My Investment Journey (Part 2)

Last time, I left you to ponder over the start of my journey into investing. This time ’round, I’ll take a look at the next phase of the process – filling in the forms and making the initial deposit.

Documentation Station

As always when it comes to matters involving money, there’s generally a lot of paperwork. First of all there’s the PDS (Product Disclosure Statement), which can be found here (at the time of writing). Then comes the actual application form – which is hidden at the end of the abovelinked PDF of the PDS (confused yet?). Basically, just go to http://www.bt.com.au/pdf/btif_commsec.pdf and scroll down to page 231 where you’ll find the start of the form.

You’ll need someone to verify some ID (can be an accountant, teacher, doctor, JP etc – the form lists all suitable persons) like a Passport or Licence and they’ll need to sign a photocopy of said ID.

The form is fairly self explanatory until you get to page 239. This is where you select the type of fund you want to invest in. About 28 rows from the top of the table (again, at the time of writing) you’ll see a row titled “BT Imputation Fund” (aka “RFA 0019AU” – at the time of writing) – it’s within the Australian Shares section. That’s the one I’ve chosen to go with, so you may wish to choose the same if you too are looking to follow a similar investment journey. I believe (don’t quote me on this) that it provides a mix of Australian shares (60-100%), Australian property (0-15%), Convertible preference shares (0-15%) and Cash / other (0-15%).

Submission

Once you complete the form, you’ll need to submit it… and this is where I ran into a small problem. The front of the form mentions that the identification process can be done at Westpac. This is because… “BT is the wealth management arm of the Westpac Banking Corporation, and as such, BT and Westpac are working together to help meet the AML/CTF obligations faced when new customers join. This cooperation means that customers new to BT have the convenient option to have the identification procedure performed at a Westpac Branch if they choose.”

Unfortunately, I managed to get some bimbo at Westpac’s Brisbane CBD who had no idea why I was there or why I was getting her to check my ID. I even showed her the relevant reference on the form but I think it went in one ear and out of the other. She truly had no idea what I was doing there, LOL! None the less, she assured me she’d fax it to the number on the form (which even I could have done from home or work). Needless to say, I’m yet to figure out why it’s “easier” to go to a Westpac branch when they did nothing but send the form via fax. Maybe they have pretty fax machines or something. Pretty like a horse.

Copy that; transmisison received!

Reassuringly, about a week later, I received a call from BT confirming my details and asking how I would be making the initial $5000 deposit required to start the fund. I had intentionally left the “direct debit” section on the form blank (because I despise DD; Virgo’s like to be in control remember ), but when I realised my only other payment options were a personal (don’t have one) or bank (expensive) cheque, I decided that a one-off direct debit would be okay, and so the funds were withdrawn from my savings account the next day and deposited into my new investment fund.

A week later I received some information in the post confirming my new investment. A few days after that (for security reasons), my login details arrived. I can now login and view the progress of my investment on a daily basis – not that I’d want to, because, remember – it’s a long-term thing. Like 2 – 10 years long-term. That said, I did login just this once to see what the interface was like (nice, clean, easy to use and you can do all kinds of thing online – like change your monthly top-up amounts, etc!) and to see what my money had been up to.

Tracking the progress

At the initial time of login, they had received my initial $5000 deposit and the first of many monthly top-ups (which I’ve set at $50 per month). So, after only a few days, the total was showing as $5,050.50 – meaning I’d essentially made 50 cents. It’s not much, but the market may have been down that day. Remember – this is something that you let sit for years and apart from an occasional monthly check-up for the purpose of blogging about it, I won’t be watching it like a hawk on a daily basis – that’s not how it works and you’ll just end up stressing out over nothing if you do that.

Interestingly, on the day that BT generated my initial paper-based statement (which was 3 days before I logged in and checked it online), my fund was valued at $4,970 (this is before my first $50 top-up had gone in) – meaning it had lost about $30 in value. I also logged in just now to check something before I wrote about it and it’s sitting at $4938 – a loss of $100 or so on the “real dollar value” that I’ve put into it to date ($5050) – so again, it really does fluctuate a lot on a daily basis. Let it run it’s course over a number of years.

Units & Dollars

One other thing I want to mention before I finish up today… although I’m quoting dollar values here, you actually buy what they call “units”. When I put my initial $5000 in, it bought me 3,100 (or so) units – because, at the time, each unit was worth about ~$1.61 (= 5000 divided by 3100). It’s the unit price that’ll fluctuate all of the time… a unit was worth $1.61 initially, but – right now – is worth $1.54 …hence the loss. The good thing is that the website tells you how many units you were able to “buy”, each time you make a monthly top-up deposit – and it also tells you what 1 unit was worth (in dollars) at the time.

Well, that’s all for today! Don’t forget to use the ‘Comments’ section below and let me know if you’ve had success with an investment of some kind in the past. How did you find it? Has it worked for you? Did it take up much of your time to monitor & maintain, or is it a set-and-forget style investment? Would you try an investment like this one, or will you wait and see how mine goes?

The fineprint, as always: Seek the advice of a financial adviser. I merely post my opinion and interpretation for your amusement & my records… make your own decisions and be sure to seek external advice.

Happy gains!