How best to invest 4 Travel

[marki]

If someone had some spare cash lying around and did not want to keep it in an everyday account earning low interest what would be the best options out there? High interest bearing accounts like Macquarie or trying the share market?

Going forward appreciate offers of good advice!

 

[luxury-lizard]

Personally I think anyone who has any idea about finances would never give advice to a friend much less a stranger - and best not to listen to anyone who does not have any expertise in this area. I'd speak to your accountant or financial advisor.

 

[MEL_Traveller]

If someone had some spare cash lying around and did not want to keep it in an everyday account earning low interest what would be the best options out there? High interest bearing accounts like Macquarie or trying the share market?

Going forward appreciate offers of good advice!

I use Qudos bank, Qantas transaction or saver account or whatever it’s called.

Earns decent FF points and pays around 3.7% interest (that might be going up soon).

It’s easy… set and forget and don’t need to make any monthly deposits. FF points aren’t as good as we used to get on Bankwest, but the points are still ‘tax free’. Whereas interest is not.

I might get 1% more in a term deposit or a specialist online bank, but the overall package with Qudos is great.

The other ‘investment’ for travel is Aeroplan. Buying miles cheap and using later. The only program I speculatively buy miles in. (touch wood).

 

[ric_melb]

Good morning. I would like to second luxury-lizard's advice. You should seek the advice of a financial advisor or accountant in this matter, so that your total financial position can be taken into account. A number of banks are now offering every day accounts with higher interest rates but make sure you are covered by the government guarantee on deposits. The sharemarket is extremely volatile at the moment.

 

[RooFlyer]

Agree with @luxury-lizard . Asking for finance advice on-a Frequent flyer forum is just not sensible.

Pay for some advice tailored for your particular needs, circumstances and plans.

 

[SYD]

As per other comments, get some professional advice but do your homework first on what‘s your bigger picture plan for savings/wealth creation, timelines and goals.

Travel (particularly in style) is a discretionary expense, some would say “luxury” that comes after saving for a home deposit, paying off mortgages, kids and schools etc.

It’s never too late to start “saving” but the earlier anyone starts the better! Compound interest is a beautiful thing.

The other useful thing (and everyone hates doing it), is “Budgeting 101“. Cash in (salary, income etc) and cash out (expenses). What’s left over is available to increase “savings” (which ever method(s) you end up choosing).

As you probably know already, there’s a wealth of tips and help here to at least do the travel bit more cost effectively and not eat into the other savings goals!

 

[dajop]

And if you don't want to / won't seek out professional financial advice, the best advice is to do your own research (there is plenty of it available) and make your own decisions, then you are entirely accountable for what you are doing. The main advice I've heard to those managing their own finances - spread your risk and don't chase the extreme returns unless understanding what you're getting into.

i.e. don't invest most of your life savings in some AI-managed acai berry plantation promising 35% p.a. compounded returns, and then go bleating to A Current Affair when it goes belly up.

 

[marki]

Thank you all for the sound advice it is just what I needed to hear!

Pay off your mortgage or high interest loans first!

Seek advice or at least do your own research.

Be aware of the bank deposit guarantee that sits around 250K about person. Or account?



Above - JBG - sunset near Timor Sea
Research is next!

Marki

 

[SYD]

Be aware of the bank deposit guarantee that sits around 250K about person. Or account?

Per bank and total of accounts held.

Note, some banks like UBank count against amounts held with NAB and v.v. Still, always a nice problem to have.

 

[Brissy1]

More info here

https://www.apra.gov.au/list-of-authorised-deposit-taking-institutions-covered-under-financial-claims-scheme.

$250,000 X the total number of solid black dots, should be good.

 

[Freq Flier 2013]

This is a good reference point:

Best High Interest Savings Accounts for September - up to 6.00% p.a. | Mozo

Mozo helps you to compare high interest savings rates from over 60 Australian banks and savings providers. You could earn up to 6.00% p.a.

mozo.com.au

Otherwise something like this could work:
CBA Perls - capital notes returning about 7% or anz or any others

 

[sqrt()]

An excellent investment I would suggest is speculatively buying points.
/s

 

[SYD]

This is a good reference point:

Best High Interest Savings Accounts for September - up to 6.00% p.a. | Mozo

Mozo helps you to compare high interest savings rates from over 60 Australian banks and savings providers. You could earn up to 6.00% p.a.

mozo.com.au

Otherwise something like this could work:
CBA Perls - capital notes returning about 7% or anz or any others

I have both ING and UBank. Currently earning 5.25% and 4.60% respectively. Of course, bank interest is taxable income, so the net earn will depend on individual circumstances.

For a few more months, ING will still be rebating OS ATMs - which was a very travel friendly feature (on top of the best in class high interest rate up to $100k). The ING Debit card is still fee free for OS purchases and ATM withdrawals (if you meet the monthly criteria). The main hassle now is maintaining and growing the monthly balance by at least $1 per month. So I shift a chunk of cash out on the last day of the month and back in on the first day the following month…

UBank is a lot simpler and also has fee free debit card for OS purchases and ATM withdrawals.

I believe Macquarie Bank has a good product also.

Of course parking money in a mortgage offset account could potentially “save” more and is tax free. Draw down as required and track the “cost” of that loan to incentivise returning the cash ASAP.

An excellent investment I would suggest is speculatively buying points.

There are risks here - mainly program enhancements and devaluations. Maybe buying points for a specific redemption but I’d be cautious about this as a long term approach. Granted, when the AUD is strong against the USD (which it currently isn’t) there’s some good value to be had.

CC churning is probably cheaper but requires discipline and a good credit rating!

 

[marki]

CBA Perls - capital notes returning about 7%

This is a good reference point:

Best High Interest Savings Accounts for September - up to 6.00% p.a. | Mozo

Mozo helps you to compare high interest savings rates from over 60 Australian banks and savings providers. You could earn up to 6.00% p.a.

mozo.com.au

Otherwise something like this could work:
CBA Perls - capital notes returning about 7% or anz or any others

wow now have to do research this is a good return and had no idea it existed