Should I Pay $2000 for Two Zoom Meetings?

Hi Scott,

My husband and I were referred to a financial advisor by a friend. The first Zoom meeting was a free introductory session – the next covered how they wanted to invest our money and what their fees were. We decided their fees were too high ($27,000 per annum!) so emailed to say “thanks but no thanks”. Now they have now sent us a bill for $2000, which we don’t want to pay. We haven’t signed anything, so I’m just wondering if this is normal for a financial advisor to charge.

Denise

Hi Denise,

Tell them to stick their bill up their Zoom.

You didn’t agree to it, and you haven’t signed a contract.

Fuggedaboutit.

And thanks to everyone for reading. Let me know your thoughts.

Till next week!

Scott.

I Turned $15,000 into $8 Million

Hi Scott,

I don’t have a money question to shock you, but more a story you’ll probably shake your head at. Many years ago, I turned $15,000 into $3.2 million in crypto. It took just over two years, and when I got there I was clueless as to what to do with that much money. I had every opportunity to turn it into real goods and services here in country Victoria. But, because it was the start of a bull run and YouTubers were saying it was going to go way higher, I held on to make more money. In fact, I locked the funds away in a smart contract where I could not access them.

Then the ride really began. The feeling was incomprehensible when it hit $8 million … saddening back at $6 million … sickening at $4 million … total denial at $1 million … and I stopped looking below $500,000. I felt embarrassed. Ashamed. I went on an emotional rollercoaster I never knew existed.

Over time I forgave myself for not being content with $3.2 million and for getting caught up in FOMO. Today, I rarely recommend crypto to people I know. I feel like my experience is similar to the time I got pummelled by the ocean thinking I was better in the surf than I actually was.

John

Hey John,

As they say in therapy, thank you for sharing.

It shows real insight and wisdom that you were able to forgive yourself.

So here’s another way to think about it: if you wrote to me saying you’d turned $15,000 into $200,000 (or however much the crypto is worth now), I’d say you were the luckiest man around.

And I’d focus on the big jackpot you’ve got sitting in your lap right now … in 25 years’ time, you’d give up all your money to wake up and be the age you are right now.

It’s time to create your own luck.

Scott.

A Helping Hand

Hey Scott,

My name is Hepa. I’m just responding to that question last week from Sarah the freelance graphic designer. If it’s all right with you, could you please pass on my contact info to her. I’m also a freelance graphic designer and I make between $100,000 and $130,000 a year. I am happy to help her by showing her how I find clients and how to charge more for her projects, and maybe even get her to help me if I ever get more work than I can handle. Sad to hear how much she’s struggling. I grew up with a single mum in the same situation so if there’s anything I can do to help, I’d love to.

Hepa

Hi Hepa

You’re awesome.

In fact, the entire community of Barefooters is amazing. This week I was flooded with emails from readers wanting to help Sarah (who is paying 85 per cent of her income in rent!).

What I love about your offer is that it’s a hand-up rather than a hand-out. Everyone needs a mentor. Everyone needs someone who believes in them. I’ll put you guys in contact.

Thank you so much.

Scott.

Port Arthur

I’ll get to the millionaire in a moment, but right now I want to talk about something important …

The Port Arthur massacre, in 1996, shocked our country.
 
A crazed gunman killed 35 people and wounded 23 others.

In the days following the tragedy, we were collectively shocked, devastated and outraged.

And our politicians heard us: in less than two weeks they unveiled a policy so big and bold – banning semiautomatic weapons and locking down guns – that countries the world over still point to it today.

The level of emotion over the last few weeks about family violence has been Port Arthur-like.

And this isn’t a one-off event: a woman is killed by an intimate partner every four days.

I look at the photos of these women and imagine the horror of their last minutes on earth. I think about how I’d feel if it were my sister. Or someone I work with. But most of all I think of the scared and scarred little children who have lost their beautiful mum.

Police are currently being called out to a domestic violence event every two minutes. One in three women has experienced physical violence since the age of 15.

We said ‘enough’.

A roundtable summit was called.

Now was the time for the Government to lead and be bold.

And Albo strode out of the summit with … a reheated Scomo policy?

Morrison had the Escaping Violence Payment, which offered up to $5000 for women, and Albanese has the Leaving Violence Payment, which does the same thing.
Now it’s better than nothing.

Yet it doesn’t come close to tackling the big issue: our housing market is a complete dumpster fire.

Many years ago politicians decided it was a better vote-grabber to give tax breaks to investors to provide private rentals, rather than build more public housing.

It’s time to admit that it hasn’t worked.

There are way too many women living with violent jerks because they can’t afford to move.

Last month Anglicare found that, even for educated women earning a higher salary (think teachers or nurses), just three per cent of the rental properties are affordable.
And those cheap rentals have eager-beaver applicants lined up around the corner.

“We’re giving out blankets to women to sleep in their cars”, Anglicare told me this week.

And Homelessness Australia found that just 3.7 per cent of women who flee domestic violence are able to secure long-term housing.

We’re better than that.

So, how could the Government really address it?

Well, let me suggest three ways.

First, by temporarily limiting immigration while the rental market is in crisis.
Second, by cutting negative gearing and the 50 per cent reduction on capital gains tax (CGT) for investors.

And finally, by funnelling those tax savings into building public housing that looks after the most vulnerable people in our society – women and their kids who are fleeing family violence.

That sounds pretty bold to me, Albo.

Tread Your Own Path!

What To Do If You Know You Want To Leave

A woman came to me this week telling me she was contemplating leaving her partner after years of abuse that had, in her words, “totally shattered my self-confidence”.

Here are the exact steps I gave her.

First, safety is your priority
If you’re living with a controlling bully, they may suspect you’re thinking about leaving. That’s when the threat of violence can really ramp up. You need to protect yourself.

So, reach out to the wonderful people at 1800RESPECT line on 1800 737 732 and let them know your situation. They’ll give you advice on entitlements and may be able to find temporary accommodation in the event you’re forced to flee.

Second, put a lock on everything
Change all your passwords and PINs (especially on your email), and, importantly, lock down your phone’s privacy and location-tracking settings. Women are being tracked by their partners like never before. Don’t assume it’s not happening to you.

Third, call your bank’s hardship department
Explain to them what’s going on. They’ll open a bank account in just your name that he can’t access. And the best banks will even provide some ‘getaway money’. I know I’m tough on the banks, but they really do want to help.

Fourth, get digging
Go through any files (either paper or on the computer) and find as much financial information as you can. You’re looking for copies of your marriage and birth certificates, your mortgage or rental details, and any information on shares, property or superannuation.

Finally, go and see a family lawyer
The first meeting will be free, and they’ll explain that you’re entitled to a share of the assets. Many controlling men threaten that they have the financial power in a separation. Your lawyer will call their bluff.

The Golden Child

Hi Scott,
 
My parents ended up losing their jobs last year, and still had debts amounting up to a total of $80,000 (a mixture of credit cards and fixed-term loans). I have been making repayments for these and, by my calculations, I should be able to finish paying them off by October this year. I’m trying to figure out the best way to help them after this. They’re both receiving Centrelink retirement payments each month, which are minimal. I would like to supplement their income, though I am worried about how they’d be spending it. Is it advisable to open up a joint bank account with my parents?
 
Annie
 
Hi Annie
 
Let’s stop for a second and acknowledge your sacrifice:
 
You are an amazing daughter!
 
I’m sure your parents really appreciate what you’re doing (and if they don’t – remind them).

If I were in your shoes, when October rolls around I’d establish some boundaries … and cut off the money. Still, that’s easy for me to type and incredibly hard for you to do. 
 
To soften the blow, I’d encourage them to have a meeting with a Financial Information Service Officer (FISO) at Centrelink, and have them do a Statement of Financial Position and a budget that shows them how they can live off their pension.
 
I don’t know if you can afford to keep funding your parents’ lifestyle, and what ultimate long-term effect will be on your retirement. Yet I’d encourage you to think about this deeply. As they say on the aeroplane safety message, you need to fit your own mask first. 

Scott.

Barefoot-Approved Home Loans?

Hi Scott
 
I was scrolling Instagram the other day and I came across a group called Unbiased Mortgage Brokers who have “Recommended by the Barefoot Investor” at the top of their page. Before I book an appointment, I just thought I’d check that you do actually recommend this home loan provider.
 
Jerry
 
Hey Jerry
 
Thanks for checking!
 
I’ve never heard of them. However, I am very happy to give you a recommendation: stay away from Unbiased Mortgage Brokers, and anyone else (other than financial counsellors from the National Debt Helpline) claiming that I recommend them.

Scott.

The End of Cash

Hi Scott,
 
I’ve heard some talk lately (a lot more than the normal conspiracy theories) around the removal of coins and then notes from the Australian monetary system – moving Australia to a completely cashless society. The discussion between Linfox, the Government and the banks all revolves around how expensive it is to ‘move’ coins around the country for regional post offices, banks, corner shops, etc. The proposal is that the $1 and $2 coins will become notes again to reduce weight, and that later notes themselves will go. This whole concept is so very scary. It would mean a lot more traceability of payments and business transactions – and the ATO would see everything!
 
Lyn

Hi Lyn
 
It’s always puzzled me why paying for something with cash doesn’t carry a surcharge like cards do.
 
After all, there’s a huge cost to taking cash: think of the shopkeepers who have to walk to a bank holding more money than a homie in a rap video. Or Armaguard, who have two pistol-packing blokes driving around in an armoured tank.
 
Now the truth is that we basically already live in a cashless society: according to the Australian Banking Association, cash is being used for less than 13% of payments, and it’s sure to continue dropping in the future.
 
So we’ll get rid of cash?
 
I don’t think so, as much as the ATO would love it.
 
A good case study is Norway, which is the world’s most cashless country, with only 2% of payments being made with cash. Yet Norway is currently legislating the right for its citizens to continue paying with cash to ensure that they are “prepared for emergencies” (like when the artificial intelligence robots shut down our digital payment systems and have us dance like monkeys for their entertainment).
 
While I don’t see an end for cash, I do see a future where there is a surcharge on paying with cash.

Scott.

The Betrayal

Hey Scott
 
We have – well had –  a much-loved receptionist. She was like a second mum to our child, even taking paid time off to go to the grandparent/important person day at her school. She was paid above award wages and has been looked after with bonuses and gifts for the last 17 years. Here is the kicker: I caught her stealing! Cash out of my wallet – on my birthday! The look on her face as I watched from the door was not one of guilt or fear of getting caught, but quiet intent, as if it was normal activity. I pretended not to notice, but I was shocked to my core. This was right before she went on holiday. While she was away, I called the local detectives and asked for advice. Here’s where I have a conflict: do we prosecute or not?
 
Sally

Hi Sally,
 
Should you prosecute?
 
HELL YES.
 
If I were in your shoes I’d want to see her face a (pre-morning coffee) Judge Judy.
 
And I’d also employ a forensic accountant to look over your accounts and see if she’s stolen money from the business, not just your wallet. If they find anything, you should hand that over to the cops and add it to the rap sheet.

I know the hurt and betrayal must be weighing on you, and the prospect of a drawn-out drama might fill you with dread, but I’d encourage you to see it through – not only as a sense of resolution for you but as a way of helping her next boss.

Scott.

How I invest my own money

On Sunday night, after the kids were fast asleep (for the third time), I lay in bed and opened my calendar to check what I had on for the week ahead. And up popped my favourite ‘event’:
 
“Check your dividends, Big Boy!”
 
"OH YEAH!" I exclaimed, loud enough to startle my sleeping wife.
 
She squinted at me: “what is it?!”
 
“It’s dividend week!” I told her wide eyed.
 
“You’re … a weirdo,” she sighed, and rolled back over to sleep.
 
One hundred percent, though she knew that when she married me. Yet, I thought you might find it interesting to hear how I invest my money.
 
Let’s get into it.
 
These days I have roughly 95% of my net worth in a handful of low-cost exchange traded funds (ETFs).
 
Which ones?
 
An Aussie shares index fund, and a couple of international shares index funds.
 
That’s it.
 
While I’m classified as a ‘sophisticated investor’ I believe in my bones that keeping things simple is the ultimate high net worth strategy – and one which will deliver higher returns than the vast majority of professional fund managers. Even better, it means I spend as little as four hours a year managing my investments.
 
How?
 
Well, to start off, I don’t have a trading app on my phone.
 
Why not?
 
For much the same reason that I don’t have social media apps on my phone: when I’m on the throne, the only thing I want to be scrolling is toilet paper, not TikTok.
 
I don’t want to check my share prices every day, or even every week. It’s a trap that leads to stress, and overtrading, and ultimately, to flushing your returns down the toilet.
 
Here’s what I do instead:
 
I have all my investments on autopilot, automatically buying a set dollar amount of the above funds each month. (It used to be expensive to do this, but today you can trade for a few bucks, or in some cases for free.) 
 
When you buy, you can google their historical payout dates and put them in your calendar, like I do. And that means I check my share prices just four times a year … like this week when my dividends come through. That way you can do something more productive with your time … even scrolling TikTok on the tot! 
 
Tread Your Own Path!

Au Pair? Au Contraire!

Hi Scott,
 
I’m 19, au pairing in the UK and preparing for a three-month backpacking trip around Europe. Living the dream, right! Except that by the time I get back to Australia I’ll have just about used up my savings. I have this little voice whispering in my ear that I should be working towards setting myself up for the future, and travelling definitely doesn’t feel like I’m doing that! I have an index fund and I save as much as possible, but I am having that classic existential crisis of what the bloody hell to do with my life now! And by ‘now’ I mean when I go back to Australia (and reality). So, what snippet of wisdom do you have for me, Scott?

Mindy
 
Hi Mindy
 
You know that little voice whispering in your ear?
 
It’s a very good thing. Most broke people don’t have that voice (instead they have advertisers and influencers whispering in their ears).
 
However, I don’t think you should listen to it for the next year or two. Fact is, you’re only 19 once, and this is your time to go out and experience all the amazing things this world has to offer.
 
Case in point: I often employ backpackers to work at my farm … they camp at the shearing shed, sleep in their vans, eat on camp stoves and have cold showers. Yet they look at me with my wife and four kids, and the basketball, ballet and cricket practice … and pity me!
 
When you’re travelling you’re growing as a person, both from gaining a more worldly perspective and from learning how to make your money stretch, which will pay dividends throughout your life.
 
My view?
 
Don’t bank dollars, bank experiences for the next few years. Australia will still be here when you get back!

Scott.

Lovestruck

Hi Scott,
 
Last year I got caught in a romance scam and lost $240k. I was just so stupid to send money to the stranger, but I thought there were lots of signs to believe him. I haven’t told any of my family about this. I’m 56 years old, a single mother and working full time as a nurse. I didn’t have $240k, so I sold my house (making $100k profit) and then took out three loans for the rest. I also moved into my adult daughter's house, so my current expense is the bare minimum and I am so grateful. I would appreciate it if you could give me any advice on how to pay this off quickly.
 
Kelly
 
Hey Kelly,
 
Each week my editor wades through hundreds of questions and gives me five (or so) to look at.
 
He wrote a note on yours that simply read “awful”.
 
Indeed.  You’re paying $140,000 off at high(er) interest rates, you’re living with your daughter, and you’re a dozen years from retirement.
 
Here’s what I’d suggest.
 
First, don’t let them rob you again: these scammers took you for $240,000 – but don’t let them take your self-respect. The fact is that romance scams are a multibillion-dollar a year business. You’re not the first, and (sadly) you won’t be the last.
 
Second, don’t suffer in silence. This is too big to shoulder on your own. You owe it to your daughter to explain what’s happened.
 
Finally, go and see a free financial counsellor (call 1800 007 007). The banks are running a mile from all this scam business, but there may be a 1% chance that they’ve lent irresponsibly, and if I were in your situation I’d be chasing down that 1%.
 
Thank you for sharing.
 
Scott

Are you smarter than a 10-year-old?

Last year, while I was fanging around France in an oversized motorhome with way too many kids, the Reserve Bank of Australia (RBA) ran its first ever large-scale survey to test the general public’s understanding of economics, by way of six multiple choice questions.
 
The results will SHOCK you.
 
The RBA found that “being male, older, of higher income, having a degree, having studied economics or finance, or being engaged with economic news are associated with higher scores”.
 
Well, slap me with a seasonally adjusted wet lettuce leaf, Guv’nor!
 
Then again, my 10-year-old son aced the first five questions. (Admittedly, he’s pretty smart – when I read him bedtime stories he often corrects my pronunciation.)
 
In fact, he did so well on the RBA quiz that I wondered whether he’d got some financial knowledge via osmosis from his old man.
 
“Well, the first five questions don’t require any real financial knowledge … it’s just logic”, he said matter-of-factly, “though the final question on the RBA needed technical knowledge that I don’t have.”
 
No pressure – but let’s see how you go.

Are You Smarter than a 10-Year-Old?

1. As far as you know, during a recession in an economy, there would normally be an increase in:
 
a) imports
b) unemployment
c) economic growth
d) business spending

2. Say wages in the economy increased by 5 per cent and prices increased by 7 per cent. As far as you know, in terms of the goods and services they can buy, a worker would be:
 
a) better off
b) worse off
c) neither better nor worse off

3. As far as you know, all else equal, which would usually increase total spending in the economy? An increase in:
 
a) tax rates
b) consumer caution
c) the savings rate
d) business investment

4. As far as you know, all else equal, a decrease in interest rates provides an incentive for people to:
 
a) save more and borrow more
b) save less and borrow less
c) save more and borrow less
d) save less and borrow more

5. As far as you know, which monetary policy would the RBA most likely adopt if the economy moved into recession during a period of low inflation?
 
a) increase income taxes
b) lower the cash rate
c) decrease purchases of government bonds
d) reduce spending on public infrastructure projects

6. As far as you know, what is the Reserve Bank of Australia’s target range for inflation?
 
(a) 0–1 per cent
(b) 1–2 per cent
(c) 2–3 per cent
(d) 3–4 per cent
(e) 4–5 per cent
(f) 5–6 per cent
(g) 6–7 per cent
(h) 7–8 per cent
(i) 8–9 per cent
(j) 9–10 per cent
(k) don’t know / uncertain
 
Answers: 1 (b), 2 (b), 3 (d), 4 (d), 5 (b), 6 (c)
 
And here’s how you did compared to the great unwashed:

Now there was one thing that really caught my eye in the wash-up … while the RBA found that wealthy white dudes got the highest scores, it also revealed that “persons aged 18–24 years, unemployed persons and those without a degree had the lowest scores”.
 
Bingo.
 
Young people leave school without knowing this stuff … so they never learn it.
 
Given the RBA’s operating costs were $500 million last financial year, surely they could snaffle a few deniros to set up and run a program and teach all Aussie school kids basic financial life skills?
 
Tread Your Own Path!

HECS Freedom for First Home Buyers!

Scott,
 
You stuffed up last week in your column on higher education. The big headline from that report was that banks should NOT be allowed to take your HECS debt into account when you’re applying for a home loan. The report blasted this practice as unfair (as a young couple with HECS debt ourselves, I’d say greedy). You should have done so too!

Louise
 
Hi Louise,
 
Nah.
 
I read the recommendation and I thought it was … daft.
 
Look, I’m no friend of the banks, but I’m on their side on this one.  
 
After all, who are a bunch of academics to dictate a bank’s lending practices?
 
If the banks are looking at your expenses and drawing a red line around your HECS debt, it’s because they know it’s a factor in you being able to repay them … and that it’s a non-negotiable expense that scales up the more you earn.  

Scott.

Let’s Talk about Bill Gates

Hey Scott,
 
I love your column and read it every time! I do have a question though: you’re extremely quiet on the global situation that’s been happening since the plandemic. WHO, WEF, global elitist groups calling the shots over health, food, money, energy, climate scams, digital currency, cashless societies, global vaccine passports. You get my drift, I’m sure. I would LOVE to hear your opinion! Is that why you took your family around Oz and overseas?
 
Mandy
 
Hi Mandy
 
You are right, I am extremely quiet about these things … and there’s a very good reason for it. Look, I know a guy, who knows a guy, who used to work for a guy, who swears what I’m about to tell you is true:
 
One of the richest men on the planet has created a social media website that is fed by an artificial intelligence algorithm that targets unsuspecting anxious-prone people and feeds them with a never-ending supply of wild conspiracy theories and outright lies. Some say that his evil aim is to keep these people chained to his website day in and day out so he can make a fortune from advertising.  
 
So that’s why I stay off social media and instead read books. The one I’d suggest you read is Factfulness: Ten Reasons We’re Wrong About the World – and Why Things Are Better Than You Think, by Hans Rosling. 
 
Trust me, you’ll love it. After all, it’s one of Bill Gates’ favourite books.

Scott.

Teacher Gets Schooled

Hi Scott,
 
I love teaching. I love the sparkle in a student’s eye when they ‘get it’. I love being a stable and consistent cheerleader in their lives. Yet things have changed in the past five years – the challenges that come with students who didn’t receive the support they needed during lockdown, and the challenges of the ‘screen kids’ – a generation with too much time on TikTok and not enough time socialising, imagining, reading or being outside. The role of teachers has never been more important, never harder and never less respected.
 
I am at the top of the classroom teacher pay scale ($120,000) after 10 years (I’m 37), with no possibility of progression unless I want to take on a Head Teacher, Deputy or Principal role – and I don’t. We can’t ask for a payrise annually like your book suggests. We have a teacher shortage and an impending education crisis, with three out of four teachers having considered a career change in the past five years. So my question is: how does a highly qualified and experienced teacher transition into another career without taking a huge pay cut?
 
Jim
 
Hi Jim,
 
So what you’re telling me is that the grass is much greener on the other side of the oval.
 
How much green are you chasing, Jim?
 
Let’s say you could earn an extra $60,000 a year. That’d give you an extra $3,000 a month after tax, which, if you invested it, would make a huge difference at your age.
 
However, it would also mean giving up your calling in life, something that clearly gives you a deep sense of meaning and purpose. You need to put a value on that – and I think it’s worth a lot more than $3,000 a month.
 
If I were in your shoes I’d look at your costs, and perhaps entertain the idea of moving to a regional area where you can live cheaper. I’d also think about how you could boost your income from tutoring. Remember, the grass isn’t always greener. Sometimes it’s just astroturf.

Scott.

Barefoot … You’re a Vulgar, Right-Wing, Nutjob

Hi Scott
 
You are a piece of work. The problems in the private health insurance industry have been ongoing for years, and Labor has been in power since the middle of 2022. That didn’t bother you! Instead you chose a cheap political hit-job on a very hardworking minister (Mark Butler). For all your spin, the facts are the facts: the more people we have in private health insurance, the less strain on the public system. In the future, keep your vulgar right-wing comments to yourself.
 
Linda
 
Hi Linda,
 
Given we’re talking about healthcare, I suggest you check your blood pressure (it might be a smidge high). A few weeks ago I was accused of being a Greens Party shill – this week you’re saying I’m to the right of John Howard. So I must be doing something right.
 
Now the hardworking minister got caught in my squirrel grip because he’s the guy in charge who can make changes. Fact is, the Government whacks people with a stick to buy private health insurance, but does nothing to rein in the deliberately confusing way it’s sold to us.
 
That’s not just my opinion: this week I was inundated with readers’ responses (many from workers in the industry!) telling me how unaffordable it is, how confusing it is, the gaps and the gotchas, and generally how terrible the industry is.
 
And to your point, a research paper by Melbourne University set out to answer whether private health insurance cuts public hospital waiting lists. They found it barely made a dent. Right, left or Green, the message is clear: the industry needs a bloody shake-up.

Scott.

My (brief) time in jail

The prisoner walked into the jail meeting room, sat down in front of me, and stared into my soul.
 
“Hello”, I said nervously.
 
Silence.
 
At the back of the meeting room there was a big clock on the wall that ticked loudly every second … perhaps a passive aggressive reminder that the prisoners were ‘doing time’.
 
A full 60 ticks later she opened her mouth.
 
“When I came in here …”, she whispered, softly enough that I had to lean forward (even though I knew I should not have been leaning forward), “I brought only the clothes on my back … and your book.”
 
“Okay”, I said, even more nervously.
 
“Okay”, she repeated without blinking.
 
I was in a women’s prison completing the mandatory workplace experience component of my Diploma of Financial Counseling … and what an experience it was!

Now, there are still people who see TAFE Vocational Educational Training (VET), compared to a university degree, as the educational equivalent of Aldi. But I strongly disagree … and I have both qualifications.
 
It’s said that uni is for learning and VET is for earning: VET/TAFE qualifications are more practical, shorter, and are generally much cheaper.
 
And I think it’s a very rational choice for a lot of teenagers who have no idea what they’re going to be when they grow up.
 
After all, not only does the research say that the average person will have five careers over their lifetime,  the World Economic Forum says that two-fifths of workers will be disrupted by technological change (read: AI) within the next three years.
 
And that’s why I was surprised this week that the Government released the Australian Universities Accord Report, which set out an ambitious goal of doubling the number of university placements over the next 25 years.
 
Does it really make sense to spend $40,000 on a degree you may never use?
 
(Today many people are finding their HECS-HELP debts are rising faster than they can pay them off. Last year the debt was increased by 7.1%; this year it will jump by another 5%.)
 
Don’t get me wrong. I don’t want my doctor to have a ‘Diploma in Appendix Removal’ from Broadmeadows TAFE. There is absolutely a need for quality tertiary education.
 
However, it’s also true that many universities have become highly profitable diploma mills: rapidly ratcheting up their fees, jamming in full-fee-paying Chinese students, and all too often delivering a Zoom-like learning experience. Which may explain why the number of students studying for a degree has fallen by more than 13% since 2016.
 
TAFE courses, meanwhile, are widely available and increasingly well funded. In fact, the prisoner I was speaking to was getting her life back on track from behind bars by doing … a VET course.
 
Tread Your Own Path!

Wine-O Needs Help

Hi Scott,
 
I have a dream. I want to start my own vineyard. I love wine! We live on 20 acres in Gippsland (Victoria) and I want to add 4 hectares of vines. I always thought it was a pipe dream but last year I got an inheritance of $250,000 from my grandmother. I want to use that money to create something. I want to bottle my own wine, it’s very profitable. My wife is not so sure, and wants to pay it off the mortgage. Is this a good idea?

Craig
 
Hi Craig,
 
I know nothing about wine, so I asked the best winemaker I know, Ben Ranken.
 
Ben won the ‘Young Gun of Wine’ award from his industry peers, so he knows what he’s talking about.
 
Over to Ben:
 
“I see a lot of doctors and lawyers and wealthy people who fall in love with the idea of owning a vineyard, but they never think about who they’re going to sell their wine to.
 
“So my advice to Craig is to work backwards: have a wine with a local winery and ask them about their experience, how much they’re selling their wine for, and to who, and how much money they’re making.
 
Because it can be a tough slog. A vineyard costs between $30,000 and $50,000 a hectare (irrigation, posts, vines) to set up, and then you’ve got three years before you have a crop.
 
So you’re basically working for free, and you’ve got all the risk. As you know all too well, Scott, there are bushfires, floods, kangaroos, rabbits, hailstorms …”
 
Thanks Ben, I’d go with paying down the mortgage Craig (and buying a case of your favourite plonk).
 
Speaking of which, I famously don’t drink anymore, but back when I did it was Ben’s wine that was my rolled-gold favourite. In fact I used to give away his plonk to hoity-toity wine snobs, and they’d often tell me it ‘tasted like $200 wine’ (check out Ben’s wines out at www.wilimeewines.com.au). I don’t get paid anything to say that … other than to see my readers get to drink amazing good wine.
 
Tell him Barefoot sent you!

Scott.

The man with no balls

Federal Health Minister Mark Butler wants you to know that he has balls of steel.
 
You see, each year private health insurers must go cap in hand to him to increase their prices. And this year they wanted to deliver their biggest premium hike in six years – but he rejected it.
 
Bam!
 
Instead he’ll soon announce that he’s allowing a much smaller increase in your annual private health insurance premium.
 
Pow!
 
The truth?
 
The truth is the Minister doesn’t have the balls to tell you it’s a total farce.
 
But I do. So let me tell you how the game is really played … and how you are getting robbed:
 
While it’s technically true that private health insurers can only increase their prices once a year, and that old Steely Balls has to sign off on it, it’s also true that health insurers can close down existing policies and simultaneously release new, much more expensive policies at any time.
 
Let me give you a very personal example:
 
My family has gold-level, hospital-only cover with insurer Health Partners. (I don’t pay for extras or combined cover, because it’s generally a rip-off for most people.)
 
Ten years ago, this was one of the best-value products on the market. Actually it was too good – Health Partners have now closed this product to new customers.
 
And here’s the rub: today, if a new customer wants the same cover as me it would cost them $2,360 more than I’m currently paying per year.
 
And it’s not just Health Partners that are engaging in this shifty practice. CHOICE recently found that insurers have increased their gold hospital cover by about 31.5% in the past three years, much more than the Government-mandated increases.
 
Look, private health insurance is intentionally confusing.
 
There are 26,000 different policies, and so many exclusions and out-of-pocket gotchas that it makes it almost impossible to work out how to get a good deal … which is exactly how the health funds like it.
 
This explains how they were able to lift their profits by more than 110% in the last financial year (to $2.2 billion) while their customers lived through a cost of living crisis!
 
So what can you do?
 
Well, think about whether you actually need private health insurance, for one.
 
That being said, the Government has a gun to our head and effectively forces 11 million of us to take it out, or smashes us with an extra tax. (And if we wait too long to sign up, we’re slugged with a further penalty based on our age.)
 
So your only option to save a buck is to consider downgrading your cover. CHOICE did the numbers and found that you could save up to $1,870 by switching your hospital insurance to a cheaper gold, silver or bronze policy – which admittedly limits or totally excludes coverage for childbirth (snip, snip!), knee or hip replacements (no limbo dancing!) or mental illness (stay happy!), among other things.
 
And when you’re comparing, avoid the churn-and-burn bucket shops like Comparethemarket and iSelect, which only show you policies they get a kickback from. Instead, head to the Government’s search engine Privatehealth.gov.au, which lets you compare every policy on the market.
 
If Mark Butler really had balls of steel, he’d stop playing political theatre with the health funds and do some serious surgery on the entire industry, because it’s an absolute disgrace.
 
Tread Your Own Path!

You’re a Dick, Barefoot

Scott,
 
I'm a hairdresser, and I didn’t appreciate you starting your column last week with the idea that your wife was embarrassed about you being mistaken for a hairdresser. It just made you sound like a dick. Don't alienate the people you are trying to help. Do better.
 
Michael
 
Hi Michael,
 
I actually got a LOT of emails this week from angry hairdressers saying the same thing. For the record my wife is embarrassed by me – not the idea of hairdressing. Mainly though, she gets annoyed that I wear free T-shirts instead of the nice ones she buys me. Apologies to all the hardworking hairdressers.

Scott.