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Why the Pension Is Not a Good Retirement Plan

Posted on 3 October 2018 | by mmhadm

The government-backed Age pension has been the bedrock of retirement planning in our country for decades. By March 2023, 63% of Australians aged 65 and over relied on income support, with 92% of them receiving the Age Pension.

But is this pension enough?

We live in a world where living costs are skyrocketing, and economic uncertainty is at its peak, which makes it challenging for most Aussies to survive on just the government-sponsored retirement pension plan. Although it promises a secure income for your retired life, it’s not enough for comfortable living in your golden years.

Let’s break this down for you.

5 Reasons You Should Not Relying on a Pension Plan

While a pension plan does offer a sense of security, depending solely on it is not a good idea.

Here’s why:

1. It’s Not Enough

By the time you retire, you are used to a certain lifestyle, which requires a steady income when you plan to retire. That’s going to be an ordeal when you are living on nothing but a government-backed retirement pension plan.

The current maximum government-age pension for couples is $40,004 a year and $26,535 a year for single seniors. Can you live on this amount of money?

If you have been working hard all your life, then this retirement pension plan will not sustain your current standard of living. You will need to consider saving for retirement to maintain your current standard of living.

That said, your superannuation funds may not be enough. Plus, there are conditions that you must meet to access your superannuation. You must be permanently retired at 55 to 60 (depending on the year you were born) to access your super with extra conditions attached. Once you are 65, you may access your super without being retired, but there will be conditions attached.

2. It Fails to Keep Up with Inflation

Although the government-back pension plan for retirement includes adjustments to cope with inflation, they often fail to keep pace with the actual increase in living costs. That means the real value of your pension payments can go down over time, forcing you to lower your standard of living. When your regular expenses grow faster than inflation adjustments, you may find it hard to afford even basic needs.

3. It’s Susceptible to Political and Economic Instability

The Australian government controls the pension plan for retirement. In other words, it may change when the economic and political winds shift. It’s not unheard of for budget cuts or economic downturns to lead to shutting down a government scheme altogether. This could mean you get a less-than-expected pension when the next government comes into power.

4. It Has Limited Flexibility

Another significant drawback of this retirement plan is the lack of flexibility. Unlike your savings or investments, where you have control over how and when you use your funds, the age pension provides a fixed amount determined by the government.

You cannot adjust your retirement income based on personal needs or life changes. This makes relying on the Age pension plan risky. It leaves you with no room to provide for unexpected expenses.

5. We Are Living Longer

Australians are living longer, which means you will have to rely on this pension plan for retirement a lot longer than you think. But as you age, your healthcare and lifestyle needs may change, requiring you to manage your funds more carefully. The meagre pension income may not be enough to support your changing needs. This might force you to rely on other sources of support, such as family or social services.

While the government-backed retirement pension plan offers security, it’s not enough to live comfortably. Other options like your super may not be easily accessible or have limitations in supporting your lifestyle after retirement. But if you want access to your finances when you need them for retirement, which is not dependent on your age, consider investing in property.

Why Property Investment Makes Sense for Your Retirement Plan

Investing in properties other than the house where you live currently is an excellent way to secure income for your retirement. It offers several benefits, such as:

1. Steady Income Stream

One of the most notable advantages of property investment is that it provides a steady income in your golden years. If you rent your property, you can get a fixed monthly income, which can increase annually. Conversely, selling your property can help you arrange funds for unexpected expenses.

2. Capital Growth

Real estate appreciates over time. The Australian property market saw its value rise for the sixth straight quarter, with Perth house prices increasing by 6.6%, reaching $852,240 for the June quarter of 2024. This growth provides a financial cushion for your future needs.

3. Inflation Adjustment

When inflation increases, the cost of living also goes up. But, unlike the government-backed pension plan, your property investments can adjust to the economic changes quickly and efficiently. With the right rental appraisal, you might be able to supplement your retirement income with a steady cash flow from your property. This can help you live more comfortably after your retirement.

4. Tax Benefits

Property investment may also offer tax benefits, depending on where, how, and when you invested. For example, if you own the property for more than 12 months and you’re an Australian resident, you may be entitled to a 50% discount of the capital gains tax. This typically makes property investment a more desirable option for your retirement pension plan.

How My Money House Can Help You Invest in Property

Property investment can be a lucrative option to build your wealth if you invest with the help of an expert like My Money House. We have a team of property specialists that can help you to do the following:

Figure out the right way to invest in property.
Understand the financial outlay required, your weekly contribution or weekly income to be received.
Identify the hot spots to invest in by using a property matrix formula.
Build an investment property using a turn-key solution.
Find the best finance.
Look for and manage your tenants.

Start Your Property Investment Today

Real estate investment can provide you with a steady retirement income. But if you aren’t sure where or how to invest in property, we are here to help. Our experts listen to your requirements, assess your current finances, and recommend an investment plan tailored to your goals and budget. This helps you put your best foot forward while securing your retirement.

For more information about how to invest in property, contact our team today.

What Are the Services That My Money House Group Offers?

Posted on 24 September 2018 | by mmhadm

Australia is the land of opportunities, with a vibrant economy and diverse cultures. It’s where you can build a fulfilling career while enjoying a comfortable lifestyle. Whether you want to invest in property, start a business, or protect your financial future, it provides a perfect environment for personal and professional growth.

At My Money House, we understand the unique financial needs of Australians. Our financial services focus on your personal and professional growth. From securing a loan for your dream home or car to managing investments and safeguarding your financial well-being, we are here to support you every step of the way.

Let’s walk you through what we do.

My Money House’s Services You Can Rely On

My Money House Group has been around since 2011. Our journey began with the aim of bringing all essential financial services under one roof. Our skilled experts do it all – help you manage your finances, secure loans, protect your assets, and invest in your future.

Here’s a closer look at My Money House’s services:

1. Finance

Financial services have always been our forte. Our financial branch, My Finance House, can assist you by researching and locating the best loan to meet your needs. We can find the best loan at the best rate to suit your circumstances.

This includes:

Home loans for buying a new home and home loan refinancing.
Motor vehicle loans for used and new cars, pickups, and commercial vehicles. We also offer car loan balance transfer.
Business loans for running capital, upgrades, new equipment, and expansion.
Personal loans for big-ticket purchases, consolidating debts or covering unexpected costs.

We take the time to understand your current financial situation and goals so we can recommend a loan that best fits your needs. Once we have all the information, we compare interest rates, repayment options, fees, and other loan features. Our skilled experts research and compare loan products from local and national lenders, landing you the best deal possible.

2. Personal Insurance

My Insurance House, which is the insurance arm of our MMH Group, offers a comprehensive range of products, including:

Home and contents cover.
Life cover.
Income protection cover.
Total and permanent disability cover.
Trauma and accident cover.

We know how complicated insurance can be. For example, payments may be a lump sum or an ongoing benefit, depending on the type and conditions of the policy. There are also conditions required to get a payout.

Our specialist insurance staff will help you understand the terms of the policy and assist in selecting the best policy that will meet your needs, whether it’s for your business or personal needs. We also assist with the claims process, ensuring you receive the benefits you’re entitled to when you need them most.

3. Property

Australia has one of the fastest-growing real estate markets in the world, which recorded its 19th-straight rise of 0.5% for August 2024, with Adelaide recording the second-biggest rise of 1.4%.

And with a network of lenders and extensive knowledge of local real estate market, My Money House is your go-to place for all real estate-related finances and advice.

We can help you with:

Sales and Purchase: If you are in the market to buy, our team can help you find the right property quickly and efficiently. For investors, we offer turnkey property solutions for investments or personal use. We can find you a buyer if you want to sell your property.

Property management: This is one of the flagship My Money House services, which includes keeping your investment property in top shape, finding a tenant, rental appraisal, and keeping your property profitable.

First-Time Buyers: We know how overwhelming local real estate marketing can be for first-time buyers. We are here to help you with everything from securing the best new home loan to finding your dream property.

Our experts know the local real estate market like the back of their hand, making property ownership and investment as easy and stress-free as possible. Plus, we have decades of experience in home loan finance, which means you can fund your dream house just as easily.

What Sets the My Money House Group Apart?

My Money House is more than just a financial service provider. We are a one-stop shop for all your financial, insurance, and property needs. However, that’s not the only feature which sets us apart.

Here are a few other benefits of partnering with us:

1. Transparent and Reliable

Transparency and reliability are at the heart of everything we do. We believe in clearly communicating with all our clients and ensuring you understand all your option. We hate hidden surprises and dubious business practices as much as you do.

So, when you hire us, you get details like fees and the terms and conditions of our products upfront. With My Money House’s services, whether home loan or insurance, you can trust that you’re getting honest advice.

2. Customer-First Approach

Since its inception, My Money House Group has been customer-focused. We are committed to understanding your financial needs and goals and offer personalised advice. Our experts discuss everything frankly over a cup of coffee or lunch, making you feel at easy from the get-go.

3. A Wealth of Knowledge

My Money House Group has been serving its customers across South Australia for over a decade. However, our founders Simon and Andrew have over 30 years of business experience between them. In other words, you cannot find a better wealth of knowledge in finance, insurance, and property – all in one place.

Want to Buy That Dream House or Grow Your Business? Let’s Talk!

Whether you’re looking to secure a loan, protect your family, or invest in property, My Money House makes it all feel like a breeze. With decades of experience in business, real estate, and finance, we are perfectly positioned to help you fulfil your dreams. MMH Group is the very symbol of personalisation, commitment to transparency, and customer-first approach.

My Money House has your finance, personal insurance and property needs covered. Let us help you take the next step towards a secure financial future. Contact us today to know more about our services.

Everything You Need to Know About House and Land Packages

Posted on 24 September 2018 | by mmhadm

There are 2 types of house and land packages which include:

Buy your land and secure a builder and construction loan – this is a more difficult option as you will have a contract to purchase the land and a contract to secure a builder
Turnkey packages which include the house and land with all the fittings and fixtures completed on the house – it is ready to move in

Turnkey packages are supplied by My Property House and include several options in different suburbs to suit the home owner’s needs. These turnkey packages are a fixed price for the house and land. There will be no nasty surprises during the build. A turnkey package will give you a new home without the stress of dealing with separate land and building contracts.

A turnkey package will have a list of items which are included in the build. You will also be able to select from a range of fixtures and fittings to suit your needs and style.

Everything that is included in the build will be covered in the building contract. You will know exactly what you will be getting.

For more information about house and land packages, call 1300 870 838.

Total and Permanent Disability Insurance

How do I Protect my Assets and Family for the Future?

Posted on 24 September 2018 | by mmhadm

So, have you ever asked yourself the question – how would you pay your mortgage and support your family if you got injured or sick and were unable to work?

We know this isn’t a pleasant topic to discuss, but securing your family’s future to cover your living expenses should anything happen to you is a MUST. There’s a lot you can do to protect your family and assets. But this process typically involves assessing your current financial situation, setting up a proper asset protection plan, and safeguarding your family from creditors and debtors.

At the end of this guide, you will know how to protect your assets and family.

Let’s get started.

Assess Your Current Financial Situation

Before you put an asset protection plan into place, you’ve to assess your current financial situation. Typically, this involved two steps:

1. Check Your Finances

The first step would be to take stock of your current financial situation. This means looking at your current debts, savings, income, real estate investments, and other investments. While this may seem simple enough, it’s an ordeal for around one-third of the Aussies who are not financially well-versed.

Whether or not you understand finances, you need to know where you stand. Taking this step will bring you closer to securing your future from any financial burden.

Here’s what you must do:

List all your properties, investments, bank accounts, and valuable possessions.
Get a clear picture of your income, including salaries, rent, investments, or other sources.
Define your liabilities, such as credit cards, mortgages, loans, and personal debts.

Use these details to define your current net worth, which will largely define your financial goals and asset protection plan. Knowing what you can afford helps you set realistic goals and stay on track for a better future.

2. Set Your Financial Goals

Everyone has different financial goals for the future based on their present commitments. For instance, parents are more concerned about investing in their children’s education. But for a young couple, saving up for their first house or a new car would be a top priority.

Whatever your situation may be, we recommend setting up three types of goals:

Short-term goals are about repaying your credit card debts, car loans, and student loans.
Medium-term goals include strategies like life insurance, income protection, trauma cover, or total and permanent disability cover.
Long-term goals focus on securing the future of your family, which involves buying your dream house, saving up for your children’s education, and securing income for retirement.

Create Your Asset Protection Plan

Once you know where you stand, you’ll have to come up with a realistic asset protection plan. There are different ways to protect your assets, from your business to your personal property, like your house and car.

But you’ve to follow a few cardinal rules:

1. Diversify Your Assets

Never keep all your eggs in one basket. That’s the first rule of asset protection. Spreading your investments not only reduces risk but also increases your chances of getting higher returns.

Like most Aussies, you can invest in:

Superannuation
Property
Company Structures
Shares (Equities)
Managed Funds and Exchange-Traded Funds (ETFs)
Bonds

2. Plan Your Estate Strategically

Estate planning is at the heart of your asset protection plan. With a well-defined estate plan, you can distribute all your assets as you wish and protect them from creditors and debtors.

You can use different strategies like:

Create a Will and nominate your heirs to avoid family disputes.
Build a trust and transfer all your assets in its name to protect your legacy.

While most Aussies create Wills, creating a Trust is a better way to protect your assets. A Trust takes effect immediately and helps you manage your assets while you are alive. It can help you handle accidents, disabilities and complex finances without stress, which makes it as important as getting income protection or life insurance.

3. Manage Your Debt

The sooner you can pay off your debts, the easier it is to protect your assets and your family’s future. But the reality is quite grim, with ASIC saying 5 million Aussies struggle to pay off their debts.

If you are struggling to pay your debts, you should consult a financial advisor as soon as possible. You might also want to approach your debt management more aggressively.

You should:

Repay your high-interest debts first, such as credit cards, to save money in the long run.

Combine all your debts into a single loan with a lower interest rate to make repayments easily and quickly.

Track your income and expenses using an app like Goodbudget or Frollo. This simple step will help you cut unwanted expenses and pay your debts faster.

Protect Your Family from Creditors and Debtors

While savings and pension can help, relying on this alone is not enough to protect your family’s future. You will need to keep your investments safe from your creditors and debtors.

Here are a few things you can consider:

1. Low-Risk Spousal Ownership

Low-risk spousal ownership is one of the most popular asset protection strategies. It involves transferring the ownership of your assets to your spouse. This strategy protects your assets from business risks and creditors if you fall into debt or get sued. It’s an excellent strategy for business owners, who are often at a higher risk of market fluctuations.

2. Invest in Different Insurance Covers

When you think of insurance, medical cover and life insurance are probably the two things that come to your mind. However, there are different types of insurance covers, meant to protect different financial aspects of your life.

These insurance policies include:

Life Insurance – a lump sum payment in the event of your death that will cover outstanding debt and the future costs of your family to live including education, childcare expenses, estate planning and business buyouts. There are a range of policies available to suit your needs.
Income Protection – covers 75% of your income should you be unable to work due to sickness or injury. This tailor-made product has different waiting periods and the premiums are generally tax deductible.
Total and Permanent Disability Cover – provides a lump sum benefit of up to $5 million in the event you become total and permanently disabled resulting from sickness or injury.
Trauma Cover – provides a lump sum benefit of up to $2 million if you are diagnosed with a specified medical condition (40 plus medical conditions are listed) and survive for 14 days after diagnosis.

Whether you want income protection or trauma cover, My Money House has a Personal Insurance Specialist on-site to help you to understand different insurance policies and how they are relevant to you.

Protect Your Family’s Future

As you can see, asset protection is a long game. But taking proactive steps now will help your family live without any financial burden in future. Starting today, you should consider diversifying your assets, planning your estate, paying off your debt, leveraging low-risk spousal ownership, and investing in different life covers.

That said, you don’t have to do this alone. MMH Group is here to help you. Our experts can help you choose the right policy covers to protect your family and assets. If you would like a quote for any of these policies, fill out the linked form.

How do I Secure My Income for Retirement?

Posted on 24 September 2018 | by mmhadm

When you are young, retirement is hardly on your mind. But like most Aussies, if you intend to retire between 65 and 67, you will need to have a proper retirement income plan in place. A well-planned retirement assures financial security in your golden years, which is all the more necessary with increasing lifespans and growing job insecurity.

Planning a steady income for retirement may seem daunting, but it doesn’t have to be. Whatever your retirement dreams may be, there are many ways to build a fixed income that supports your lifestyle.

In this post, we’ll help you understand how to plan your retirement income stream.

Let’s start.

Start Early

According to the Association of Superannuation Funds of Australia (ASFA), an average single person retiring at age 67 who seeks a comfortable lifestyle needs a retirement income of $48,074.77 a year, and couples need at least $67,049.86 a year. It’s easier to secure this income if you start planning your retirement in the early twenties.

For one, it reduces your financial stress, allowing you to set aside a budget for your retirement income without stretching your resources thin. Secondly, it helps your investments grow substantially over time thanks to the power of compound interest.

Another benefit is it allows you to pay off your debt early, ensuring a debt-free retirement. Early planning also helps you plan big-ticket expenses like your kid’s education, property investment, and healthcare without added stress.

Set Your Retirement Goals

Everyone dreams of a different retirement. While some aim to live modestly, others may want a more comfortable or high standard of living. Having a clear idea of what your golden years should look like helps you plan your retirement properly.

When planning income for your retirement, consider your:

Living Costs: What will be your daily expenses after retirement? This includes expenses like groceries, utilities, housekeeping, and food.

Healthcare Costs: Do you foresee any significant health expenses? You may not have any health issues at a young age, but you might need regular medication when you retire. Be sure your healthcare plan can cover these costs while your retirement income can pay for out-of-pocket expenses.

Leisure Activities Costs: How often do you plan to travel or eat out after retirement? Perhaps you want to take up piano lessons or learn to paint. Whatever you plan to do, factor those expenses in when planning your income for retirement.

Create Your Retirement Savings Plan and Stick to It

Once you know how much you need to set aside for retirement, you can create a savings plan. Whether $100 or $500 a month, whatever you decide to save, stick to your plan. Financial discipline is critical for planning your retirement.

Here’s what you can do to stay on track:

Monitor Your Expenses: Track all your daily expenses, even if a nickel and decide where you can cut back. Goodbudget, WeMoney, and PocketSmit are a few apps you can use to track and manage your daily expenses. Remember, money saved is money earned.

Start Investing: Set aside a specific portion of your income for retirement savings and investments. It can be 10% or 20% of your income, depending on your retirement goals. But while doing this, make sure to pay off your debts like car and home loan and credit cards. This helps you retire without any unrealistic financial commitments.

Don’t Put All Your Eggs in One Nest

Diversification is the cardinal rule of retirement planning. Don’t put all your income for retirement in one savings account or retirement plan. Diversify your investments as much as possible. It lowers the risk of your portfolio because different assets do well at different times.

Some of these options include:

Superannuation: It is considered the best income stream for retirement, with nearly half the retirees in Australia (48%) relying on superannuation in 2023. As this is your primary retirement savings account, you can invest more in your Super to benefit from compound growth.

Usually, your employee will contribute a portion of your fortnightly wages to your Super directly. But we recommend you choose the amount as it will help you meet your retirement goals.
Real Estate: Real estate can also serve as one of the best income streams for retirement. Unlike shares and mutual funds, real estate is a relatively stable class of financial assets. Plus, your investment property can fetch a higher value over time. Although you may have tax obligations, you can benefit from this investment in different ways.
Sale: You can decide to sell your property once you retire, which provides you with a lump sum retirement income.
Rent: Alternatively, you can rent your property and build a steady retirement income stream. You can use this regular income to pay for your living expenses or retirement activities.

Stay Informed and Adapt Your Plan

Planning income for retirement is a long-term goal, meaning you will need to keep up with the changing market trends, economic conditions, and personal circumstances. Every quarter, you can review your investment portfolio and see if you are on track. You can modify your investment strategy according to the changing market conditions and your finances.

Why Choose My Money House?

All you want is to have a good lifestyle in your retirement. So just how do you secure your income so that you can use it in retirement. My Property House can assist you with purchasing an Investment Property that can secure your income in retirement.

My Property House have a range of investment property packages that include residential properties in popular Australian suburbs. Property is a secure investment in the long term, is relatively simple to understand, and easy to leverage. My Property House can assist you to create a property investment portfolio by:

Teaching you to understand property as an investment.

Helping you in setting your budget and understanding your financial capacity.

Providing research and information on specific properties and their potential return on investment.

Guidance in understanding the numbers including cash flow, equity, negative gearing, and tax benefits.

Ongoing access to a team of professionals who can research the property market, and find you the best property and loan to suit your needs.

Manage your property portfolio to ensure high rental returns.

Talk to Our Property Investment Experts

Everyone deserves a comfortable, stress-free retirement, which begins with careful planning. If you start early, set your investment goals, maintain financial discipline, and diversify your investments, you can turn your dream retirement into a reality.

MMH Group can help you strengthen your retirement income plan with property investments. For more information about property investment and building your own property portfolio book a strategy session today.

How Do I Own My Own Home Sooner?

Posted on 14 September 2018 | by mmhadm

The great Australian dream of owning your own home may seem impossible, but My Money House can assist you to reach your dreams.
My Money House can work with you to understand what kind of home you can afford; the suburbs that you could afford to live in; and how you can own your own home sooner.
The best ways to own your own home sooner include:
• Set a realistic budget that you can follow and save money for a deposit or go towards your home loan;
• Work out ways to reduce your discretionary spend (money that you don’t have to spend) and put that money on your home loan or put it towards a home deposit;
• Consider ways to increase your income by taking on a second job, walking dogs, house sitting, baby-sitting, or selling your unwanted items on ebay;
• Take our Home Loan Comparison Test, your current home loan could be costing your thousands.
Remember, owning your own home is a goal and it will take time to own your own home. By reducing your discretionary spending and increasing your income you will own your own home sooner.
My Money House Consultants have worked with thousands of Australians to own their own homes. They can assist you to own your own home sooner.
Contact My Money House for an appointment today.

What is Rent Invest?

Posted on 14 September 2018 | by mmhadm

With property prices and interest rates rising, many Australians are finding it hard to buy their dream home in the area they love.

But rather than taking on a big mortgage, more people are choosing ‘rentvesting’.

Rentvesting, or rent investing, means someone rents a home in their preferred area while purchasing an investment property in a more affordable location. It’s a clever way to get into the market without sacrificing lifestyle. About 15% of renters in Australia are now ‘rentvestors,’ according to the Australian Bureau of Statistics (ABS).

So, what is rent investing? And is this the right step for you?

In this post, the My Property House team will explore rent investing, its risks and rewards, and whether it’s a good idea.

The Rent Investing Approach

Let’s say you’re currently renting in an expensive city like Sydney or Melbourne. You want to stay in the area, but purchasing a home there seems impossible.

Instead, you buy an investment property in a more affordable suburb or even a different state where the market has better prospects for growth. Meanwhile, you continue renting in the location you prefer.

Benefits of Rent Investing

Rent investing offers a range of benefits that make it an attractive strategy for many young Australians. Here’s what they are.

Flexibility to Live Where You Want: Renting and investing allows you to enjoy living where you want without the financial burden of owning a home there.
Potential for Higher Returns: By choosing growth areas, you can build wealth through property appreciation and rental income, even if you don’t live in the home you own.
Tax Benefits: Rent investing comes with financial perks, like tax deductions on loan interest, maintenance costs, and management fees. You can leverage these to make your investment more affordable.
Diverse Portfolio: Rentvesting allows you to spread your investment risk by owning property in multiple areas. This way, you benefit different market conditions and protect your investments from downturns in any one location.

Turning a Liability into an Asset: In renting and investing, the property isn’t just a cost—it’s a money-making asset. Rent from your investment can help cover your mortgage payments.

Who Should Consider Rent Investing?

Rent investing can be a smart move for:

Young professionals who want to live in bustling city centres, but can’t afford to buy there.
First-time buyers who want to get their foot on the property ladder without giving up their ideal living spot.
Investors who want the freedom to choose where they live and invest.

Finally, those unsure about where they’ll settle- perhaps due to job changes or family plans- can use rentvesting as a way to stay flexible while growing their financial future.

How Rent Investing Differs from Traditional Homeownership

Rent and invest is quite different from traditional homeownership because it separates where you live from where you invest. Most homeowners buy a property with the intent of living in it. In contrast, rent investors treat properly solely as a financial asset.

The shift in mindset is key to rent investing. You’re no longer tied to the idea that your home must also be your greatest financial asset. Instead, you choose properties that will give you the best return, regardless of where you want to live.

Risks to Consider

Like any investment, investing rent comes with its risks- and you must be aware of them.

Market Fluctuations: Property values can rise or fall over time. Picking a location with solid growth potential can help mitigate this risk, but no investment is immune to market changes.
Ongoing Costs: While rentvesting offers flexibility, you still need to cover costs like property management, repairs, and mortgage payments. These expenses can add up, especially if you’re managing multiple properties.
Vacancy Risks: If your rental property remains vacant for a long time, you’ll be responsible for covering the mortgage and other expenses out of pocket- which could put a strain on your finances.

What to Consider Before Rent Investing

Before jumping into rent investing, there are a few key factors to think about:

Financial Readiness: Make sure you’re in a stable financial position. You’ll need to manage both your rental expenses and the costs of owning an investment property, including mortgage payments, maintenance, and possible vacancies.
Property Location: Do your research on areas with strong growth potential. The right location can help you get a good return on your investment.
Long-Term Goals: Rent investing works best when it aligns with your long-term plans. Consider your financial and lifestyle goals, and whether rentvesting helps you achieve them.
Tax Implications: While rent investing offers tax benefits, it’s important to understand how they work. Consult a financial expert to make the most of these deductions.

Risk Tolerance: Are you comfortable with the risks involved, such as market fluctuations or vacancies? Make sure you have a plan to handle potential downsides.

Final Thoughts

Rent invest is a fantastic opportunity to enter the market and purchase a home and rent in an area you would like to live in, but may not be able to afford to purchase. It’s an increasingly popular strategy for younger buyers or anyone struggling to afford property in expensive areas.

My Property House can source a property for you that is in a suburb where property prices are likely to increase, and great tenants are easy to find. They can assist you in working out your finances and develop a home-owning strategy that will meet your needs.

The present tax system is great for property investors. You could get various tax deductions on your property investment and property maintenance costs. Our Property Specialists are aware of these deductions and how you can use them to become a homeowner.

If you are currently renting a home because you can’t buy a home, consider talking to a My Property House Consultant. They are experienced and have assisted many renters become property owners and realise the great Australian dream of owning their own home. To find out more contact My Property House today.

How Can My Money House Assist Me with The Best Home Loan?

Posted on 14 September 2018 | by mmhadm

It’s natural to feel overwhelmed when looking for a home loan. The average new home loan in Australia is $626,055, with an average interest rate of 6.27% p.a. That’s a commitment of repaying $3,863 a month over 30 years.

Given this situation, you would want to secure the best home loan when buying your dream house. That means selecting a home loan with repayment flexibility, the lowest possible interest rate, and adjustable tenure with minimal fees.

The good news is you have plenty of options, and with an expert home loan broker like My Money House on your side, you can find a loan that best fits your needs.

In this post, we’ll tell you how you can find the best home loan. But first, let’s go through the basics.

What Types of Home Loans Can You Get in Australia?

While a home loan is offered against the property you are buying, its terms and conditions can vary depending on:

The lender
Your credit score and income
Property size and location
Market conditions

Each lender will create its own products with specific terms and conditions. In Australia, you can typically come across the following types of home loans.

1. Fixed Home Loan Options

In a fixed loan, your interest rate remains unchanged for a set period. Most Australian banks offer fixed rates for 1-5 years, while ANZ bank and RAMS are the only major lenders offering 10-year fixed-rate mortgage products. The main benefit here is your initial payments are predictable, which helps you better manage your finances.

2. Variable-Rate Home Loans

In variable-rate home loans, your interest rate changes depending on the market conditions, and so will your payments. While you can benefit from the drop in the interest rate, your repayments would also increase if the rate goes up.

3. Split-Rate Home Loans

These home loans combine the benefits of fixed and variable-interest loans. You can nominate a portion of your loan to have a fixed interest rate, and the remainder will be charged a variable interest rate. You can split it 50/50 or 60/40 – the choice is yours. But be sure to consult your home mortgage broker or consultant before making this decision.

5 Things You Must Consider When Choosing a Home Loan

Choosing the best home loan is often easier said than done. With so many options available, you may feel overwhelmed and need more time to decide which mortgage fulfils your needs. But if you keep the following things in mind, you might come to a decision sooner than you think.

Here’s what you need to consider:

1. Interest Rates

It is the most critical component of your home loan. Usually, a higher interest rate means steeper monthly repayments, which may affect your bottom line. Australian lenders offer two types of interest rates – fixed and variable.

Fixed rates offer more stability with a set interest rate for typically 1-5 years, while variable rates can fluctuate with market conditions. You can also opt for a split-rate home loan, where one part of your mortgage attracts fixed interest while the remainder is charged a variable rate.

Whether a fixed, variable, or slipt-rate loan, compare the interest rates. You can use a loan comparison calculator or consult a home loan broker to decide which mortgage is more cost-effective in the long run.

2. Loan Term

The loan term is the length of time over which you agree to repay the loan. It typically ranges from 15 to 30 years in Australia. While a shorter term may seem attractive due to less interest paid over the life of the loan, it requires higher monthly repayments.

Conversely, a longer term will have lower monthly payments but more interest overall, making it expensive in the long run. You will need to understand your current financial obligations when deciding the term of your loan. If you can afford to pay more, go for a shorter term. But if you want to save more money right now, you can choose a longer home loan term.

3. Repayment Options

Lenders offer different repayment options, including principal and interest or interest-only repayments. Principal and interest repayments reduce your loan balance over time, while an interest-only mortgage lowers initial monthly payments but does not reduce your principal.

Use loan repayment and interest-only calculators to know which option best suits your requirements. You can also consult your home mortgage broker to understand your options. You shouldn’t have to make your ends meet while repaying the mortgage. It puts pressure on your financial and emotional well-being. Choose an option that aligns with your financial goals and current budget.

4. Fees & Charges

See if there are any extra charges or fees associated with the loan.

Most Australian banks charge different fees. If you are stuck with a lender who loves charging fees, they can quickly add up, making your home loan more expensive than you imagined.

Typically, you may have to pay:

Application or settlement fees, often ranging from $150 to $600 or more.
Around $100 to $300 in property valuation fees, depending on the type, location, and value of your property.
Conveyance fees, which may be anywhere between $500 and $1,000.
Ongoing maintenance fees ($5 to $15).
Annual fees ($200 to $400) and redraw fees that can be up to $50 per redraw.
Government charges and legal fees as applicable.

In addition to this, your lender may charge an early exit fee if you repay the loan within the specified period. Most lenders charge this fee if you repay your home loan within five years. It depends on your loan amount, term, and other loan conditions. Understand how these fees might affect your bottom line when deciding on your home loan.

5. Loan Features

Most mortgages in Australia come with features that offer flexibility and convenience. These may include offset accounts, redraw facilities, and flexible repayment options, which can help you manage your loan more effectively. An offset account, for example, can reduce the interest you pay by offsetting your loan balance with the money in your account.

When shopping around for a home loan, ask if the lender will allow you to make additional payments or change your repayment schedule without attracting fees. This helps you repay your loan faster without stretching your finances too thin.

How Can My Money House Help Me

The My Money House team is the expert in getting their customers the best home loan that suits their needs. All My Money House Finance Specialists are fully qualified and licenced. The team have assisted our clients in providing in excess of $850 Million in home loan approvals.

My Money House can assist you to get the best home loan by:

Understanding how much money you earn and how much money you can afford to borrow.
Talking with you about what kind of loan would suit your needs. For example, variable rate loans, fixed-rate loans, extra repayment facilities, redraw facilities, offset accounts, interest-only loans, guarantor loans, low doc loans, line of credit loans and non-conforming loans. My Money House Finance Specialists can explain to you the different loans available and discuss which would best suit your needs.
My Money House will take the hassle out of applying by completing the entire process for you, from application through to approval/settlement.
My Money House can also get your home loan pre-approved so that you know how much you can spend.

Final Thoughts

Getting the best home loan is possible if you know what and where to look. Always compare interest rates, lean features, loan term, fees, and repayment options when shopping for a mortgage. Remember, you don’t have to go through this alone. My Money House team is with you every step of the way.

We can help you get the mortgage you deserve. Contact a My Money House Consultant today to get your loan approved.

How to Save Money for a Home Deposit

Posted on 14 September 2018 | by mmhadm

Everyone wants to live in their own house one day – it is the great Australian dream. But for many apprising homeowners, saving money for a home deposit can seem like an uphill battle. With the living costs showing no signs of going down, you may struggle to set aside money for the down payment.

But with the right strategy, you can reach your goal faster. As experts on home finance, we at My Money House believe that the best way to save for a home deposit is to set your financial goals. It helps you save money without stretching your resources too thin.

Let’s walk through the insights to make this journey smoother.

Things to Do Before You Start Saving Money for A Home Deposit

Before you even think about saving money for a home deposit, you’ve to do a few other things, such as working out where you want to live, getting your home loan pre-approved, and thinking about financial aid.

Here’s is quick lowdown:

1. Decide Where You Want to Live

Working out which suburbs you would like to live in is the first step in your financial planning. Like the rest of the world, property prices in Australia are directly tied to the location. For example, Medindie, Toorak Gardens, and Unley Park are the most expensive suburbs in Adelaide.

You can plan to settle in one of these suburbs. However, we recommend choosing a more affordable suburb that could reduce your home loan deposit amount, especially if you are a first-time buyer.

2. Know What Kind of Home You Can Afford

Once you know where you want to live, decide what kind of home you think you can afford. If this is your first home, don’t set your goals too high and consider that you will probably need to compromise on where you end up purchasing.

This means:

Looking at home options in affordable suburbs like Elizabeth, Davoren Park, and Salisbury.

Compromising on add-ons such as a swimming pool, second garage, or second floor.

3. Figure Out the Size of Your Home

The size of the home will also affect your budget. So, ask yourself, how many bedrooms do you require? How many bathrooms? A large, four-bedroom, two-story house may require a bigger deposit and higher ongoing costs like maintenance and utilities. So, be realistic about the space you need, and save money for a home deposit accordingly.

4. Get Your Loan Pre-Approved

Consider getting your loan pre-approved so that you can find out how much you can spend on a home. It also shows sellers that you’re serious about buying a new home. Lenders will look at your income, expenses, and credit history before giving pre-approval. And since this is what we do, My Money House can assist you in finding the best home loan to meet your needs.

5. Find Out the Deposit You Need

Find out how much deposit you need for the home that you would like to purchase. Typically, lenders in Australia ask for a 20% deposit. However, most lenders, including the big four banks, accept a 5% home deposit if you pay the Lender’s Mortgage Insurance (LMI). Be sure to check with your lender to know exactly how much deposit you need.

6. Learn About Additional Expenses

While home loan deposit is the biggest expense you’ll have to bear, it’s not the only one. You will also need to find out the additional costs of purchasing a home, like stamp duty, conveyance fees, moving costs, and building inspections. These extra costs can add up, so budget for them in advance and avoid surprises down the road.

7. Think About Financial Aids

Find out what government grants like the First Home Owner Grant (FHOG) are available. For example, in South Australia, you can get a $15,000 grant if you purchase a brand-new home instead of an established home. This one-off grant can reduce your financial burden, including the home deposit.

My Money House can assist with finding the best loan that can meet your needs. With as little as a $3,000 deposit, you can purchase your own home or maybe with no deposit you can consider your parents going as guarantor.

How to Save Money for A Home Deposit

Once you’ve finished working your way through the above list, you can start saving money for a home deposit. Here’s how:

1. Work Out Your Income

First, work out how much money you receive monthly. This means checking all your income sources, including your salary, bonuses, cash income, freelance work, or rental income. Knowing how much money you have coming in can help you save faster for a home loan deposit.

2. Check How Much You Spend

The next obvious step is to track your spending for a couple of months to see where your money goes. Check your credit card and debit card statements – How much money do you spend? What do you spend this money on? Keep track of all your expenses, like rent, groceries, bills, and entertainment.

3. Use a Budget Planner

Once you know your income and expenses, figure out your monthly budget. It’s like a balance sheet of your income, expenses, and savings. This helps you see how much you can realistically save each month. It would be worthwhile to review your expenditure on an Excel spreadsheet to work this out. Here is a template that can assist you, or use our online budget planner.

2. See Where You Can Cut Back

Review your expenses for the month. Are there any categories that you can cut back on? Was there any discretionary spending that you could do without? Remember, the best way to save for your home deposit is to cut back on the expenses that you can do without. This is called reducing your discretionary spending.

Here’s how to save money for a home deposit by reducing discretionary spending:

You could reduce your monthly discretionary spending by taking your lunch to work (approximately $200); cutting back on takeaways (approximately $200); taking a bus to work (approximately $80); and not going out to dinner weekly (approximately $200). Already, you have $680 for a deposit, and it only took one month to save this.

3. Increase Your Income

Increasing your income can help you save faster. Find out other ways to increase your income by recycling bottles and cans (in SA, this could be $30 per month); selling your unwanted items on eBay; or doing jobs for cash, for example, gardening, dog walking, babysitting, or house sitting. You might also consider picking up an extra shift at work, freelancing, or starting a side hustle. More income means more money towards your home deposit.

Start Saving Money for a Home Deposit

Saving for a home deposit takes time and dedication. But if you set realistic goals, reduce your discretionary spending and increase your income, it could take 3 to 6 months to save up for a home deposit. Start by deciding where you want to live and how much deposit you need. Then, create a budget and look for ways to save more and spend less. Remember, every dollar saved brings you one step closer to owning your dream home.

My Money House stands with you throughout this journey. We can help you with everything from saving for a home deposit to finding a suitable home loan. Complete this quick online questionnaire to see if you qualify to buy your first home.

If you have questions or doubts, reach out to our expert today!