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Saturday, 26 June 2021

Back into lockdown we go

After several months of relative normality since the North Beaches region of Sydney was in lockdown (I was still working from home (by choice), but DS1 was going to his new job in the city on most days, DS2 was attending school and sports training and events, and DW was working PT and going out and about socializing) it looks like the whole of Sydney will soon be in another period of lockdown (only going out for work if you can't work from home, and staying at home except for shopping for food, exercise (subject to limits on how far from home you're allowed and the max size of groups exercising out-of-doors), and to get medical care etc.). This latest outbreak started from a single limousine driver being exposed to the delta variant of Covid-19 from an international aircrew, and from there it spread to family members and the local community in the Eastern suburbs of Sydney. One 'super spreader' event (a party where ten of the thirty guests caught Covid-19) and some community transmission and we're now in the situation where new cases numbered 29 in the past 24 hours, and some of those cases occurred outside of the area already in lockdown. Given the more contagious nature of the delta variant I suspect we'll see most of greater Sydney put into lockdown by the end of next week.

(** update: just a few hours after I wrote this the entire Greater Sydney area was put into two weeks lockdown for the next 14 days **)

Unfortunately the roll-out of the vaccination program has been a quite slow in Australia. The government has placed orders for five different vaccines last year, but two didn't work out, and our biggest supply was for the AstraZeneca vaccine that can be produced locally, but which has turned out to have some more serious potential side-effects than was initially known. The Pfizer mRNA vaccine seems to be a better option, but limited supplies initially meant it was only available to those aged under 40 (where this risk of blood clot complications from the AZ vaccination was greater than the risk of Covid-19). Subsequently that was raised to under 50, and recently those under 60 are eligible for the Pfizer vaccine.

But being eligible doesn't mean you can get vaccinated immediately. DW and myself are both under 60 (until the end of this year!) so we've booked in for the Pfizer vaccine. The earliest available date for the first injection was in September, so we won't be getting the second jab (and likely have immunity to Covid-19) until late October.

Meanwhile community spread of Covid-19 and subsequent lock-downs remains 'situation normal', probably until the end of the year when sufficient numbers of people have been fully vaccinated to slow the rate of spread of any future outbreaks.

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Thursday, 24 June 2021

Millionaires of Australia

In an annual study produced by investment bank Credit Suisse the median level wealth for Australian adults was calculated to be $A315,380, pulling ahead of previous #1  country - Belgium. However, Australia 'only' ranked fourth in mean wealth (at $A640,852 per adult) due to averages being skewed by a small number of extremely wealthy people in the top three countries - US, Hong Kong and Switzerland (which conversely means that Australia would be considered more egalitarian than those countries).

Currently 9.4 per cent of Australian adults are millionaires, and ranks behind only Switzerland (15 per cent) for millionaire density, and ahead of the United States (with 8.8 per cent).

The report predicts that over the next four years the number of millionaires in Australia will rise by 70 per cent to 3.1 million, which is just below one quarter of the adult population! The calculations included the value of owner-occupied houses, but also took into account an individual’s debt. So it measures net wealth rather than simply gross assets.

In general the international growth in the number of millionaires is quite high, with the report predicting that the number of millionaires will swell by 49 per cent across the board during the next four years. Australia will add to its tally of millionaires faster than the UK (where numbers are predicted to rise by 50 per cent) and the US (where millionaire numbers are expected to increase by 28 per cent).

With the title 'millionaire' rapidly losing its ability to define who can be considered 'rich', a new measure of 'rich' is the ‘very high net worth individual’ (VHNMI) which consists of those people having $US50 million ($A66 million) net wealth. Australia currently has 3262 VHNMIs.

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Wednesday, 2 June 2021

Perth Mint Unallocated bullion purchase - May

My second monthly savings plan deposit (I increased the amount from $100/mo to $200/mo in May) went across to my Perth Mint online depository account on the 15th May. The scheduled bullion purchases ($100 each of gold and silver) were automatically processed at the close of business pricing on the 1st business day of June.

This month 0.040 troy ounces of gold were purchased for A$99.29 (including the $0.50 transaction fee), and 2.682 troy ounces of silver were purchase for A$100.00 (including the $0.50 transaction fee).

Total unallocated bullion holding are now:

gold: 0.083 troy ounces

silver: 2.682 troy ounces

The residual A$1.07 cash balance will carry towards next month's bullion purchases.

In my monthly NW calculations my bullion holdings are split into two components - the bullion value of my proof gold coin collection is recorded under 'other assets' and is probably undervalued as these proof coin sets were limited qty and generally have higher numismatic value than bullion value.

My Perth Mint bullion holding is valued at the spot bid price at the end of the month, and is currently included in my geared share portfolio valuation (I included it there as the first month was only $100 sitting in the cash account pending the first bullion purchase). I might remove it from the share portfolio calculation and add it to my gold coin collection next month, so that all my 'bullion' holdings are grouped together in my monthly NW reporting.

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Tuesday, 1 June 2021

Net Worth: MAY 2021

My monthly NW estimate has been updated in NetWorthShare for the end of May. Chart is in the side-bar.

Stocks and managed fund investments decreased slightly this month, down $2,121 (-0.62%) to have  $341,453 net equity in my geared share portfolios.

Our estimated house price for May (my half) increased by $58,041 (6.69%) to $925,027. While the Sydney house market has been rising strongly, this monthly gain seems a bit high. Possibly due to the particular mix of sales in our suburb making the median price bounce around (in previous months our suburb median price appreciation had seemed rather subdued compared to the overall Sydney housing market).

The value of my retirement savings rose during May, to $1,417,878 (up $25,704 or 1.85%). 

The value of my precious metals rose significantly during May, to $24,377 (up $1,432 or 6.24%). 

Overall, my NW reached $3,007,427 by the end of May - up by a healthy $83,427 (2.85%).

I continue to include the value of the 'other real restate' (the lake house I 'bought' from my parents, and the off-the-plan unit I 'bought' with a 10% deposit and paid stamp duty on) at 'cost'. The portfolio loan used to pay the deposit on the unit and the stamp duty (and the remaining mortgage I'll need to obtain upon settlement in 2023) is listed under 'other mortgages'. In reality the value of the lake house has increased since I 'bought' it, but I will never realize that capital gain as I intend to leave the lake house to my sons, and although the value of the off-the-plan unit is likely to be higher than 'cost' (based on movement in unit sales prices in that suburb since I bought) I'll wait until I get a valuation done when the unit construction is completed before I start tracking changes in the unit's value.

I did indeed become a tri-millionaire before the end of the financial year (as I mooted last month might occur), but it could easily drop again. I remember when I first became a 'millionaire' prior to the GFC, only to see my NW plunge during 2008/9. It is also sobering to remember that Australia now has over 100 billionaires - so being a billionaire is similar to the level of relative wealth a 'millionaire' had back in the days of the Great Gatsby,  and being a 'millionaire' these days simply means you are comfortably middle class.

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