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The 20 Commandments of Wealth for retirees

Noel Whittaker has been a great supporter of Firstlinks (previously as Cuffelinks) since the start, not only writing dozens of articles, but referring the thousands of people who subscribe to his own newsletter to us.

In this tribute on his 80th birthday, Noel has three children now aged 38, 36 and 34 who between them have produced 11 grandchildren. This is keeping him and Geraldine as busy and active as ever, combined with his always-hectic speaking and writing schedule.  

We start with an article first published on 13 February 2011 but with a timeless message. It's especially relevant in these worrying market conditions.

Boom and bust 

There are always people who claim they forecast when the market was going to peak and cashed in all their shares just before the crash. I guess when pessimists are forecasting crashes a few will be right now and again. The reality is that nobody, to my knowledge, has yet mastered the skill of consistently and accurately forecasting market movements.

This week a reader took me to task about some comments I made in late 2007. Apparently he had asked my opinion on a book he had seen advertised on a website that had forecast the “coming great financial crisis of 2008”. According to him I had responded that those kinds of books were always popping up, and I had learned never to take much notice of them.

He claimed he remained fully invested after reading my reply and, as a result, lost heavily when the global financial crisis hit. He now subscribes to a daily financial newsletter which is forecasting another severe crisis in 2011. The purpose of his latest email was to enquire if my views had changed and whether the dreaded double dip was finally on its way.

He was asking the wrong person

I have been an investor for too long to even attempt to forecast where the market is heading. I have been through the 1974 share crash that followed the nickel and property booms and suffered through 1987 when share prices doubled within 12 months and then halved in just one month. This was followed by the 1990-91 recession and then that terrible year of 1994 when every asset class except cash produced negative returns. How shocked we all were when the All Ordinaries index, which had started the year at 2,174, plunged 11% to 1,932.

Then there was the dotcom boom in 1999 and 2000 where Telstra shares hit a high of $8.35, followed by another bust. In November 2007 the market had its highest peak to date, which was followed by the famous crash of 2008.

What a fascinating history of ups and downs. And there has never been a year that a book or a newsletter or the latest guru does not predict that a great depression, or at least a share slump, is just around the corner.

Of course, they are correct every few years, because it is the nature of markets to rise and fall, and they loudly trumpet their success to the world at large. It may gain them an army of short-term disciples but whenever it happens I am reminded of the famous quote by Marie von Ebner-Eschenbach: “Even a stopped clock is right twice a day”.

The optimists who stay invested

The world seems to be divided between those who think the glass is half full and those who think it is half empty. There are optimists like myself who stay invested in the belief that the market, even when it falls, will eventually recover and exceed its previous high. Then, there are the bears – the habitual pessimists who forecast bad times ahead year in, year out. The good news for them is that they are right occasionally – the bad news is that they usually end up broke because they never find the right time to invest.

All those bears worrying about the end of the world in late 2008 missed the huge recovery early in 2009.

After being an investor for more than 50 years, I am convinced that shares are the easiest investments to manage and will produce the best returns long term. However, like every investment, they have their disadvantages – the main one is volatility.

If we look at every decade since 1880, we find that shares have produced a negative return in up to four years out of ten. This means anyone who owns them can expect four negative years and six positive years. Those who think the glass is half empty will focus on the four negative years – those who think it is half full will rejoice in the knowledge that there are more good years than bad. Sadly, nobody knows which ones they will be.

The 20 Commandments of Wealth for retirees

1. Ignore the prophets of doom – they are always with us and usually wrong.

2. Understand compounding, and appreciate that the rate of return your portfolio can achieve will be a major factor in how long your money will last.

3. Take advice before the deed is done – not afterwards. It’s hard to rewrite history.

4. Always judge an investment on its merits – any tax benefits should be regarded as the cream on the cake.

5. If a person contacts you by phone with an offer of an investment, or even to help you pay your mortgage back faster, hang up.

6. Don’t have all your eggs in the one basket – diversify across the major asset classes and certainly have some international exposure.

7. Involve your partner, if you have one, in all your financial decisions. This will make it easier if one of you passes away or becomes incapacitated.

8. Don’t panic when the share market has a bad day – volatility is the price you pay for the unique benefits of shares.

9. Make sure your wills are up-to-date and include a testamentary trust if that is appropriate.

10. Give Enduring Powers of Attorney and an Advance Health Directive to trusted people. And make sure they have copies and can locate the originals when needed.

11. One of the most expensive evenings you can go to is a “free” investment seminar.

12. Be extremely wary of going guarantor for any of your children – especially if they are in business.

13. Understand the basics that never change, and take advice on the things that do.

14. Don’t spend unnecessarily just to maximise your Centrelink benefits. Further cuts to benefits are possible.

15. Investigate if you should have a Binding Death Nomination in your super fund. Keep in mind that what is appropriate in one situation may not be appropriate in another.

16. Each year assess whether it is to your benefit to stay in super. In some cases you may be better off to withdraw the balance and invest outside the superannuation environment.

17. Don’t follow the herd and back last year’s winner – that’s a recipe for disaster.

18. If you decide to take on a reverse mortgage involve family members in the process and have them pay the interest if possible. This will stop the debt increasing.

19. Make sure your children have adequate insurance. It’s much more affordable than you funding their misfortune.

20. Finally – keep in mind that your potential worst enemies can be the media who focus on the negative, and well-meaning acquaintances who may give you information that may be half right.


Noel Whittaker is one of Australia's foremost authorities on personal finance and a best-selling author of many books including Making Money Made Simple. See to subscribe to Noel's free monthly newsletter. This article is general information and does not consider the circumstances of any investor.


Val Ward
February 13, 2020

I always enjoy getting your newsletter. I also turned 80 recently. Congratulations to us we made a milestone many are denied. I bought Money Made Simple back in the 90s and have followed the principles ever since. I also bought copies for my children. The best part of life is Now.

Noel Atkinson
February 09, 2020

Noel, I bought your book Making Money Made Simple about 30 years ago and it really helped us achieve financial security. 3 things in particular: pay your mortgage fortnightly, add up all your fixed bills like rates etc for the year and divide by 12 and sweep that amount into a separate account, spend less than you earn and invest in good quality assets. I still like reading your articles in the Courier Mail.
Congratulations on your 80th

February 09, 2020

Happy 80th Noel, better later than never, I need to read your book!

Jonathan Hoyle
February 09, 2020

Outstanding advice as always Noel. Many happy returns on your 80th birthday!

February 07, 2020

I fully believe that share market record highs and global warming are intimately related.
Still, I'm a big fan of Noel Whittaker.

February 07, 2020

And I would add that Number 21 be : Always remember that very, very few fund managers have ever beaten the index over a ten year period. (Warren Buffet won a million dollar bet on this one)

February 07, 2020

Hi Stefy, since you 'fully believe' in this 'intimate' connection, do you wish to elaborate on your unusual theory?

February 06, 2020

Happy Birthday Noel.
Like others, I too read your first edition of "Making Money Made Simple" decades ago, along with "Think and Grow Rich" and "The Richest Man in Babylon". I was in my 20's then and those books started me on my financial education. I'm now a month away from my 60th birthday and have sufficient funds to be financially independent. Thank you.

February 06, 2020

I bought and read "Making Money Made Simple" in 1998.
I am now sitting comfortably in self-funded retirement in no small part because of tht piece of valuable education.
Thanks and many happy returns.

February 06, 2020

80, well done!!
Your book, 'Making Money Made Simple', started myself & my partner onto a very happy investment curve that has lead us too financial freedom & independence.
Thank you very much & may you enjoy the next 80 years

February 06, 2020

Congratulations Noel, on achieving the magic 80 years and for the advice given over many of those years.

February 06, 2020

Happy 80th Noel. Congratulations on all the great work you have done for many Australians. Noel Whittaker truly a great Australian.

February 06, 2020

Happy birthday, Noel. I too have been reading your material since the 1980's and have greatly benefited from that knowledge. Thank you. Many share investors would do themselves a favour by reading in the areas of randomness and probability. Nassim Nicholas Taleb's books are a great place to start. Luck does play a role in share investing, though many 'experts' would never admit that.

February 06, 2020


Congratulations on your 80th birthday.

Thank you for the wise advice.


February 06, 2020

Happy 80th, Noel, I've enjoyed reading your advice for many years.


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