Financial Information you wish you knew 5 years

All,

Thought I would start a thread on financial information/hints that people wish they knew five years ago. Might be useful for others.

For me, the two big things are:

1. Tax implications of offset vs redraw on home loans
2. Concept of using a discretionary trust to hold investments

I guess it's better late than never - but it would have been so much easier if I knew them five years. Has anyone else got anything that they wish they knew - which I might not yet know?

Regards,

Jason

 

Not so much that I wish I had known earlier, but one that I find mentioned but not always defined. The '6 year' rule when determining your PPoR upon sale of a property.

My basic understanding is that there is a 6 year window where you can rent out your PPoR as if it were an IP (claiming expenses and interest for tax), and upon sale you can still claim it as PPoR and hence pay no CGT.

My basic understanding of a strategy using this is:

Purchase your 'PPoR', hopefully recieving benefits such as FHOG. Live in it for at least 6-12 months (depending on FHOG eligibility).

After the 6-12 months Purchase (or Rent) another property and start treating your PPoR as an IP. As long as you move between the two every 6 years you have the option to treat one as a PPoR upon sale. Of course, after you've sold one, the other cannot be claimed as PPoR during the overlapping years.


I'm sure someone can word that much more eloquently than I.

 

Three little letters...



F M G

 

Never deal with Macquarie bank. Ever.

 

I wish I knew the the rhetoric of "you never lose money in the long term (7+ years)" was just marketing spin framed on very recent history.

 

stupid question

Stupid question but what are the tax implications of offset vs redraw on home loans?