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 […]
Tag: investment property
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 […]
Home equity
What is equity? How much equity should I have in my home or investment property? How does equity fluctuate? What does ‘negative equity’ mean and could it affect me? Strap in for answers to all the questions you never asked. What is equity? Say you own a 100sqm rusty tin shed with no ceiling in […]
Passive vs active investment
Imagine if you will the only available investment opportunity is to invest in shares of sandal manufacturers. You are presented with two options. Option 1 is to take a long-term buy and hold position in a fund which holds interests in the top 100 sandal manufacturers in the world. Option 2 is to constantly buy […]
What makes things go up and down
Even in a pre-covid-19 world, my brother would always ask me why the market (and more relevantly) individual stocks would often defecate themselves. He did not say ‘defecate’. ‘Defecate’ is very much a euphemism here. Everyone’s talking about large dips or rallies in the market these days but if you distance yourself from the market […]
Buying your first home – Part 2 of 2
Imagine you were in the market for a pair of birkenstocks. Imagine it was your very first pair. Now imagine the salesperson at the store said that they were running a promotion. The salesperson tells you that all first-birkenstock buyers qualify for a 5% discount. Well that sounds pretty appealing doesn’t it? Not really. Because […]
Accumulating assets
One of the best pieces of advice I ever received early in my career was that if I wanted to be wealthy, I needed to focus less on growing my income and more on accumulating assets. In most OECD countries, this is true from both a finance and a tax perspective. Assets grow faster than […]
