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Cash to use but help needed

Discussion in 'General Investing Discussion' started by hedo, 8th Dec, 2008.

  1. hedo

    hedo New Member

    Joined:
    5th May, 2008
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    Location:
    emerald qld
    Hi Folks,

    My wife and i are both 45yrs old and would like some advise,We have a ppor worth 650k mortage of 210k ,150k each in super,No other outstanding debts we both have very secure jobs.I bring home $1900 per wk nett and my wife $750 per wk nett.We have previously had very poor advise for an ex accountant,And currently tied up with a financial adviser that i'm not happy with,The adviser is very conservative and doesn't want to invest in property at all.I have been doing alot of reasearch myself,and attending investment courses over the last 12 mths.I understand that corner stone of investing is serviceability and we are in a postion to manage our investments however the asset class may be.We are looking to invest long term but would like to retire/semi retire around the late 50s. I know we have left our run late but any advise would be appriciated, or maybe the name of a good financial planner would help.
     
  2. Young Gun

    Young Gun Guest

    Your missing a few details that would help us answer your questions.

    How much surplus income do you have?
    What is your planned retirement income?

    One of the questions I would be asking is "do I need to borrow at all?" can I get from point A to B without needing to borrow. If the answer is Yes I'd steer well clear of it.

    As an adviser myself I'm not a fan of direct property either but it has it's place and many people have done quite well for themselves. Personally I wouldn't use an adviser who recommends property or buy a property from an "investment Seminar", too many fingers in the pie and the only loser is you.

    If your really keen on property $300K in a SMSF + some borrowings through an instalment loan would get your foot in the door without needing to borrow directly.

    Personally I'd sit tight for 12 months, power down your home loan and wait and see. Alternatively the sharemarket is very attractive at the moment, although it has further to fall, its still a good buying opportunity. Dollar cost averaging in over 12 months using a line of credit should do very well over the long run.
     
  3. hedo

    hedo New Member

    Joined:
    5th May, 2008
    Posts:
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    Location:
    emerald qld
    Thanks for the reply Y.G

    We have $1700 pwk surplus after all expenses, and our aim is for $1200 pwk nett retirement income.Yes i'm fully aware of the sharks that are around the property investment seminars.We were looking to invest within the 15km ring from briz centre .As we know the area well and have done a fare bit of research into it.But we also know of the pit falls of having ips as we have had one and sold due to advise from accountant,We shouldn't have sold it it was neutrally geared and going along nicely on it's own.Also we are dumping all of our money into an offset on the home loan and paying bills with credit card then paying card expense at the end of the mth.I really like the opportunities i see in the future with the share market and would like to get some exposure to it??
     
  4. C3PO

    C3PO Well-Known Member

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    Location:
    Adelaide, SA
    Hedo

    Selling the neutrally geared property was only a mistake if you made a worse investment with the funds that you had tied up in it - presumably you did?? Can you elaborate on what you did instead of holding the IP?

    If you buy another property then doing it via your SMSF is one good approach. It enables you to take advantage of having sold the old IP, since having the income taxed at 15% is better than your marginal rate.

    If you don't want to do it via SMSF then have a think about doing it in your wife's name, although you should at least neutrally gear it (positively gearing it wd be better). The advantage of doing it this way is that it enables you to keep your superannuation in the sharemarket (I assume that's where it is now?) and provides you with at least the opportunity for further capital gains.

    I would also encourage you to pay off the rest of your mortgage as quickly as you can, then just have the debt on the IP
     
  5. crc_error

    crc_error The Rule of 72

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    your best bet would be to pay off your home loan, and then dump as much into super as possible as it would be your most tax effective option.

    If your planner is conservative, then thats a good thing over the last 12 months.
     
  6. hedo

    hedo New Member

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    Location:
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    C3PO

    We made $130k on the investment property and have pumped the money on our ppor.
     
  7. C3PO

    C3PO Well-Known Member

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    Nothing wrong with that really - it could have been much worse, you could have put it in the sharemarket 6mths ago or bought yourself a Maserati
     
  8. Chris C

    Chris C Well-Known Member

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    I don't think you should be bad mouthing the maserati Grand Turismo as an investment option given what the AUD did over the last four months.

    If you had bought a near new Maserati Gran Turismo six months ago it would be worth 20% more today given the AUD deflation against the Euro. That would have been one of the best performing investments of the last six months (especially compared to a 35% fall on the stock market), not to mention you would have been driving one the hottest cars available to man!

    :p

    *drools*

    ...ahh the oppurtunities missed.
     
  9. C3PO

    C3PO Well-Known Member

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    Lol ... the honourable member is quite correct. I withdraw my remarks.

    hedo, if you are going to kick yourself over something, kick yourself over the fact that your accountant did not advise you to buy the Maserati
     
  10. Chris C

    Chris C Well-Known Member

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    Though don't feel too ripped off, mine didn't forward the recommendation to me either...

    :(