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The Financial Side of Breaking Up

Relationship breakdowns can be devastating emotionally, as anyone who’s been through it knows. Then, just when you’re at your most fragile and vulnerable, you have to deal with unravelling your finances. This is where we learn that 1÷2 ≠ 0.5, even though we wish it would. Divorce generally means losing money thanks to transaction costs and the need for speed.

No wonder divorce ranks in the All Time Top Five Greatest Hits on the ‘Life’s Most Traumatic Experiences’ Charts!

It’s something I’ve seen play out first hand when my parents divorced. The financial decisions they made as they split rippled through the following decade. Indeed occasional blips are still felt 29 years later by both of them. As a financial educator, I am often asked for suggestions on dealing with the financial side of divorce. (E.g. this 45min segment for Focus on ABC Radio with Jessica Strutt). Read more

Housing affordability: you can’t spend your way out of this

There’s a problem with the way Gen X and Y view housing affordability, and it’s going to ruin the financial futures of their children if they don’t snap out of it pronto.

I read this article in which the author says she is spending money on brunch because she can’t afford a house, like it’s the only way she can console herself about her dire financial future. Read more

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Becoming a self-funded retiree: more of Fran’s story

If you’ve read anything about Money School, you’d know we wouldn’t be here without Fran, the mother half of the our mother-daughter team.

Fran’s a bit shy. She’s more than happy to be in the background. Getting in front of a camera was a daunting task for her, but with a little coaxing we got there. It’s a shame she’s shy because Fran’s is the more inspirational story in our opinion. Starting investing at 48 years old and now a self-funded retiree, her life proves it’s never too late to start.

We’ve finally convinced her to tell more of her story. Here it is, in her own words:

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Can today’s teens break into the property market?

Having bought property in 2001 at 19 years old, I get asked this question at least once a month:

 Could a 19 year old do the same today, in 2016?

My short answer is: yes, they could. I’ll outline how in this post.

The far more important question is: if they could, should they? Well, that’s a slightly longer answer. Read more

Tips for first time property buyers

By Lacey Filipich BEng(Hons) MAICD

Having bought a property in my teens, I am asked time and again by students and those early in their career how they can do it too. To those aspiring young property magnates, I say: bravo! Thinking about wealth creation in your teens and twenties is fabulous. It’s bound to put you in better stead than those that only wake up to it later in life. That you’re asking the question makes you one in a hundred.

Congratulations done. Now the hard part… Read more

Selling investment property | %%sitename%%

Should you sell your investment property?

Author’s note: This article on selling investment property is by far our most popular – probably because it’s comprehensive and comes complete with formulae – but at over 5,000 words it’s longer than an average book chapter. So, here’s the summary of what you’ll find in this article so you can decide if it’s what you’re after:

  • Five sensible reasons to sell (to reduce interest on your home; poor performance; better asset available; it was once your home; losing sleep over it).
  • Five reasons that it may be better to hold (it’s a recent purchase; solid performance; high potential for growth; it’s key in your strategy; no mortgage on your home).
  • Full worked calculations based on the scenario of having a home mortgage and an investment property (three worked options: keep both; sell investment and swing profits to home mortgage; sell investment and use profits to buy another property).

At the end of the article, you’ll find instructions for obtaining an Excel spreadsheet that does all the calculations covered in the article and lets you run scenarios for your personal situation.

 

Recently, I was asked on two occasions in a single day for my thoughts on whether or not my friends should sell their respective investment properties. When I mentioned being asked the same question twice that day at dinner in the evening, a third friend said ‘Yeah, I’ve been wanting to ask you the same question about my property.’ I’ve been pondering why so many people were thinking about selling their investment properties around then.

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Selling property: a cautionary tale

By Lacey Filipich, BEng(Hons), MAICD

This month my husband and I sold a property. We don’t do that often. In fact, it’s only the second time I’ve sold and the first for hubby. The last time was a golden handshake from my employer: they paid me the average of two valuations on the home and I signed it over to them. I didn’t have to engage an agent, I didn’t have to clean my house for home opens, I didn’t even have to think about it really. That’s a far cry from this recent sale, which can reasonably be termed ‘a learning experience’. With all this learning fresh in my mind I am writing this post so that you, dear reader, may profit from it if you ever decide to sell a property. Read more

Buying a property in my teens

By Lacey Filipich, BEng(Hons), MAICD

When I started saving half the income from my part-time jobs, I envisaged I would one day use the money to buy a flashy car. I dreamed of driving that car in the finest clothes, on my way to a swish restaurant. I had absolutely no expectation that my savings would be used to buy a property before I’d even finished my second year of university, but they did. I traded the flashy car, clothes and restaurant for a small, dingy apartment in which I wore clothes encrusted with paint and ate microwave dinners. I was 19 years old at the time. As usual, I have my mother to thank. My gratitude knows no bounds… seriously.

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Monopoly and Real Life | %%sitename%%

7 Ways Monopoly is like Real Life

By Lacey Filipich, BEng(Hons), MAICD

Monopoly and real life?

Monopoly? Really? Yes, I’m not talking about what Microsoft had in the 90’s, I’m talking about the board game we all know and love. Monopoly began life around 1903, originally (and quite aptly) named ‘The Landlord’s Game’. The version of Monopoly we are familiar with today was officially released in the early 1930’s and has been a staple in most Australian childhoods since then. In primary school, my sister and I spent many a holiday racing each other around the board to buy Mayfair and Park Lane. We had games that went on for several days and some that lasted mere minutes. Of course, a board game can never be a perfect replication of such a complex investment vehicle as property, but it was a great start that we didn’t even know we were getting!

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