Barefoot Investor's top tips amid coronavirus panic
Barefoot Investor Scott Pape is warning Australians not to make rash money decisions fuelled by coronavirus panic - and says financially, it's not all doom and gloom.
The Australian stock market had its worst day since the Global Financial Crisis (GFC) on Monday and Prime Minister Scott Morrison has said coronavirus could hit the economy harder than the 2007 slump, amid predictions of a recession.
Finance guru Pape told News Corp while he does not know what the future holds around the virus, or for the share market in the short term, there are unique opportunities for Australians who are smart with their money.
He said consumers could expect to see petrol prices drop to around a dollar and a further decrease in interest rates which presented a "once in a lifetime opportunity to pay down debt".
For those who have money they do not need to access for 10 years, Pape, author of The Barefoot Investor and The Barefoot Investor for Families, said making smart investments in the stock market could pay off.
"Right now, my view is, it's the same as the Boxing Day sales, the share market is on sale," he said.
"And we will look back on this in 10 years and say, 'That was a really good opportunity'."
Pape invited readers to contact him with questions around the issue, to address in his News Corp Sunday column.
He said while the serious health consequences of coronavirus should not be downplayed, it was a "health crisis", not a financial crisis and he urged people to avoid making decisions based on panic.
"I think the best advice would be: don't just do something, sit there," he said.
"If you are basing your financial decisions on short term headlines, it's time to go for a walk in nature.
"And what I would also say is with people that are really worried, now is the time that paying to see a financial adviser, to stop you from being like a rabbit in the headlights, is a good thing."
As for a recession, Pape said after unprecedented bushfires, and now the coronavirus epidemic: "of course there's going to be a hit".
"Things don't always just go up all the time," he added. "There is always going to be tough times on the horizon.
"So what I've been saying over the years is, don't do Afterpay, don't have credit cards, build up some Mojo - some savings - you know, don't buy the most expensive house and load yourself up to the gills with debt."
Pape has experienced the impacts of bushfires first hand, not only through the loss of his rural property in Romsey, Victoria in 2014, but while volunteering as a financial adviser to help those hit by the most recent bushfires.
Road to Recovery with Scott Pape, which documents Pape's journey, will air on Foxtel's LifeStyle tonight (March 11) at 8.30pm.
"There are people in our community that have been hit with a really devastating and life changing situation where they've lost their home and their livelihoods," he said.
"And what I wanted to do was … to tell the story of the road to recovery, warts and all, because for those people, the recovery is very much still ongoing."
Pape offered his services for free and all advertising revenue from the show will go to the Financial Counselling Foundation.
To ask Pape a finance question which he may answer in his News Corp column, visit: www.barefootinvestor.com/askbarefoot.