In an article posted a little over 12 months ago, Inflation watch, I described the bond market as the “all-seeing eye”, noting that the bond market was signalling a potential incoming spike in inflation. The events of late 2021 and early 2022 have justified the bond market’s concerns. What now? As an investor, what sort […]
Tag: interest
Don’t take on too much HECS debt
Having the government bankroll your tertiary education in Australia is often called out as being the “best loan you can get”. And that’s certainly true when you compare Australia’s HECS-HELP program to the more complex, crippling student loan program in the US. On the other hand our university tuition structures are not nearly as generous […]
Investment grade property: Yield vs capital growth
There are three main ways you can make money on property: Rental yield Capital growth Growth on rental yield Let’s have a chat about the first two. Rental yield A property’s rental yield is calculated by dividing a property’s annual rental earnings by its valuation. I often argue that the better way of calculating rental […]
Home loan products: Redraw facilities and offset accounts
For each day that you owe money to the bank on a home loan, interest accrues on that loan. You make periodic home loan repayments and if your home loan is a P&I loan (see Home loan products: P&I vs IO loans), the value of your loan, the principal, will slowly trickle downwards. What if […]
Home loan products: Variable vs fixed rates
I’d like to say we’re almost done with home loans but if I did I’d be lying. There’s so much complexity out there on this topic and it has such a profound impact on your cash flow that I think everyone has a right to know as much as possible before taking the plunge. So […]
Home loan products: P&I vs IO loans
When I was younger (I wasn’t the coolest kid) I used to wonder why anyone would take on a massive home loan and opt to pay off the interest only. When you take on a home loan, you can typically choose from P&I (principal & interest) and IO (interest only) products. Here’s what they mean […]
Home loan products: Owner-occupier vs investment loans
Whether you’re buying your first home or you’re looking to invest in property, chances are you aren’t quite wealthy enough to fork out the hundreds of thousands or even millions of dollars it can cost to buy one outright. Even if you do happen to have a seven figure bank balance, you probably won’t even […]
What to do with $10k right now
Here we take a look at what an average person with an average risk profile should do if they had managed to save $10k and didn’t know how to best make use of it. Please understand this is not financial advice, it does not take into account your personal circumstances and it’s only here to […]
Negative and positive gearing
Negative and positive gearing are very popular topics, especially when we talk about residential investment. Generally speaking, if your investment is negatively geared, then from a finance perspective you’ve likely made a poor investment decision. It’s only from a tax perspective that you may actually derive some benefits. However it’s very important to understand that […]
Why saving is getting you nowhere
Let’s say you made a declaration to cut down on your routine smashed avo shenanigans because some rich prick told you that delicious green mush is the real reason you can’t afford to own real estate (#okboomer) and you’ve instead opted to set aside more of your fortnightly wages into a savings account to buy […]
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