Alex, are you married/partner?
Anyone else in Mortgage Stress ? 50% Pay ?
80%, that's nothing.....
We're putting about 97% of our income/profits towards IP's.
But no stress encountered so far.
Regarding the nab credit card - ring up and ask to speak with the "card solutions team" or say you want to negotiate your interest rate on your credit card. They may be able to offer you a short (or long term) solution by discounting your interest rate.
let me know what the splits are .(loan amounts and rental return on IP).Hi
Anyone else in mortgage stress?
50% of my salary is going into ppor & ip mortgage repayments. I make $1547 net a fortnight.
I'm struggling atm and my bank balance has been going down! I'm down to $1600 now. I'll get paid tomorrow though. I'll be ok and have some breathing space once I get my $3,500 tax return back in August, but in the meantime just to stay afloat I've had to open a new credit card with my anz account for a limit of $3000 set to min payments. Also instead of paying off my nab credit card in full each month i'm going to start paying just half the amount.
I'm using the credit card as a short term back up and once I get my tax return I'll be paying off the credit cards. I'll be using the credit card to pay for expenses such as food, petrol, accountant fee, yearly water bill, rate bill. Because I have to make sure I have enough money to make my mortgage repayments. Other living expenses for the next 2-3 months will have to be on credit.
In January I'll be increasing the rent from $230 pw to $245 pw. For it to become neutral it needs to get to $270 per week. So as I increase the rent that will make it easier to handle for me!
I'm thinking I may have to get a 2nd job but I really dont want to have to do it due to health reasons of which i'm not going into on this forum. 1 full time job is enough for me as it is.
I really need to be extra frugal now. Pretend to live like a pensioner and be so careful. The next 2 years I think will be tough but If I'm careful I can get through it.
Any tips encouragement or advice would be great!
Anyone else struggling too? People usually go quite when they struggle dont they and dont want to say anything.
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Rent out the PPoR and move into a 2 or 3 br rental. Rent out the spare rooms.
Best thing you can ever do is share rooms in your first PPoR if you are single, it also splits the bills and your cost of living is a fraction of what it is if you live alone. You're a mug if you are young, single and don't share, its very easy to save living like that.
Living alone is a luxury.
Best thing you can ever do is share rooms in your first PPoR if you are single, it also splits the bills and your cost of living is a fraction of what it is if you live alone. You're a mug if you are young, single and don't share, its very easy to save living like that.
Living alone is a luxury.
do you still have your cleaning lady?
Well I wouldn't say it's 'nothing'
It's only 12% less than you. It also depends on other factors.
It's only 12% less than you. It also depends on other factors.
In percentage terms it is actually 3% vs 20% so its a grand sum of 15% of what you spend relative to income or 85% less than you spend.
It would mean earning $175,000.00 p.a. and spending $100.00 p.w in the case of Ace.
That certainly is efficiency.
Compared to your own situation assuming same income 175k spending $675 p.w.
I don't earn 175k and worse, I spend more than $675.00 p.w. so clearly I am doing something wrong! I save / direct to investments, about 30% of my gross income not including super and I thought I was pretty frugal, compared to those around me with power boats and new cars at any rate!
Thanks for your input Tom, although I'm not sure where you get those figures from?
I make a tiny bit more than you per week, in the 30% tax bracket for what it's worth. So I basically leave $10,000p/a for food, petrol, closthes and car maintenance. Unless I wish to dig into my LOE cash, but I prefer not to for the time being, the more the merrier!
I make a tiny bit more than you per week, in the 30% tax bracket for what it's worth. So I basically leave $10,000p/a for food, petrol, closthes and car maintenance. Unless I wish to dig into my LOE cash, but I prefer not to for the time being, the more the merrier!
Although i must say that I feel like a douschebag when I compare myself to Nathan.. Every new copy of API I get he's on the front cover again making three times my annual wage in a month!!
It gets me thinking in a good way but it seems I'm too busy working for semebody else to have time to do anything about it. It feels like I don't even have the time to think in depth and head more in the same direction. I will have to try and find some time soon to just sit and think. There is obdviously more I could be doing but at the same time I feel I am doing quite well just working in a guaranteed pay/job to pump income into investments.
I'd like to have a large buffer before setting out and taking bigger risks such as leaving work to persue full time investing.
It gets me thinking in a good way but it seems I'm too busy working for semebody else to have time to do anything about it. It feels like I don't even have the time to think in depth and head more in the same direction. I will have to try and find some time soon to just sit and think. There is obdviously more I could be doing but at the same time I feel I am doing quite well just working in a guaranteed pay/job to pump income into investments.
I'd like to have a large buffer before setting out and taking bigger risks such as leaving work to persue full time investing.
If you are having to use a credit card to get by, I reckon you are too close to the edge, but maybe I am a bit conservative compared to others here.
Some good ideas in this thread and you said something about early next year making things easier, but how will you cope if interest rates rise more? They could keep rising.
Also, 1st July, many utilities will rise in price. Cost of living things etc etc.Can you cope with that also? Will your tennant accept a rent rise? Can you afford it if it is empty a week or two while you find someone else?
Sorry to sound negative with those questions, but if you can sell without a loss, maybe that is an option to consider also. If any of the other ideas help you through, then great.
Some good ideas in this thread and you said something about early next year making things easier, but how will you cope if interest rates rise more? They could keep rising.
Also, 1st July, many utilities will rise in price. Cost of living things etc etc.Can you cope with that also? Will your tennant accept a rent rise? Can you afford it if it is empty a week or two while you find someone else?
Sorry to sound negative with those questions, but if you can sell without a loss, maybe that is an option to consider also. If any of the other ideas help you through, then great.
How much you making? I'll tell you if it's worthwhile
Good point Delta
If I'm in the later 30% tax bracket, and earning 3x this wage in growth then things are good.
If I'm in the later 30% tax bracket, and earning 3x this wage in growth then things are good.
The figures were plug numbers just relating spending 3% of an income v 20%.
I could have taken any income figure for the contrast, only choose 175k because I assumed it would be impossible for someone (Ace) to save 97% of their income without earning at least that. Indeed you have to assume after tax or it does not work.
For clarity, I do not earn that much myself, I only interjected to point out rather than spending only 12% less it is in fact spending much much less in percentage terms.
I wish I only spend $100.00 a week. I spend half that just between nappies and formula, more than that on fuel, used to spend nearly that on smokes.
I am definitely not a good example of frugality, just do a bit of math at work from time to time, but nonetheless am notorious at making mistakes. As I tell the younger folk, when I was young I could do this stuff, what do they teach you now at school? It took 15 years for me to forget it.
Another good example of where people can come unstuck on the maths stakes is when interest rates rise say 1%... They say oh I can put the rent up 5%, that should more than cover it. It doesnt. Say you pay 7% interest and it rises to 8%, thats a 12.5% rise in interest outgoing, assuming rent was initially covering interest, that you need to jack the rent up by to break square on the increase, possibly why the OP is struggling when it would sound like 5% to 7% interest increase is only 2%! It aint it is an interest bill 30% odd higher in the latter case so easy to see how for some people it can be life changing / dramatic.
As an aside now off topic it is why it is vitally important that inflation be kept in check as inflation hurts more than you might think at the front end, down the line if you can hold on of course it is OK when your wages are starting to dwarf your debt however front end >> Finance becomes exceedingly difficult to get hold of, yes wages rise but finance costs soar initially killing off investment, businesses on fixed price contracts die off or price in inflation and then as Rudd would say the genie is out of the bottle. In Rudds case 18 months before inflationary cash handouts were given to all and sundry ('cept me
) and the reserve bank dropped rates massively and is now jacking them up without regard to the mess they themselves created."97% of income/profits" must include rental income too..?
Rixter
PPOR & IP are IO. I have some pay going into my anz offset and some into my nab savings account. PPOR loan comes out of my ANZ offset and my IP repayments come out of my ANZ rental chequeing account. The nab credit card has been getting paid off in full from my NAB savings account.
LuceRocks, Painter thanks for the suggestion but nope my place is a bedsit.
Devo76
1070 per month PPOR repayments which is $267 a week
As of December 2009
PPOR loan $177,000 - PPOR valued at $260,000
IP loan $199,000 - IP bought for $210,000
376,000 \ 470,000 = 80 LVR
PPOR in 2009 worth 260,000
Yes I agree this is an option! Thanks! I could rent something for around $250 a week then I wouldn't have to worry about the rates, strata and other PPOR expenses. The only thing is atm I'm not prepared to do this as I am quite happy where I am. I've been here for 3 years and I dont want the upheaval of moving again. But later on in the future this could be a very smart move. Rents will increase even more and in a few years time I can see myself getting a nice little cashflow positive thing going on with my current PPOR when its rented. I wont discount this option though. I'll keep it in my thoughts thanks
PPOR & IP are IO. I have some pay going into my anz offset and some into my nab savings account. PPOR loan comes out of my ANZ offset and my IP repayments come out of my ANZ rental chequeing account. The nab credit card has been getting paid off in full from my NAB savings account.
LuceRocks, Painter thanks for the suggestion but nope my place is a bedsit.
Devo76
1070 per month PPOR repayments which is $267 a week
As of December 2009
PPOR loan $177,000 - PPOR valued at $260,000
IP loan $199,000 - IP bought for $210,000
376,000 \ 470,000 = 80 LVR
PPOR in 2009 worth 260,000
Yes I agree this is an option! Thanks! I could rent something for around $250 a week then I wouldn't have to worry about the rates, strata and other PPOR expenses. The only thing is atm I'm not prepared to do this as I am quite happy where I am. I've been here for 3 years and I dont want the upheaval of moving again. But later on in the future this could be a very smart move. Rents will increase even more and in a few years time I can see myself getting a nice little cashflow positive thing going on with my current PPOR when its rented. I wont discount this option though. I'll keep it in my thoughts thanks
Bluestorm
When I bought my IP at the end of 2009 I calculated that I would be ok if rates hit 8% but I dont know what happened. I guess its all a learning experience isn't it. I thought I would be able to manage fine and didn't realise that I would be overextending myself. In hindsight that $10,000 cash of mine that I spent to help buy the place hurt me in the end, as I'm finding I really needed a bigger buffer than I started with. But all is not lost. I'll get through this. My LVR at the time I bought my IP was 80% Thanks for your tip btw
Bluestorm
I am happy with my job and my health is the most important thing that matters to me. It is not stressful and I'm enjoying it. People are all different! I think you need to be a bit more tolerant of peoples differences and not so critical and judgemental! It just means it will take me longer to acquire and retire from property because of my lower income but thats fine by me
When I bought my IP at the end of 2009 I calculated that I would be ok if rates hit 8% but I dont know what happened. I guess its all a learning experience isn't it. I thought I would be able to manage fine and didn't realise that I would be overextending myself. In hindsight that $10,000 cash of mine that I spent to help buy the place hurt me in the end, as I'm finding I really needed a bigger buffer than I started with. But all is not lost. I'll get through this. My LVR at the time I bought my IP was 80% Thanks for your tip btw
Bluestorm
I am happy with my job and my health is the most important thing that matters to me. It is not stressful and I'm enjoying it. People are all different! I think you need to be a bit more tolerant of peoples differences and not so critical and judgemental! It just means it will take me longer to acquire and retire from property because of my lower income but thats fine by me
It just means it will take me longer to acquire and retire from property because of my lower income but thats fine by me
You're resorting to credit cards to make ends meet, APK. You should be thinking about financial survival, not retirement. More rate rises later this year may happen. Every 0.25% is about $20 a week increase for you. What do you do then?
