Hi guys – my situation is as follows and I am having troubles working out what to do!
Have about $200k although I am only 22 but plan to move out at 24-25. I am looking for an investment property to lease in the short term (2 yrs or so) and then possible live in once I move out.
My options are investing in a mid $300k’s unit with a relatively small loan or looking for a house in the high $500k range with a $350k odd loan. Not sure which option will yeild better results in the long term. As I said, I will be leasing initially most likely living in it aftre a couple of yrs. If I were to buy a unit, I would be living in it for a few yrs with the aim of then buying a house although there would be no real rush to buy another house if that’s what I end up doing.
Not sure which is a better option for long term growth and/or tax implications.
Any advice would be appreciated!
I dont know about the financially adviseable side of it, but for you at 22 my advice is get a small loan (you can feel very pure and virtuous and financially responsible) and then get out and have some fun in your life. I can’t see the point of living on the smell of an oily rag to pay big payments off a house at your age.
Fern
Hi,
as a previously licenced financial adviser I know something about what you are going though. Given that I am not allowed to give financial advice now for legal reasons (not licensed – got out of the game), I would have thought that there would have been some other options for you to obtain higher and more aggressive wealth creation opportunities rather than just buying and holding. if you are looking to stay at home for the next couple of years, why don’t you take some time to take advantage of your low bills and source some other options for higher growth.
Your age group would usually be defined as “able to withstand a certain amount of risk” or “highly agressive”, given that you have to be comfortable with your investments and able to sleep at nights, I think you have more opportunities than you think.
Have you thought about being a money partner with some one you trust, if you don’t have the time or knowledge yourself?
Have a think.
Nicolethanks for the response guys & a very interesting reply Nicole!
Any suggestions for what would be more aggresive wealth creation strategies? Might be an idea to start researching other options I think.
Thanks!
Hiya AMDS,
With 200K cash or equity at your age is absolutely marvellous – well done. You are streets in front of me at the same age.
Assuming you have a high powered income to match that marvellous equity level, you could certainly do some amazing things in the next 2 or 3 years with a bit of leverage.
It’s only my opinion, but purchasing a flat or house would be nigh on the bottom of my list, as things to really get you fired up.
Have a casual chinwag to some of the guru’s on this site (Terryw / Simon / Richard / Dr X / Derek) and they should be able to point you in the right direction.
Good luck – how exciting for you….you are in a cracking position.
ADMS,
Congratulations on having your present position with $200k in your pocket.
Depending on what is your long term goal in life. If you are keen into the world of property investing. I believe you might have taken some steps in educating yourself toward your goal. Steve’s mentoring program might be whortwhile for you to consider if you haven’t.
Cheers,
Hi AMDS,
As others have mentoned, you are in a fantatsic financial position at your age- congratulations!
I’m not sure if you have any debts from study but if you do, you could put aside some money to cover those debts. Also, if you want to put aside a small amount for holidays or travel, or future commitments like a new car, you could put this small amount in an online savings account to make sure you have this money on hand when you need it.
With the remainder, you could either buy into property or shares. You can afford to take more risks than others at your age. Whatever you choose to do, my advice would be to buy the highest quality asset that you can afford – “you pay for what you get”.
Kind regards,
Jason.Without wanting to suggest anything as I don’t know your financial position I can give genral advice only. The firast thing I would do is speak with someone such as Cata and look into seeting up a trust structure which suited my financial needs, wants and goals. Then I would look at taking on a mixed portfolio of investments such as a house, a unit, a commercial property, and some blue chip shares in either an insurance company or somewhere like x-strata or bhp, with the possibility of an offshore mutual fund depending on how you feel about it.. Balance is the key and calculating the risk is the same. If you take the safe shares option at first you still get returns and you know they are relatively safe.
Either way your comfort zones are the key and being able to sleep at night is as well.
Just remember you need to protect your assetts as their is always someone looking to take them. Play safe have fun and remember at 22 you are more than young enough to stand up and start running again if you fall…
Stuart Milne
Non-Conforming Specialist
READY Mortgages
http://www.readymortgages.com.au
[email protected]
Mob: 0404 056 055
You must be logged in to reply to this topic. If you don't have an account, you can register here.
