Hi guys
I’ve been floating around this forum for the past 3 years or so and hope I’ve learned a bit!
I’ve got a problem that has been doing my head in for a while.
Basically, my main investing goal is to retire when I’m 40. I’m pretty set on this, and it’s a big driver for me.
The problem is, I don’t know if I’ll be able to do it using my current strategy. My spreadsheet tells me I’ll just miss it (by 2 years) even IF the banks keep lending to me and all of my assumptions prove to be right.
As a bit of background, my current situation is this:
1. I’m just about to get married, both me and my girlfriend are 28, and we currently rent.
2. We have three investment properties in the inner suburbs of Melbourne valued at $620K, $520K and $450K.
3. We have a discretionary trust that holds $200K of unencumbered, high dividend yielding shares.
4. We have cash of around $30K.
5. We have total debt of $1,270,000 (all deductible and all secured against IPs).
6. So, our net wealth is around $550K.
7. All of the properties we’ve bought have been very negatively geared (which is largely the reason I haven’t wanted to post on the forum yet…this strategy seems to be a bit frowned upon!!) Anyway, currently, our portfolio (including the shares in the trust) is negatively geared to the tune of about $150/week (after tax).
9. Both my GF and I are on good salaries, but we want my GF to have the freedom to stop work at 31 (which is in 3 years and when we’re hoping to have kids).
Our plan is simply to:
1. Buy a home in 4 years.
2. Every year (or as often as possible), approach the banks, draw as much equity as we possibly can against our three IPs and/or home, and then use those funds to buy high yielding shares in the trust.
Really, I want some reassurance from the forum that this strategy sounds ok, or for someone to tell me that I’m dreaming and need a new strategy!! Also, if anyone has any tips that can speed the process up a bit, that’ll be great.
Happy for my plan to be criticised!! I’d much rather know now if there’s a fatal flaw.
I’ve been floating around this forum for the past 3 years or so and hope I’ve learned a bit!
I’ve got a problem that has been doing my head in for a while.
Basically, my main investing goal is to retire when I’m 40. I’m pretty set on this, and it’s a big driver for me.
The problem is, I don’t know if I’ll be able to do it using my current strategy. My spreadsheet tells me I’ll just miss it (by 2 years) even IF the banks keep lending to me and all of my assumptions prove to be right.
As a bit of background, my current situation is this:
1. I’m just about to get married, both me and my girlfriend are 28, and we currently rent.
2. We have three investment properties in the inner suburbs of Melbourne valued at $620K, $520K and $450K.
3. We have a discretionary trust that holds $200K of unencumbered, high dividend yielding shares.
4. We have cash of around $30K.
5. We have total debt of $1,270,000 (all deductible and all secured against IPs).
6. So, our net wealth is around $550K.
7. All of the properties we’ve bought have been very negatively geared (which is largely the reason I haven’t wanted to post on the forum yet…this strategy seems to be a bit frowned upon!!) Anyway, currently, our portfolio (including the shares in the trust) is negatively geared to the tune of about $150/week (after tax).
9. Both my GF and I are on good salaries, but we want my GF to have the freedom to stop work at 31 (which is in 3 years and when we’re hoping to have kids).
Our plan is simply to:
1. Buy a home in 4 years.
2. Every year (or as often as possible), approach the banks, draw as much equity as we possibly can against our three IPs and/or home, and then use those funds to buy high yielding shares in the trust.
Really, I want some reassurance from the forum that this strategy sounds ok, or for someone to tell me that I’m dreaming and need a new strategy!! Also, if anyone has any tips that can speed the process up a bit, that’ll be great.
Happy for my plan to be criticised!! I’d much rather know now if there’s a fatal flaw.