Newbie - starting off in property investment

[virgill]

Hi all,

This is my first post so please forgive me if I dont use the correct terminology

My partner & I recently purchased a house together (joint), and as a result of this I have rented out my original house. This house was bought as tennants in common, but we had it transfered into my name at the time we settled on the second house (mainly to do with the child support agency - rotten !@#$). Unfortunately this IP is negatively geared and is costing me about $260 per week (as well as using the rent $$) to cover the expenses. We both earn under 50K per year at our jobs, so its not like we are paying huge amounts in tax (as compared with 100K earners), but now having to pay for 2 houses - well its tough. The two properties have a combined value of 520K - but carry debt of 400K. Due to the csa, we have come to the conclusion that there is no point in my partner working extra OT, etc as the $$ just disappears in tax and more child support to the troll. And I have two young kids and already work FT, so me getting another job would be really difficult.

I love the idea of using property to create wealth, as I have little in super and do not wish to live on the poverty line when I am old, (we are both 40). I am just finding it a little daunting on how to be able to afford to have IP's and still be able to feed my kids. When you read the invester magazines - well they make it sound so easy.

Any suggestions on where to start, good books to read would be great.

Thanks

 

[letiha]

I was going to give you some suggestions but i find your comments regarding child support offensive so not even going to bother.

 

[flowkingrich]

It does make it all difficult.

Margaret Lomas' teachings are very helpful and her advice comes cheap.
She has several books but you should start at reading "Making your money last as long as you do". Go from there and educate yourself rather than get someone misguiding you. I would hate to see you have to sell. However if you come to that conclusion after running the numbers and options yourself then perhaps its a step sideways first before moving forward approach.

Try ebay first. You should pick her books up dirt cheap secondhand

In no time you will have adopted the lingo as well. Hang in there

 

[The Y-man]

Unfortunately this IP is negatively geared and is costing me about $260 per week (as well as using the rent $$) to cover the expenses. We both earn under 50K per year at our jobs, so its not like we are paying huge amounts in tax

Seems like a big shortfall.
Where is the IP and what is it getting in rent?

The Y-man

 

[marg4000]

Maybe the money is being directed to "the troll", but these are HIS kids, his responsibility, and the fact that he is minimising his income (and assets?) to avoid paying more for them is very sad, and not to anyone's credit.

Poor kids...
Marg

 

[virgill]

Thanks to those who didnt want to turn this into a debate on child support. When you have been screwed over like we have been by the csa, then maybe you would understand why I feel its important to be able to feed my kids and not just those of the first family. Plus we would like to be able to retire with something instead of seeing the efforts of our labours being used to fund the tax man and a woman who refuses to get a job and help support the kids (meaning we actually have to pay more). Her children were very well provided for in their settlement, and we have had to start financially again. And I can tell you now - I dont believe that the extra $$ that we pay in cs actually goes to the kids - more like to fund her "lifestyle" choices.

The other thing is it would be nice to be able to leave all the kids a little inheritance to actually help them when they are adults.

Will try looking for books on the internet - have heard of Margaret Lomas so I will seek her books out.

Thanks again flowkingrich and the Y man for your suggestions.

 

[tubs]

I dont know too much about the effect CSA is having on your income, but if your new partner working extra hours means your ex is getting more money then it surely shows that something is wrong with the system.

After all, why should your partner's income go to YOUR ex? But you're right, it is unfair and certainly discourages people to try to make something for their future, when the ex partner gets a split of the proceeds from your efforts, even if they dont make the same effort themselves.

But unfortunately, it looks like you're stuck with it. One partner usually jumps up and down and screams out for the maximum time with the kids, but doesnt take on the responsibility of earning the money to take care of them.

You pay for them when you've got them, I'll pay for them when I've got them I reckon.

Anyway, the only advice I can give you is not to mention child support when you post, because as you see, people start getting defensive, even if they dont know about your situation.