sue78 said:
If equity isn't an issue, why not just go no doc?
Young investors - tell all
- Thread starter wallace
- Start date
If equity isn't an issue, why not just go no doc?
FrankGrimes said:
For me, NO!!
I menationed alex's situation to my better half tonight - that of being a million in debt - and she needed me to change the subject cos it was stressing her out!! I can see I'm never going to be able to do all I want to do and leverage will always be quite low.
Any suggestions?
FrankGrimes said:
My girlfriend is very 'normal'. Her parents are public servants, none of her friends invest (though I've heard her mum got burned in shares, and some of her colleagues play the market) and she herself doesn't really understand investment at all.
I'd like to get her started by having her read the Kiyosaki books. I got her to pay off all of her store cards so that's a start.
However, (most importantly) she lets me do whatever I want investing-wise as long as I can still pay the rent and put food on the table. Doesn't question the magic, so to speak. Isn't she going to be surprised one day when I tell her 'By the way, we're moving to a waterfront mansion.'
Part of the reason is that I was already investing when we met, so she knew that's something I do. I was already at a point when I wasn't exactly scraping by and always seem to have money, so she trusts that I know what I'm doing.
I think if you are a couple that historically just got by with no savings and your other half knows that, it's a shock if you suddenly want to start investing (take risks? Nooooo!) In my case investing is so much a part of me that my girlfriend thinks it's natural. She always asks me why I have so much paperwork (divs, bank statements, rental stmts, etc). Yeah, well, my tax agent won't accept a shoe box....
Alex
Sultan of Swing said:
This is always a huge hurdle! i have a similar situation where my wife freaks out when i start talking big money issues. SLOWLY she is getting used to it
I always try to talk to her about what im doing, why im doing it and what benifits and risks there are. It helps her get an understanding of the situation and helps US achieve our goals! Im luck that we both one day want to live in a huge new home.
Sultan of Swing said:
I always thought hitting a mil in debt would be more significant. But it's just another day. Rent coming in, interest going out, pay the bills.... The numbers get bigger, sure, but if you manage it right (multiple properties, spread the risk, etc) it's not risky. We know that, but....
Alex
Guys N Gals,
Just let me say I've been on the forum now for a couple of years or so, and this is one of the most inspirational threads I've had the pleasure to read. Take a bow you lot, it is truly great to see such level headedness and "big picture" vision.
JIM
Just let me say I've been on the forum now for a couple of years or so, and this is one of the most inspirational threads I've had the pleasure to read. Take a bow you lot, it is truly great to see such level headedness and "big picture" vision.
JIM
Frank - yeah may have to go no doc in future. the rates can be quite competitive right? not sure.
I think it's easier for me as I am the decision maker anyway. My other half has no interest in property. He sort of understands what we are doing and supports me as he has reaped the rewards aswell. We work well together, I do the research, finance, buying, negotiating and he deals with the construction side of it albeit reluctantly. I tell him that unless he can earn more then he better help me.
It would be great if he loved property too but, in hindsight, it's probably better this way coz then he just lets me do whatever I want rather than get his nose in it.
Maybe it's good to have a conservative partner to keep you balance and in perspective? women generally are a bit more conservative than men are, it's to be expected.
I am impressed with the paperwork. I have a File for Filing and I file about once a year usually around tax time!! it's shocking. The best tip is just to keep everything and put it in the 'to be filed' file. Amazing how I still manage to find all the paperwork for tax, every issue of every statement, receipts etc.
I think it's easier for me as I am the decision maker anyway. My other half has no interest in property. He sort of understands what we are doing and supports me as he has reaped the rewards aswell. We work well together, I do the research, finance, buying, negotiating and he deals with the construction side of it albeit reluctantly. I tell him that unless he can earn more then he better help me.
It would be great if he loved property too but, in hindsight, it's probably better this way coz then he just lets me do whatever I want rather than get his nose in it.
Maybe it's good to have a conservative partner to keep you balance and in perspective? women generally are a bit more conservative than men are, it's to be expected.
I am impressed with the paperwork. I have a File for Filing and I file about once a year usually around tax time!! it's shocking. The best tip is just to keep everything and put it in the 'to be filed' file. Amazing how I still manage to find all the paperwork for tax, every issue of every statement, receipts etc.
I'm surprised you don't have to do it every month, Sue. I follow the advice I was given by my first manager at my first job (accounting firm): when you make a file, make it simple and clear enough that anyone can open it and find what they want.
I've followed this advice ever since. Very clearly labelled sections, as many sections as possible and lots of summary spreadsheets. Multiple copies of everything (e.g. one depreciation schedule in the permanent QS Report file and another copy in the yearly tax file). Mind you accounting firms trained us specifically in filing techniques.
Alex
I've followed this advice ever since. Very clearly labelled sections, as many sections as possible and lots of summary spreadsheets. Multiple copies of everything (e.g. one depreciation schedule in the permanent QS Report file and another copy in the yearly tax file). Mind you accounting firms trained us specifically in filing techniques.
Alex
alexlee said:
Sounds about the same! Her parents own one investment property at least!
alexlee said:
I tried - Just couldn't get her to read it, she is an avid novel reader but I couldn't get her to read an investment book for the life of me. It sat on her dresser for 6 months collecting dust :/
alexlee said:
Likewise, I had the first property before we started seeing each other and doesn't question it. But she still can't get her head around the fact I owe 350k, I must be poor! But I still pay the bills and live a normal lifestyle! But I would love for her to become involved in some way (it would double my servicability
) as it's important to me and something I enjoy doing.alexlee said:
As above. I owe lots of money so I'm poor... "When are you going to pay it off?" She asks.
Sigh.
alexlee said:
I've been investing since before we started seeing each other, we've been together for 4 years now I would have thought she would be more interested. I guess I just have to do my own thing until she's interested.
I get jealous of the other forumites that all seem to do it as a couple! Anyway, I was just interested to see if you had similar 'challenges'
sue78 said:
1% higher or so, depends on the lender? Check with the resident brokers.. 1% isn't much if a good deal comes your way! Cost of not acting could be alot worse than an extra 1%
Think you need a semi-matured ABN though, maybe 1-2 Years?
alexlee said:
I work in accounts but do a lot of admin since it's a small family business and i'm very organised at work but can't duplicate it at home. Your tip on keeping two copies is great. thanks
We actually can't afford an equity loan as we can't service it. We don't earn much $, infact financial year 04-05 I only paid $100 tax (took a year out to start a family). This year we are only on one income as husband is dong his postgrad.
Tax deductible debt is good debt but not if you don't pay tax. Our situation will be better next year.
Looking to buy another property before the end of year. Well, tossing up between a o/s holiday to visit family in UK or property. Want to take baby over before he turns 2 since it's free for infants.
FrankGrimes said:I've been investing since before we started seeing each other, we've been together for 4 years now I would have thought she would be more interested. I guess I just have to do my own thing until she's interested.
I get jealous of the other forumites that all seem to do it as a couple! Anyway, I was just interested to see if you had similar 'challenges'
Personally, I don't want to invest as a couple. I have my own views on investing and I'd rather not have her looking over my shoulder all the time. It's the same reason why I don't mix money and family.
If I want an investing partner I'll go find one. One that I can argue with and sue and never have to see again if things go pear shaped, as opposed to someone who sleeps next to me (with kitchen knives within walking distance!)
Alex
Sultan of Swing said:
I’ve noticed that some (otherwise intelligent and capable) people just aren’t able to think about debt logically. You can talk all you want about how LVR and cashflow are what count and that debt by itself doesn’t matter, but that’s how their brains are wired.
I think your missus is being floored by the IDEA of $1m (and that’s small potatoes compared to some of the forum members!) If you view it logically, a $300k house renting for $300pw with a $250k mortgage is reasonably safe. Therefore, 4 such houses ($1.2m gross, $1m debt, $120 rent pw) in different geographical areas is just as safe, but the numbers tend to scare people.
What she needs is more ‘safety’. How about transferring the family home, shares, etc to her name only, and only sign mortgage documents yourself? Then explain to her that even in the Armageddon scenario, YOU lose everything, declare bankruptcy, but the family home, assets and her credit rating will be intact. You can then go on your merry way and buy all the IPs you want.
(Note this is an idea only: I’d have intense sessions with my accountant and lawyers first.)
Alex
Hi SOS,Sultan of Swing said:
One thing that may help is for someone else to hold the assets & debts for you - like a trust. Since being is debt is a 'mind' thing, if it's your trust that has the debts rather than you & your wife, maybe that'll allow her to keep her mindset. So no assets or liabilities in your or her name.
Let use know if it works!!
Cheers Keith
Ditto.JoannaK said:
It's really great to see other peoples views on different situations.
I constantly find myself saying that you should never stop learning, no matter what level you are at with your investing, and threads like this just keep on driving that message home.
Regards
Marty
Thanks Alex and Keith
Both are good suggestions that are well worth considering. I've been thinking about trusts again just recently.
Cheers
Both are good suggestions that are well worth considering. I've been thinking about trusts again just recently.
Cheers
My girlfriend didn't have any interest in my investing for a while, but slowly she learnt that money has little value and what she was seeing was just a set of numbers. I think she also started to realise that the lifestyle she had become accustomed to needed more than an average wage to sustain. Then one day at the office I sat her in front of the whiteboard and explained my entire strategy. I think that was the turning point because we were there for six hours straight without even a thought about anything other than investing. By the end of it she knew how to calculate LVR, IRR, NPV, P&I repayments (annuities), etc. I had also dramatically changed my strategy based on our discussions and her input.
Now she is doing post grad finance (she has an interior design/architecture undergrad) and she loves it. Uni is really exposing her to some advanced investment concepts that are quite practical in nature. I'm going to start her writing covered calls by herself soon to give her a real taste of the action (if you can call it that).
We basically do everything together so I am more than happy to have her on my side. Just by her questioning my decisions and acting as a sounding board has improved my strategy by more than I can imagine.
The best advice I could give to those who are trying to get their partner on-board: take some time out to slowly and calmly explain everything in the context of their current situation (goals, strategy, outcomes, etc).
PS It's great to hear the stories of the young people here.
Now she is doing post grad finance (she has an interior design/architecture undergrad) and she loves it. Uni is really exposing her to some advanced investment concepts that are quite practical in nature. I'm going to start her writing covered calls by herself soon to give her a real taste of the action (if you can call it that).
We basically do everything together so I am more than happy to have her on my side. Just by her questioning my decisions and acting as a sounding board has improved my strategy by more than I can imagine.
The best advice I could give to those who are trying to get their partner on-board: take some time out to slowly and calmly explain everything in the context of their current situation (goals, strategy, outcomes, etc).
PS It's great to hear the stories of the young people here.
