Following on from another thread I have now decided to write some timely advice for young people to assist them into investing.
There are many options to get you on track.
-Stay home buy rentals etc
-The following option I discuss with the younger people I work with is a win win.
If possible buy a affordable house to live in and get flatmate's/ boarders. There are a few things you need to do here:
Deposit. Obtaining the first money to get started is hard. Can you work extra hours? The amount of work you put in at the start of your investing career is directly proportional to the gains. Maybe borrow from parents? Go partners with them on your first place etc. Think outside the square.
First house. It needs to be affordable. Many young people want to max out and get the nice house straight away. There is time for all this in years to come. You want to get a place that you are not
struggling to make payments on. If you are working extra hours to pay for it you will not have spare time for the add value stage. You need to be comfortable and have ability for surplus cash if possible.
Add value. Buying a affordable house which has the potential for minor make over. The key here is keep it simple, this is your first house and Reno's can get out of hand. You want a place that is in the minimum suburb your ego will let you live in. Paint the rooms, tidy up the house change, light fittings etc. Do all this minor work in your spare time as funds allow you. The work should only be minor. Some people start a job and give up half way through. If they are minor you are more likely to finish them. Doing all this work may increase the value of the property.
Pay down debt. If you finish tidying up house why not pay down some debt with the flatmate's weekly rent.
Move on/ repeat process. Time to realise you potential. You have done the hard yards sell the house and take the cash. Use cash for deposit on another place. The reason I mention sell is important. *You may have bought a undesirable house in a bad suburb to start with and not want it for a rental. *The present mortgage on it is not tax deductible and you would need to sell it to another entity to be able to get deductions. *Your first house may be emotional and if you are attached to it never make it a rental. *Cash is king. There is no other better incentive than getting that first big pay out. You can know see in real terms your reward.
Structures. Some young people have a sum of cash already saved or may have property previous. If this is the case then get a Trust Structure set up. You can protect the savings or the property now. You may currently have a girlfriend or boyfriend and later decide to move in together. Trusts are a good way to protect yourself if you are concearned with “what could happen”.
There are many options to get you on track.
-Stay home buy rentals etc
-The following option I discuss with the younger people I work with is a win win.
If possible buy a affordable house to live in and get flatmate's/ boarders. There are a few things you need to do here:
Deposit. Obtaining the first money to get started is hard. Can you work extra hours? The amount of work you put in at the start of your investing career is directly proportional to the gains. Maybe borrow from parents? Go partners with them on your first place etc. Think outside the square.
First house. It needs to be affordable. Many young people want to max out and get the nice house straight away. There is time for all this in years to come. You want to get a place that you are not
struggling to make payments on. If you are working extra hours to pay for it you will not have spare time for the add value stage. You need to be comfortable and have ability for surplus cash if possible.
Add value. Buying a affordable house which has the potential for minor make over. The key here is keep it simple, this is your first house and Reno's can get out of hand. You want a place that is in the minimum suburb your ego will let you live in. Paint the rooms, tidy up the house change, light fittings etc. Do all this minor work in your spare time as funds allow you. The work should only be minor. Some people start a job and give up half way through. If they are minor you are more likely to finish them. Doing all this work may increase the value of the property.
Pay down debt. If you finish tidying up house why not pay down some debt with the flatmate's weekly rent.
Move on/ repeat process. Time to realise you potential. You have done the hard yards sell the house and take the cash. Use cash for deposit on another place. The reason I mention sell is important. *You may have bought a undesirable house in a bad suburb to start with and not want it for a rental. *The present mortgage on it is not tax deductible and you would need to sell it to another entity to be able to get deductions. *Your first house may be emotional and if you are attached to it never make it a rental. *Cash is king. There is no other better incentive than getting that first big pay out. You can know see in real terms your reward.
Structures. Some young people have a sum of cash already saved or may have property previous. If this is the case then get a Trust Structure set up. You can protect the savings or the property now. You may currently have a girlfriend or boyfriend and later decide to move in together. Trusts are a good way to protect yourself if you are concearned with “what could happen”.
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