviously, they’re hot property in these days of celebrity worship. What could be better than getting a guaranteed limited edition of Kim Kardashian’s latest fashion release? Or a signed, numbered, limited-edition photo of a celebrity in their home?

And they have taken off in a range of areas. You can now buy digital artworks, limited editions of clothing and fashion brands, unique sporting memorabilia … even the National Basketball Association has launched its own collection of NFT cards. Expect other codes to follow suit; the possibilities are endless.

James tells me the big favourite is NFT horse racing. The National Association for Stock Car Auto Racing (NASCAR) has partnered with Virtually Human Studio (VHS) to create virtual racehorses that compete against each other on a virtual racecourse. Races take place 24 hours a day and anyone can join in by buying a digital horse to breed or race, or by simply having a bet. You can start with a little as two dollars, or pay $125,000 or more for an NFT racehorse, if you are so inclined. The promoters claim that each racehorse is unique because it lives in an algorithm — no two horses are the same.

I just can’t get my head around it. Are people really prepared to pay big money for digitally created horses that have been designed by artificial intelligence? Won’t it just become a case of, “my AI is bigger than yours”? Maybe I’m old-fashioned, but it just sounds like gambling to me.

If you google NFT horseracing, you’ll find enough information to keep you occupied all weekend. But at the end of the day, anybody in the crypto space is only buying Bitcoin or an NFT in the hope that somebody else will buy it for a higher price. It reminds me of the wonderful old story about a box of strawberries that kept changing hands at ever-increasing prices. Finally, a buyer opened the box and exclaimed, “These strawberries are rotten!” The seller responded, “But these strawberries were never meant to be eaten – they were meant to be sold.”

Health Matters

Science shows us that being physically active helps us feel better, and prevents or slows many diseases, including heart disease, cancer, and dementia. It even helps us live longer. For these reasons, the US physical activity guidelines and the American Heart Association recommend at least 150 minutes of moderate physical activity weekly. Now, a study in the British Journal of Sports Medicine suggests that routine activity may help protect people who get COVID-19 from becoming seriously ill.

What the researchers learned in this initial study was pretty remarkable, though further research to support the findings is necessary. Even after correcting for all of those characteristics, people who were consistently inactive had a significantly higher risk of hospitalization, ICU admission, and death after getting COVID-19 than those who were active for at least 150 minutes per week. Additionally, those who were active for over 10 minutes per week had some protection against severe illness or death from COVID-19 — though not as much as those who got the full 150 minutes. It’s worth noting that people who were white were somewhat more likely to meet physical activity guidelines — a discrepancy that should be acknowledged and addressed.

This study is one more reason to encourage and promote physical activity for everyone. Companies could provide gyms or fitness memberships, standing desks, and movement breaks. Government funding for bike lanes, walking paths, and pedestrian access would make it easier and safer to exercise. But set your own priorities, too: we can all commit to moving more! And next time you see your healthcare team, spend a few minutes talking about what might get you moving more. Would an exercise prescription help? Is there coaching available to help you set activity goals and achieve them? Does exercise hurt, or are you not sure how to get started?

Consistent physical activity helps protect you if you do get COVID-19. Of course, getting vaccinated offers much greater protection. Possibly doing both may be super-protective, although this needs to be studied. Meanwhile, we know that moving our bodies every day, even if it’s just walking, provides many benefits from head to toe. We as a society need to make it easy and safe for everyone to be as active as they can be.

The Power of a Book

I think it’s important to keep in mind the huge effect you can have on people’s lives by introducing them to good books. The following email I received recently is a good example:

37 years ago I worked in Ballarat and one of my co-workers said they had heard you speaking the previous night. I don’t know if it was on the radio or if you were actually in Ballarat but my co-worker was hugely impressed with what you had said about your new book ‘Making Money Made Simple’. I was really interested and bought the book either that night or in the next few days. It changed my life, I understood for the first time how money worked and how easy it was to invest and budget.

I’m long retired now but the reason I am ‘comfortably’ retired is because of your book. I’ve always kept it and still have it now so this is a 37 year belated ‘thank you’.

And finally…

While walking down the street one day a “Member of Parliament” is tragically hit by a truck and dies.

His soul arrives in heaven and is met by St. Peter at the entrance.
‘Welcome to heaven,’ says St. Peter.

‘Before you settle in, it seems there is a problem. We seldom see a high official around these parts, you see, so we’re not sure what to do with you.’

‘No problem, just let me in,’ says the man.

‘Well, I’d like to, but I have orders from higher up. What we’ll do is have you spend one day in hell and one in heaven. Then you can choose where to spend eternity.’

‘Really, I’ve made up my mind. I want to be in heaven,’ says the MP.

‘I’m sorry, but we have our rules.’
And with that, St. Peter escorts him to the elevator and he goes down, down, down to hell. The doors open and he finds himself in the middle of a green golf course. In the distance is a clubhouse and standing in front of it are all his friends and other politicians who had worked with him.

Everyone is very happy and in evening dress.. They run to greet him, shake his hand, and reminisce about the good times they had while getting rich at the expense of the people.

They play a friendly game of golf and then dine on lobster, caviar and champagne.

Also present is the devil, who really is a very friendly & nice guy who has a good time dancing and telling jokes. They are having such a good time that before he realizes it, it is time to go.

Everyone gives him a hearty farewell and waves while the elevator rises….

The elevator goes up, up, up and the door reopens on heaven where St. Peter is waiting for him.

‘Now it’s time to visit heaven.’

So, 24 hours pass with the MP joining a group of contented souls moving from cloud to cloud, playing the harp and singing. They have a good time and, before he realizes it, the 24 hours have gone by and St. Peter returns.

‘Well, then, you’ve spent a day in hell and another in heaven. Now choose your eternity.’

The MP reflects for a minute, then he answers: ‘Well, I would never have said it before, I mean heaven has been delightful, but I think I would be better off in hell.’

So St. Peter escorts him to the elevator and he goes down, down, down to hell.

Now the doors of the elevator open and he’s in the middle of a barren land covered with waste and garbage.

He sees all his friends, dressed in rags, picking up the trash and putting it in black bags as more trash falls from above.

The devil comes over to him and puts his arm around his shoulder. ‘ I don’t understand,’ stammers the MP.

‘Yesterday I was here and there was a golf course and clubhouse, and we ate lobster and caviar, drank champagne, and danced and had a great time. Now there’s just a wasteland full of garbage and my friends look miserable.
What happened? ‘

The devil looks at him, smiles and says,  ‘ Yesterday we were campaigning….. 
Today you voted.’


I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker


Noel News 3 Sep

“It’s good to have money and the things that money can buy,
but it’s good, too, to check up once in a while and make sure
that you haven’t lost the things that money can’t buy.”



Scammers are the big topic this week. I’ve started to receive phone calls on my mobile from strangers telling me that they were simply returning my call. This is puzzling, because these people aren’t criminals, they are simply responding to what they thought was a phone call from me. My question is, how can scammers make a phone call using my number as the originating number? That’s a serious worry.

Then I got an email from one of my golfing friends telling me he wished to send me an email with a question and was that okay. I replied of course. Next thing I got an email along the lines of “I’ve had a bad week financially and I need $400 to tide me over – will pay you back next week.” I know this guy well – and he’s not at all financially challenged. When I phoned him, he told me that many of his mates had gotten the same email. It’s a con.

Furthermore, there have been emails from what appears to be a Gold Coast builder telling me that he had a bill which he owed me for books and I needed to click on the link to download the invoice. It didn’t sound right so I rang him and he told me that he too had been hacked.

I received a text purporting to be from PayPal, telling me that a payment for $1199.10 appeared to be fraudulent, and asking me to ring a number which was highlighted in blue. This was a red flag to me, because there have been warnings recently about texts asking people to click on links that insert malware into your phone.

But I figured it could be important, so to protect myself I dialled the number without clicking on the phone link in the text. A foreign voice answered promptly, “Good morning, PayPal,” and the conversation started.

It didn’t take him long to establish his credentials: he was able to read me the last 10 transactions on my PayPal account, and then told me my correct address and asked me to confirm it. He then said that, to prove his bona fides, PayPal would text me a six-digit authentication number, which I was to read back to him. This duly happened.

Then the conversation turned to credit cards. He claimed a fraudulent transaction had been made on my Virgin credit card. He said the number he had on file started with 4724, and asked me for the other digits on the card, plus the expiry date and the security number on the back.

He then told me he was in contact with Virgin Money, because it was their credit card which had been compromised, but Virgin needed me to authenticate the communication and to do this would text me a six-digit number. This quickly arrived from Virgin, and I read the number to him. This process was repeated several times because, “their computers are slow today.”

A while after the call ended, I got a niggling feeling that something hadn’t been right, and redialled the number he had been phoning me from. The message was, “that number is not connected.”

I became busy with other things, but another red flag was raised when we went out with friends to dinner that night and my Virgin card was declined. I rang Virgin immediately, who identified me using voice recognition – a blessing given the amount of time I’d been on the phone during the day – and they told me there had been six attempted unauthorised transactions on my card during the day. The reason that my caller had been asking me to give him the authenticating numbers from the Virgin texts was to authenticate the fraudulent transactions he was trying to make! Virgin had prevented each one, but of course in stopping them, my credit card got stopped too.

When I reported this whole incident to PayPal, they told me that PayPal never sends texts to anybody – all their communications are by email.

It’s getting scary out there. First of all, how can people make calls that show up as my mobile number, and second, how can people make scam calls to me already knowing my PayPal transactions, my home address and other private information? Be on your guard – the bad guys are getting smarter.

I wrote about this at one of my newspaper columns I got a barrage of emails from readers. What follows is typical.

Brian – You may be interested in an almost exact mirror image of the scam in question using PayPal as the bait, except Westpac have not responded favourably in my case. My situation happened on Wednesday, 18 August, 2021 commencing at approximately 9.30 and involved three amounts $1,878, $2,691 and $3,330. To add salt to the wound, the amounts were cleared today with an additional $80 exchange charge to an account in Kuwait.

I felt uneasy on the day and went immediately to my local Westpac branch and after waiting in a line for 20 minutes, the Teller informed me that it was a scam and there was nothing she could do to stop the payment being processed because I had authorised the payment.  She then advised me to immediately talk to the fraud department of Westpac on my own phone.  This I did, sitting in the public area at the branch and after waiting until someone was free to speak with me, I was told I had no redress apart from lodging a complaint on the Westpac Bank web site.  The complaint was noted and eventually a bank rep will talk with me about the issue. I have been a loyal Westpac customer for over 60 years.   

Rob – It has been a stressful week after I was scammed into believing that a screenshot on my computer was from Microsoft Security telling me that my computer had been hacked and that I needed their help do get rid of the hackers in my computer. The punchline was a screenshot that indicated that there were 24 users on my computer, one being Microsoft Security and one being me, with the remaining 22 being scammers that were already accessing my computer data. This was scary, so I was sucked into giving the scammer access to my computer and other personal identification data. 

Much loss of sleep and a deep sense of gullibility in being sucked in after warning friends for years to be wary of scams. I have had to notify my bank which closed down all my accounts until my computer was cleared by my computer guru, change all my passwords, and complete a heap of other notifications and reports, and in the meantime days of uncertainty that the issue was safely resolved!

Peter – A bogus email was sent from my email address to my taxation accountant requesting that my tax refund be sent to a different account. The office girl compiled with the request without a phone call to myself for confirmation. Subsequently $8520 was sent. The accountant has requested the bank reverse the transaction and they are in the process of investigating it. I’m told this could take up to 30 days. I’ve made a report to the fraud squad who me the money probably left the country as soon as it was deposited. The ATO tell my they are powerless as the refund was sent to the accountants’ bank and the accountants are saying they were just obeying my instructions.

Bank Share Buybacks

Share buybacks being offered by some of the major banks pose major questions for investors. The big ones are: Why is it happening? What should we do? and What does it mean for the future of the bank shares?

Cast your mind back to early last year, when the COVID-19 crisis was escalating. All the forecasts were of doom and gloom – even the possibility of a major depression. The banks rushed to make provision for the bad debts that were anticipated, and APRA even went to the extent of advising banks to reduce or forego dividends to preserve capital. Bank profits were slashed to make provision for bad debts.

Twelve months later it’s a different world, despite the major lockdowns in some states. The bad debts never eventuated, and banks are now increasing their profits, as well as their dividends, by getting rid of provisions that were never needed. They now find themselves over-capitalised, and are returning that excess capital to shareholders.

So, what does this mean for the future of banks and bank shareholders? If a bank reduces the number of shares it has, and retains its present earnings, investors who retain their shares should see greater earnings and increased dividends per share as time passes. The remaining shareholders will receive a greater share of future dividends than had the buy-back not occurred.

But other issues come into play when deciding whether to sell your shares or keep them. Capital gains tax could be an issue if they are held in your own name or a family trust, but is not an issue if the shares are held by a low income investor or a self-managed super fund in pension mode.

To make it more confusing, NAB and CBA have taken different approaches. NAB are simply going to offer their shares to the market, and anybody who wishes to dispose of their shares, or buy more shares, would do it in the normal way.

The CBA issue is much more complex. The bank is offering to buy a percentage of existing shareholdings at a price which will be based on the bank’s average trading price over the five days leading up to 1 October. Almost certainly it will be at a discount of 14% to the bank’s current price, which was $100 per share at date of writing. The buyback price will comprise two components – a capital component of $21.66 and a fully franked dividend, which will be the difference between $21.66 and the final sale price minus the tender discount.

For example, if the final sale price was $100, the bank would buy them from you at $86 in exchange for a capital payment of $21.66 and a fully franked dividend of $64.34, which would include $27.57 of franking credits. If you are an investor who pays no tax, either because you are on a low income, or because you are in a self-managed superannuation fund in pension mode the franking credits will be refundable to you.

And it gets better; in addition to the above, you will receive a final dividend of $2.00 a share plus all $0.8571 in franking credits. Therefore, your net proceeds should be around $116.43 per share.

Of course, your best strategy will depend on your situation, but it’s hard to see how a retiree could go wrong by joining the tender process. The demand will be massive, which means at best only a small percentage of your CBA shares will be accepted. CBA have announced they will buy the first 100 shares and nobody will be left with fewer than 20 shares, therefore it is reasonable to expect that a parcel of 120 shares would be bought back. And don’t forget, having received an effective $116.43 for each share, you are free to go back into the market and buy more.

Upcoming Event

Join me next week for a free retirement living seminar where I will be discussing the financial challenges and opportunities facing older people.

Not to be missed, the event includes morning tea and a free copy of my book “Downsizing Made Simple“.

Hurry, places are limited so register today!




Making Money Made Simple

This book has been in circulation for more than 30 years, has sold over 2 million copies, and continues to change the lives of people who read it. Last week I was thrilled to get an email from Ed Vesely an analyst with Motley Fool Australia which is self-explanatory.

In this video which is around 10 minutes long he speaks with Scott Phillips their Chief Investment Officer about Making Money Made Simple and about investing generally.  I think you will enjoy it.

“My employer, The Motley Fool Australia, has just started a new YouTube series where each of us discuss a favourite investment book. Naturally, I spoke about yours because it was the first book, and the most important book, I have ever read on investing and personal finance.
It’s just gone up on YouTube and you can watch by clicking on the link here.
It was, and is, a great book
Ed Vesely”

Book Updates

Rewritten for New Rules

There were some major changes to superannuation that took effect from 1 July 2021 Many of these were due to indexation which increased the amounts that can be contributed, as well as some changes to the age limits.

There are also major changes that should take effect from 1 July next year.

My book Superannuation Make Simple has been totally rewritten to take account of these new rules.

It just happened that both Retirement Made Simple and Making Money Made Simple needed reprints too which gave me the opportunity to incorporate the changes to superannuation in these books as well. All these books are available from my website.


Just a few left

A few months ago I mentioned two books which will be going out of print and which I’m keen to clear. They have nearly all sold but I’ve got just a few left. Do you know I’m slashing the price to $24.95 for each book.

The first is 25 Years of Whitt & Wisdom – a hard cover 450 page very attractive book in high-quality paper. It’s not just a wonderful history of the 25 years when the Australian financial services industry was coming-of-age, it also contains a wealth of timeless value. It is still one of my favourite books and a great book to browse through.

The other is the international bestselling book written by my son James Whittaker that accompanied the film Think and Grow Rich: The Legacy, which we launched in Los Angeles in 2018. This book is a timeless classic. Not only does it introduce the original Think and Grow Rich principles in a modern context, it also includes firsthand accounts of how some of the most successful leaders on the planet today used those principles to achieve massive success. If you want a blueprint to growth, and the inspiration to make it happen, I can’t recommend it highly enough.

We have a limited supply of 250 copies left, which we’re reducing to $24.95.

As a special bonus to my loyal readers I’m going to let you have a copy of the updated edition of Superannuation Made Simple to anybody for just $5 who buys one of these two books. The retail price of the Superannuation book is $24.95 – the bundles of two are just $29.95. That’s a huge saving.


And finally…

Some thought provoking ideas for those of us whose day is filled with the mundane………

What’s the speed of dark?

How come abbreviated is such a long word?

Why are they called apartments, when they’re all stuck together?

If you got into a taxi and the driver started driving backward, would the taxi driver end up owing you money?
Why is a carrot more orange than an orange?

When two airplanes almost collide why do they call it a near miss and not a near hit?

Why are there 5 syllables in the word “monosyllabic”?

Why do scientists call it research when looking for something new?

If “con” is the opposite of “pro,” then what is the opposite of progress?

What do little birdies see when they get knocked unconscious?

If all those psychics know the winning lottery numbers, why are they all still working?

Why do we put cargo on a ship, and shipment in a truck?

Can vegetarians eat animal crackers?

If man evolved from apes why do we still have apes?

I went to a bookstore and asked the saleswoman where the Self Help section was, she said if she told me it would defeat the purpose.

Should crematoriums give discounts for burn victims?

If a mute kid swears does his mother wash his hands with soap?

And whose cruel idea was it to put an “S” in the word “Lisp”?

If a man stands in the middle of the forest speaking and there is no woman around to hear him….Is he still wrong?

If someone with multiple personalities threatens suicide….is it considered a hostage situation?

Is there another word for synonym?

Isn’t it scary that doctors call what they do “practice”?

Where do forest rangers go to get away from it all?

What should you do if you see an endangered animal eating an endangered plant?

If a parsley farmer is sued do they garnish his wages?

Would a wingless fly be called a walk?

Is a shell less turtle homeless or just naked?

Is it true that cannibals won’t eat clowns because they taste funny?

Why do they put Braille on the drive through bank machines?

Do they use sterilized needles for lethal injections?

Why did kamikaze pilots wear helmets?

What was the best thing BEFORE sliced bread?


I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker


Noel News 18 Aug

“How many millionaires do you know who have become wealthy
by investing in savings accounts? I rest my case.”


Thank You for the Feedback

First let me give a huge thank you to all you members of the Whittaker tribe who responded so magnificently to my recent special bulletin. Over 5000 of you took part in the survey, and I also received over 300 emails with comments and suggestions which I am still working through at the moment. I believe if someone takes the trouble to email me, they deserve a response. Unfortunately, with tight deadlines for newspaper articles, life sometimes gets overwhelming. But you can be assured I read every email and you will get a reply in due course.

The overwhelming message is you want information, information and more information. Some of you are huge fans of paper books, many want podcasts and audiobooks, and webinars are becoming much more popular. But of course, what one person wants, another may not want. Also, I need to be mindful of my own capabilities. Therefore, in future newsletters I will be doing my best to include podcasts and webinars.

For example, in this newsletter is a brilliant webinar, all about equity release, which was filmed last month through Starts at 60. Plus, a fantastic podcast from my friend Ashley Owen of Stanford Brown, one of Australia’s leading financial advisory firms who talks about the outlook for markets, inflation and where interest rates might be going.

Also, I’m pleased to announce that negotiations are now in place for an audio version of Retirement Made Simple and I’m working hard on that small book which I mentioned in the recent bulletin. It’s a busy life right now, but that’s how I like it.

A Debt Free Retirement

Being debt-free when you retire should be a major goal. However, there are diverse ways to achieve this, and often advice from well-meaning friends can be misleading. Recently I received an email from Lucy, who told me that she was aged 59, earned $100,000 a year and had $429,000 in super. She still owed $169,000 on her home, with an interest-rate of 2.73% and monthly payments of $839. With those numbers it would take 22 years to pay the loan off, and she was looking for ways to improve her situation.

She had already spoken to her superannuation fund, whose advisor recommended she maximise her contributions to super. On the other hand, a work colleague said, “That’s a bad idea – if the market crashes, you could lose heavily”. She hoped I could put her on the right path.

For somebody over 50, making contributions to superannuation is a much better option than speeding up loan repayments. This is because super contributions lose just 15% contributions tax, whereas the after-tax dollars required to pay your home loan lose tax at your marginal rate, which in Lucy’s case is 34.5%. Furthermore, a good superannuation fund should be returning at least 8% per annum, whereas the interest on your home loan should be no more than 3%.

Thanks to the indexation changes that took effect from 1 July, Lucy can now make a concessional contribution of the difference between $27,500 a year and the employer contribution of $10,000. That $17,500 contribution would be tax-deductible to her. After the $2,625 contributions tax she would have $14,875 working for her in the low-taxed superannuation system, where it would continue to grow. In contrast, if she chose to invest $14,875 to reduce a home loan, the cost to her gross pay would be $22,710.

And there’s more – on Lucy’s salary, a tax deduction of $17,500 should give rise to a tax refund of $6,000, which could also be contributed to her superannuation fund, as an after-tax contribution. The combination of the concessional contribution and the after-tax contribution would mean an extra $20,000 a year would be going to superannuation. If the fund earned 8% per annum, that puts an additional $146,000 into her super in six years.

If her salary grew at 2% per annum, and her employer fund achieved 8% per annum, she would have $751,000 in her employer fund at age 65, giving her a total of $897,000 in super.

Let’s turn our thoughts to what would happen if markets tumbled and her superannuation balance fell. Without doubt, it will do just that at some stage, due to market movement, but just as certainly it will bounce back. Lucy can expect at least 30 years living ahead of her, and should take a long-term view.

When she is 65, her debt should be $134,000 if she keeps up her present repayments. The extra contributions she’s been making could cover paying this off, but there would be no requirement to pay out her loan. Depending on interest rates, Lucy might still be better off keeping more money in super.

Let’s run some figures. The interest payable on $134,000 at 3.5% would be just under $5,000 a year, so she could simply take $10,000 a year from her superannuation fund to make the repayments on the loan. This would allow Lucy to keep at least $850,000 in superannuation. If her super were earning 8% per annum, the difference between the two rates would give her an extra 4.5% on the loan balance of $134,000 – a nice $6,000-a-year bonus. That would be a great position to retire on.

Webinar – Equity Release

The government has made it abundantly clear that retirees are expected to utilise their capital as they move into their final years. But the big question is how to do that. One option is to downsize to a cheaper home, but, as I pointed out in Retirement Made Simple this strategy often has the major disadvantage of converting an exempt asset — the family home — to an assessable asset.

If you are receiving a part age pension now, increasing your assessable assets could severely reduce or even totally lose your pension. To make matters worse, the costs of moving from one home to another are high, which usually means a net loss of capital. Most importantly, retirees want to remain in their local communities, and it may be hard to find a good quality smaller home nearby.

One benefit of downsizing is that the government lets each homeowner put $300,000 of the proceeds of downsizing into their superannuation as a non-concessional contribution.  Even that incentive has not convinced many older Australians to leave their family homes.  So not downsizing leaves retirees asset rich, but remaining cash poor.

This leaves two other options. Borrow against the home, or sell a portion of it using one of the equity release options which are available.

Last month I was a participant in a masterclass via a webinar arranged by Starts at 60 – it lasted for just over an hour with more than 2000 people watching.

The participants were Dr Deborah Ralston – a leading figure in the financial services industry, and co-author of the recent Retirement Income review, Fiona Navarro – an executive of Household Capital one of the major providers of reverse mortgages in Australia, and myself. In this masterclass we discuss equity release in-depth and answer questions from the audience. I really do hope you find it useful.

The Electric Car

It appears that the electric car (EV) is the way of the future and will eventually replace the internal combustion engine (ICE). Many countries are taking steps now to ban future production of ICEs. The United Kingdom plans to ban the sales of new diesel and petrol cars from 2030 but will still allow the sales of hybrid cars until 2035., Norway wants all new light vans and passenger cars to be zero emission by 2025.

It’s an ambitious goal but from my experience it’s easier said than done. Just over two years ago I got myself a new Tesla on the grounds that a “self driving” car would be a better option for a senior citizen than driving the car yourself as years pass. That was an optimistic view. The term “self driving” is no longer used by Tesla – the term now is “auto steer” which is really a type of cruise control with a degree of lane control.

True, – there are reports that Tesla is working on fully self driving (FSD) cars with a software update due to be released this month. However, the alleged update has been put back, and the reports I am reading would indicate it’s got a long way to go.

The car is a pleasure to drive, and has required zero maintenance despite having travelled 42,000 km. Apart from Auto Park which backed me into a brick wall did $8000 of damage there have has been no other problems.

But EV’s have three major challenges. They are hellishly expensive, have a relatively small range, and refuelling makes long trips almost impossible.  To appreciate the story, you must understand the way chargers work. The big ones could possibly charge my car in an hour, the smaller ones such as the ones that some motels have, charge at 100 km an hour maximum.

Last year I had a speech at Moura which is 187 km west of Gladstone. We left Brisbane and drove 170 km to Gympie where we stopped at a shopping centre to top up the car. Despite it being a high-speed charger, it took over an hour to replenish the battery. We opted to have lunch at the shopping centre.

The next stage was the 348 km trip to Gladstone where our options were to leave it for a long time at a shopping centre with a charger when we got there, or book one of the few motels in Gladstone with a Tesla charger. We chose the latter, and found ourselves in a pleasant but not outstanding motel with the charger outside our room. That took six hours to charge so we left it there overnight.

It’s impossible for the Tesla to get to Moura from Gladstone and back as there are no decent size chargers on that route back so we arranged a Hertz car to be picked up at Gladstone airport. Having made a speech at Moura we drove back to Gladstone airport and drove to home via Harvey Bay where we stayed the night. We chose a beautiful motel on the water but the only way to get the car charged was to drop the car at a motel which had a charger.  The owner kindly allowed me to leave the car undercover attached to his one and only charger for the night, but that did incur taxi costs in both directions.

Much as I love my car, I do think that hybrids are more likely to be the way of the future. Recently I have been in two Toyota taxis – one a Camry and the other a RAV4. They are both less than $50,000 and have a range of almost 900 km. They are also much cheaper than EV’s.

According to a recent article by Toyota there are 290 million cars in America and 98% of them are ICEs. In the entire world there are just 2% of EVs. If this move to ban ICEs happens the world will need to be able to provide the infrastructure to power 300 million EV’s within 20 years. Elon Mgreausk recently said for the world to go electric we will need to double the amount of power recurrently generating, and thousands of electric charge stations will need to be built.

The big questions are how we can possibly double the amount of power we are generating now, how long it will take charging stations to become so commonplace that a charge will be just as quick as pulling up a tank of petrol. I really don’t think it’s nearly as easy as governments everywhere seem to think.

Boosting Your Remote!

Have you ever needed to use your remote to open the car or open a garage door or gate but due to circumstances are just out of range?

Here is the solution. All you need to do is touch the remote to your head and hold it there while you press the button. You will be amazed how much the range is extended. If you do a Google on it there are various explanations – the one I first heard it was the liquid in your head creates a circuit. Anyway, it works. Give it a go.

Need some help with parenting?

As many of you know, my son James is based in Los Angeles and runs a podcast where he interviews some extraordinary people. The episode that was just released today, ‘How to Raise Strong, Healthy and Resilient Children‘, is with the world’s leading holistic child psychologist. It’s chock full of practical parenting tips and I’m sure you will find it enormously valuable, as I did.

Watch the video version.

Listen to the podcast version.

The truth about the financial world

It’s important to get accurate information without the noise that often permeates the news cycle. This is why I’m delighted to include a podcast from my friend Ashley Owen the Chief Investment Officer of Stanford Brown, one of Australia’s leading financial advisory firms.

He talks about where share markets my go in the short to medium term, prospects for government bonds, the effects of government stimulus, the outlook for inflation and interest rates and also gives a general overview of what’s happening in the financial world.

Ashley has been a friend of mine for over 30 years and has one of the best minds in the business. I suggest when you listen that you imagine Ashley is in your lounge room having a chat. You’ll end up being much better informed.

Access it on Apple Podcasts here.

In my experience however, you better off to go to Spotify and subscribe to the SB Talks Podcast – that makes it much easier to stop and rewind and start again if you wish.

If you don’t use iTunes or Spotify, you can listen on SoundCloud here.

And finally…

Do you like to read a good murder mystery?  Not even Law and Order would attempt to capture this mess.  This is an unbelievable twist of fate! At the 1994 annual awards dinner given for Forensic Science (AAFS), President, Dr. Don Harper Mills astounded his audience with the legal complications of a bizarre death.

Here is the story:

On March 23, 1994, the medical examiner viewed the body of Ronald Opus, and concluded that he died from a shotgun wound to the head.

Mr. Opus had jumped from the top of a ten-story building intending to commit suicide. He left a note to the effect indicating his despondency.  As he fell past the ninth floor, his life was interrupted by a shotgun blast passing through a window, which killed him instantly.

Neither the shooter nor the deceased was aware that a safety net had been installed just below the eighth floor level to protect some building workers, and that Ronald Opus would not have been able to complete his suicide the way he had planned.

The room on the ninth floor, where the shotgun blast emanated, was occupied by an elderly man and his wife.  They were arguing vigorously and he was threatening her with a shotgun!  The man was so upset that when he pulled the trigger, he completely missed his wife, and the pellets went through the window, striking Mr. Opus.

When one intends to kill subject ‘A’ but kills subject ‘B’ in the attempt, one is guilty of the murder of subject ‘B.’

When confronted with the murder charge, the old man and his wife were both adamant, and both said that they thought the shotgun was not loaded.  The old man said it was a long-standing habit to threaten his wife with the unloaded shotgun.  He had no intention to murder her.  Therefore the killing of Mr. Opus appeared to be an accident; that is, assuming the gun had been accidentally loaded.

The continuing investigation turned up a witness who saw the old couple’s son loading the shotgun about six weeks prior to the fatal accident.  It transpired that the old lady had cut off her son’s financial support and the son, knowing the propensity of his father to use the shotgun threateningly, loaded the gun with the expectation that his father would shoot his mother.

Since the loader of the gun was aware of this, he was guilty of the murder even though he didn’t actually pull the trigger.  The case now becomes one of murder on the part of the son for the death of Ronald Opus.
Now comes the exquisite twist…

Further investigation revealed that the son was, in fact, Ronald Opus.  He had become increasingly despondent over the failure of his attempt to engineer his mother’s murder.  This led him to jump off the ten-story building on March 23rd, only to be killed by a shotgun blast passing through the ninth story window.  The son, Ronald Opus, had actually murdered himself.  So the medical examiner closed the case as a suicide.

A story this good should be true. Alas, it’s not. According to Snopes there never was a suicidal Ronald Opus, a feuding, shotgun-wielding older couple, or an increasingly confused medical examiner trying to get to the bottom of things. But there is some truth to it, for there is a Don Harper Mills, and he did tell this very story at a meeting of the American Academy of Forensic Sciences. Mills explained that he made up the story to present to the meeting for entertainment and illustrate how changing a few small facts can greatly affect the legal consequences.

I hope you have enjoyed the latest edition of Noel News.

Thanks for all your kind comments. Please continue to send feedback through; it’s always appreciated and helps us to improve the newsletter.

And don’t forget you’ll get much more regular communications from me if you follow me on twitter – @NoelWhittaker.

Noel Whittaker