Thought an exercise might be an idea to generate some interesting discussion: Lets forget for a moment how a guy got to a certain point, whether he would have been better off going all shares or all property or whatever. He finds himself in a situation many of us have. On the asset side he has his own PPOR, 2 IPs, and a portfolio of managed funds. On the Liability side he has a loan for his properties, a line of credit he pulled out to start his MF portfolio, and a margin loan on the portfolio. PPOR $100,000 IP1 $100,000 IP2 $100,000 MF portfolio $50,000 Margin Loan $30,000 (60% LVR) Line of Credit $20,000 PPOR Loan $80,000 IP1 Loan $70,000 IP2 Loan $70,000 The guy is comfortable sticking with 80% LVR for property, and 60% LVR for managed funds. Now the guy has a choice. He can get another $100,000 property, but has to come up with a 20% deposit (or he isnt comfortable with the LVR). His options going forward are either leave things as they are, or sell his managed funds and use the $20k balance (from the LOC) as a deposit on IP3. He expects his managed funds to grow by 15% per annum (no yield), and his property to grow at 8% per annum with a 4% yield. He expects his average property interest rate to be 8% and his average margin loan interest rate to be 9%. What is the best way forward for this guy? Why? (Sorry, some goals might help: guy wants to retire as soon as is safely possible on the $25,000 per year - he doesnt care, LOE, divs, rent, whatever as long as it is $25k a year, indexed for inflation of 3%).