According to a recent ‘Super Shortage’ study*, for Australians to live the retirement lifestyle they aspire to from 65, their savings will last just five years.
With the average life expectancy of Australians being 82.5 years old, this creates a super shortage of 12.5 years.
AVOID A TOUGH RETIREMENT
There are many investment options, but one way to become financially secure and avoid the ‘super shortage’ is to grow a substantial asset base through property investing.
Long term property investment can pay off IF investors ride out the highs and lows of the property market.
ARE YOU RELUCTANT TO INVEST?
Did you know that only 1.5M Australian individuals are property investors? That is approximately only 6% of the population~.
With the right strategy and risk prevention, property investment can give you long term financial security.
So why are so many people reluctant to take the next step and invest in one, two or more properties?
When working with our clients on their property investment strategy, some of the things they worry about are:
- losing their home
- not being able to afford another property
- losing their job or other income, and
- interest rates rising
These are genuine and appropriate concerns for property investors, especially in the current lending environment. With tighter regulatory requirements for the finance industry, lenders are now scrutinising borrowers’ capacity to service debt.
Borrowers may be anxious about higher future interest rates and repayments but lenders closely assess:
- a borrower’s capacity to repay their debt
- potential interest rate rises, and
- vacancies from tenants, amongst other factors
This is where we play our part. We are obliged and trained to ensure you do not undertake any finance that is not suitable for your circumstances, now and in the future.
In a less favourable property market, selecting a good property in a high demand area with low vacancy rates will minimise difficulties in finding tenants.
Investing in mortgage protection insurance and landlord insurance is important and should protect you if you unexpectedly lose your job and if tenants don’t pay their rent or damage your property.
STRATEGY IS THE KEY
Structuring your finance is a vital step if you are planning to grow a property portfolio.
Your investment property strategy will depend on your age, income, stage of life and years remaining until retirement.
A strategic acquisition of properties can give you an asset base to live off in retirement.
DO YOUR HOMEWORK WITH OUR EXPERTISE!
It is important to investigate:
- the Australian property market and where the best potential gains are likely to occur
- your long term serviceability, finance structure, and
- your current AND future financial position
1. AMP Newsroom 25 July 2018, Australian’s face 12.5 year ‘Super Shortage’
2. ATO Taxation statistics 2015-16, ABS Australian Demographic Statistics 2016
Disclaimer: This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Subject to lenders terms and conditions, fees and charges and eligibility criteria apply. © 2018