Also it maybe a bit too late for gearing anyway as he is retired and she is only working 7hrs per week...
Where to from here
- Thread starter Harro
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Also it maybe a bit too late for gearing anyway as he is retired and she is only working 7hrs per week...
Plenty of people on this forum in your age bracket, "old school" if you like who have used the banks for the own benefit, started from scratch and built multi million dollar portfolio's.
Your thinking is wrong, very wrong.
The best risk adverse way to buy shares is either blue chip LICs(ARG/AFI/MLT with ARG being probably the most conservative) or ETF (VAS is the ASX 300, STW is the ASX 200), because you are effectively buying the market with these they cant go broke and should keep up with inflation while suppplying you with franking credits to hide behind.
ETF and LICs have been discussed here ad nauseam the search box is your friend.
ETF and LICs have been discussed here ad nauseam the search box is your friend.
Divorce is not an option. HAHA,
Interestingly hubby and I are the same age as you and your wife - and we have almost exactly the same asset values (but no inheritance and our "cash" is super and IP's).
Strangely enough we are not risk adverse - but we are cautious - except for a brain snap around 10 years ago when I got caught up in the frenzy. It means we look very carefully and research what we are going to invest in - whether that be share or property - so that when we see a bargain, we are in a position to pounce.
Being the same age as you, we are looking at moving from capital growth/accumulation to cashflow options. Almost all our super is sitting in blue chip shares 70% and cash 30% ... and we see our PPOR as an asset we can always downsize in the distant future.
As hubby is fast approaching 55 and "transition to retirement" we have decided that the share return just won't cut it for our current lifestyle ... and last thing we want to do is have to sell the share asset base.
As such, we're looking very closely at a particular low capital growth - high cashflow - business/property that the superfund can buy ... and even with hubby being restricted to only drawing 10%pa of the value until he's 60, the cash throw-off after expenses still produces more than he can draw (and three times what you bank interest is giving) and the balance can be reinvested back into shares and high interest cash.
Sure - there is always risk - but 99.9% of this will be mitigated by the time due diligence is finished - and by learning the business - and if we choose to outsource even the management of the business, we still come up with a higher income than he currently has by working.
It's not that you are risk adverse - it is simply that you don't understand all your options and how to go about sourcing the right ones.
Fear of anything comes from lack of understanding ... you're not working ... take this time to learn ... after all ... it is your future and there is no one better positioned to look after it than you
Strangely enough we are not risk adverse - but we are cautious - except for a brain snap around 10 years ago when I got caught up in the frenzy. It means we look very carefully and research what we are going to invest in - whether that be share or property - so that when we see a bargain, we are in a position to pounce.
Being the same age as you, we are looking at moving from capital growth/accumulation to cashflow options. Almost all our super is sitting in blue chip shares 70% and cash 30% ... and we see our PPOR as an asset we can always downsize in the distant future.
As hubby is fast approaching 55 and "transition to retirement" we have decided that the share return just won't cut it for our current lifestyle ... and last thing we want to do is have to sell the share asset base.
As such, we're looking very closely at a particular low capital growth - high cashflow - business/property that the superfund can buy ... and even with hubby being restricted to only drawing 10%pa of the value until he's 60, the cash throw-off after expenses still produces more than he can draw (and three times what you bank interest is giving) and the balance can be reinvested back into shares and high interest cash.
Sure - there is always risk - but 99.9% of this will be mitigated by the time due diligence is finished - and by learning the business - and if we choose to outsource even the management of the business, we still come up with a higher income than he currently has by working.
It's not that you are risk adverse - it is simply that you don't understand all your options and how to go about sourcing the right ones.
Fear of anything comes from lack of understanding ... you're not working ... take this time to learn ... after all ... it is your future and there is no one better positioned to look after it than you
It would be handy if the RBA raised the official Cash Rate (not ideal for property investors) but would assist greatly Self funded Retirees, I feel.
That's true, but what goes up will eventually come down again ie. interest rates, and sometimes very quickly too...
Thanks Lizzie for your candid reply. You are right, we probably are not totally risk adverse, but as you say lack some understanding.
However, while purchasing a business may suit you guys it certainly has no appeal to us. Retirement means retirement ( whether it be for yourself or anybody else). The only thing I work on is catching more fish!
Worked for the one employer for 27 years (pretty much unheard of these days) and have a reasonable amount of super to access in 2.5 years.
We will be devoting more time to our portfolio now, something we haven't done for a while. Good luck with your plans.
I understand that everyone is different ... but rest assured ... asides from keeping an overview of the business, we have no intention of working "in" the business.
I might do the bookings/payments for the first little while just so that I understand what is happening ... but our intention is to be able to bugger of for months on end all whilst the $$ are pottering into our account.
Famous last words.
I know
... can't help but keep bringing GeoffW to mind ... but I am an optimist!I know
I was more thinking of Mark...
We are about to embark on a similarly (possibly) risky venture, but we are not buying a business. We are looking at building on our blocks to bring in more rent and turn them from negative to positive cash-flow. There are risks, but I'm hoping it will mean this block puts money into our pocket rather than the other way around.
I also do wonder if we don't know how good we have it now and whether this risk is worth taking...
I'm also an optimist and quite excited but keep reminding myself that we need to plan and allow contingency funds for problems and then we won't be shocked if some problems arise, which I'm sure they will.
