Getting into the property market is a challenge but the right kind of loan, coupled with first-time buyer incentives, can make it easier
Sophie, 29, earns $120,000 a year plus super. Because of employment opportunities, a few years ago she moved away from home and has been renting with a friend. She has been a good saver over time, using an account set up years ago by her parents when she was in school.
Although she earns good money and is a good saver, she is financially naive about managing her financial situation more effectively. She has not compared interest rates, bank accounts or any money strategies, as she has been satisfied with her savings regime.
Sophie does have car insurance but she has no other insurances, such as private health cover. Her main goal is to get into the property market and now she wants to make a concerted effort to buy a property, either to live in or as an investment.
Three key tips for Sophie are:
1 Health fund cover
Sophie should contact health funds to compare the type of cover that would be suitable for her. She shouldn’t get cover for conditions or items she doesn’t need. There is a penalty for people aged over 30 who do not hold private health insurance hospital cover. For each year over 30, a 2% loading (cumulative) is added to the premium up to a maximum of 70%. Health funds are required to charge different premiums based on the age of each member, depending on when they first took out private insurance.
Also, Sophie should note that there is a Medicare levy surcharge, which is levied on taxpayers who do not have private health insurance. With Sophie’s current income, she would have an extra 1.25% applied to her, above the 2% Medicare levy. Having private health cover actually provides two financial benefits.
2 Buying her first home
Bu hikaye Money Magazine Australia dergisinin July 2017 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Giriş Yap
Bu hikaye Money Magazine Australia dergisinin July 2017 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Giriş Yap
An outrageous, beautiful monopoly
Telstra's mobile business is a cash machine with few competitors, giving it the highest returns in the world.
Drop the anchor to judge value
Buying and selling decisions should be based on where a stock price is going, not where it has been.
Powering the AI boom
Beyond the software and chipmakers, where will the energy come from?
Get into life
Tucked inside super are products that can protect you from life's inevitable uncertainties.
Paths to home ownership
Taking the road less travelled can sometimes deliver unexpected benefits.
Sold! Quick ways to add value
Small, strategic changes can have a big impact on the look and feel of your home. And get you a better price on auction day.
Money lessons the kids need to know
Your children can learn a lot from your past money mishaps. Here are eight financial conversations I have had with mine.
Property-investing rules: are they likely to change?
The pressure for the government to curb the tax benefits of tax concessions, such as negative gearing and the capital gains tax discount, is unrelenting. Most recently, independent senators David Pocock and Jacqui Lambie proposed five options for paring back investment property tax concessions, with savings to the Federal budget of up to $60 billion over the next decade.
What's love got to do with it?
A rollercoaster of emotions could be driving poor crypto behaviour.
Are we ready to be cash-free?
Saying goodbye to our piggy banks too soon could leave small businesses in the dark when problems arise.
