0:07

Hello and welcome to It All Adds Up the podcast

0:09

where we chat about money, how to get it, how to

0:12

spend it and how to invest it. I'm money editor

0:14

Dom Powell.

0:14

And I am senior economics writer Jess Irvine.

0:17

And today we're going to talk about

0:19

the wild world of cryptocurrencies.

0:22

Yeah, we figured it was time to take a look at crypto

0:24

as it's an asset class that people often ask

0:27

us about and it's inherently quite confusing

0:29

and also quite controversial.

0:32

Yeah, definitely a bit confusing. Definitely

0:34

confusing for me. It's also an extremely

0:36

volatile asset class with the price

0:39

of major cryptocurrency Bitcoin down

0:41

50% in the past year. But

0:43

hopefully by the end of this episode you'll have

0:46

a better understanding at least of what a

0:48

crypto currency is and

0:50

if it's something worth investing in.

0:52

But first, Dom, I believe you do

0:54

have some personal experience when

0:56

it comes to investing in crypto.

0:58

We're not calling you a crypto king, but

1:00

can you, can you explain

1:02

how you got into it and how did it go for

1:04

you?

1:05

Yeah, so sort of for my

1:07

sins, I guess I invested in crypto

1:10

in the early part of

1:12

2017. I think I remember

1:14

reading about it online. I just read something

1:16

about Etherium, which today

1:18

is the second biggest cryptocurrency,

1:21

and I was like, Oh, this is a bit interesting. What's this all about?

1:24

Went down a bit of a rabbit hole and

1:26

ended up buying some Etherium at around

1:28

the start of 2017. And

1:31

they like pretty much for the rest of that year I was like full

1:33

on like crypto trading

1:36

pretty much every day, constantly

1:38

looking at my portfolio like it was a full

1:40

thing.

1:41

Were you buying and selling sort

1:43

of day to day?

1:44

Yeah, I like loads of different cryptos.

1:46

Like I went, I went really deep on

1:48

it for that year. I don't like to

1:50

admit this because, you know, it was I

1:53

was like working full time that year too. So until

1:55

my old boss. But you know, it

1:58

was it was pretty full on. And then at the I had this

2:00

sort of I guess

2:02

I told myself when I started investing, I

2:04

was like, okay, if your portfolio

2:06

ever hits like a certain level sell

2:09

no matter what, just sell like you will have. That's

2:11

enough just to sell. And I hit that

2:13

level at the end of 2017 and I

2:15

sold everything and I haven't touched

2:17

it since.

2:19

That's an amazing level of discipline

2:21

for you to just have that number

2:23

and you got to walk away from the casino,

2:26

or if it is a casino.

2:27

Pretty much was a casino really to

2:30

be on, especially at that time. Like there was no sense

2:32

to any of the valuations that anyone was

2:34

giving, any of the things that I

2:36

was investing in. And half the things that I invested in

2:39

today don't exist. Like that's an indication

2:41

of while the crypto market

2:44

was, but it was purely luck because

2:46

like, like I timed the market almost

2:49

perfectly. Like literally the day after

2:51

I saw it, everything started going down and went down for

2:53

the next year.

2:54

And I think we should recognise that's incredibly

2:57

fortunate. Yes, there is a golden

2:59

piece of timing.

3:00

I've said to people like I will never invest

3:03

in anything seriously again because I don't think I'm ever

3:05

going to get as lucky as I did with

3:07

that. Like it was just complete luck,

3:09

complete privilege to have the money

3:11

to invest in the first place, all that sort of stuff.

3:13

Like I don't proclaim to be an investing

3:16

genius and you

3:18

know, you should not look to me for any sort of crypto advice.

3:20

In fact, these days I don't invest in crypto and I

3:22

think that it's kind of dumb,

3:25

but, you know.

3:26

Ooh, controversial. Yeah, that's.

3:28

That's my that's my sort of done the full

3:30

180 on it since since

3:33

2017 the market has also changed pretty significantly

3:36

since 2017 as well so there's a lot

3:38

of different factors but yeah that's my, that's my crypto

3:40

journey.

3:41

So it's fair to say you don't hold any crypto

3:43

now, there's no crypto currency in your digital

3:45

wallet or whatever it is. That's the

3:47

way you know.

3:48

I mean, there's probably like some scraps of

3:50

things like that. I just haven't

3:52

got around to selling, but nothing of any value

3:55

whatsoever. Yeah. Do not you

3:57

don't invest and have not invested for a number of years.

3:59

So I'm similar, I'm the

4:01

same, I don't hold any crypto. My

4:03

story is that back at probably the time that you

4:05

were in your pyjamas wide eyed with coffee,

4:09

huddling over your laptop or however that the

4:11

trading works.

4:12

That's fair. That's pretty accurate. Yeah.

4:13

I remember writing a few columns just sort of basically

4:16

saying crypto is not a thing

4:19

and sort of picking holes in a few of

4:21

the arguments, particularly around scarcity,

4:23

I think because I think it was even earlier than that

4:25

when I wrote a column about Bitcoin

4:28

and I'd never really got the scarcity,

4:30

I was like, Well, okay, you might run out

4:32

of things. You can mine on that particular

4:34

blockchain, but you can just have another cryptocurrency.

4:37

You could there's an infinite number of cryptocurrencies

4:39

you could start, So where's the

4:41

scarcity in that? But let's, let's just

4:43

start with, you know, what is

4:45

crypto? And I keep saying cryptocurrency,

4:47

they always currency, what

4:50

is crypto dumb? And we're going to arrive

4:52

at a point where we both sort of recognize whether it's something

4:54

or talk about, whether we think it's something that should be in your

4:57

investment portfolio, because I do see a lot of younger

5:00

investors going, Oh, I need to have, you know, a responsible

5:02

10% of my portfolio should be in

5:04

crypto. So I'm well-diversified. I want to I

5:06

want to get to that. But let's for anyone who

5:09

hasn't bought it or sort of is struggling

5:11

still to deal with what crypto is, what

5:13

is it done?

5:14

Well, I think it's important to to divide

5:17

crypto into two different sort of camps.

5:19

You've got things like Bitcoin, which is the one that most

5:21

people know about, and Bitcoin is effectively

5:23

just a store

5:25

of value and a way to transact

5:28

value like it is very

5:30

often likened to digital gold

5:33

because it is, as you mentioned earlier,

5:35

it has this sort of scarcity built into it. So

5:37

the original programming of Bitcoin says that

5:39

only 21 million coins can

5:41

ever be mined. So therefore

5:43

once you hit that number, that's it, there isn't any more.

5:46

And this mining process, which is

5:48

sort of how almost all cryptos

5:51

are made these days,

5:53

is basically to create cryptocurrency.

5:56

You have to get a computer to

5:58

sort of crunch increasingly difficult

6:01

calculations. And all

6:03

these computers all around the world are all competing

6:06

to be the first every 10

6:08

minutes to crunch these

6:10

calculations. And that

6:12

sort of forms the basis of crypto in the sense that

6:14

that's what makes it valuable in a sense,

6:16

because it requires a great deal of sort

6:18

of energy and and production to

6:21

create this crypto. And also,

6:23

while all those computers are crunching the numbers, they're

6:25

also validating this network

6:27

which sort of cross-references and cross-check

6:30

all the transactions being made every second.

6:32

You know, it's, it's all sort of this big web

6:34

of computers put together. So

6:37

that's sort of the basis upon which cryptocurrencies

6:39

are formed. And those sort of features

6:42

give us something like Bitcoin, you

6:44

know, theoretically a lot of some

6:46

attractive attributes in

6:49

the sense that you can't fake it, like

6:51

you can't fake a Bitcoin transaction because all these

6:53

computers are constantly cross-referencing and checking

6:55

all the transactions at once. And

6:58

you know, there's a certain limited number of them

7:01

that are hard to produce, etc., etc.

7:03

Hence why you see this digital gold similarity.

7:06

And then you've got the other cap, which is sort of Etherium

7:08

is the most sort of prominent one, which are these sort

7:10

of cryptocurrencies which are programmable.

7:13

So they have sort of like a software layer to them where you

7:15

can put all these sort of features

7:17

and sort of put all these terms and conditions

7:20

attached to the transactions. And

7:22

people say that, you know, all theoretically in the future

7:24

you could use an a theorem network to

7:27

completely automate the transaction of a house,

7:29

right? You could just go bang, it's all

7:31

written into a contract, you do the transaction

7:33

and all this sort of conveyancing

7:36

legal mumbo jumbo is all sort of baked into

7:38

this transaction. So that's sort of the other camp

7:40

of of cryptos, which are less about just the

7:43

singular transfer of value and more

7:45

about the actual sort of programming,

7:48

you know, future of the Internet sort of thing, which

7:50

which a lot of people claim that it will

7:52

be. So those are sort of the two different

7:54

camps. Obviously, that's a lot of information to

7:56

take in. It's kind of really hard to explain crypto

7:59

succinctly. It's such a bonkers

8:01

and confusing area, but

8:03

that's about as best as I could do.

8:05

But fascinating. No, that's great. I was listening

8:08

to an interview between Ezra Klein and

8:10

the founder of Ethereum, which was sort of going

8:12

into some of those other uses. And

8:15

I'm wondering with that sort of software that you

8:17

can build into a theory, is that open source?

8:19

So can anyone like you say on a set up a real

8:21

estate agency and I'm going to use the theory of

8:23

to sort of do the transactions

8:25

or is it within the control of a theory

8:27

as such that they will innovate and come

8:30

up with the new programmable

8:32

use?

8:32

No, it's completely decentralized, completely

8:34

open source, like everything's open to everyone.

8:37

No one controls it, which is another big sort

8:39

of draw of crypto is that

8:41

in theory this is all again, in theory,

8:44

sometimes this doesn't actually work in practice at all.

8:46

No one can determine how Ethereum

8:49

network runs or anything like that. It's all very sort

8:51

of collective and, you know,

8:53

done together.

8:54

Okay. But to participate in whatever

8:57

innovative new sort of a fancy thing

8:59

exists, you might need to have some Etherium

9:01

because that would give it value. Or could

9:03

you use another digital

9:05

cryptocurrency.

9:07

Well to do anything on sort of like

9:10

the Ethereum blockchain, the network that

9:12

it runs on. To do anything on

9:14

that, you have to pay a fee. And

9:16

typically those fees are in theory, so

9:18

you have to have the currency in the first place to

9:20

to be able to sort of operate on the network.

9:22

Interesting, because that's where I'm sort of like, well,

9:24

maybe it could arise that there are

9:26

sort of ecosystems around

9:29

particular cryptocurrencies where you're

9:31

actually going to need the underlying

9:33

cryptocurrency to participate and therefore

9:36

there's value in that.

9:39

Yeah, well that's sort of what gives something like a theorem.

9:41

Its value is the fact that if you want to participate

9:43

in the network, you actually have to hold the

9:46

currency itself in order to pay the fees.

9:49

So that's why the sort of, you know, that

9:51

sort of token or that coin as they're called,

9:54

as value, it's a very sort of

9:57

especially if you come into it from sort of a very

9:59

sort of traditional finance background, there's a lot of things

10:01

that are quite confusing and there's

10:03

a lot of like stuff that. I think it sort

10:05

of benefits from the fact that people don't understand

10:08

it. Yeah. Like it is one of those sort

10:10

of markets. It's like, you know, the depths of the financial

10:12

system, right? Like the fact that

10:14

no one really knows how the hell it works. It

10:16

sort of works to its advantage in the sense

10:18

that people can just be like, Oh no, it's great. It's

10:20

going to be the future of the Internet, It's fine sort of thing, where in

10:22

reality it might not be, but it's so complicated

10:25

that no one really questions it.

10:26

Yeah, I'm sort of like, I don't see a world

10:28

where I have to have Bitcoin to go buy my coffee.

10:30

Yeah, well, that's probably never going to happen.

10:32

I feel like cash is working pretty

10:35

well for me for that. But other

10:37

worlds that don't exist and we can't see

10:39

the future in which there's fancy online

10:41

things in which would operate off crypto currencies,

10:43

in which case you will need them. And

10:46

if they're limited, then it would make

10:48

sense to get in early to have some. Yeah.

10:50

So I'm suddenly turning into a crypto.

10:52

I'd be like, Oh, I've got to go get some.

10:55

But but let's just cool

10:57

down and can you just talk us through what I

10:59

mean, what has happened with crypto

11:02

pricing? How high did it get?

11:04

It's totally crashed in the last couple

11:06

of months or years.

11:09

How volatile is it.

11:11

Like extremely volatile. Like

11:13

over the course of, you know, possibly

11:15

this conversation, you could see the swing

11:17

of like a of a major crypto like Bitcoin

11:20

over Etherium, you know, go up or down by $100.

11:22

Like that's not uncommon. Like it's a massively volatile

11:24

market. You know, back when I was investing

11:27

in like 2017, it was more volatile. Like

11:29

it was really, really like, you

11:31

know, all over the shop all the time.

11:34

And I think we it hit its peak last

11:36

year also partially due to COVID

11:39

and a lot of the stimulus that was around a lot of people getting

11:41

into investing and crypto for

11:43

the first time, I think Bitcoin

11:45

got pretty close to if not,

11:47

it hit 100,000 AUD

11:50

like it was. Like, really,

11:52

really high. And then since then, it's fallen

11:54

by like 50% or more like it is completely

11:57

plunged. And that was in about November

11:59

last year. So certain markets have taken

12:02

a real significant downturn.

12:05

Which has really pulled the rug out of one

12:07

of the arguments people sort of thought

12:09

at a time back in the day when sort of

12:11

interest rates were really low and sort of

12:13

there was sort of this theory that central

12:15

banks can't control the the value of money

12:17

and we need to have this independent thing. It'll be a hedge.

12:20

And, you know, in uncertainty, when all global

12:22

currencies fall apart, we'll have this sort of

12:24

more secure thing and it will be a hedge against

12:26

times of uncertainty. And so, you

12:29

know, one of the things are going down, it would go up

12:31

or like has it that

12:33

it's some sort of defensive element of your portfolio

12:35

that might outweigh other turbulences

12:38

turned out to be completely untrue.

12:40

Yeah, well, it just turned out to be complete crap because

12:42

what happened is a little like the, you know, the traditional

12:45

finance people got into

12:47

crypto as well, and then the

12:49

crypto decided following exactly what traditional

12:51

finance did and people just sort of traded

12:53

like a tech stock. Now like it pretty much car.

12:56

Like if you look at the price of bitcoin, it kind

12:58

of tracks what the Nasdaq does.

13:00

I mean, the thing that gives crypto such

13:02

bad name is all the sort of spruiking and

13:04

we've seen recently, like Kim Kardashian

13:07

is being fined for being involved in sort

13:09

of spruiking. And I think Matt Damon

13:11

has an ad for a cryptocurrency

13:13

and some of the advertising is around like,

13:15

you know, yeah, I know you don't understand it, but just

13:18

but anyway.

13:19

Yeah well like don't don't miss out don't be behind

13:21

sort of thing.

13:22

Yeah. The sort of FOMO aspect

13:24

of it but okay so volatility

13:27

aside and you know spruikers

13:29

beside what are some of the reasons why you might

13:31

want crypto in your portfolio.

13:34

Well I think like the number one reason and like I think a

13:36

lot of people sort of recognise this with crypto is the fact

13:38

that it's can have a massive upside,

13:40

right? Like you know, look at what will

13:42

happen to me in 2017. Right. That's insane.

13:44

Typically you're never going to see like a massive

13:46

increase in value over the course

13:49

of a year, as you know, we

13:51

did back then. And it's not uncommon

13:53

that, you know, for certain cryptos,

13:55

you could see them rise, you know, 100

13:57

or 200% over the course of a year like that

14:00

typically doesn't happen for equities. Right.

14:02

Like, that's pretty rare. So

14:05

obviously, that's the number one upside and

14:07

why people have a lot of it or want

14:10

to think that they should have some in their portfolio

14:12

is because of the of the potential upside.

14:15

And then I suppose on top of that, you got diversification

14:17

like it is. You know, it is distinctly

14:19

different to equities and commodities

14:22

and things like that, like it is a

14:24

truly sort of unique asset class in the way

14:26

that it functions and all that sort of stuff.

14:28

And also, I guess

14:31

as we sort of mentioned earlier, like people

14:33

did view it as a bit of a hedge to, you

14:35

know, traditional markets, but that's not really true anymore. So

14:38

that's sort of that can be a kind of be a reason

14:40

why you might put it in your portfolio. And

14:43

I suppose maybe the last reason would just be that

14:45

there are some people who out there who think it

14:47

is going to be the next version of the Internet.

14:51

I don't personally agree. I don't think it will be the next

14:53

version of the Internet, but there

14:55

is sort of like a decent sized camp that

14:57

think that things like Etherium and all

14:59

that sort of stuff is going to be sort of the basis

15:01

upon what the next iteration

15:03

of, you know, the World Wide Web will be.

15:05

It's this sort of term web3,

15:08

which gets bandied around a lot without much

15:10

meaning. And, you know, I

15:13

think that that's sort of going to be the next

15:15

frontier. So, I mean, if you if you sort

15:17

of buy into that and you think that these people might have a

15:19

bit of a point, then, you know, putting some in your portfolio

15:22

obviously kind of makes sense because you could be at

15:25

the forefront of a next of the next big thing. But

15:28

that's obviously up to you to decide,

15:30

as with every investment.

15:31

Of course, and it seems like on the risk

15:33

spectrum, like of investments,

15:35

it's way out there on the frontier of something

15:37

that is high risk. Yes.

15:40

Compared to shares compared to property,

15:42

you know, work out. You know, there are other

15:44

places to put your money, essentially. And if you if

15:47

you do sort of park some money there, I think it

15:49

probably won't to be money that you didn't want back

15:51

in in a hurry.

15:53

Yes. And definitely not one

15:55

for sort of anyone who's sort

15:57

of environmentally conscious in terms of their investments,

15:59

because crypto as on the whole

16:02

is really bad for the environment

16:04

like the Bitcoin network does, I

16:06

think has a carbon footprint,

16:08

annual carbon footprint equal to that of

16:10

Greece. Well, as in the country Greece.

16:13

So that just gives you an idea it

16:15

is not good for the environment and you'd.

16:17

Have to think that investments that are not good for the environment

16:19

are sort of not going to produce value over

16:22

time. While like stocks, the companies that are heavily

16:25

have those imposing those externalities

16:27

on society are not going to do so well.

16:29

Well, that's my opinion anyway.

16:32

Yeah. So. Alright, well let's

16:34

wrap it up. Do we need to buy

16:36

crypto in our portfolio? What do you reckon?

16:39

Well, I don't know, Jess. I think you're the one to ask the

16:41

other sort of the passive that was sort of,

16:43

I mean I worry about it after this chat. How do you, how do

16:45

you feel about putting Bitcoin into your book?

16:47

Look, I struggle I still struggle

16:49

to see as an asset class what it is

16:51

because I know. Property, you get rental

16:53

returns and capital appreciation. You know, if

16:55

you don't get the good upside

16:57

to the price, you're at least getting some rent shares

17:00

the same. You're owning an actual company and they're going to

17:02

distribute some of the profits to you. You

17:04

know, bonds, they're going the government's going to pay

17:07

you a fixed rate on that. What's

17:09

the income generating potential of

17:12

of crypto? I don't think there

17:14

is or not one that I can imagine just yet.

17:17

You're sort of it's it's sort of like a commodity,

17:19

as you say, or like gold and you really

17:21

taking a bet on, you know, how the asset

17:23

valuation will go. I don't quite understand

17:26

it, but I'm also I'm just like, perhaps

17:28

we can conclude that I am crypto curious

17:31

because, you know, there are

17:33

relatively intelligent people

17:36

who seem to be very deep in this ecosphere.

17:39

And I'm aware, you know, sometimes

17:41

you can't see what the future is, but

17:43

I don't know in a world if they're inventing Web3,

17:46

I still don't know what that is, but it sounds pretty

17:48

good. Maybe I'll have a happy life anyway. I'll just

17:50

enjoy being a consumer on whatever the platform is.

17:52

But am I going to need some crypto

17:54

to participate? I don't know. I'll probably

17:57

be dead by then, so

17:59

I'm not rushing out to to get

18:02

crypto. And I I'm not sort of saying

18:04

that anyone should do what I do or whatever

18:06

and get your own advice, but I sort of

18:09

don't see it as something that's going to be necessary

18:11

for my life.

18:13

Yes. I mean, I, I

18:16

mean, as I sort of said, I think I've done my dash when

18:18

it comes to crypto. I'm pretty happy with what

18:20

happened. And these days, I think like firstly,

18:23

do research and do more

18:25

research than you would for any other investment.

18:27

Like if you're going to look at crypto, you need to sit down

18:29

and you need to really read everything,

18:33

get a really balanced perspective because there's

18:35

just so much sort of nonsense out

18:37

there that people push. So do

18:39

a lot of research. And then if you really think you want

18:41

to invest like my sort of, you know, again,

18:43

not providing any financial advice, but I think just

18:45

common sense would dictate that the

18:47

things that you would want to look at would be things like Bitcoin

18:50

and theory and like the big ones. They're sort of been

18:52

around for the longest. They relatively stable.

18:55

You know, those would be the sort of the obvious

18:58

choices if I were to make a choice.

19:00

Excellent. Well, we'll expect

19:02

you to be well dressed and out of the house now

19:05

that you're no longer a crypto investor, which

19:08

is not to denigrate anyone who is making

19:12

some. Maybe I might be stereotyping

19:15

there. Alright.

19:16

And now we've got our listener question of

19:19

the week, as we always do, and thank you for

19:21

everyone who's been sending them in. We've got a inbox

19:23

that is nice and full of questions

19:26

but always keen to hear more, so please do

19:28

keep on sending them. And this one is from

19:30

Kirsten, who says that she has a large mortgage

19:33

and she has been investing extra

19:35

cash into an ETF and not paying extra

19:38

off her mortgage. She also says that she

19:40

has a three month emergency fund. However,

19:42

she's worried that she'll come off her 1.84%

19:46

fixed interest rate was the end of

19:48

next year and her repayments are going to go through

19:50

the roof. So she's asking

19:53

should she pause her investing now

19:55

and shovel all of that extra cash into her mortgage

19:58

between now and the fixed rate comes off because

20:00

she's trying to not be too terrified about this

20:03

fixed rate cliff, which is approaching

20:05

for her and many other borrowers. And

20:07

Jess, what's your thoughts on this?

20:09

Yeah, Kirsten, you're speaking to me because

20:11

this is pretty much exactly the situation

20:13

that I'm in. Even that rate is my

20:16

my mortgage rate, and it rolls off in

20:18

the middle of next year. And I'm currently,

20:20

you know, because I'm a bit of a budget her I do know

20:22

I'm generating cash surpluses every

20:24

month and I'm like well what do I do with

20:27

that given that I know I'm going to hit

20:29

this cliff where I'll be refinancing

20:31

to sort of maybe a 4.55%

20:34

interest rate that's going to

20:36

eat into my buffer a lot.

20:39

I am confident that I can still when that

20:41

happens, I'll be able to pay that. So

20:44

with the surpluses that I'm generating now, I've got to decide

20:46

do a will, do I start trying to throw it at the mortgage

20:49

or do I keep investing?

20:52

I you know, the main thing

20:54

is, is when you hit that cliff, are you going to have

20:57

the cash flow to be able to pay your mortgage?

21:00

And if you're not, you might want to be squirreling

21:02

away some cash because you're going to need into your

21:04

cash savings. The focus should really be on

21:06

making sure stress testing yourself.

21:09

Are you going to have the cash flow to meet your mortgage

21:11

repayments when it goes up? And

21:13

if you are and I'm fairly confident that I am,

21:16

I am still continuing to invest

21:18

because, you know, you're making that assessment of do I

21:20

think the long term returns of of investing

21:22

are going to be better than paying down my mortgage?

21:25

You know, and I can't see the future,

21:27

but I do like to still be, you know,

21:29

investing some money and getting some sort

21:31

of ticket on whatever returns the

21:33

share market will do. Whilst, you know,

21:35

the cost of my mortgage is really low. So I think

21:37

it's going to to change

21:39

when I do because I'm just

21:42

not going to have a cash surplus anymore. Basically

21:44

with interest rates going up, my repayments

21:46

are already going to be about $1,000 more per

21:48

month. All right. Pretty much my monthly cash

21:50

surplus that I've. In investing, so

21:53

I won't have a choice. My only

21:55

thing for Kirsten is if she. If she's.

21:57

She's trying not to be terrified. But if she is

21:59

feeling a little bit uncomfortable, maybe that three month

22:01

emergency fund might need to be a little

22:03

bit bigger. I've got a six month basic

22:06

living expense emergency cash

22:08

buffer, so I feel pretty confident

22:10

in that. And so maybe you might

22:12

just feel a little bit more comfortable sleep

22:15

at night if you had a little bit more cash, you know,

22:17

sitting in the in the offset rather than

22:19

investing more. But then, you know, shares

22:21

are down. It's you know, it's hard to not

22:23

want to be trying to get some buying opportunities

22:26

there. So it's hard. But my main thing is get

22:28

a really laser like focus on your expenses

22:31

and convince yourself that you will be able to

22:33

afford your stress, test your finances to make

22:35

sure you can afford the repayments when

22:37

when they go up. And then, you know, either

22:40

way, it sort of depends on how how you're

22:42

feeling. If you're getting pretty stressed about it, maybe

22:44

not locking all your money up in the share market

22:46

or again, pocket analyst doors,

22:48

why not do a bit of a bit

22:50

more squirreling, a bit more investing?

22:52

I think it's it's good that that person's

22:55

got that three month emergency fund in the first place.

22:57

Right. Like that's a good starting point, especially

22:59

when you worried about interest rates going up because like

23:02

a lot of people be worried about interest rates going up and they

23:04

wouldn't have that sort of emergency fund.

23:06

So I think you're in a good spot. Start with

23:08

and then it's just about how you manage it from there on out.

23:10

Yeah.

23:11

And to bring us home, it's just this budget

23:13

tip of the week.

23:14

So my tip this week is just to make people

23:16

aware of something called a no interest

23:19

loan scheme. So this is for

23:21

people who are earning under 70,000

23:23

or who have sort of access to a health

23:25

care or pension card. So it's at that lower

23:27

end. If you hit a massive

23:30

expense like the washing machine breaks

23:32

down, the car breaks down, there's actually

23:34

an availability to you to get

23:36

a no interest loan of up

23:38

to $5,000 for cars, up to $2,000

23:41

for appliances or medical bills. It's

23:44

run by NAB Bank in

23:46

conjunction with the Good Shepherd Organisation

23:49

and I'll give you the phone number. But instead of

23:51

going to a payday lender, putting it on the credit

23:53

card with 20% interest or whatever it is,

23:56

you can actually borrow the $2,000

23:58

and pay it back in small chunks over time with

24:00

absolutely no interest applied.

24:03

So if you're really in an emergency

24:05

type situation, you don't have that emergency

24:08

savings buffer. This is one

24:10

to to look out for and I'll just give

24:12

the number. You can call them the Good Shepherds

24:14

No interest loan team on 13

24:16

6457 or

24:18

just Google no interest loans

24:21

and Good Shepherd and find out more information

24:23

about that.

24:24

Thanks everyone for listening again this week. I hope

24:26

we managed to demystify the world of

24:29

crypto a little bit for you. If you've

24:31

left it just as confused as you are.

24:34

I'm sorry we did our best.

24:36

And I do tend to think that the best

24:38

piece of financial wisdom is not to invest in things

24:41

you don't understand properly. Absolutely

24:43

more research to do. If we've tempted you

24:45

in some way.

24:46

We'll be back again next week, as usual.

24:48

And thanks for listening.

24:50

Thanks for listening. This

24:54

episode of It All Adds Up was produced

24:56

by Chee Wong. The information discussed

24:59

is general in nature and does not take

25:01

into account your personal financial situation,

25:03

goals or objectives. You should always

25:06

do your own research or get professional

25:08

advice before making any major financial

25:10

decisions. If you like today's

25:12

episode, hit follow in your podcast

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app. Leave a review and recommend

25:17

it to all your friends. You can submit

25:19

your listener questions in text or

25:21

audio format at [email protected] .