Need advice...

S

Sydney_Steve

My mum has inherited just under $1million dollars after a divorce. This sounds like a lot although the problem is she does not work, she and 56 years old and probably will not work again.

So I want to make this money last and invest well, but the problem is she does not want to live in an apartment (stubborn like me haha). She likes Dee Why and town houses start at $650K. With the remainder money she could live off it for 10 - 15 years? Then go onto the pension?

Do you guys know of any creative strategies? If you were 56 years old, not going to work again but had $1mil cash what would you do to live in a Dee Why town house ($650K - $750K) and create an income?

Cheers in advance.
 
or put the million into a high interest account live off the interest while paying the house IO payments off with the interest aswell that could be fully paid off when she hits the pension if she likes
i read somewhere some banks allow certain money in a term deposit to be used if they are the ones holding it?
 
Once the money runs out could she continue to living in Dee Why on the pension which is about $250 per week for a single? (assuming fully paid off house).

Pension would kick in when she is 65, if not sooner (widows pension). So think of the tests that need to be met to get this - own home and $xx in assets or less for full pension etc.
 
$1M
HIGH INTEREST account at 6% = $60K pa
Expenses?​
$650K IO loan $45.5K pa
Warringah rates ~$1K pa
Electric $3K pa
gas $1k pa
water $2K pa
phone cable tv ISP etc $3K pa
vehicle $8K pa​
expenses $63.5K
==> food $[size=+1]-[/size]3K

bum,
eat more of the principle each year, hope she doesnt outlive her funds,
its not going to be a completely worry-free life, but functionally possible, if the financers will do an IO loan for a person with 'no income'
 
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Inheritance or divorce settlement? They're not the same.

Could I suggest making a non-deductible contribution to a low risk option in a super fund? That way the interest earned is on a low tax scale and tax free upon retirement. Use the other half to purchase a t/h in the area.

If she is not working at present, what is she living off?
 
Well - hate to be cruel - but honey, you ain't got the money.

She has to make some tough decisions about what she wants out of life. If she doesn't want to/can't work she can either have the townhouse in the areas she wants - OR - the income she wants ... not both.

$1mil only buys $1mil of assets ... it is either the expensive house or the future comfortable living.
 
Sigh... I wish I had $1mil to play with... anyone feeling generous.
She could always Rent a room to foreign Students, this should cover some of the expenses.
Failing that there is always the Casino, I wonder what $1mil in Chips would look like.
 
Could she buy in her preferred area and get something with a granny flat, or a separate rentable area?

That way she could live where she wants, and have a little income to supplement whatever pension she may be entitled to?
 
IMO anyone who spends 2/3 of a settlement on a house, will be selling the property within a few years, after the remaining 1/3 is spent.
Doesn't sound like this person is careful of money.

Just my opinion....
 
The Y-man said:
Does she qualify as a widow after divorce, or does she have to remarry, and then have him taken down...? :eek:

The Y-man
Click to expand...

yeah $1m is nice but not really enough to keep her in the style accustomed do, i suggest hiding the $1m in a bank account somewhere is someone else's name then marry and take down another sucker for at least $2m this time.

then her never going to work again lifestyle can be maintained until the grave.
 
Bigtone said:
yeah $1m is nice but not really enough to keep her in the style accustomed do, i suggest hiding the $1m in a bank account somewhere is someone else's name then marry and take down another sucker for at least $2m this time.

then her never going to work again lifestyle can be maintained until the grave.
Click to expand...

Perhaps she helped build up the assets in her marriage :rolleyes:.

Perhaps she cannot work for health reasons :rolleyes:.

Do you have anything helpful to say?
 
c'mon wylie, anyone who spends 2/3 of a settlement on a house, will be selling the property within a few years, after the remaining 1/3 is spent.
Doesn't sound like this person is careful of money.









:D
 
Not one to generalise, are you?

You are always banging on about how "some people" generalise, jump to conclusions and judge people.

What do you think your post is doing?
 
wylie said:
Could she buy in her preferred area and get something with a granny flat, or a separate rentable area?

That way she could live where she wants, and have a little income to supplement whatever pension she may be entitled to?
Click to expand...


This is what I am thinking. She is currently renting a 3 bedroom place and renting two of the bedrooms to one of her friends and a friend of a friend, so she is used to the idea of sharing a house and actually I think prefers it.

From what I have read her options are:

1) Rent and live of the interest. I dont like this one as it seems to be a waist of a good opportunity. ie ending up with nothing seems pretty sad after getting the money.

2) Buy a townhouse in Deewhy, rent out a room and then go onto the pension. Is it better to get a loan and pay it off or buy the house in full?

or 3) She was is also thinking of moving to Wollongong where my sister lives... But doesn't want to move down straight away. Maybe she could buy a house down there, rent it, then move down if or when she wants while still renting up in Dee Why, that way she can stay in dee why while building up some assets.

Also Kathryn and Bigtone I came on here for advice from experts, not uninformative opinions, this is my mum we are talking about!
 
wylie said:
Not one to generalise, are you?

You are always banging on about how "some people" generalise, jump to conclusions and judge people.

What do you think your post is doing?
Click to expand...

My post was quoting kathryn d :rolleyes: not posting my own opinion

Yesterday 05:20 PM
kathryn d IMO anyone who spends 2/3 of a settlement on a house, will be selling the property within a few years, after the remaining 1/3 is spent.
Doesn't sound like this person is careful of money.

Just my opinion....
 
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