I am 33 and am looking into our future financial position. Might have to… but I really don’t want to work until I’m 65, only to have a meagre existence after retirement. Currently I earn 82,000 (gross) and my wife is on about 50,000 (gross), I have a young daughter (16 months) and my wife will be stopping work soon (if all goes to plan I guess in about 2 years) to have a 2nd child. I’ve been reading online investment forums and books/magazines for a few months now, I think I’ve come up with a plan to supplement my wife’s income when she stops work while (hopefully) not having to trim down on the lifestyle we’re used to. I’m going to lay it all out here, please advise/comment/remark on my plan. It definitely needs refining and I’m hoping to get help refining it. Our home loan (HL) = 305,000 Offset account has 70,000 Shares/savings account = 35,000 I am thinking of using half of the offset funds to buy into a managed fund (MF) and use margin lending (ML) to increase my exposure. Current Home loan rate: 7.47% ML rate: 9.15% If I use 35,000 from my offset account I will be paying 7.47% on it… right? This is because it is no longer in the offset acct to reduce the total HL amount. The HL interest rate together with the ML interest repayments means the managed fund that I buy into will have to perform better then 16.62% (7.47% + 9.15%) to make it worth while… right? Anyone know of an online calculator to work out the amounts? Or if you’re good with excel and can create a spreadsheet… hint hint!! EG: If a bank is willing to lend 75% for a particular MF. Is this correct: 35,000 plus 75% = 61,250 total MF 35,000 x 7.47% = 2,614.50 p.a. (interest repayment) 26,250 x 9.15% = 2,401.88 p.a. (interest repayment) Total repayment = 5,016.38 p.a. For the total of 61,250, it has to return above 5,016.38 p.a. to make it worthwhile… right? The MF has to produce an income because it’s main (only) reason/use is to help service IPs (none acquired yet, planning stage). Once that is setup, I will look into buying the first IP shortly after and continue to buy IPs when equity builds up enough. Serviceability. This is the greatest concern, we could probably afford to service a couple of IPs but it would mean not being able to provide a decent life/school for the kids and a huge change to the current lifestyle. Yep, I want my cake and eat it too . How can I afford to service more IPs? Ideas please?! That’s it. That’s a plan to work on. Rough isn’t it?! Hopefully with the ideas/comments from here I’ll be able to get a firmer understanding and refine it.