very low income earner

[natmarie73]

Fightcrank think of studying as investing in yourself - you will get a better job and more money, and in a recession (yes there will be a recession eventually) will be more employable than if you had no quals. Alternatively could you do an apprenticeship and get a trade behind you? You will not be earning much at first but in a few years it will definately pay off. Meanwhile, you can invest your savings in other areas such as shares so it is working for you until you can afford to buy a property.

You are still very young and have oodles of time ahead of you - plenty of booms and busts to come. The money you may lose in lifetime earnings by not getting good qualifications now could be quite substantial and believe me getting them while you are young, have no debts and can live with mum and dad is much easier than waiting until your 30's.

 

[Mr. Fabulous]

getting good qualifications now could be quite substantial and believe me getting them while you are young and can live with mum and dad is much easier than waiting until your 30's.

Speaking from experience, this is right on the money.

Mark

 

[s_t]

From the other viewpoint, I wouldn't recommend studying for a couple of years just to get a higher paying job - unless you can do it at night or something so it doesn't affect your current income. If you are reliable, hardworking and honest you should be able to find a higher paying job fairly easily. The more initiative you can show, the easier it will be.

The other thing to think about is your own business. It doesn't have to be a large, quit your job and go all out type affair. I'm an engineer, but don't work as one - I run my own business - a nursery I know others who have ordinary fulltime jobs, and have a small nursery business on the side - selling at markets. An extra few hundred a week (double or triple that in spring&autumn) doesn't hurt the finances. That is just one example that I am familar with- there are plenty of other possibilities!

Being able to generate income yourself, rather than having to be soley reliant on a 'job' is a great skill to have. Further studying may only further entrench you into a particular job (depending on what you study). Developing the skills and experiences to be able to generate your own income does the opposite IMHO.

 

[natmarie73]

Further studying may only further entrench you into a particular job (depending on what you study). Developing the skills and experiences to be able to generate your own income does the opposite IMHO.

Totally agree. However Fight has said he has no qualifications at all. Even getting a basic TAFE diploma at night will be better than nothing especially when/if the labour market becomes more competitive.

I really can't think of many jobs that can be had with no quals that will ever pay enough money to allow someone to build an investment portfolio. And yeah we all know you can get squillions driving trucks in the mines but for how long? After the boom all those unqualified workers will be back in the factories/Maccas/Woolies earning $10 an hour or at Centrelink.

If I were him I would be getting myself a good trade - builder or whatever that will not only get good jobs/money but would also be extremely beneficial in the property market ie in regards to property development or whatever.

Being so young, he has to assume that at some point in his life he will need to compete for jobs during a recession with other honest, reliable, hard working people - some of whom will have more qualifications or experience. If you can study at night and work during the day then why wouldn't you?

 

[grizzly_1]

There are definately jobs out there that pay enough with no quals. They might be mind numbing, but i have friends that are willing to do that as a means to an end. One is on 55k in a quarry working arvo shift straight out of school, another on 45k in a motor company factory working day shift production work.
Both dont really enjoy their jobs so qualifications might help them with more enjoyable jobs but it shows there is higher paying work out there its just a matter of doing the hard yards to find it.

 

[Mr. Fabulous]

Hi flightcrank,

I dunno why I didn't think of this before - why don't you go and work in the mines. Work up there for a few years, save like crazy and you'll have enough cash to put a very hefty deposit on a home or a couple of I.P's.

Mark

 

[flightcrank]

thought i would dig up my old thread. ive moved out and rent a studio apartment. i still have the same job. even tho i completed a tafe course in '08 pretty much went to study right after i made this thread back in sept '07.
i havent found anywork with it tho.

ive continued saving however and have got 120k in a high intrest account. plus an extra 10k as a buffer in a everyday spending account.

pretty much cant save money anymore with rent,bills,food and all that. i dont know how to do anything else except not buy the things i want. and after 9 years ive had enough. i want that new nintendo, the new dirt bike, the holiday.

i still wont buy them tho its against my self imposed rules. so with 120k to spend on property what advice can you give. knowing that i could only spare a minimum amount per week to service any debts.

 

[ok180]

At the risk of sounding stupid. Why don't you just get another job that pays better? I know people who do jobs that require little to no experience earning 70k.

 

[wylie]

I don't know if this helps you, but my son is on $38K, no savings but has been paying way more than necessary off his car loan and paid off his credit card after an overseas holiday, so he has the capacity to save. He lives at home and is nearly 22.

We are looking at a very basic unit for him, two bedrooms, for around $300K inner Brisbane. The only way he can buy it is on an interest only loan and have a friend living in the spare room to contribute towards expenses. He will have to borrow interest only, but at least he has his foot in the door, his own place, and can decorate how he likes (but he won't be able to afford too much too soon).

For about the same money, he could buy in Shailer Park or Slacks Creek and get a highset house with three bedrooms. Much more living area and size, but too much travel and cost of fuel, so he is choosing to buy a unit, close to work and social activities.

The bank certainly will consider the rent he could get to work out his borrowing capacity. Whether he rents it for six months or moves straight in doesn't seem to matter, as long as he makes the repayments.

 

[mary&mat]

Hi flightcrank,

Wow, $120K saved....buy a 1BR now!!!

If you purchase for $300K, the loan would be approx 180K, that's not much to service even on a low wage. Set up loan with LOC & you can use this to service any shortfall in repayments. At 7%, your repmts would be approx $1050 month, minus rent @ approx $200 month = shortfall approx $250 month = approx $62/wk...is that do-able?

Regards,
M&M

 

[bene313]

Why have you stuck with the same job?

 

[D.T.]

I was earning the same money as you when I bought my first; I was 21 and earning 27k pa. I borrowed 7k from a friend (along with my 25k I had saved) and bought a place for a shade under 200k, using the anticipated rent towards the servicability calcs. Once it settled, I moved into it and claimed first homebuyers grant (7k) and repaid my friend. I lived there for a while, did some painting and landscaping whilst I was there. Rented it out and sold it 3.5yrs later for 370k.

I regret selling it, but my point is you are limiting yourself on a mental level - not a financial level. Sure, theres not a whole heap of 200k places around anymore, but you have 5x the deposit I had. I'd check out some stuff in western suburbs of sydney for example.

(Or if you have the inclination, you could buy 2-3 places in America but thats a whole 'nother ballgame)

 

[Ace in the Hole]

You're taking the slow road, but you know that.
It's slow, but safe.
I feel you don't like risk.
9 years is too long to not make any progress with earning capacity.

I would say get leveraged for bigger and better results.
Not just property, shares or other investments, but your job or a business which has been mentioned many times before.

5 years ago a started selling pool tables on eBay on the side.
Was hoping to make a couple hundred extra dollars a week on top of my wages.
I was working as a builders labourer at the time, and it sucked and I hated it, but it's all I could do.
After a few weeks of online selling, I was earning up to $5000/week!
Quit my job right away.
Not selling pool tables anymore, but earning alot more than that now selling other products.

If you are skilled and agree to work in a lowly paid job, your employer would be pleased.
Do you really want to earn more?
You say you haven't found work with your new TAFE qualifications.
I say, don't look for work, look for opportunity.

Good luck

 

[skater]

I obviously don't know what you do for a living, but I think you should look seriously into whether or not you can increase your income. If you can't, then maybe look for a part time job to top up your wages.

You have a sizable deposit. I don't know how you did it on such a low income. Good for you! If homes/units are too expensive in your area, then look elsewhere. If you are wanting an investment it does not need to be close to home. Look in areas where there is a good yield and high demand, as on a low income you really don't want anything that is going to cost you money out of pocket each week.

Best of luck.

 

[flightcrank]

i do earn a little more money now, closer about 32 - 35k per year now.

 

[Lil Skater]

i do earn a little more money now, closer about 32 - 35k per year now.

Question, what do you do? And how old are you?

If you don't mind me asking. Just thinking out loud for what you could do and get better money for as in 3 years you haven't progressed a great deal with the money you're bringing in.

 

[intrigued]

A block of land is NOT income producing so cannot be claimed against your tax, and nobody is helping you to reach you goal faster.

I was of the similar view, we are financing a family member in a development, and this was pointed out the other day.

Rental properties 2006-07 ATO

Similarly, if you take out a loan to purchase land on which to build a rental property or to finance renovations to a property you intend to rent out, the interest on the loan will be deductible from the time you took the loan out. However, if your intention changes – for example, you decide to use the property for private purposes and you no longer intend to use it to produce rent or other income – you cannot claim the interest after your intention changes.

http://www.ato.gov.au/individuals/content.asp?doc=/content/00096828.htm&page=8

Regards

 

[big_head]

Wow, saving an extra 75k in 3 years on a minimum wage is mighty impressive! Good job with that! As everyone else says, buy a place and rent it out! You obviously know how to stretch your money, so it shouldn't be too bad. Have you looked out for positively geared or CF+ properties???

 

[redwing]

thought i would dig up my old thread. ive moved out and rent a studio apartment. i still have the same job. even tho i completed a tafe course in '08 pretty much went to study right after i made this thread back in sept '07.
i havent found anywork with it tho.

ive continued saving however and have got 120k in a high intrest account. plus an extra 10k as a buffer in a everyday spending account.

pretty much cant save money anymore with rent,bills,food and all that. i dont know how to do anything else except not buy the things i want. and after 9 years ive had enough. i want that new nintendo, the new dirt bike, the holiday.

i still wont buy them tho its against my self imposed rules. so with 120k to spend on property what advice can you give. knowing that i could only spare a minimum amount per week to service any debts.

WOW!!

Great effort and achievement

Touch base with a few of the knowledgeable mortgage brokers here, even if just to explore your options...you will find many a veritable font of information

I reccommend reading some of Noel WHITTAKERS books also

If you can hack the conditions, purchasing a PPoR and renting the additional rooms to friends may be an option

Though, as Rixter is wont to say

Whats your chosen wealth & investment strategy?

 

[lawsjs]

Flightcrank,
Inspiring stuff Flightcrank. Well done and great to have the guts to post and 'admit' you have a low salary.

A low salary is an advantage. True. You don't have a massive income to replace.


I agree full with Mary & Mat and Bricks and Mortar.

Go out and buy little rental property in a lesser suburb (in Sydney Mt Druitt - $250k or an outer suburb of Newcastle - 3br fibro $300k).

With a $100k deposit you will be earning an extra $20-50 most weeks above the mortgage. Your first taste of passive income. The next exciting bit will be if you save a bit more and put in a new kitchen or tidy up the garden and get a valuation a bit higher.

I think the time for action is NOW. You have saved enough and a property of your own is so within your reach.

Buy exactly what Jan recommends - you will NOT go wrong.

Or sell pool tables like Ace in the Hole - THAT sounds an interesting story! Do something though, or your life will pass!