Bendigo bank

[Bruce Tuncks]

I have sold my house in Adelaide and moved down to the farm at Edenhope. I was planning to move my stuff ( proceeds of the house sale) to Bendigo Bank, which has a main street branch in the town.

BUT I have been told that only the big 4 banks ( eg NAB) have a govt guarantee, so my money will be safer there than with the Bendigo Bank.

Please will anybody tell me this is nonsense?

[red750]

This might be the answer to your question, Bruce.

 

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

[Bruce Tuncks]

Thanks Red. Bendigo bank was there on a list...  does this mean that it is covered and my informant was wrong?

 

[red750]

As I interpret that, deposits of up to $250,000 with the Bendigo Bank are covered by the guarantee, the same as any of the other listed banks, including the big four.

[Jerry_Atrick]

Yep Bruce, your informant is wrong. He may have been thinking of when they were a building society?

 

Darn it... you are only covered for up to 250K for all accounts... Should be per account (as per almost the rest of the developed world)...

 

Anyway, as a bank (i.e. operating under a banking license as an approved deposit institution), it is a condition of maintaining that license that they are in the scheme.

[facthunter]

I wouldn't be worried about using the Bendigo Bank. I do and have for a fair while.. Research it's "reliability". The others might be more cause for worry as the inquiry found.  Nev

[Fliteright]

I'm with the BDG bank purely as it's convenient (in town), they are the same as the other corrupt big 4, pick one most have little choice! I just wish the grubs in charge would put interest rates up, they are way too low, we need a balance!

[spacesailor]

Go with Mcquarri bank 

They paid their CEO $53 million PA.

spacesailor

[octave]

A bank is the last place I would keep money other than for day to day requirements or temporary storage of a large sum.   My superannuation account earned  19.6% last year and my wiles superannuation pension account earned 16.6%   

[Yenn]

Go with Macquarie Bank, I do.

Yesterday I tried to pay a bill and they have changed the screen that comes up when you log on. It has a big blue flag across the screen saying download the security app. I couldn't get rid of that screen, nor could I do any transaction, because the "Pay" button is missing.

A phone call resulted in being told that they will have to alter the back end of my account. Whatever that means. It should all be OK in two business days. Not bad for a bank that has about $150000 of mine and my wifes and pays nearly zero percent on that.

Luckily my wife has their shares and they pay well, but you can see why.

Haven't had any feed back from them to my question as to why I should not take my money elsewhere.

[Dax]

I've always used credit unions and small banks, you get real service and they don't charge as much as the big banks. When I took over my last pub, they had their accounts through Bendigo bank, when I did the sums, compared them to a small local bank and after talking to them, save a hundreds of dollars in fees and charges over a year.

[facthunter]

Banks now generally have too many loans out that are not to people who can pay them off if the market falls even a bit. so they have a RISK.. I had a lot of shares in Macquarie Infrastructure Group. After I examined the shareholder reports and business model i divested myself of their product because of it's BONUS payments it makes to the people who run it whether there's a profit or not.. . IF you get much at the other end you are lucky... The stock market runs on 2 things FEAR and GREED. Only Inside traders do well the rest are just Gamblers.. Some Super funds are doing quite well . Others are just siphoning of your assets with management fees.and spurious charges. Nev

[Bruce Tuncks]

Thanks guys. I agree that any bank is not the very best place for your money, but in this case it is only going to be there till I buy a newer plane.

Many years ago, I put my retirement money briefly into the Commonwealth bank. During this time, they paid a 20 million golden handshake to a retiring executive.  I was aghast, and when I looked into it, they could have made it 2000 million just as legally, and emptied the coffers.

These days, I have some of the farm ownership  in a private superannuation scheme, but this is no good either because the law demands that I have an outrageously expensive audit every year.

[facthunter]

Bit of a trap with your last line option. There are "investments" that superfunds cannot use by law. The final Purchaser of my vineyard had most of his fairly extensive  empire in superfund structures and I think he came a bit of a gutser. . I had a self managed superfund once and did ok till I let someone else run the investment   side for a while . I didn't have the time required and you can guess the rest.. Nev

[octave]

We bank with Bank Australia which does not have outside shareholders.  The bank customers are the shareholders and any profit is returned to the customers.  Banks Australia started from the merger of the CSIRO credit union with other credit unions.  They have strong ethical guidelines about where they invest.   We  usually  don't pay any fees.   The only downside (although it suits us) is that they a very few branches. We do all our banking online.   

https://en.wikipedia.org/wiki/Bank_Australia

 

We both have super with Australian Ethical which has always given good returns.   My wife retired 2 years ago and I retired at the end of last year.  We were quite nervous about whether we had enough to retire early given the number of stories in the media that said people don't have enough super.   Contrary to this we we have more now than we did when we stopped working.   

 

 

[spacesailor]

Octave, My daughter retired last month !. that makes me Feel Old.

spacesailor

[facthunter]

Well, Frankly you probably are (as are many of us here) May I ask do you have grandkids  and how do they get on with their "Poppy"?  I only had one grandfather I knew and he died of silicosis when I was about 4. I used to walk behind him along the railway line. Little was said. He was probably not old but was a coal miner who worked in a mine that went out under the sea and he told me you could hear the ships passing overhead.. Nev

[spacesailor]

Gradkids,!   ( 15 )

Ive got heaps of Greatgrand kids, ( 17 & more on the way ) , the oldest just started high school.

I have,t seen the last few, with this pandemic. Just won,t risk them getting sick !.

spacesailor

 

 

 

[Marty_d]

31 minutes ago, spacesailor said:

Gradkids,!   ( 15 )

Ive got heaps of Greatgrand kids, ( 17 & more on the way ) , the oldest just started high school.

I have,t seen the last few, with this pandemic. Just won,t risk them getting sick !.

spacesailor

 

 

 

Bloody hell Spacey,  the way your family breeds you're likely to add another "Great-" to your title soon!!

[Jerry_Atrick]

@octave, you picked the best time in a long time to invest your savings in future and top it up. Despite the fraud and rorts uncovered by the royal commission, the main investments that super (and other retail investment funds) invest in are shares or derivatives of shares, and those markets have been red-hot lately.

 

Of course, everything has to be looked at in terms of risk/reward. The risk is, that if the markets crash, well, so does your super (or other investment fund).. Even guaranteed return funds (usually of the principal investment) are not guaranteed unless there is a government guarantee behind it. The banks pay poo because the risk is very low - at least for the first $250K.. And those poor banks have to make money somehow, right?

 

There is an old saying it's best to have your money own part of the bank than deposited in the bank.. and in an indirect way, that is what is happening with your funds. Also, with compulsory super (and it is recently compulsory here, although most companies provided it in some form or other anyway), the funds are flushed with cash.. and they need to place it somewhere. So, there is a school of thought that this excess cash generates higher demand for investments, and where there is an increase in demand without an increase in supply, then the price will go up. So, the argument is, while more and more people pump money into their funds each month, the fund managers are competing for the best investments in their portfolio strategy; which puts up the prices.

 

Despite this, you still have to be relatively careful: https://www.smh.com.au/business/banking-and-finance/unlucky-13-australia-s-worst-performing-super-funds-named-20210831-p58nf7.html

 

I still have my Bendigo Bank accounts (reminds me, have to get a new security token). I opened them up in 2003 when returning the first time from abroad. I did a lot of research and at the time, they were definitely the best and most ethical of the more well known banks. I am sure they have their problems, but, back then, they were not bad at all..  One thing few people know (or knew) is that if your town has a Bendigo Communtiy branch rather than a Bednigo Bank branch, the branch is actually owned by a franchisee and not the bank itself. It used to be that the person who purchased a franchise had to have a connection with the community the branch was in, amongst other things. So, they have an interest in keeping the bank going in the community and is not just a corporate suit from, Bendigo (or Adelaide, now, I guess). I have my accounts with a community branch.

 

[octave]

1 hour ago, Jerry_Atrick said:

Despite this, you still have to be relatively careful: https://www.smh.com.au/business/banking-and-finance/unlucky-13-australia-s-worst-performing-super-funds-named-20210831-p58nf7.html

 

Yes that is true. I have been with my super fund for about 30 years.   It is an ethical fund and usually performs well although is often slightly lower than the best performers.   When corvid hit it did initially fall sharply.  I did withdraw a reasonably large sum of money and put it in a term deposit for safety.  Alas the super recovered quickly and were left with this sum of money earning very little whilst our super thrived.   Of course that money is now back I super.

 

 

We dropped out for about 20 years and found ourselves in our 50s with very little super.  We considered that it was too late and that we had missed the boat and we would just have to work until we dropped.  My clever wife, being sick of her job did a course on the ins and outs of super.  In around 4 years we were able to somewhat catch up.   We salary sacrificed  to the max, we downsized our home.   instead of working until we drop we were able to retire comfortably at 59 (my wife retired 2 years ago at 57).

 

Of course super comes with some risk however our super fund is quite conservative in terms of risk and within that we choose  the medium risk options.   I have, more through accident than intention,  a small amount in one of their riskier investment options which earned 44.2% last year which is impressive but it is the 10 year rate (14%) that is important.

[facthunter]

Playing with derivatives speeds up everything. You can make money fast or lose it just as quickly. IF you borrowed the money to invest , moreso. In Australia with the ASX you had to do an approved course before you were allowed to deal in derivatives. With investments don't put all your eggs in the one basket as many do when they just keep on buying houses.  Stock markets can be manipulated and some poorly performing Companies  maintain a reasonable dividend to hold the share prices up. IF you manage to get a high return on a deposit the chances are, there's a high risk involved.  Inflation makes a loan easier to pay off but your money loses value. You still pay tax on the basis of the increased number of dollars with no account for inflation... The stock market is gambling and the mug investor is working at the bottom end where all the main benefits have already been creamed off.. You can play the rises and falls and pick your buy and sell points but none of this is big deal in the big scheme of things and you are getting your profit at the expanse of some lesser aware advised group not providing capital for growth as the investor in a new float does.. Nev

[Jerry_Atrick]

4 hours ago, facthunter said:

The stock market is gambling and the mug investor is working at the bottom end where all the main benefits have already been creamed off..

I agree with the sentiment that the mug investor is working at the bottom. but the mug at anything is usually working at the bottom of whatever it is.. The cavalier pilot, the inept worker, etc. The mugs will always be at the bottom and investing (whether the stock market or something else) is no different.

 

But I do disagree that stock market investing is gambling. Like anything, it has an uncertain outcome predicated by risk. If you don't do your homework or you don't monitor the situation with your asset manager (who, at the end of the day, are usually guided by commissions or fees), then yes, you can end up losing your shirt. But that is the same with anything - are I say, even life - it doesn't always turn out the way we expect it, and unfortunate events can have much more dire consequences than walking around bare-chested. Like life, the more you put into investments, on the whole, and normally, the more you get out of it... but sometimes things happen you can't control.

 

The reason why I say investing in the stock market is not really gambling is that, on the whole, you may end up losing - but not everything (some derivatives, excepted - where they are a zero sum game). Say you purchased Bendigo Bank shares back in 2016. It's share price was around $12.70 and is today 9.89. Yes, you will have lost money, but unlike gambling, you still have value (and 75% of it minus inflation). It's not a great result, but gambling (and if we are talking investing, we are talking derivatives - particularly futures and options for most of what is available for the retail investors), you are either in the money or out of it at expiration.. The other thing about stock market (equities) is that you can make something from your stocks and sell it to the next guy, and he or she can make some more... sometimes the seller views it as a loss (of opportunity cost), but the reality is, both can gain; gambling isn't like that - one loses; on gains.

 

Of course, retail investors are at the bottom of the pool. One of penultimate last jobs in Aus was to put in a eTrading system for a bank.. It was a front to a larger broker platform - The stock market member would buy or sell the stock at a price, put their commission on, pass that to the broker, who put their commission on. The bank then passed that price to the retail client with a fixed AUD commission. To make it worthwhile as a retail investor, you need to know what you are doing,  do your research so that you average returns beat the commissions, inflation and earn you a decent return. That is the reason I use funds.

 

BTW, after 9/11, I noticed the US airline stocks took a pounding. I was dabbling in individual company investments at the time, and without research picked the stock that dropped the most and set a get out price. I bought US Airways at something like $2.76 and set a get out price at something like $6. It wasn't a large investment - a couple of hundred pounds, but if I lost it, it was going to cost me going out for a month. The stock quickly climbed to about $7 or $8. I revised my get out price to $12. Sadly, the electronic broker I had didn't have stop profit orders (i.e. get out once you have made enough).. and at about $10.50 (I may be wrong, but that is what I recall), the filed for Chapter 11 Bankruptcy and I lost it all. So, you can lose your shirt if you don't do your homework. I learned that lesson the hard way... But, these incidents are rare.. if you do your homework.

 

 

8 hours ago, octave said:

When covid hit it did initially fall sharply.  I did withdraw a reasonably large sum of money and put it in a term deposit for safety. 

Yes... sometimes it is worth waiting and seeing what happens. The markets do have a her mentality (which is why algorithmic trading usually works very well). As Warren Buffet says, "When the market gets greedy, I get scared; when the market gets scared, I get greedy), But you still have to do your research! (Which is why I buy ETFs on the dip - they do it for me, and they generally do reasonably well over the longer term, and if my return isn't as good as if I had invested myself, well, who cares - I wouldn't have picked the same stocks anyway).

[octave]

17 minutes ago, Jerry_Atrick said:

es... sometimes it is worth waiting and seeing what happens

I think at the time it was the first wave and we just dint know what would happen so we wanted to at least secure one years income.  We were quite optimistic that the market would recover so we left most in super.   Thee is no point looking back with regret.  On the upside I was working at the time so Job Keeper more than compensated.

 

 

 

I cant believe I have become interested in the stock market.   For most of my life I resented having to listen to news readers talking about the Dow Jones etc.  Now I follow it as I can see how for example the  ASX  feeds into the value of my super.    I do play around with the the stock market a a little.  I think it is like any form of speculating.  Any money I have bought shares with is on the understanding that I am willing to lose it.

 

I bought $1200 of Tesla shares in 2019 they are now worth $13390.  I am about to sell a couple of shares which will get me back the original investment plus a little.  Then I intend to let the rest ride on the understanding that I could lose it or I could do well. I am not willing to bet the house or borrow in order to invest though

[Jerry_Atrick]

22 minutes ago, octave said:

I bought $1200 of Tesla shares in 2019 they are now worth $13390. 

Don't bloody remind me! I was working at a large multinational bank at the time, and while the Equities traders were advising against it, I wanted to put a lot of $ into Tesla. Unfortunately, the bank forbade people in my role from investing in single name shares, so I couldn't (nor could immediate family; and wider family/friends couldn't on my advice; if it were found out I would be working as a taxi driver for the rest of my life and I am not that great a driver).

 

Although I think they may wobble a bit now, you will still be quids in on your original investment.