5 Reasons Not to Invest (and What You Should Do Instead)
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What are the five reasons not to invest?
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Lastly, please keep in mind that past performance is not indicative of future performance. Kate Campbell, welcome back to this episode of the Australian Finance Podcast. What are we talking about?
Oh, well, we're talking about something that we don't usually talk about. And I think it's something we should given just the sheer amount of topics that we cover when it comes to investing. But today I really wanted to talk about when should you not be investing? And I mean, we're definitely advocates of investing and getting started early, but I thought it would be a good chance to step back and look at some of the reasons why someone wouldn't invest right now.
Yeah, yeah, makes sense. Good old inversion, Kate. Ask yourself the opposite question to get to the truth. So normally we say, you know, what are some reasons why you would invest today? Well, let's invert it and say, why wouldn't you invest? And then let's say where you sit on the spectrum. So yeah, obviously we talk about all different types of investing. And I think that the five things that we've got today, the five reasons that you wouldn't invest apply to basically anything. So it's not necessarily shares, ETFs, EMU eggs, gold, platinum, crypto, whatever you're doing. These five things can apply to any of those. So Kate, without further ado, what is reason number one, why you shouldn't invest?
The first reason why you shouldn't be investing in anything, as Owen said, whatever it is, is because you've got a lot of debt. And by debt, I'm talking about you've got credit cards, you've got personal loans, you've got car loans, you've got maybe a few buy now, pay later accounts. sitting around. So this is one of the big reasons why you wouldn't want to invest because you really want to focus on getting the past off your back first, because it's really hard to move forward if you've got this, I don't know, if people visualize debt as some sort of ball and chain or an anchor, it's weighing you down and holding you back from moving forward financially. And it's really good to start to kind of get back to neutral.
So figuring out how a plan to pay off debt and really get back to neutral before investing and moving forward. And as you've probably seen, credit card interest rates are pretty astronomical, like upwards of like we're getting to 20% on some cards, depending on what it is. And personal loans can be, I don't know what you've seen recently, like six to 8% on. Easy.
Yeah.
Easy. Yeah. And that when it comes to investing, like 8% would be in a year would be a really good return.
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Sounds like good money advice... But is it?