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Speaker 1: Hello, my name's Santasha Nabananga Bamblet. I'm a proud yr

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Speaker 1: the Order Kerni Whoalbury and a waddery woman. And before

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Speaker 1: we get started on She's on the Money podcast, I

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Speaker 1: would like to acknowledge the traditional custodians of the land

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Speaker 1: of which this podcast is recorded on a wondery country,

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Speaker 1: acknowledging the elders, the ancestors and the next generation coming

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Speaker 1: through as this podcast is about connecting, empowering, knowledge sharing

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Speaker 1: and the storytelling of you to make a difference for

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Speaker 1: today and lasting impact for tomorrow.

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Speaker 2: Let's get into it.

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Speaker 3: She's on the Money, She's on the Money.

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Speaker 2: Hello, and welcome to the new financial year.

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Speaker 4: Gotcha, and welcome to She's on the Money, the podcast

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Speaker 4: for manials who want financial freedom. Victoria Devine is with

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Speaker 4: me as always, and we're talking about something very exciting today.

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Speaker 5: Yeah, you've brought a lot of energy for what could

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Speaker 5: have been a very dry topic.

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Speaker 4: It's not going to be dry. I have a good

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Speaker 4: feeling about this. It's the Investor's Guide to Tax Time.

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Speaker 5: That is so juicy, That is spicy, spicy clancy.

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Speaker 2: Oh, I cannot late to jump in.

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Speaker 5: I am so excited about this spicy content. Tell me

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Speaker 5: you're not stupidly excited, Beck.

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Speaker 2: I'm stupidly excited. My favorite part about this is that

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Speaker 2: you're not an investor.

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Speaker 5: Everything that we're going to talk about completely irrelevant to you.

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Speaker 2: I'm just glad you're here with bells on. It's new

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Speaker 2: news to me.

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Speaker 4: I'm a tiny baby in this episode, and I hope

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Speaker 4: you teach me a thing or two.

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Speaker 5: But my favorite thing about these episodes is whether you're

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Speaker 5: ready or not to be an investor. My favorite thing

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Speaker 5: ever is making sure you're educated and actually ready for

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Speaker 5: the conversation when it does happen. So like, I cannot

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Speaker 5: wait for the day that you're like, oh, v I'm

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Speaker 5: investing my first fifty bars because you're going to have

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Speaker 5: so much education behind you that you're making the right

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Speaker 5: decision for you.

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Speaker 2: I think it's such a.

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Speaker 5: Misconception that, oh, well, maybe like this episode about tax

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Speaker 5: and you know, investors, it's not relevant for me.

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Speaker 2: I totally get that.

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Speaker 5: But like, what if in the next twelve months you

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Speaker 5: get your financial shit sorted enough that you are an investor.

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Speaker 2: You're going to need this next June.

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Speaker 5: You're going to need this for future You and I

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Speaker 5: think that it's really beautiful in a way to kind

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Speaker 5: of like give yourself that education before you need it.

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Speaker 5: Like I've said it before and it's probably not the

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Speaker 5: right example, but like you don't become a brain surgeon

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Speaker 5: by like just going in and doing brain surgery.

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Speaker 2: Right, Like you say, YouTube is yeah, oh can you

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Speaker 2: do it? Buy YouTube?

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Speaker 3: Baby, and so much cheaper than a med degree at

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Speaker 3: MELBOURNI like, honestly.

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Speaker 2: Quicker, quicker twenty minutes.

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Speaker 5: You know what, if I ever have to have brain surgery,

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Speaker 5: you best believe I want someone with a real degree,

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Speaker 5: not someone who's like learned. Not me, not you, You're canceled.

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Speaker 5: So today we're going to be stepping through a few

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Speaker 5: very important points on this huge topic to give you

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Speaker 5: guys some general basics when it comes to tax time

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Speaker 5: and your investments and what to do, because it can

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Speaker 5: be super overwhelming and it's worth obviously bearing in mind

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Speaker 5: that tax implications and beck the possible benefits of certain investments.

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Speaker 5: So generally, all of your investment income needs to be

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Speaker 5: declared in your tax return, all of it, every single dollar.

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Speaker 2: Interests, dividends, rent.

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Speaker 5: Managed fun distributions, capital gains from properties, shares and cryptocurrency.

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Speaker 5: And if you're like, oh my gosh, I'm not an

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Speaker 5: investor v I just have my money in a high

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Speaker 5: interest savings account.

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Speaker 2: Beck that's interest, you have to declare that, Oh my gosh,

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Speaker 2: exactly scary.

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Speaker 5: So it's not scary, it's just about being transparent.

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Speaker 2: And to be honest, guys, it's twenty twenty three.

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Speaker 5: The tax system is so advanced that more often than not,

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Speaker 5: you're not even going to have to do the research.

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Speaker 5: It will just be in your tax return already because

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Speaker 5: your bank ruty has your TFN. So it's very likely

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Speaker 5: that all of this could be automated for you. And

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Speaker 5: that's why so many times when I talk to people

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Speaker 5: and they say, I'm not sure should I be doing

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Speaker 5: my tax return myself? You could give it a crack like,

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Speaker 5: it is so much easier than it used to be.

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Speaker 5: So you pay tax on investment income at your marginal

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Speaker 5: tax rate, that's the rate that you pay tax.

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Speaker 2: On your normal income.

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Speaker 5: However, there are some special rules that apply to what

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Speaker 5: we call.

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Speaker 2: Capital gains, which could arise on quote, the disposable of

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Speaker 2: your assets.

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Speaker 5: That just means you sell them in a fancy way,

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Speaker 5: right like capital gains is a tax that you pay

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Speaker 5: when you sell an asset and it is worth more

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Speaker 5: than what it was when you purchased it, because they

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Speaker 5: look at it and they go all right, well, Beck,

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Speaker 5: If you bought a share for ten dollars and it

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Speaker 5: did really well and it got to fifteen dollars and

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Speaker 5: you were like, well, I'm going to sell it, they're

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Speaker 5: going to go okay, cool, you bought it at ten dollars,

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Speaker 5: it's now worth fifteen. Capital gains will apply to that

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Speaker 5: five dollars that you made because in Australia and usually

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Speaker 5: every other tax environment in the world, you have to

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Speaker 5: pay tax on what you earned.

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Speaker 2: And you earned about five dollars. Does that make sense?

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Speaker 2: That does make sense.

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Speaker 5: So you're allowed tax deductions for the cost of buying,

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Speaker 5: managing and selling an investment, which is really cool. So

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Speaker 5: if you've been brokering shares during the year, like you've

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Speaker 5: jumped on shares is and there were fees, you can

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Speaker 5: claim them on your tax. That is very sexy, I think.

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Speaker 5: But there are also rules around what you can and

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Speaker 5: claim as a tax deduction. We'll obviously get onto those later.

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Speaker 5: And I genuinely think that more.

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Speaker 2: Things should be tax deductible.

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Speaker 5: Like something that really grinds my gears back and we'll

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Speaker 5: obviously get into more of the semantics of it, but

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Speaker 5: as somebody who is an ex financial advisor, this really

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Speaker 5: grinds my gears. So you obviously go and see a

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Speaker 5: financial advisor if you've got some money and you want

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Speaker 5: to be in the best possible financial position. And a

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Speaker 5: lot of the time you'll see a financial advisor and

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Speaker 5: they will say, all right, Beck, you've got you know

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Speaker 5: this amount today and we're going to grow it to

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Speaker 5: this amount over here, and with my advice, you're going

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Speaker 5: to be hopefully hundreds of thousands, if not millions of

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Speaker 5: dollars better off, and you go, great, that's fantastastic. What

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Speaker 5: grinds my gears is that process where you're putting yourself

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Speaker 5: first sounds really sexy. That benefits our government significantly. Like

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Speaker 5: the idea that if somebody an individual goes and sees

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Speaker 5: the financial advisor about their superannuation, even if they are

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Speaker 5: just a general employee, like we're not talking about millionaires

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Speaker 5: seeing financial advisors, which you're talking about general mum and

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Speaker 5: dad seeing financial advisors, they will be in a better

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Speaker 5: off financial position because of that advice, which means the

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Speaker 5: likelihood of them claiming a pension in the future.

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Speaker 2: Far far less likely.

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Speaker 5: Right, So, like, if you go and see your financial advisor,

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Speaker 5: you're probably not going to rely on the government during

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Speaker 5: retirement because the whole point is that you're working towards

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Speaker 5: a secure individual financial future.

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Speaker 1: Right.

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Speaker 2: Does that not piau the government in the best possible positions?

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Speaker 5: Why are they not letting us claim the cost of

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Speaker 5: initial financial advice where you get your statement of advice

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Speaker 5: on tax? Why can't I claim that? Does it not

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Speaker 5: put you in the best possible position? Government to give

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Speaker 5: me some tax back now on the probably anywhere between

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Speaker 5: three and eight thousand dollars fee, which would be very sexy.

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Speaker 5: Why can't you let me have that initial piece of

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Speaker 5: advice with some kind of like you know, tax incentives

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Speaker 5: so that more of us do it, so less of

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Speaker 5: us down the track actually claim pensions and actually need

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Speaker 5: government support.

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Speaker 2: But you won't do that.

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Speaker 5: Isn't that insane when you like extrapolate it out and

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Speaker 5: go hold on the government would actually be better off if

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Speaker 5: more of us got advice. And the amount of times

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Speaker 5: I saw people ask me questions when I was working

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Speaker 5: as a financial advisor. Oh can I claim this on

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Speaker 5: tax and I'd have to go, look, no, you can't, unfortunately,

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Speaker 5: because it's initial advice. But what you can claim is

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Speaker 5: ongoing investment advice. So like after you've got your initial advice,

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Speaker 5: any monthly fee after that is claimable, but not the

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Speaker 5: initial and the initials the thing that scares most people off, right,

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Speaker 5: because like if I said to you, hey, Beck, get

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Speaker 5: financial advice, it will put you in the best possible position.

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Speaker 2: You go, oh my god, this.

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Speaker 5: Is such a good idea, but like it's such a

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Speaker 5: high upfront. I don't mind about the ongoing monthly fee,

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Speaker 5: like that's completely manageable, but the upfront scares people off.

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Speaker 2: I totally. I've got thoughts. Anyway, maybe you should write

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Speaker 2: a letter to the tax person.

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Speaker 5: Yeah, hello, mister tax man, please let me claim this

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Speaker 5: because it will be the goodest for you. Yeah, Like,

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Speaker 5: it's a very very what's the word persuasive, it's a

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Speaker 5: persuasive argument.

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Speaker 4: It's persuasive, and really, I think that you've really thought

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Speaker 4: this through.

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Speaker 2: I think this is a great idea I.

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Speaker 5: Actually have because do you know how frustrated I would

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Speaker 5: get every single time I would have to explain to clients, No,

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Speaker 5: you can't claim me on tax, like you can't claim

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Speaker 5: my initial advice. But you can for your accountant, you

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Speaker 5: can for any other service providers related to money, just

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Speaker 5: not me because the government doesn't see me as valuable

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Speaker 5: as I am.

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Speaker 2: Oh my gosh, yeah you need to write. I've just

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Speaker 2: got a lot to say about that process.

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Speaker 5: But then also the part where financial advisors basically undersell

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Speaker 5: themselves completely, Like you guys are so magical and put

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Speaker 5: people in such good financial positions. But like if I

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Speaker 5: busted in the door and said, all right, Beck, we're

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Speaker 5: gonna sit you down. I'm going to put you in

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Speaker 5: the best possible financial position of your entire life, You're

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Speaker 5: going to be so financially secure. See, your subranuation might

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Speaker 5: be sitting at eighty thousand dollars right now, but when

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Speaker 5: you retire, it's going to be well over a million.

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Speaker 5: Because of my advice, You're going to be literally millions

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Speaker 5: of dollars better off. You'd be like, oh, I'm in

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Speaker 5: You sound like a sales queen, whereas financial advisors don't

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Speaker 5: do it that way. They like are a lot softer

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Speaker 5: and a lot more gentle with the process because obviously

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Speaker 5: you don't want to scare people off.

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Speaker 2: But then clients have the audacity.

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Speaker 5: And come back and be like, oh, four thousand dollars

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Speaker 5: is a fee that's insane. Absolutely not paying that. I'm like,

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Speaker 5: you're literally going to make more than a million dollars

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Speaker 5: because of me. But okay, no worries.

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Speaker 2: Jeez. Anyway, there's just a lot to be said on

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Speaker 2: that topic. Yeah.

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Speaker 5: That so this episode is about but get financial advice.

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Speaker 5: Now's a good time to think about your insurances as well.

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Speaker 5: So if you haven't got that advice, yes, I would

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Speaker 5: be going and actually, you know, putting yourself in the

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Speaker 5: best possible position. We obviously have a recommend Phil from

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Speaker 5: Skywealth is who you should be going and talking to

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Speaker 5: about your situation. And his fee is not thousands of dollars.

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Speaker 5: It's like three hundred and ninety five for a consultation,

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Speaker 5: which is wild, Like for all advice, you can't claim

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Speaker 5: it on tax I AM really sorry. But given his

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Speaker 5: fee is only a couple of hundred dollars in comparison

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Speaker 5: to thousands, to put yourself in the best possible decision,

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Speaker 5: I think that's really good money when you.

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Speaker 2: Had to go anyway, Soling Advice.

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Speaker 4: So V, I want to know when it comes to

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Speaker 4: investing in tax returns, what do you need to have prepared?

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Speaker 2: Everything? Everything, every single thing.

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Speaker 5: Yep, you should have like a Manila folder, one of

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Speaker 5: those light yellow ones that give me anxiety from the

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Speaker 5: amount of times I used to use them.

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Speaker 2: To write that down. Get Manila folder on my shop list.

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Speaker 5: If you could get like a label maker and label

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Speaker 5: it as well, that would make it feel a lot

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Speaker 5: more official.

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Speaker 2: Really stucking up place. Yeah, label maker, yep, yep, you're

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Speaker 2: writing this down.

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Speaker 3: I like it.

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Speaker 2: You're taking this very seriously.

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Speaker 5: What you want actually is your investment income as a report.

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Speaker 5: Most investment platforms will automatically generate this for you.

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Speaker 2: And email it to you.

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Speaker 5: So misconception is that it will be available on the

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Speaker 5: thirtieth of June or the first of July. That is

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Speaker 5: not true, and it's not not true because they're lazy

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Speaker 5: and haven't done the reporting. It's because we actually need

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Speaker 5: the date to pass so that we can actually look

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Speaker 5: at the historical changes and what actually happened in your portfolio.

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Speaker 5: And reporting is actually quite intricate in in depth. So

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Speaker 5: investment reports usually come out from I would say the

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Speaker 5: middle of July. So anywhere between the middle of July

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Speaker 5: to the end of July is when I usually see

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Speaker 5: them hit my accounts. So if you're one of those

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Speaker 5: people like Beck Beck wants to get her tax returning

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Speaker 5: asafety right, yes, Like, once you start investing, that process

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Speaker 5: has to be pushed off a little bit because you're

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Speaker 5: waiting for these reports. So you want your investment income,

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Speaker 5: you want to make sure that you're claiming all the

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Speaker 5: deductions that you're entitled to. So this is really hard.

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Speaker 5: If you get to the point where you're like, oh

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Speaker 5: my gosh, I've got to do my tax return.

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Speaker 2: You haven't been thinking about it.

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Speaker 5: You're like scrambling to work out what you can and

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Speaker 5: can't claim. I've said it before on the show. The

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Speaker 5: Ato actually have an app where you can keep track

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Speaker 5: of things throughout the year. But if you're like me

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Speaker 5: and you just don't want another app on your phone,

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Speaker 5: you can actually just put a folder in your photos

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Speaker 5: and just take photos of things as you go along.

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Speaker 5: If you looked at my albums in my photos section, BEG,

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Speaker 5: you'd be like, this woman's unhinged, Like I have a

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Speaker 5: folder for everything. I have a folder for tax I

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Speaker 5: have a folder for business tax I have a folder

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Speaker 5: for all of the outfits I've worn historically that I

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Speaker 5: really like. I have a folder for all of the

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Speaker 5: expenses i've incurred trying to make a baby with my husband.

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Speaker 5: Wild Like you would literally look at my phone and

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Speaker 5: be like, Victoria, why have you got? Yeah, But when

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Speaker 5: it comes to tax time, you best believe I just

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Speaker 5: flipped my phone around and I'm like, hey, beck, look

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Speaker 5: at all these costs.

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Speaker 2: I can claim that is so good, makes Victoria.

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Speaker 4: If the ATO needed like proof or receipts, a photo

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Speaker 4: of a receipt is it's absolutely sufficient.

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Speaker 5: Okay, great, because you will have to provide that to

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Speaker 5: the ATO anyway, if you get audited and they're just

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Speaker 5: going to ask for a quote the original receipt, but

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Speaker 5: a photo of that attached is much easier to go

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Speaker 5: back in email than going, oh hey, yep, misster tax man,

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Speaker 5: let me just go under my bed to the shoe

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Speaker 5: box where I keep all of those receipts. Also, something

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Speaker 5: that you probably haven't considered, but I've seen happen far

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Speaker 5: too many times is receipts fading. So receipts more often

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Speaker 5: than not are printed.

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Speaker 2: On Thermo paper.

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Speaker 5: Thermo paper means that when the receipt comes out, it

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Speaker 5: doesn't have ink. It actually heats up and it prints

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Speaker 5: that way. So if you leave a receipt in your

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Speaker 5: car on a hot day, it is very likely that

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Speaker 5: that receipt loses all of the information that was on

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Speaker 5: it because it's overheated.

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Speaker 2: Do you remember those.

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Speaker 5: Pens where you could like rub them out but they

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Speaker 5: were pen, Yeah, that actually disappeared because of friction, not

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Speaker 5: because of the rubber doing it.

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Speaker 2: It was actually friction and heating it up.

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Speaker 5: So one time, I used to be obsessed with like

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Speaker 5: eraisable pens because I'm a lefty and I mess everything up,

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Speaker 5: So a raisable pens they don't smudge, So I loved that.

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Speaker 5: But then also I loved that I could just like

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Speaker 5: eraise my mistakes and my notes would always look perfect.

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Speaker 5: Like I don't know if you've noticed this, but I

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Speaker 5: like being organized. I like everything to look perfect, Like

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Speaker 5: I used to write everything in these like erasable pens.

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Speaker 5: Notebook car hot day, lost every note I ever had

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Speaker 5: for a client. And now I've never used an eraisable

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Speaker 5: pen ever again because I'm triggered. Yeah that makes sense,

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Speaker 5: that's but that is why, in a very long winded

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Speaker 5: way of saying, it's actually better to take a photo

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Speaker 5: and save it because the likelihood of your receipt disintegrating

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Speaker 5: whether you look after it or not, is very high.

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Speaker 4: Now, I wonder if I had a piece of paper

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Speaker 4: that may or may not have once been a receipt,

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Speaker 4: sent that to the ATO and said, I'm so sorry,

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Speaker 4: this is not.

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Speaker 2: Kind of you don't have proof.

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Speaker 1: Ah.

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Speaker 5: Yeah, it's kind of like when the police come to

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Speaker 5: get you, and it's like innocent, indelatable, innocent until proven guilty.

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Speaker 5: But also you've got to prove that you're innocent, right,

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Speaker 5: you know, like if you get accused something, they'll be like, well,

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Speaker 5: prove you didn't do it, and you're like, oh, well damn,

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Speaker 5: I don't know how I'm going to do this. Yeah, honestly,

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Speaker 5: TLDR of this conversation, take photos of your receipts, save

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Speaker 5: them somewhere important. It could be a folder, it could

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Speaker 5: be the atier app, it could be anywhere. But that's

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Speaker 5: going to mean that all of your tax deductions are

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Speaker 5: much easier to one claim because it's just in the

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Speaker 5: one space. But also, remember, like I forget all the time.

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Speaker 5: I'm a business owner as well as somebody who claims

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Speaker 5: on my personal tax. So these small things add up.

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Speaker 5: Like if you're going to pop past office works and

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Speaker 5: pick up some last minute things or some like pens

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Speaker 5: or some notes, or you know, I buy a million

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Speaker 5: sharpies and post it notes, like take photos of those receipts,

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Speaker 5: because they're the ones that if it's for work purposes,

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Speaker 5: you can claim. So just make sure that throughout the

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Speaker 5: year you're just keeping track of stuff, my friend. It

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Speaker 5: will also mean that when you have to like calculate

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Speaker 5: any capital losses or capital gains when you sell an investment,

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Speaker 5: like just keep everything in one place. It'll make it

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Speaker 5: so much easier, whether you're doing it individually or you're

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Speaker 5: handing that information over to an accountant. My accountant loves me,

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Speaker 5: he really does, because I'm so organized that I make

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Speaker 5: his lafe so much easier.

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Speaker 4: I can imagine that would be very nice, exactly, love

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Speaker 4: to see Victoria walking through those doors.

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Speaker 2: Yeah, I mean that's how I feel.

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Speaker 5: I mean, it's probably just my ego telling me that

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Speaker 5: that's it. He's probably just like, yep, another cut paste client,

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Speaker 5: no worries.

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Speaker 2: But I think, of course you can you can see

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Speaker 2: it in his eyes? Yeah? Yeah, Now, V what.

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Speaker 4: Do we actually need to keep records off to show

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Speaker 4: the ato erroiting erroting errooting? Okay, so if you are

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Speaker 4: claiming something, you must have a receipt for that, even

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Speaker 4: if it's under the.

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Speaker 5: Do I say in my office this is terrible. I'm

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Speaker 5: going to get in trouble with the environmental hippies. When

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Speaker 5: in doubt printed out like we need it, And I

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Speaker 5: don't actually mean to print it like on hard paper.

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Speaker 5: Sure you know when you like get emailed like a

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Speaker 5: receipt or something. Love that I say, when in doubt

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Speaker 5: printed out, because if you hit print, like the invoice

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Speaker 5: that you've been sent or the receipt or whatever, you

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Speaker 5: can actually save it to PDF and put it in

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Speaker 5: an album.

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Speaker 2: And that's what I do.

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Speaker 5: I'm not actually printing it, but I'm saving it, filing

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Speaker 5: it away, because I guarantee the last thing small business

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Speaker 5: owners want to do, or anyone wants to do, is

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Speaker 5: troll through their emails trying to find an attachment for

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Speaker 5: an invoice that they paid back in January?

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Speaker 1: Right?

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Speaker 2: How do you want to do that? How can you remember? Also?

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Speaker 5: Oh my gosh, the amount doesn't line up because there's

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Speaker 5: lots of different invoices that get paid. Honestly, just file

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Speaker 5: it away. We use an accounting system at the moment,

390
00:17:23,720 --> 00:17:25,800
Speaker 5: we're using zero, so it's all just like tracked in there,

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Speaker 5: and it makes it so much easier that small business

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Speaker 5: side of things. But when it comes to being an individual,

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Speaker 5: like just file it away. Even in your emails, have

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Speaker 5: a little like separate email folder that you can just

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Speaker 5: click and drag things that you think might be relevant

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Speaker 5: to tax time. Call it tax time and call it

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Speaker 5: tax time twenty twenty three or twenty twenty four, because

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Speaker 5: I promise you you're not going to want to look

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Speaker 5: at all your old tax stuff next year. And at

400
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Speaker 5: least it's all kind of like folders. So I've got

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Speaker 5: tax time twenty twenty, tax time twenty twenty one, twenty

402
00:17:53,880 --> 00:17:56,159
Speaker 5: twenty gen know what I mean, totally like just be

403
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Speaker 5: organized and will help you.

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00:17:58,240 --> 00:18:01,840
Speaker 4: I unfortunately do have twenty maybe thirty emails because I,

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Speaker 4: you know, want to sign up for Netflix and have

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Speaker 4: a free trial doneary every month. Yeah, so for me

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Speaker 4: it's going to be a bit of a nightmare trying

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Speaker 4: to find all the invoice.

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Speaker 5: But if you were doing it as you were going, Yeah,

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Speaker 5: were very much easier, right.

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Speaker 4: Absolutely, So you know what I might do if i'd

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Speaker 4: start doing Yeah.

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Speaker 5: When it comes to investments, though, what you're really wanting

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Speaker 5: to keep track of is kind of the start and

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Speaker 5: the end of the process, like the middle ground. It's

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Speaker 5: fun for you, but the tax man isn't going to

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Speaker 5: care as much. What they want to know is how

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Speaker 5: much would you pay for that asset? How much did

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Speaker 5: you sell that asset for, or how much is that

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Speaker 5: asset worth today? Like what is it worth when we

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Speaker 5: do our tax return, right, so, like we also want

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Speaker 5: to understand how much income are you getting from that investment.

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Speaker 5: Make sure that you're just keeping record of all income

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Speaker 5: payments like your distribution statements or like your rental payment

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00:18:47,600 --> 00:18:51,480
Speaker 5: receipts and dividend statements. And then also Beck, we want

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Speaker 5: to make sure that we are keeping track of any

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Speaker 5: expenses that you incur while owning that asset, so receipts

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Speaker 5: for payments to manage. So if you're engaging a property

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Speaker 5: manager claiming it, we are making sure that we are

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Speaker 5: tracking any cost that we incurred to maintain the property.

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00:19:09,119 --> 00:19:11,159
Speaker 5: So say something happened to the front door, and you

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Speaker 5: needed to replace it on a rental claimable because it's

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Speaker 5: an improvement or a maintenance thing for your property. We

434
00:19:17,359 --> 00:19:20,040
Speaker 5: also want to make sure that we're claiming any cost

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00:19:20,119 --> 00:19:23,720
Speaker 5: that was incurred to improve your investment. So like as

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00:19:23,720 --> 00:19:26,600
Speaker 5: I said before, you're not able to claim first initial

437
00:19:26,600 --> 00:19:29,320
Speaker 5: advice with a financial advisor, but you can claim ongoing

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00:19:29,359 --> 00:19:32,520
Speaker 5: which is improving your investment. So there's lots to it.

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00:19:32,760 --> 00:19:35,359
Speaker 5: You also need to keep your records for five years.

440
00:19:35,400 --> 00:19:38,000
Speaker 5: That's why I didn't say delete that folder when you're done,

441
00:19:38,040 --> 00:19:40,360
Speaker 5: don't do that. You need to keep it for five

442
00:19:40,440 --> 00:19:42,720
Speaker 5: years on record because that's the period of time that

443
00:19:42,760 --> 00:19:45,080
Speaker 5: they could potentially audit you for and you'd have to

444
00:19:45,119 --> 00:19:47,840
Speaker 5: prove it. So just important to make sure that it's

445
00:19:47,880 --> 00:19:50,080
Speaker 5: all filed away and then you can delete it after

446
00:19:50,160 --> 00:19:53,200
Speaker 5: five years if anything. Like me, you still have your

447
00:19:53,200 --> 00:19:55,240
Speaker 5: tax return information from twenty sixteen.

448
00:19:55,280 --> 00:19:57,280
Speaker 2: It's all good. Like I don't delete.

449
00:19:56,920 --> 00:19:58,800
Speaker 5: Anything because I'm not going to go back through that,

450
00:19:59,119 --> 00:20:01,320
Speaker 5: but at least it's biled away for future use.

451
00:20:01,400 --> 00:20:04,600
Speaker 4: Yeah, yeah, I love that. Okay, this is interesting about

452
00:20:04,640 --> 00:20:07,480
Speaker 4: the landlord thing. Sorry, the landlord thing, not the landlord thing.

453
00:20:07,760 --> 00:20:09,000
Speaker 4: If you have an investment property.

454
00:20:09,080 --> 00:20:11,760
Speaker 5: Yeah, because it's an investment and you're paying for things

455
00:20:11,760 --> 00:20:13,040
Speaker 5: to improve the property.

456
00:20:13,280 --> 00:20:15,920
Speaker 2: Yeah, so you can claim it. That is really really cool.

457
00:20:16,000 --> 00:20:19,600
Speaker 5: It's one of the sexy reasons why people who have

458
00:20:19,720 --> 00:20:23,560
Speaker 5: investment properties, you know, might choose to buy an investment

459
00:20:23,560 --> 00:20:27,840
Speaker 5: property and then renovate it or make substantial improvements to

460
00:20:27,880 --> 00:20:30,639
Speaker 5: it while it is still an investment. Obviously, you need

461
00:20:30,680 --> 00:20:32,439
Speaker 5: to talk to an accountant and get some advice on

462
00:20:32,480 --> 00:20:35,320
Speaker 5: this because there are like, you know, regulations and things

463
00:20:35,320 --> 00:20:38,840
Speaker 5: that you need to abide by. But if you wanted

464
00:20:38,880 --> 00:20:41,440
Speaker 5: to improve the property and you know, change the bathroom

465
00:20:41,520 --> 00:20:43,800
Speaker 5: or update the bathroom, if it's an investment, you can

466
00:20:43,840 --> 00:20:44,600
Speaker 5: claim some of that.

467
00:20:44,960 --> 00:20:47,879
Speaker 4: What things can you claim on and what can you

468
00:20:47,960 --> 00:20:49,880
Speaker 4: not claim on? So I'm assuming if you like live

469
00:20:49,920 --> 00:20:52,560
Speaker 4: in a house, it's not obviously an investment. So if

470
00:20:52,560 --> 00:20:54,760
Speaker 4: you're you know, fixing up your own house that you

471
00:20:54,840 --> 00:20:57,639
Speaker 4: have maybe purchased, you could be able to claim that.

472
00:20:57,960 --> 00:21:00,439
Speaker 5: No, no, no, because it's not an investment and it

473
00:21:00,520 --> 00:21:02,720
Speaker 5: has to like they're asked. And that's why I said,

474
00:21:02,760 --> 00:21:04,760
Speaker 5: get advice on it. You can't just listen to a

475
00:21:04,760 --> 00:21:08,200
Speaker 5: podcast and be like, well, Victoria Device said, because babe,

476
00:21:08,200 --> 00:21:10,280
Speaker 5: that's not going to fly with the ATO, Like I'm

477
00:21:10,320 --> 00:21:12,720
Speaker 5: pretty close with them, but all that close, like don't

478
00:21:12,800 --> 00:21:15,080
Speaker 5: name drop me, you know, like they're probably gonna side,

479
00:21:15,080 --> 00:21:17,760
Speaker 5: are you all? Victoria's said, okay, Victoria, Well in that case,

480
00:21:17,800 --> 00:21:20,639
Speaker 5: like give me who this woman again? Like we're so

481
00:21:20,800 --> 00:21:21,400
Speaker 5: sick of her.

482
00:21:21,720 --> 00:21:22,120
Speaker 2: Anyway.

483
00:21:22,240 --> 00:21:26,439
Speaker 5: What you can claim is interest income expenses, so claiming

484
00:21:26,440 --> 00:21:29,439
Speaker 5: a deduction for like account keeping fees that you incur

485
00:21:29,600 --> 00:21:32,359
Speaker 5: on an account held for investment purposes, like a cash

486
00:21:32,400 --> 00:21:36,040
Speaker 5: management account. So like, for example, I have a separate

487
00:21:36,080 --> 00:21:39,280
Speaker 5: bank account with McQuary because I invest with six Park

488
00:21:39,320 --> 00:21:42,320
Speaker 5: as well, So like not recommendation, I'm just sharing some information.

489
00:21:42,600 --> 00:21:45,000
Speaker 5: I invest through six Park and through them, I have

490
00:21:45,080 --> 00:21:48,800
Speaker 5: a cash management account with mcquarie, and that's where essentially

491
00:21:48,840 --> 00:21:52,680
Speaker 5: I direct debit cash to that account and then six Park,

492
00:21:52,720 --> 00:21:56,359
Speaker 5: which is the investment platform that I use, They actually

493
00:21:56,359 --> 00:21:59,120
Speaker 5: have authorization to take money just out of that account,

494
00:21:59,200 --> 00:22:01,880
Speaker 5: so I move into that account so that then when

495
00:22:01,920 --> 00:22:03,840
Speaker 5: I say, yep, I would like you to invest X

496
00:22:03,840 --> 00:22:05,960
Speaker 5: amount of my money, they just take it out of there.

497
00:22:06,240 --> 00:22:08,240
Speaker 5: And we need that account because I'm not going to

498
00:22:08,280 --> 00:22:11,000
Speaker 5: give them authorization on my daily transaction account, right like

499
00:22:11,040 --> 00:22:14,120
Speaker 5: I want that middle buffer where they can only touch

500
00:22:14,160 --> 00:22:16,960
Speaker 5: that money that is in that cash management account. That

501
00:22:17,080 --> 00:22:20,080
Speaker 5: account has fees, so I can claim those fees on

502
00:22:20,160 --> 00:22:22,240
Speaker 5: tax which is kind of cool, but a lot of

503
00:22:22,240 --> 00:22:24,440
Speaker 5: people would just like dismiss it and not think about

504
00:22:24,480 --> 00:22:26,280
Speaker 5: it because they're like, oh, that's just some structure that

505
00:22:26,320 --> 00:22:29,080
Speaker 5: I've set up to invest whatever. Don't think about it again.

506
00:22:29,560 --> 00:22:31,320
Speaker 5: You can claim that, and you need to claim that

507
00:22:31,520 --> 00:22:34,200
Speaker 5: because you're entitled to it, Like we need to claim

508
00:22:34,240 --> 00:22:36,359
Speaker 5: what we are entitled to. So don't throw away those

509
00:22:36,400 --> 00:22:39,119
Speaker 5: like fees statements when they come through. If you have

510
00:22:39,200 --> 00:22:42,399
Speaker 5: a joint account, you can only claim half, like or

511
00:22:42,440 --> 00:22:46,040
Speaker 5: whatever your joint amount is. So obviously you can only

512
00:22:46,119 --> 00:22:48,760
Speaker 5: claim your share of the fees, not like the total fees.

513
00:22:48,760 --> 00:22:50,879
Speaker 5: You can't double dip. I'm really sorry, because I know

514
00:22:50,960 --> 00:22:52,880
Speaker 5: some people might be like, oh, I'm going to double

515
00:22:52,920 --> 00:22:54,919
Speaker 5: dip you in. My partner will do it and I

516
00:22:54,960 --> 00:22:56,960
Speaker 5: will do it. No, no, no, you can't do that.

517
00:22:57,119 --> 00:22:57,439
Speaker 2: Sorry.

518
00:22:57,520 --> 00:23:00,000
Speaker 5: You can also claim on charges or taxes on that account.

519
00:23:00,200 --> 00:23:02,680
Speaker 5: So for example, like if you hold an equal share

520
00:23:02,760 --> 00:23:05,520
Speaker 5: in an account with your partner, you can only claim

521
00:23:05,600 --> 00:23:08,960
Speaker 5: half of that allowable account keeping fee. It's kind of rude,

522
00:23:08,960 --> 00:23:11,960
Speaker 5: but also like it makes sense. Yes, suppose to this

523
00:23:12,119 --> 00:23:14,520
Speaker 5: second part of your question. You were asking about what

524
00:23:14,560 --> 00:23:16,679
Speaker 5: you can't claim. So you can't claim a deduction for

525
00:23:16,800 --> 00:23:19,359
Speaker 5: the interest you incur on personal tax debt.

526
00:23:20,080 --> 00:23:22,520
Speaker 2: Sorry, I need to absorve that so that at that time.

527
00:23:22,400 --> 00:23:25,560
Speaker 5: I just stopped when I said that the interest that

528
00:23:25,600 --> 00:23:28,320
Speaker 5: you incur on a personal tax debt. So like, if

529
00:23:28,359 --> 00:23:30,600
Speaker 5: you've got a personal tax debt, yes, and you owe

530
00:23:30,640 --> 00:23:34,119
Speaker 5: the atos and casholer ah, and then you're occruing interest

531
00:23:34,160 --> 00:23:37,360
Speaker 5: on that debt. You can't claim that interest because in

532
00:23:37,520 --> 00:23:40,400
Speaker 5: another circumstance, so like say you bought a house back,

533
00:23:41,240 --> 00:23:44,680
Speaker 5: you are able to claim the interest on that property, oh,

534
00:23:45,000 --> 00:23:48,159
Speaker 5: because it's for investment, But you can't claim the interest

535
00:23:48,280 --> 00:23:49,120
Speaker 5: on a tax debt.

536
00:23:49,200 --> 00:23:49,840
Speaker 2: For example.

537
00:23:49,960 --> 00:23:52,320
Speaker 5: This is coming up because a few people have asked

538
00:23:52,359 --> 00:23:54,119
Speaker 5: me that question, because you might be like, oh, they,

539
00:23:54,200 --> 00:23:56,240
Speaker 5: why are you mentioning that that that doesn't make a

540
00:23:56,240 --> 00:23:59,480
Speaker 5: lot of sense for an investment. You can claim the

541
00:23:59,520 --> 00:24:02,199
Speaker 5: interest on the money that you borrowed because it's a

542
00:24:02,400 --> 00:24:06,120
Speaker 5: cost of investment. Okay, I taxed it. That's not the same.

543
00:24:06,200 --> 00:24:08,080
Speaker 5: You can't claim the interest on a loan that you

544
00:24:08,119 --> 00:24:10,879
Speaker 5: take to pay your personal tax dep yep. Okay, So

545
00:24:10,920 --> 00:24:14,840
Speaker 5: if you say borrow money to put into literal investment,

546
00:24:14,880 --> 00:24:18,640
Speaker 5: maybe like superannuation or something that can be considered not

547
00:24:18,680 --> 00:24:22,359
Speaker 5: necessarily superannuation, but you can do it on property. So

548
00:24:22,440 --> 00:24:24,680
Speaker 5: you might go get a mortgage to buy an investment

549
00:24:24,720 --> 00:24:27,399
Speaker 5: property and then you'll pay an interest rate to borrow

550
00:24:27,440 --> 00:24:30,600
Speaker 5: that money that is claimable and then also something that

551
00:24:30,720 --> 00:24:33,639
Speaker 5: you're probably not have going to come across before, but

552
00:24:33,680 --> 00:24:37,000
Speaker 5: I've covered on the podcast, just kind of like topically,

553
00:24:37,280 --> 00:24:39,719
Speaker 5: you can actually borrow money to invest in the share market,

554
00:24:40,000 --> 00:24:43,360
Speaker 5: so you could claim on that as well. So it's

555
00:24:43,440 --> 00:24:46,879
Speaker 5: not something that a lot of people in our community do,

556
00:24:47,160 --> 00:24:50,040
Speaker 5: especially in this economy. I don't think it's you know,

557
00:24:50,119 --> 00:24:53,399
Speaker 5: the wisest decision ever because obviously, as you know, interest

558
00:24:53,480 --> 00:24:56,800
Speaker 5: rates for borrowing money are quite high, but then the

559
00:24:57,080 --> 00:25:00,239
Speaker 5: stock market is I wouldn't say returning low. It's not that,

560
00:25:00,320 --> 00:25:02,199
Speaker 5: but it's not as good as it could be. So

561
00:25:02,320 --> 00:25:06,920
Speaker 5: having a leveraged portfolio, so leveraged portfolio just means I

562
00:25:07,000 --> 00:25:10,600
Speaker 5: have borrowed money to create my portfolio is not something

563
00:25:10,640 --> 00:25:13,840
Speaker 5: that I assume a lot of financial advisors are recommending

564
00:25:13,880 --> 00:25:14,920
Speaker 5: at this point in time.

565
00:25:15,040 --> 00:25:15,960
Speaker 2: Sure, it is.

566
00:25:15,920 --> 00:25:19,119
Speaker 5: Something that financial advisors do use. It is something that

567
00:25:19,200 --> 00:25:23,040
Speaker 5: I have recommended, is something that I have worked with

568
00:25:23,040 --> 00:25:25,440
Speaker 5: with my clients before. It's also something that I've used

569
00:25:25,480 --> 00:25:28,280
Speaker 5: personally and owned before, but I don't currently own at

570
00:25:28,280 --> 00:25:30,840
Speaker 5: the moment because the market just started to not make

571
00:25:30,920 --> 00:25:32,880
Speaker 5: sense in that aspect and I sold it and got

572
00:25:32,960 --> 00:25:35,159
Speaker 5: rid of it and just said, yeah, the market's not

573
00:25:35,240 --> 00:25:37,720
Speaker 5: performing the way I would want it to see for

574
00:25:37,880 --> 00:25:40,120
Speaker 5: me to take on that risk. Sure in saying that,

575
00:25:40,320 --> 00:25:42,360
Speaker 5: if you're listening to this, just as a side note,

576
00:25:42,359 --> 00:25:44,520
Speaker 5: and you do have a leveraged portfolio and you're like, oh.

577
00:25:44,520 --> 00:25:46,680
Speaker 2: Victoria doesn't have hers anymore, I should get rid.

578
00:25:46,600 --> 00:25:48,800
Speaker 5: Of mine, That's not the case at all. I am

579
00:25:49,000 --> 00:25:53,520
Speaker 5: just very risk averse. The second there's any lack rocky waters,

580
00:25:53,560 --> 00:25:56,199
Speaker 5: I'm like god right away. So I talked to your

581
00:25:56,240 --> 00:25:58,760
Speaker 5: financial advisor about that, because I can almost guarantee that

582
00:25:58,760 --> 00:25:59,800
Speaker 5: you have a financial advisor.

583
00:25:59,800 --> 00:26:02,399
Speaker 2: If you have a leveraged portfolio, that is a very

584
00:26:02,560 --> 00:26:03,280
Speaker 2: strong assumption.

585
00:26:03,359 --> 00:26:06,680
Speaker 5: Strong assumption, and not many people go get their own

586
00:26:06,720 --> 00:26:09,160
Speaker 5: investment loans and diy the whole thing. Like, if you're

587
00:26:09,160 --> 00:26:11,280
Speaker 5: going to take on that much risk back and you're

588
00:26:11,280 --> 00:26:13,440
Speaker 5: willing to, you know Moorrow one hundred grand to get

589
00:26:13,440 --> 00:26:16,240
Speaker 5: into the share market. Like very likely that you also

590
00:26:16,280 --> 00:26:18,400
Speaker 5: see the value in paying for personal advice on.

591
00:26:18,359 --> 00:26:21,560
Speaker 2: That, right, Like, just the math is mathing in that city.

592
00:26:21,640 --> 00:26:24,320
Speaker 2: The math is Mathan, the math is mathing. So V,

593
00:26:24,480 --> 00:26:28,840
Speaker 2: how about dividend and share income expenses? I like that

594
00:26:28,920 --> 00:26:31,680
Speaker 2: you're reading that out in a way that you're like, I've.

595
00:26:31,520 --> 00:26:35,760
Speaker 5: Just been pondering my dividend and share income expenses. Not

596
00:26:35,920 --> 00:26:37,600
Speaker 5: I've just been beck and I did some research and

597
00:26:37,640 --> 00:26:39,920
Speaker 5: I wrote down these questions to ask Victoria.

598
00:26:40,600 --> 00:26:40,919
Speaker 2: Yeah.

599
00:26:41,000 --> 00:26:43,760
Speaker 4: No, I've just been sitting here wondering. Yeah about dividend

600
00:26:44,240 --> 00:26:45,200
Speaker 4: yield sealed?

601
00:26:45,480 --> 00:26:45,720
Speaker 3: Yeah?

602
00:26:45,760 --> 00:26:48,200
Speaker 2: Wow, impressive. So you're right.

603
00:26:48,280 --> 00:26:51,000
Speaker 5: You can claim a deduction for costs that you incur

604
00:26:51,119 --> 00:26:54,760
Speaker 5: to invest in shares, as I said before, obviously borrowing money,

605
00:26:54,800 --> 00:26:57,520
Speaker 5: but that's probably not going to be that popular right now.

606
00:26:57,720 --> 00:27:01,800
Speaker 5: But ongoing management fees are retainers, financial advisors and such

607
00:27:02,200 --> 00:27:05,800
Speaker 5: fees for advice about changes to your investment mix or

608
00:27:05,840 --> 00:27:08,560
Speaker 5: your risk profile. It's kind of like if you're paying

609
00:27:08,600 --> 00:27:12,640
Speaker 5: somebody to rebalance your portfolio, you can claim that. Yeah,

610
00:27:12,800 --> 00:27:15,560
Speaker 5: but then you're also able to claim the expenses if

611
00:27:15,560 --> 00:27:17,480
Speaker 5: you wanted to go to the annual general meeting of

612
00:27:17,520 --> 00:27:19,280
Speaker 5: a company that you hold shares in. And I've seen

613
00:27:19,320 --> 00:27:22,880
Speaker 5: people do this before. In fact, our friends over at

614
00:27:22,920 --> 00:27:25,080
Speaker 5: Equity Mates, I believe they did this and went to

615
00:27:25,119 --> 00:27:27,919
Speaker 5: the US to attend a meeting, and I thought that

616
00:27:28,040 --> 00:27:30,840
Speaker 5: was so cool. They didn't talk about whether they were

617
00:27:30,880 --> 00:27:32,760
Speaker 5: able to claim it on tax or not, but I

618
00:27:32,760 --> 00:27:35,320
Speaker 5: can almost guarantee that they were able to, and I

619
00:27:35,320 --> 00:27:38,320
Speaker 5: think it's just real cool, like so ye, But I

620
00:27:38,440 --> 00:27:42,719
Speaker 5: am also a stock and share nerd and like that

621
00:27:42,760 --> 00:27:45,159
Speaker 5: would be my dream to be like able to be

622
00:27:45,200 --> 00:27:47,200
Speaker 5: in on one of those like can you imagine going

623
00:27:47,200 --> 00:27:48,040
Speaker 5: to Wall Street?

624
00:27:48,520 --> 00:27:50,639
Speaker 2: Like you go to an annual general meeting?

625
00:27:50,760 --> 00:27:53,280
Speaker 4: Like, oh yeah, well if I buy like shares in

626
00:27:53,320 --> 00:27:54,000
Speaker 4: like McDonald's.

627
00:27:54,000 --> 00:27:56,720
Speaker 2: Our producer is literally laughing at me and I get it.

628
00:27:57,000 --> 00:28:02,240
Speaker 2: Sit down, she's been to Wall Street. You know what.

629
00:28:02,359 --> 00:28:05,440
Speaker 5: I'm going to Wall Street later this year, and I

630
00:28:05,440 --> 00:28:08,160
Speaker 5: have never been more excited, Like what are you going for?

631
00:28:08,240 --> 00:28:11,760
Speaker 5: I'm going to become your Wall Street girlye Like anyway,

632
00:28:12,080 --> 00:28:15,040
Speaker 5: I actually have a finance conference in New Orleans, which

633
00:28:15,080 --> 00:28:15,879
Speaker 5: is very cool.

634
00:28:15,960 --> 00:28:16,720
Speaker 2: I'm so excited.

635
00:28:17,960 --> 00:28:20,119
Speaker 5: Yeah, I think concin New Orleans this year and a Lisa,

636
00:28:21,600 --> 00:28:23,359
Speaker 5: you gotta be in it to win it. So we're

637
00:28:23,400 --> 00:28:26,240
Speaker 5: going to New Orleans. If you know anything about geography,

638
00:28:26,280 --> 00:28:28,160
Speaker 5: you would know that New Orleans is not even close

639
00:28:28,200 --> 00:28:31,280
Speaker 5: to New York. But it is close enough for an

640
00:28:31,280 --> 00:28:35,400
Speaker 5: Australian to justify the additional travel to New York.

641
00:28:35,640 --> 00:28:35,800
Speaker 1: Oh.

642
00:28:36,040 --> 00:28:37,320
Speaker 2: Absolutely.

643
00:28:37,680 --> 00:28:39,920
Speaker 5: So I'm like, oh, is that a really long flight

644
00:28:39,960 --> 00:28:41,640
Speaker 5: from New Orleans to New York?

645
00:28:41,640 --> 00:28:43,880
Speaker 2: Absolutely? It is. How long of it? Oh, it's like

646
00:28:44,200 --> 00:28:45,160
Speaker 2: four or five hours.

647
00:28:45,000 --> 00:28:48,320
Speaker 5: Away, which is like it's not like a Melbourne to Sydney, sure,

648
00:28:48,480 --> 00:28:50,920
Speaker 5: but like it's definitely a moody on the other side

649
00:28:50,920 --> 00:28:52,479
Speaker 5: of the world. May as well, I may as well

650
00:28:52,520 --> 00:28:54,719
Speaker 5: go see Wall Street as well. I'm gonna look at

651
00:28:54,720 --> 00:28:56,680
Speaker 5: that little bull and like REBT's little nose.

652
00:28:56,480 --> 00:28:57,760
Speaker 2: And be like, hello, little bullfriend.

653
00:28:57,920 --> 00:29:00,280
Speaker 5: If you know I'm talking about I don't kind of

654
00:29:00,280 --> 00:29:02,320
Speaker 5: say a aalsa is part of the bull.

655
00:29:02,360 --> 00:29:05,719
Speaker 2: What is this ball? It's a brass bull, so like

656
00:29:05,920 --> 00:29:06,480
Speaker 2: brass bull.

657
00:29:06,560 --> 00:29:08,320
Speaker 5: Yeah, So there's a bull and a bear because like

658
00:29:08,480 --> 00:29:11,480
Speaker 5: we talk about a bullmarket and a bear market. A

659
00:29:11,520 --> 00:29:15,000
Speaker 5: bull market is where the market's being really aggressive and

660
00:29:15,200 --> 00:29:17,000
Speaker 5: you know, it's kind of like waving a red flag

661
00:29:17,040 --> 00:29:19,680
Speaker 5: to a bull and everything's going up and everybody's happy

662
00:29:19,720 --> 00:29:22,520
Speaker 5: and there's a lot of excitement. And then the bear

663
00:29:22,640 --> 00:29:26,920
Speaker 5: market is a market where it's relatively bear so like yeah,

664
00:29:27,080 --> 00:29:29,800
Speaker 5: kind of like in a hybernation zone, right, So like

665
00:29:30,080 --> 00:29:32,440
Speaker 5: a bear is obviously a little bit more chilled than

666
00:29:32,480 --> 00:29:34,160
Speaker 5: a ball with a red flag. They're more likely to

667
00:29:34,200 --> 00:29:35,640
Speaker 5: go into a cave for a little while and have

668
00:29:35,680 --> 00:29:38,800
Speaker 5: a little nap. Anyway, those are the true like mascots

669
00:29:38,840 --> 00:29:41,960
Speaker 5: of Wall Street, and your girlie is gonna pat them,

670
00:29:42,400 --> 00:29:45,000
Speaker 5: but they're actually just brass statues that are on the street.

671
00:29:45,040 --> 00:29:47,040
Speaker 5: And I'm just really excited, And to be honest, I

672
00:29:47,040 --> 00:29:48,880
Speaker 5: think I'm going to be excited until I get there

673
00:29:48,920 --> 00:29:50,840
Speaker 5: and then I realize it's just like standing on Colin

674
00:29:50,920 --> 00:29:53,480
Speaker 5: Street in Melbourne and it's actually really boring.

675
00:29:53,480 --> 00:29:56,080
Speaker 2: But boring and overwhelming people everywhere.

676
00:29:55,920 --> 00:29:59,120
Speaker 5: Tell people about it, Yes, exactly, I can gloat about it.

677
00:29:59,160 --> 00:30:01,720
Speaker 2: I'm like, well, have you've been to World Street. Yep,

678
00:30:01,760 --> 00:30:03,600
Speaker 2: it's going to be a storytell for a bar. I

679
00:30:03,640 --> 00:30:05,760
Speaker 2: stood on the street and did absolutely nothing.

680
00:30:05,840 --> 00:30:08,680
Speaker 5: I padded the ball, the brass ball. I'm very excited

681
00:30:08,680 --> 00:30:10,040
Speaker 5: about it for you. All right, let's get back to

682
00:30:10,080 --> 00:30:13,480
Speaker 5: talking about tax on your investment. Yes, please, because you

683
00:30:13,600 --> 00:30:16,720
Speaker 5: best belief my trip to the US is an investment.

684
00:30:18,160 --> 00:30:20,720
Speaker 2: Actually it will be because it's for a finance conference. Oh,

685
00:30:20,920 --> 00:30:22,280
Speaker 2: she's on the money. The team's going.

686
00:30:22,360 --> 00:30:25,600
Speaker 5: Yeah, it'll be good anyway. What else can you claim

687
00:30:25,640 --> 00:30:29,120
Speaker 5: a deduction for? You can claim a deduction for specialist

688
00:30:29,160 --> 00:30:32,840
Speaker 5: investment journals and subscriptions, so you best believe. I claim

689
00:30:32,840 --> 00:30:38,040
Speaker 5: my Australian Financial Review subscription every year. Borrowing costs and interests.

690
00:30:38,120 --> 00:30:41,800
Speaker 5: We covered that. The cost of internet access. Oh, because

691
00:30:41,800 --> 00:30:45,040
Speaker 5: you've got to have the internet to invest. Yes, the

692
00:30:45,120 --> 00:30:48,600
Speaker 5: decline in value of your computer that you used to invest.

693
00:30:49,360 --> 00:30:52,720
Speaker 2: Do you have to be investing to claim these things? Yeah? Yeah,

694
00:30:52,760 --> 00:30:55,240
Speaker 2: that's a real shame. Yeah. I mean it's cute that

695
00:30:55,280 --> 00:31:00,400
Speaker 2: you tried. It's so cute, just said, yes, this is

696
00:31:00,400 --> 00:31:04,360
Speaker 2: about investing. So I'm sorry. I obviously know you're my favorite.

697
00:31:04,480 --> 00:31:06,719
Speaker 2: You are my favorite. Why we're here. I love you.

698
00:31:07,040 --> 00:31:09,520
Speaker 5: And you can also claim fifty percent of the listed

699
00:31:09,600 --> 00:31:13,400
Speaker 5: investment company or l C capital gain amount if you're

700
00:31:13,400 --> 00:31:16,400
Speaker 5: an Australian resident where a listed investment company paid you

701
00:31:16,440 --> 00:31:21,280
Speaker 5: a dividend and the dividend included an LIC capital gain amount.

702
00:31:21,720 --> 00:31:25,120
Speaker 5: That's going to mean nothing to you, Beck, but if

703
00:31:25,160 --> 00:31:27,480
Speaker 5: you are listening and you do have an l C,

704
00:31:27,760 --> 00:31:30,160
Speaker 5: that is something that you should absolutely consider.

705
00:31:30,320 --> 00:31:30,520
Speaker 2: Beck.

706
00:31:30,600 --> 00:31:33,080
Speaker 5: It's just another form of investment and it will be

707
00:31:33,160 --> 00:31:34,400
Speaker 5: on your annual statements.

708
00:31:34,520 --> 00:31:36,720
Speaker 2: Okay, A lick A lick.

709
00:31:37,360 --> 00:31:40,120
Speaker 5: I mean, we call them LICs, but we really should

710
00:31:40,160 --> 00:31:41,120
Speaker 5: be calling them licks.

711
00:31:41,760 --> 00:31:44,200
Speaker 2: It's a bit. It saves time, you know, life is sure.

712
00:31:44,320 --> 00:31:46,920
Speaker 5: Yeah, and also it's just way more fun. Like we

713
00:31:47,000 --> 00:31:50,680
Speaker 5: already think that the investment world is, you know, overly

714
00:31:50,920 --> 00:31:55,360
Speaker 5: capitalized when it comes to complexity of acronyms.

715
00:31:55,880 --> 00:31:58,040
Speaker 2: Yes, but might as well add another. Why not just

716
00:31:58,040 --> 00:32:02,040
Speaker 2: call it a lick? Exactly right? Anyone, any context.

717
00:32:01,680 --> 00:32:04,959
Speaker 5: No context that when we're investing in shares, here are

718
00:32:04,960 --> 00:32:07,520
Speaker 5: some things you can't claim the fees you incur for

719
00:32:07,640 --> 00:32:10,240
Speaker 5: drawing up an investment plan. So, as I said before,

720
00:32:10,360 --> 00:32:14,160
Speaker 5: that's the thing that I get frustrated about unless you're

721
00:32:14,160 --> 00:32:19,240
Speaker 5: carrying on an investment business. Okay, you're probably not, so

722
00:32:19,320 --> 00:32:23,400
Speaker 5: don't worry about it. Some interest expenses where you borrow

723
00:32:23,480 --> 00:32:27,000
Speaker 5: money under a capital protected borrowing arrangement to buy shares

724
00:32:27,480 --> 00:32:31,120
Speaker 5: units in unit trusts and stapled securities, the interest is

725
00:32:31,160 --> 00:32:34,560
Speaker 5: treated actually as the cost of the capital protection feature

726
00:32:35,240 --> 00:32:36,200
Speaker 5: again not going to.

727
00:32:36,320 --> 00:32:38,160
Speaker 2: Mean a lot to you. You just can't claim it.

728
00:32:38,240 --> 00:32:41,480
Speaker 2: No you're not, don't lie. How did you know that?

729
00:32:41,560 --> 00:32:44,480
Speaker 5: I just know you well enough by native Beccer Rooney

730
00:32:44,560 --> 00:32:48,640
Speaker 5: sit down. Also, you can't claim brokerage fees and other

731
00:32:48,640 --> 00:32:51,720
Speaker 5: transaction costs, but you can include these in the costs

732
00:32:51,800 --> 00:32:54,200
Speaker 5: to work out your capital gains tax when you sell

733
00:32:54,240 --> 00:32:57,360
Speaker 5: the shares. So there's just honestly, I feel like I

734
00:32:57,440 --> 00:33:00,960
Speaker 5: am talking a lot and over complicating it. It shouldn't

735
00:33:01,000 --> 00:33:06,160
Speaker 5: be that complicated. It is twenty twenty three. Your investment

736
00:33:06,160 --> 00:33:09,440
Speaker 5: platform that you're investing on is going to provide you.

737
00:33:09,360 --> 00:33:10,680
Speaker 2: With all of this information.

738
00:33:11,080 --> 00:33:13,640
Speaker 5: It will either be automated or it will be something

739
00:33:13,680 --> 00:33:16,400
Speaker 5: that you're able to go into your platform and automatically

740
00:33:16,480 --> 00:33:19,320
Speaker 5: generate if it's not an email that you get, and

741
00:33:19,440 --> 00:33:23,440
Speaker 5: it will be I promise, far less complicated than what

742
00:33:23,480 --> 00:33:25,840
Speaker 5: Beck and I am making it sound right, right, Like

743
00:33:26,120 --> 00:33:28,600
Speaker 5: all of this talk about like borrowing costs and interest

744
00:33:28,680 --> 00:33:32,080
Speaker 5: and laics and licks and you know management fees and

745
00:33:32,280 --> 00:33:34,320
Speaker 5: you know whether you can claim travel. All of that

746
00:33:34,400 --> 00:33:38,680
Speaker 5: makes sense, but it's far less complicated if you are

747
00:33:38,880 --> 00:33:41,760
Speaker 5: just a general investor and you've gone on like, I

748
00:33:41,760 --> 00:33:44,320
Speaker 5: don't know, Raise do it, Spaceship does it.

749
00:33:44,360 --> 00:33:46,640
Speaker 2: Let's not even start on Spaceship or Raise at the moment.

750
00:33:46,880 --> 00:33:49,560
Speaker 2: But you know shares is do it self, Wealth do it.

751
00:33:49,600 --> 00:33:52,120
Speaker 5: Every other investment platform that you are using, they are

752
00:33:52,160 --> 00:33:55,720
Speaker 5: all going to have reporting for tax time because they

753
00:33:55,720 --> 00:33:56,960
Speaker 5: are based in Australia.

754
00:33:57,240 --> 00:33:59,720
Speaker 2: Yeah, okay, so don't stress. Good. I just don't want

755
00:33:59,720 --> 00:34:01,400
Speaker 2: people to be overwhelmed by going, oh.

756
00:34:01,240 --> 00:34:03,320
Speaker 5: My god, I became an investor and now it's all

757
00:34:03,360 --> 00:34:05,400
Speaker 5: so confusing when it comes to tax and I don't

758
00:34:05,440 --> 00:34:07,840
Speaker 5: want to screw myself over. You're not going to screw

759
00:34:07,840 --> 00:34:11,080
Speaker 5: yourself over, I promise, because it's not that complicated. Yes,

760
00:34:11,280 --> 00:34:14,200
Speaker 5: And if you're feeling like it's complicated, it's probably because

761
00:34:14,200 --> 00:34:16,279
Speaker 5: you haven't looked at the investment reports yet.

762
00:34:16,320 --> 00:34:18,080
Speaker 2: It's not because you're silly. It's just because you haven't

763
00:34:18,080 --> 00:34:21,920
Speaker 2: seen it. Yes, exactly right, exactly. I'm so afraid.

764
00:34:22,120 --> 00:34:24,320
Speaker 5: No, don't be afraid, because it can be really easy,

765
00:34:24,360 --> 00:34:26,040
Speaker 5: and it's only easy once you learn about it. But

766
00:34:26,080 --> 00:34:27,799
Speaker 5: you've never learned about it, so that's why it's not

767
00:34:27,840 --> 00:34:28,520
Speaker 5: making a lot of sense.

768
00:34:28,600 --> 00:34:31,200
Speaker 2: A little bit scary. I think we need to go

769
00:34:31,239 --> 00:34:32,160
Speaker 2: to a break.

770
00:34:32,120 --> 00:34:34,759
Speaker 5: I do want to go google tenant rights so that

771
00:34:34,840 --> 00:34:37,040
Speaker 5: I can talk about how much I can claim on

772
00:34:37,120 --> 00:34:39,080
Speaker 5: my rental property and whether I can move in with

773
00:34:39,120 --> 00:34:40,360
Speaker 5: my tenants over Christmas.

774
00:34:41,200 --> 00:34:43,960
Speaker 4: That sounds very exciting for you and your tenants.

775
00:34:44,000 --> 00:34:51,480
Speaker 2: Well let's do lucky. I have no tenants. All right,

776
00:34:51,520 --> 00:34:52,239
Speaker 2: there we are back.

777
00:34:53,040 --> 00:34:56,560
Speaker 4: Now, let's jump straight back into it. I want to

778
00:34:56,600 --> 00:34:59,520
Speaker 4: know about rental and holiday home expenses.

779
00:35:00,560 --> 00:35:01,000
Speaker 2: Yeah.

780
00:35:01,320 --> 00:35:03,600
Speaker 5: Is it because you have a rental or holiday home

781
00:35:03,600 --> 00:35:06,080
Speaker 5: that you haven't spoken to me about before? So many

782
00:35:06,120 --> 00:35:09,160
Speaker 5: I've got at least ten rentals, at least ten holiday homes,

783
00:35:09,280 --> 00:35:11,120
Speaker 5: and I just want to know what I can claim on.

784
00:35:11,320 --> 00:35:13,200
Speaker 2: Oh well, the Internet's now going to come for you

785
00:35:13,239 --> 00:35:16,200
Speaker 2: and be like, what suck? Did you know you suck?

786
00:35:16,320 --> 00:35:17,120
Speaker 2: I did know I suck.

787
00:35:17,200 --> 00:35:19,280
Speaker 4: But also for anyone listening, I am joking, I promise.

788
00:35:19,440 --> 00:35:22,640
Speaker 2: Yeah. No, she actually doesn't have any hosts.

789
00:35:22,160 --> 00:35:25,440
Speaker 5: Yeah, but you will get yet. Yet yet is the

790
00:35:25,480 --> 00:35:28,359
Speaker 5: operative word here. We are optimistic about it. But yes, Beck,

791
00:35:28,400 --> 00:35:31,120
Speaker 5: you are correct. You can claim interest expenses that you

792
00:35:31,160 --> 00:35:34,000
Speaker 5: incur on the loan that you used to And.

793
00:35:33,920 --> 00:35:34,760
Speaker 2: Here's the summary.

794
00:35:35,080 --> 00:35:39,160
Speaker 5: Buy a rental property, buy a depreciating asset for the

795
00:35:39,200 --> 00:35:42,719
Speaker 5: rental property. What's a depreciating asset.

796
00:35:42,440 --> 00:35:46,200
Speaker 2: Beck, I'm going to say air conditioner. Yep, air conditioner.

797
00:35:46,239 --> 00:35:50,200
Speaker 4: Why because once you buy it, Yeah, it won't go

798
00:35:50,440 --> 00:35:55,480
Speaker 4: up in value. From there, you're is it exactly anything

799
00:35:55,520 --> 00:35:56,920
Speaker 4: that's going to decrease in value?

800
00:35:57,000 --> 00:36:00,319
Speaker 5: Yes, So air conditioner great example, because if you bought

801
00:36:00,320 --> 00:36:03,560
Speaker 5: it today, it's probably insanely expensive and you're probably not

802
00:36:03,600 --> 00:36:05,359
Speaker 5: feeling that good about that. Having to buy a new

803
00:36:05,400 --> 00:36:07,279
Speaker 5: air conditioner for a property that you don't even live

804
00:36:07,320 --> 00:36:10,440
Speaker 5: in cost you what two grand or something, But if

805
00:36:10,480 --> 00:36:12,200
Speaker 5: you went to sell it tomorrow, it wouldn't be worth

806
00:36:12,239 --> 00:36:14,239
Speaker 5: two grand, and in ten years, I guarantee there's a

807
00:36:14,239 --> 00:36:15,399
Speaker 5: way better version out there.

808
00:36:15,520 --> 00:36:18,719
Speaker 2: Yeah, right, Like that's exactly what it appreciating us. It is.

809
00:36:19,160 --> 00:36:22,680
Speaker 5: You can claim expenses for making repairs to the rental property.

810
00:36:22,920 --> 00:36:25,880
Speaker 5: So for example, if the roof broke during a storm,

811
00:36:25,920 --> 00:36:27,680
Speaker 5: you could claim that. So a couple of years ago,

812
00:36:27,760 --> 00:36:30,040
Speaker 5: I lived in a property that had a really big,

813
00:36:30,160 --> 00:36:32,560
Speaker 5: beautiful skylight. I mean I thought it was beautiful, but

814
00:36:32,600 --> 00:36:35,200
Speaker 5: it turns out it was just perspex because a couple

815
00:36:35,200 --> 00:36:37,480
Speaker 5: of years ago we had a massive hailstorm.

816
00:36:37,520 --> 00:36:39,160
Speaker 2: Do you remember, Like I think it was like.

817
00:36:39,040 --> 00:36:42,439
Speaker 5: Twenty twenty just pre COVID where that massive hailstorm came

818
00:36:42,480 --> 00:36:45,440
Speaker 5: through and everyone's car was absolutely ruined.

819
00:36:45,600 --> 00:36:48,160
Speaker 2: I think I remember there were like golf the size. Yeah,

820
00:36:48,160 --> 00:36:49,360
Speaker 2: it was absolutely insane.

821
00:36:49,600 --> 00:36:53,480
Speaker 5: So our skylight just got trashed, like we were having

822
00:36:53,600 --> 00:36:57,680
Speaker 5: hail come straight through the skylight into our hallway and

823
00:36:57,760 --> 00:37:00,040
Speaker 5: like we ended up having to like go state my

824
00:37:00,080 --> 00:37:02,040
Speaker 5: parents house for a couple of days because it was

825
00:37:02,120 --> 00:37:06,360
Speaker 5: just like so ruined track. Anyway, that didn't cost me

826
00:37:06,400 --> 00:37:08,040
Speaker 5: anything because I was a tenant. All I had to

827
00:37:08,040 --> 00:37:11,280
Speaker 5: do was move out. But my owners or the owners

828
00:37:11,280 --> 00:37:13,279
Speaker 5: of that property, they had to pay to replace it,

829
00:37:13,280 --> 00:37:14,799
Speaker 5: and that's fine, but they could have claimed that on

830
00:37:14,920 --> 00:37:17,800
Speaker 5: tax because that was a cost of maintaining the property.

831
00:37:18,000 --> 00:37:20,880
Speaker 2: Wow, that is so cool. I mean I think the

832
00:37:21,000 --> 00:37:24,000
Speaker 2: hail wasn't cool. No, it wasn't cool. Kind of sucked.

833
00:37:24,360 --> 00:37:26,680
Speaker 2: It's just unreal. You can claim that, I like.

834
00:37:26,640 --> 00:37:29,960
Speaker 5: It finance renovations to the rental property, so like you

835
00:37:30,000 --> 00:37:32,600
Speaker 5: can claim to you know, obviously, as I mentioned before,

836
00:37:32,760 --> 00:37:35,399
Speaker 5: pop a new bathroom in for your tenants, which in

837
00:37:35,440 --> 00:37:38,120
Speaker 5: turn would add a value to your property because you know,

838
00:37:38,719 --> 00:37:41,919
Speaker 5: updating it. And you can also claim interest expenses where

839
00:37:41,960 --> 00:37:43,720
Speaker 5: you have pre paid for up.

840
00:37:43,560 --> 00:37:45,600
Speaker 2: To twelve months in advance.

841
00:37:46,120 --> 00:37:48,560
Speaker 5: So that is important because you're I see your little

842
00:37:48,600 --> 00:37:53,480
Speaker 5: glazed over eyes, so what. But essentially, let's say you've

843
00:37:53,520 --> 00:37:55,879
Speaker 5: got a service and you're paying for insurance, or you're

844
00:37:55,880 --> 00:37:58,360
Speaker 5: paying for something for your rental property, and it was

845
00:37:58,480 --> 00:38:01,279
Speaker 5: cheaper to pay for it all at once, like you know,

846
00:38:01,320 --> 00:38:04,879
Speaker 5: how we've spoken about on the podcast before, how it's

847
00:38:04,880 --> 00:38:07,280
Speaker 5: one of those things that I think wealthy people forget

848
00:38:07,320 --> 00:38:09,680
Speaker 5: they have the privilege of, and that's being able to

849
00:38:09,719 --> 00:38:12,920
Speaker 5: pay things in advance for a significant discount. So like

850
00:38:12,960 --> 00:38:15,480
Speaker 5: whether that's insurance or health insurance or whatever. So if

851
00:38:15,520 --> 00:38:18,839
Speaker 5: you're prepaying anything for your rental property or for your

852
00:38:18,840 --> 00:38:21,440
Speaker 5: investment in advance because it gets you a sweet discount,

853
00:38:21,520 --> 00:38:24,080
Speaker 5: you can still claim that amount, even if it's for

854
00:38:24,120 --> 00:38:26,879
Speaker 5: the future. You can claim that on your tax return

855
00:38:26,960 --> 00:38:29,640
Speaker 5: now because if the payment was made within this first

856
00:38:29,680 --> 00:38:31,160
Speaker 5: financial year, Okay, so.

857
00:38:31,160 --> 00:38:33,640
Speaker 2: You can't claim if you're doing the month by month.

858
00:38:33,440 --> 00:38:35,520
Speaker 5: Payment, no, but you could claim the month by month

859
00:38:35,560 --> 00:38:38,439
Speaker 5: payments that you've already made. But if you've prepaid into

860
00:38:38,440 --> 00:38:41,480
Speaker 5: the future, you can claim that. That's a whole conversation,

861
00:38:41,560 --> 00:38:43,880
Speaker 5: and I think we should do a whole podcast about

862
00:38:43,920 --> 00:38:47,560
Speaker 5: like wealth privileges, like discounts you get because you're wealthy.

863
00:38:48,040 --> 00:38:50,279
Speaker 4: I mean it does sound a little bit like that

864
00:38:50,280 --> 00:38:51,839
Speaker 4: if you have money to invest you can claim.

865
00:38:51,920 --> 00:38:53,920
Speaker 5: Well, it's kind of like you know, we're talking about

866
00:38:53,920 --> 00:38:55,920
Speaker 5: this on the podcast, probably a couple of months ago now,

867
00:38:55,920 --> 00:38:57,160
Speaker 5: because Beck, do you know it's July?

868
00:38:57,520 --> 00:38:59,360
Speaker 2: Oh my god, do you know what that means? What

869
00:38:59,400 --> 00:39:01,799
Speaker 2: does that mean? You passed your shoes on the money

870
00:39:01,880 --> 00:39:05,640
Speaker 2: probation period? Look at you go? Did you joined in here?

871
00:39:06,160 --> 00:39:08,400
Speaker 2: I knew you get here. Ah, that's so nice. I

872
00:39:08,400 --> 00:39:10,359
Speaker 2: didn't know. What do you mean you didn't know? I've

873
00:39:10,360 --> 00:39:12,879
Speaker 2: been begging you to come on the show for so long,

874
00:39:12,960 --> 00:39:16,000
Speaker 2: and now I win. I win. She's here. Haha, we

875
00:39:16,160 --> 00:39:17,399
Speaker 2: both win. We both win.

876
00:39:17,560 --> 00:39:20,080
Speaker 5: But anyway, essentially, I think we should do it whole

877
00:39:20,120 --> 00:39:24,080
Speaker 5: episode on this idea of wealth privilege, because it's like

878
00:39:24,120 --> 00:39:26,239
Speaker 5: the shoe concept that we're talking about a couple of

879
00:39:26,320 --> 00:39:29,360
Speaker 5: months ago, where you know, you were saying that you

880
00:39:29,560 --> 00:39:32,560
Speaker 5: colored in a pair of shoes with black text. Honestly

881
00:39:33,120 --> 00:39:36,799
Speaker 5: ten points for innovation, gryffindor thank you. But if you

882
00:39:36,840 --> 00:39:38,960
Speaker 5: hadn't colored your shoes in, you probably would have gone

883
00:39:39,080 --> 00:39:41,920
Speaker 5: to like Kmart or Target or something and brought, you know,

884
00:39:42,080 --> 00:39:44,319
Speaker 5: a reasonable pair of shoes that would have lasted three

885
00:39:44,320 --> 00:39:45,880
Speaker 5: months and then you would have had to replace it.

886
00:39:46,080 --> 00:39:48,960
Speaker 5: But if you had significant wealth behind you, or you know,

887
00:39:49,080 --> 00:39:51,560
Speaker 5: any type of financial privilege, you maybe would have just

888
00:39:51,600 --> 00:39:53,680
Speaker 5: gone and bought a more expensive pair of shoes that

889
00:39:53,680 --> 00:39:55,719
Speaker 5: would have lasted two or three years. Yes, and I

890
00:39:55,760 --> 00:39:58,680
Speaker 5: think that there's such privilege in being able to buy

891
00:39:58,680 --> 00:40:02,600
Speaker 5: those higher ticket items. Like with insurance, people who have

892
00:40:02,719 --> 00:40:06,000
Speaker 5: significant savings behind them can go, oh, it's health insurance

893
00:40:06,040 --> 00:40:08,160
Speaker 5: twenty percent cheaper if I pay it in Bolk right now,

894
00:40:08,200 --> 00:40:11,000
Speaker 5: Oh great, I'll just pay that. That's a discount that's

895
00:40:11,000 --> 00:40:13,520
Speaker 5: not then passed on to, from my perspective, the people

896
00:40:13,520 --> 00:40:16,719
Speaker 5: who need it. So it's this concept that you know,

897
00:40:17,040 --> 00:40:20,160
Speaker 5: wealthy people continue to get wealthy, but they also have

898
00:40:20,280 --> 00:40:22,759
Speaker 5: a number of different privileges afforded to them because they

899
00:40:22,760 --> 00:40:24,319
Speaker 5: can put their money where their mouth is, and we

900
00:40:24,400 --> 00:40:27,920
Speaker 5: can't do that right now. Yeah, that makes sense anyway.

901
00:40:28,000 --> 00:40:30,680
Speaker 5: What you can't claim though, let's go through that. So

902
00:40:30,719 --> 00:40:34,239
Speaker 5: you can't claim interest for periods of use for the

903
00:40:34,239 --> 00:40:37,359
Speaker 5: property for private purposes, even if it is a short term.

904
00:40:37,440 --> 00:40:39,520
Speaker 5: So like if you've got a holiday house and then

905
00:40:39,560 --> 00:40:41,799
Speaker 5: your holidaying in it and you spent two weeks that

906
00:40:41,920 --> 00:40:45,000
Speaker 5: you can't claim those two weeks gotcha any part of

907
00:40:45,040 --> 00:40:47,319
Speaker 5: the loan. So like you can claim the interest, but

908
00:40:47,440 --> 00:40:50,640
Speaker 5: like not the actual loan. You can't claim interest when

909
00:40:50,880 --> 00:40:53,359
Speaker 5: the property was used for private purposes, when you took

910
00:40:53,400 --> 00:40:57,279
Speaker 5: out the loan or refinanced it. That's redrawn for private purposes,

911
00:40:57,360 --> 00:41:00,320
Speaker 5: even if you're ahead in your repayments. You can can't

912
00:41:00,360 --> 00:41:02,680
Speaker 5: use it when you buy a new home if you

913
00:41:02,719 --> 00:41:05,520
Speaker 5: don't use it to produce income, even if your rental

914
00:41:05,520 --> 00:41:08,440
Speaker 5: property is security for that loan, And you can't on

915
00:41:08,560 --> 00:41:12,040
Speaker 5: funds used to buy vacant land until the time construction

916
00:41:12,120 --> 00:41:15,359
Speaker 5: on your rental property is complete, like completely completed, not

917
00:41:15,440 --> 00:41:16,840
Speaker 5: like oh it's halfway there.

918
00:41:16,600 --> 00:41:19,200
Speaker 2: Like done and it's ready and available for rent.

919
00:41:19,560 --> 00:41:22,040
Speaker 5: Right, So like that is something that I think a

920
00:41:22,040 --> 00:41:24,839
Speaker 5: few people get a little bit stuck on when they're like, oh,

921
00:41:24,880 --> 00:41:27,000
Speaker 5: but I bought land and I'm building an investment property,

922
00:41:27,000 --> 00:41:27,720
Speaker 5: I should be able.

923
00:41:27,560 --> 00:41:27,960
Speaker 2: To claim it.

924
00:41:27,960 --> 00:41:30,359
Speaker 5: It's like, well, the land's vacant, it's not actually an

925
00:41:30,360 --> 00:41:33,400
Speaker 5: investment yet. It's not like drawing any income from rent.

926
00:41:33,520 --> 00:41:34,399
Speaker 5: You can't claim that.

927
00:41:34,440 --> 00:41:35,760
Speaker 2: Yet, right, I see?

928
00:41:35,880 --> 00:41:38,080
Speaker 5: Okay, So if your loan was used to buy a

929
00:41:38,080 --> 00:41:40,520
Speaker 5: rental property or something else, like say a car, you

930
00:41:40,600 --> 00:41:43,360
Speaker 5: can't just repay the part relating to your personal purchase,

931
00:41:43,400 --> 00:41:47,080
Speaker 5: even when you've refinanced. All loan repayments are appointed across

932
00:41:47,120 --> 00:41:50,080
Speaker 5: both purposes until all the loan has been repaid and

933
00:41:50,080 --> 00:41:52,880
Speaker 5: you are no longer claiming interest expenses on that property.

934
00:41:53,160 --> 00:41:55,160
Speaker 5: So it's a little bit complicated. The best thing to

935
00:41:55,160 --> 00:41:58,560
Speaker 5: do is obviously talk to your accountant or your mortgage broker.

936
00:41:58,800 --> 00:42:01,800
Speaker 5: Your mortgage broker is going to have a complete grasp

937
00:42:01,880 --> 00:42:05,440
Speaker 5: of this, like I you know again shameless plug for

938
00:42:05,520 --> 00:42:10,520
Speaker 5: my own business, Zella Money. We literally finance thousands of

939
00:42:10,520 --> 00:42:13,840
Speaker 5: properties a year for clients. And if you haven't already,

940
00:42:13,880 --> 00:42:16,120
Speaker 5: like it is tax time now, you're probably looking at

941
00:42:16,120 --> 00:42:18,279
Speaker 5: it going wow, my interest rate really needs looking at.

942
00:42:18,360 --> 00:42:20,839
Speaker 5: You're probably thinking about the fact that, oh wow, I'm

943
00:42:20,840 --> 00:42:22,680
Speaker 5: about to come off my fixed period. I need to

944
00:42:22,680 --> 00:42:25,000
Speaker 5: talk to someone. Go talk to Kate, Go talk to Nikki,

945
00:42:25,080 --> 00:42:27,279
Speaker 5: Go talk to Jackeline, go talk to anyone in my

946
00:42:27,440 --> 00:42:29,719
Speaker 5: team who can go. All right, Beck, sit down, what

947
00:42:29,800 --> 00:42:30,600
Speaker 5: are we looking at?

948
00:42:30,760 --> 00:42:31,000
Speaker 1: You know?

949
00:42:31,080 --> 00:42:33,080
Speaker 5: What's the market look like? What's your loan look like,

950
00:42:33,120 --> 00:42:35,920
Speaker 5: what's the best possible outcome and structure? Right, Because I've

951
00:42:35,920 --> 00:42:37,799
Speaker 5: said it before, and this is something that a lot

952
00:42:37,840 --> 00:42:40,239
Speaker 5: of people don't like to hear because we don't like change. Right,

953
00:42:40,680 --> 00:42:43,040
Speaker 5: But you do not need to be loyal to your bank.

954
00:42:43,239 --> 00:42:45,280
Speaker 5: I know you might have been with a particular bank

955
00:42:45,480 --> 00:42:48,880
Speaker 5: since they gave you a little yellow checkbook in primary school,

956
00:42:49,239 --> 00:42:51,160
Speaker 5: but that doesn't mean that that's going to put you

957
00:42:51,160 --> 00:42:53,920
Speaker 5: in the best possible position. So sometimes having someone who

958
00:42:53,960 --> 00:42:56,080
Speaker 5: sits down and goes, oh, well, I have access to

959
00:42:56,239 --> 00:42:59,600
Speaker 5: seventy different lenders, let me show you which one would

960
00:42:59,600 --> 00:43:02,759
Speaker 5: work better for your financial position, Like, go and do that.

961
00:43:03,080 --> 00:43:05,080
Speaker 5: Because a lot of clients that we're talking to at

962
00:43:05,080 --> 00:43:07,160
Speaker 5: the moment, especially like in June coming up to the

963
00:43:07,239 --> 00:43:09,919
Speaker 5: end of financial year, were really stressed either about their

964
00:43:10,040 --> 00:43:13,800
Speaker 5: fixed interest term coming up or the fact that interest

965
00:43:13,880 --> 00:43:16,400
Speaker 5: rates had increased so much that they weren't able to

966
00:43:16,520 --> 00:43:19,560
Speaker 5: like balance lifestyle and stuff. So a lot of the

967
00:43:19,600 --> 00:43:22,680
Speaker 5: time we kind of sat down and restructured them in

968
00:43:22,680 --> 00:43:24,959
Speaker 5: a way that you know, maybe some clients are moving

969
00:43:25,000 --> 00:43:28,080
Speaker 5: to not paying principle and interest at the same time,

970
00:43:28,120 --> 00:43:30,319
Speaker 5: they're just paying interest for a fair period of time

971
00:43:30,360 --> 00:43:32,959
Speaker 5: so they can like build back up their emergency fund

972
00:43:33,000 --> 00:43:35,360
Speaker 5: and you know, still have the lifestyle that they deserve

973
00:43:35,480 --> 00:43:37,479
Speaker 5: while we wait for the interest rates to come down.

974
00:43:37,760 --> 00:43:40,680
Speaker 5: So definitely, And I mean, do you know what, at

975
00:43:40,680 --> 00:43:42,239
Speaker 5: the end of the day, I don't care which broker

976
00:43:42,280 --> 00:43:44,239
Speaker 5: you see. I've got a team of great ones. If

977
00:43:44,280 --> 00:43:46,719
Speaker 5: you want to see them, that's fantastic. But go and

978
00:43:46,800 --> 00:43:49,240
Speaker 5: see someone who can put you in the best possible position.

979
00:43:49,600 --> 00:43:52,920
Speaker 5: Because mortgage broking back it's free for you. Like it's

980
00:43:53,000 --> 00:43:56,719
Speaker 5: literally a free service. Mortgage brokers cannot charge you individually.

981
00:43:56,840 --> 00:43:57,920
Speaker 2: That is actually very cool.

982
00:43:58,000 --> 00:44:00,239
Speaker 5: It's very cool because the main pays them. And I

983
00:44:00,239 --> 00:44:02,680
Speaker 5: mean then you would think, oh my god, conditions are involved. No,

984
00:44:03,040 --> 00:44:06,279
Speaker 5: like we legally cannot make more off you, Like the

985
00:44:06,320 --> 00:44:10,399
Speaker 5: bank shares their profit with me, not part of your

986
00:44:10,400 --> 00:44:10,960
Speaker 5: interest rate.

987
00:44:11,000 --> 00:44:12,520
Speaker 2: Like the interest rate is not higher.

988
00:44:12,840 --> 00:44:15,759
Speaker 5: In fact, it can be lower because of the relationship

989
00:44:15,840 --> 00:44:18,120
Speaker 5: you're broker has with that bank. So it's all just

990
00:44:18,200 --> 00:44:20,920
Speaker 5: a sexy process. From my perspective, that's great. It feels

991
00:44:20,920 --> 00:44:21,759
Speaker 5: like a win win win.

992
00:44:22,080 --> 00:44:22,720
Speaker 2: Hot girlshit.

993
00:44:22,880 --> 00:44:25,000
Speaker 4: Okay, So I feel like it's time to talk about

994
00:44:25,040 --> 00:44:26,720
Speaker 4: my personal favorite topic.

995
00:44:26,960 --> 00:44:27,759
Speaker 2: Yeah, what is it?

996
00:44:27,800 --> 00:44:31,480
Speaker 5: And something I know at about that is a straight

997
00:44:31,520 --> 00:44:36,040
Speaker 5: experience of women in Australia. Yeah, that's exactly right, straight rights,

998
00:44:36,080 --> 00:44:38,920
Speaker 5: all of that stuff. Also, second to that, I know

999
00:44:38,960 --> 00:44:41,480
Speaker 5: a lot about obviously capital gains and losses.

1000
00:44:41,640 --> 00:44:45,160
Speaker 2: Oh yeah, and that's actually same. Yeah. And negative and

1001
00:44:45,200 --> 00:44:49,200
Speaker 2: positive gearing. Yeah okay. So I knew you were going

1002
00:44:49,280 --> 00:44:49,799
Speaker 2: to ask this.

1003
00:44:50,000 --> 00:44:51,719
Speaker 5: I was like, Oh, Beck's going to really want to

1004
00:44:51,760 --> 00:44:54,840
Speaker 5: talk about negative and positive gearing in this current environment.

1005
00:44:55,080 --> 00:44:57,520
Speaker 2: And then I wrote some notes. So are you ready perfect?

1006
00:44:57,600 --> 00:44:59,239
Speaker 4: Yes, I was going to say I actually, because I

1007
00:44:59,280 --> 00:45:00,799
Speaker 4: know so much, I fe like I'm going to sit

1008
00:45:00,880 --> 00:45:02,839
Speaker 4: back and let you do the talk.

1009
00:45:03,239 --> 00:45:05,320
Speaker 2: That's okay, Yeah, so please go ahead.

1010
00:45:05,640 --> 00:45:08,160
Speaker 5: Look at the end of the dayback if you personally

1011
00:45:08,400 --> 00:45:11,440
Speaker 5: you were thinking about selling an investment for more than

1012
00:45:11,440 --> 00:45:13,560
Speaker 5: what you acquired it for. So if you went and

1013
00:45:13,560 --> 00:45:15,759
Speaker 5: purchased an investment, we used that example of a share

1014
00:45:15,760 --> 00:45:17,880
Speaker 5: that was ten dollars and it went up to fifteen dollars,

1015
00:45:18,200 --> 00:45:21,799
Speaker 5: you're making what's called a capital gain. So your job

1016
00:45:21,960 --> 00:45:25,880
Speaker 5: as an individual consumer is to include every single capital

1017
00:45:25,920 --> 00:45:28,480
Speaker 5: gain in your tax return in the year that you

1018
00:45:28,560 --> 00:45:32,120
Speaker 5: sold that investment. So although capital gains are taxed at

1019
00:45:32,160 --> 00:45:34,080
Speaker 5: your marginal tax rates. So like if you go to

1020
00:45:34,120 --> 00:45:36,800
Speaker 5: work and your tax rate is thirty two point five percent,

1021
00:45:36,880 --> 00:45:39,319
Speaker 5: that's how much you're going to be taxed on your investments.

1022
00:45:39,600 --> 00:45:42,840
Speaker 5: If you've held that investment for more than twelve months,

1023
00:45:43,160 --> 00:45:46,799
Speaker 5: you're actually only taxed on half that capital gain. So

1024
00:45:47,000 --> 00:45:49,280
Speaker 5: if we look at that example of that ten dollar share,

1025
00:45:49,520 --> 00:45:51,680
Speaker 5: you made five dollars, it was worth fifteen dollars you

1026
00:45:51,719 --> 00:45:54,239
Speaker 5: decided to sell it. If you sold it in less

1027
00:45:54,280 --> 00:45:55,920
Speaker 5: than twelve months, so you held it for like eight

1028
00:45:56,040 --> 00:46:00,000
Speaker 5: or nine months, you'd be taxed on that five dollars,

1029
00:45:59,800 --> 00:46:02,640
Speaker 5: But if you hold it for more than twelve months,

1030
00:46:02,920 --> 00:46:05,600
Speaker 5: your taxed on two dollars fifty instead. So that is

1031
00:46:05,640 --> 00:46:08,359
Speaker 5: a very big money win, and it's also a very

1032
00:46:08,360 --> 00:46:11,000
Speaker 5: big money loss if you haven't thought about capital gains

1033
00:46:11,000 --> 00:46:13,680
Speaker 5: when it comes to investing for the first time, Because

1034
00:46:13,840 --> 00:46:16,040
Speaker 5: how many people in our community have gone, you know what,

1035
00:46:16,080 --> 00:46:18,160
Speaker 5: I really want to invest and I'm so excited about this,

1036
00:46:18,440 --> 00:46:20,359
Speaker 5: and they go and they purchase their shares, and then

1037
00:46:20,360 --> 00:46:22,160
Speaker 5: they might get, you know, some cold feet, or they

1038
00:46:22,200 --> 00:46:24,759
Speaker 5: might see a really good interest rate return and they go, oh,

1039
00:46:24,800 --> 00:46:27,200
Speaker 5: that's really sexy. I'm just going to sell, Like we

1040
00:46:27,239 --> 00:46:30,000
Speaker 5: need to actually have a bigger picture hat on here

1041
00:46:30,080 --> 00:46:33,719
Speaker 5: and go all right, well, Beck, actually you need to

1042
00:46:33,719 --> 00:46:35,759
Speaker 5: hold it for more than twelve months because you could

1043
00:46:35,840 --> 00:46:37,480
Speaker 5: end up losing a fair chunk of it.

1044
00:46:37,719 --> 00:46:39,719
Speaker 2: You don't want to lose stuff just because you didn't know.

1045
00:46:40,120 --> 00:46:43,279
Speaker 5: Yeah, a lot of that happened, and not necessarily in

1046
00:46:43,320 --> 00:46:45,960
Speaker 5: our community, but I've seen a lot of it happen.

1047
00:46:46,360 --> 00:46:50,719
Speaker 5: And let's like, you know, attack finance bros, Simmer finance Bros.

1048
00:46:50,719 --> 00:46:52,640
Speaker 5: Who brought crypto currency and it went out real quick,

1049
00:46:52,640 --> 00:46:54,040
Speaker 5: and then they sold it and then they're like, what

1050
00:46:54,080 --> 00:46:55,759
Speaker 5: the hell? Why am I having to pay so much

1051
00:46:55,800 --> 00:46:56,359
Speaker 5: tax on this?

1052
00:46:56,360 --> 00:47:00,440
Speaker 2: This wasn't worth it? No, because you didn't do your homework, mate, Nah,

1053
00:47:00,440 --> 00:47:02,399
Speaker 2: because you didn't know about capital games, did you.

1054
00:47:03,239 --> 00:47:06,719
Speaker 5: So right now, Beck, you are now officially smarter than

1055
00:47:06,719 --> 00:47:07,319
Speaker 5: a finance bro.

1056
00:47:07,520 --> 00:47:10,799
Speaker 2: WHOA, that's huge. You're welcome. Thank you so much, John

1057
00:47:10,880 --> 00:47:14,520
Speaker 2: on a bestowed to not many. That's very true and

1058
00:47:14,600 --> 00:47:16,520
Speaker 2: I'm very grateful for it. Yeah, you're welcome.

1059
00:47:16,640 --> 00:47:19,440
Speaker 5: But that discount, in effect is going to have the

1060
00:47:19,440 --> 00:47:22,680
Speaker 5: marginal tax rate that you pay, So it is significant

1061
00:47:22,719 --> 00:47:25,799
Speaker 5: and needs to be taken into consideration, and it's applicable

1062
00:47:25,880 --> 00:47:30,920
Speaker 5: on basically everything, so property shares, you know, bonds, whatever,

1063
00:47:30,960 --> 00:47:35,040
Speaker 5: you're purchasing, cryptocurrency. It doesn't matter what it is. It's

1064
00:47:35,200 --> 00:47:37,279
Speaker 5: really important to actually do that, you know what. It

1065
00:47:37,280 --> 00:47:38,760
Speaker 5: doesn't apply on what cars?

1066
00:47:39,239 --> 00:47:42,240
Speaker 2: Oh, depreciation, Yeah.

1067
00:47:42,280 --> 00:47:44,360
Speaker 5: No, there's like lots of rules about it. But I

1068
00:47:44,360 --> 00:47:46,520
Speaker 5: think I've spoken about it on the podcast before. But

1069
00:47:46,560 --> 00:47:48,319
Speaker 5: if you bought a car and then sold it for

1070
00:47:48,360 --> 00:47:51,680
Speaker 5: a profit, that's personal, it's not actually oh yeah, it's

1071
00:47:51,719 --> 00:47:54,359
Speaker 5: why a lot of people buy cars and restore them

1072
00:47:54,360 --> 00:47:56,560
Speaker 5: and sell them, like really high end cars. Like they

1073
00:47:56,600 --> 00:47:59,960
Speaker 5: might buy a fancy rundown Porsche. Not that you are

1074
00:48:00,120 --> 00:48:02,239
Speaker 5: I could afford that, but they might by fancy run

1075
00:48:02,280 --> 00:48:03,239
Speaker 5: down portion to them.

1076
00:48:03,280 --> 00:48:04,840
Speaker 3: It's like a money win because it was like ninety

1077
00:48:04,920 --> 00:48:07,160
Speaker 3: thousand dollars and you're like, oh my god, that's literally

1078
00:48:07,200 --> 00:48:09,880
Speaker 3: completely out of my budget anyway, like that's a house deposit.

1079
00:48:10,200 --> 00:48:12,080
Speaker 5: And then they restore them and sell them for like

1080
00:48:12,160 --> 00:48:14,360
Speaker 5: one fifty. Then they don't pay tax on that profit.

1081
00:48:14,480 --> 00:48:18,000
Speaker 4: Really, I have to like tell the government that they

1082
00:48:18,440 --> 00:48:21,560
Speaker 4: it's completely transparent process, Like they're not doing anything right.

1083
00:48:21,800 --> 00:48:24,160
Speaker 2: It's just that's not an asset that's deemed to be

1084
00:48:24,200 --> 00:48:27,520
Speaker 2: an investment. That's pretty cool. Yeah, isn't it wild? I

1085
00:48:27,520 --> 00:48:29,200
Speaker 2: mean completely unreachable.

1086
00:48:29,239 --> 00:48:30,759
Speaker 5: And I mean if you're listening to this podcast and

1087
00:48:30,800 --> 00:48:32,440
Speaker 5: you're like, that's a good way of making money, like

1088
00:48:32,600 --> 00:48:35,359
Speaker 5: good luck getting in the door, Like, yes, it's a lot,

1089
00:48:35,440 --> 00:48:37,319
Speaker 5: but a lot of people do do that, and that's

1090
00:48:37,600 --> 00:48:38,759
Speaker 5: you know, a bit of a money win.

1091
00:48:38,920 --> 00:48:41,120
Speaker 2: I mean, I could afford a Tarago? Do you reckon?

1092
00:48:41,120 --> 00:48:42,520
Speaker 2: We could do one of those up together back?

1093
00:48:42,640 --> 00:48:43,239
Speaker 3: Oh god?

1094
00:48:43,360 --> 00:48:46,280
Speaker 2: Yeah, love a toarago. Yeah, we could get around Brunswick

1095
00:48:46,320 --> 00:48:47,840
Speaker 2: in that. Yes, it's polite.

1096
00:48:48,000 --> 00:48:49,759
Speaker 5: Do you even sell it for a lot of money too?

1097
00:48:50,040 --> 00:48:51,400
Speaker 5: Like it pimped out chirago?

1098
00:48:52,040 --> 00:48:53,600
Speaker 2: Totally? Those are going for a lot.

1099
00:48:53,880 --> 00:48:56,440
Speaker 4: Maybe not a Toarago specifically, but vans that have like

1100
00:48:56,480 --> 00:48:57,200
Speaker 4: beds in the back.

1101
00:48:57,600 --> 00:49:01,520
Speaker 2: Oh no, specifically talking about it. We could do a torago.

1102
00:49:01,719 --> 00:49:02,319
Speaker 2: Thanks to do it.

1103
00:49:02,400 --> 00:49:05,080
Speaker 5: But if you're selling an investment for less, right, so

1104
00:49:05,160 --> 00:49:08,560
Speaker 5: I know we're talking about profit profit profit. Sometimes you

1105
00:49:08,640 --> 00:49:10,879
Speaker 5: sell an investment for less, there might be a few

1106
00:49:10,880 --> 00:49:13,520
Speaker 5: reasons behind that. You might be selling it because it

1107
00:49:13,600 --> 00:49:16,480
Speaker 5: no longer serves you, it's no longer aligning to your values.

1108
00:49:16,800 --> 00:49:18,800
Speaker 5: You might be selling it because you need the money

1109
00:49:18,840 --> 00:49:21,759
Speaker 5: out asap. You might be selling it because you've looked

1110
00:49:21,760 --> 00:49:24,280
Speaker 5: at it and you're rebalancing your portfolio and you're like, goddamn,

1111
00:49:24,760 --> 00:49:27,560
Speaker 5: this investment has not paid off in a while. I've

1112
00:49:27,640 --> 00:49:29,320
Speaker 5: checked out all the reports, and I'm just going to

1113
00:49:29,360 --> 00:49:31,080
Speaker 5: get rid of it and cut my losses. There could

1114
00:49:31,080 --> 00:49:33,120
Speaker 5: be a number of reasons why you're choosing to sell

1115
00:49:33,160 --> 00:49:35,600
Speaker 5: an investment for less than the cost you acquire it,

1116
00:49:36,160 --> 00:49:38,479
Speaker 5: in which case you're making what's called a capital loss,

1117
00:49:38,480 --> 00:49:40,880
Speaker 5: which is the opposite of a capital gain. And these

1118
00:49:41,120 --> 00:49:44,120
Speaker 5: can still be sexy, So you might be losing money, okay,

1119
00:49:44,160 --> 00:49:45,840
Speaker 5: But we want to make sure that we're not just

1120
00:49:45,880 --> 00:49:48,080
Speaker 5: burying our head in the sand when we're making a loss.

1121
00:49:48,200 --> 00:49:51,880
Speaker 5: We're like keeping track of them because a capital loss

1122
00:49:51,920 --> 00:49:55,640
Speaker 5: on one asset means that you could reduce other capital

1123
00:49:55,680 --> 00:49:58,520
Speaker 5: gains made in the year that that loss occurs. So

1124
00:49:58,640 --> 00:50:01,600
Speaker 5: like all balances itself, we look at our portfolio as

1125
00:50:01,600 --> 00:50:04,879
Speaker 5: a whole. Or if you didn't claim it because you're

1126
00:50:04,920 --> 00:50:08,799
Speaker 5: like Victoria, I made a capital loss on my one investment,

1127
00:50:09,040 --> 00:50:11,040
Speaker 5: I've got nothing to claim it against, Like I.

1128
00:50:11,000 --> 00:50:13,120
Speaker 2: Don't have capital gains to like offset it with.

1129
00:50:13,400 --> 00:50:16,560
Speaker 5: Don't worry, Beck, you can carry it forward to offset

1130
00:50:16,840 --> 00:50:17,799
Speaker 5: future capital gains.

1131
00:50:17,840 --> 00:50:21,319
Speaker 2: Oh my god, So I told you it could be sexy. Yeah.

1132
00:50:21,600 --> 00:50:24,360
Speaker 5: Trueever, I thought we'd have this conversation and use the

1133
00:50:24,360 --> 00:50:25,879
Speaker 5: word sexy as much as we have.

1134
00:50:26,000 --> 00:50:28,480
Speaker 2: Sexy and loss in the same sentence.

1135
00:50:28,680 --> 00:50:31,840
Speaker 5: Yeah, it's novels novel.

1136
00:50:31,960 --> 00:50:33,520
Speaker 2: It's not something you'll hear every day.

1137
00:50:33,640 --> 00:50:36,200
Speaker 5: It's funny because when I do speaking events, like, I

1138
00:50:36,239 --> 00:50:38,560
Speaker 5: am obsessed with speaking events right like, And if you

1139
00:50:38,600 --> 00:50:39,880
Speaker 5: don't know that I do them, now you do.

1140
00:50:39,920 --> 00:50:40,400
Speaker 2: You welcome.

1141
00:50:40,680 --> 00:50:42,960
Speaker 5: I probably do a speaking event or two a week,

1142
00:50:43,000 --> 00:50:45,440
Speaker 5: which is why my voice is always cooked beck. But

1143
00:50:45,520 --> 00:50:48,040
Speaker 5: I go into people's workplaces and I'm like basically trying

1144
00:50:48,040 --> 00:50:51,080
Speaker 5: to convince them that caring about their financial wellness is

1145
00:50:51,120 --> 00:50:53,560
Speaker 5: a genius idea and it is just, so you know,

1146
00:50:54,040 --> 00:50:56,080
Speaker 5: very easy sell. So I go in and I talk

1147
00:50:56,080 --> 00:50:58,040
Speaker 5: about all these things. So I'll be like, oh, here's

1148
00:50:58,080 --> 00:50:59,880
Speaker 5: your money story, let's talk about this, here's what the

1149
00:51:00,080 --> 00:51:02,600
Speaker 5: saving and investing in you know, all these asset classes mean.

1150
00:51:02,719 --> 00:51:06,760
Speaker 2: And then oh, let's talk about superannuation. Super is so sexy.

1151
00:51:06,760 --> 00:51:09,279
Speaker 5: And I literally stand in front of and a couple

1152
00:51:09,360 --> 00:51:10,759
Speaker 5: of weeks ago I did it, and there were two

1153
00:51:10,840 --> 00:51:12,879
Speaker 5: hundred people in the room, and it was like from

1154
00:51:12,960 --> 00:51:15,160
Speaker 5: the ages. I think they said their youngest staff member

1155
00:51:15,239 --> 00:51:17,200
Speaker 5: was like twenty one and their oldest was like in

1156
00:51:17,239 --> 00:51:20,120
Speaker 5: his late sixties, and it was like really diverse. And

1157
00:51:20,160 --> 00:51:23,719
Speaker 5: I'm just like, Superannuation is really sexy in front of

1158
00:51:23,760 --> 00:51:25,719
Speaker 5: all these people. And then after they're like, yeah, the

1159
00:51:25,760 --> 00:51:27,840
Speaker 5: board that was there really enjoyed your presentation.

1160
00:51:27,920 --> 00:51:28,960
Speaker 2: I'm like, oh cool.

1161
00:51:29,000 --> 00:51:32,480
Speaker 5: So I stood in front of an ASX listed team

1162
00:51:32,960 --> 00:51:36,160
Speaker 5: and their board were watching me go, super is really sexy.

1163
00:51:36,160 --> 00:51:38,040
Speaker 5: He let me explain it, and then I'm pretending to

1164
00:51:38,080 --> 00:51:39,880
Speaker 5: get all hot and flustered about it, and I was like,

1165
00:51:40,120 --> 00:51:41,360
Speaker 5: I've never felt more humbled.

1166
00:51:41,480 --> 00:51:43,840
Speaker 4: Oh my gosh, I think, but it is so hot,

1167
00:51:43,960 --> 00:51:46,040
Speaker 4: Like it's so sexy, totally.

1168
00:51:46,239 --> 00:51:49,279
Speaker 5: Have you ever heard of anything as hot as Superannuation.

1169
00:51:49,560 --> 00:51:51,680
Speaker 2: No, I've never seen nor heard.

1170
00:51:51,960 --> 00:51:53,920
Speaker 5: I think my husband and I on our first date

1171
00:51:53,960 --> 00:51:57,560
Speaker 5: talked about Superannuation. I just I knew it was true love.

1172
00:51:58,040 --> 00:51:59,560
Speaker 2: I just knew that we were going to get married.

1173
00:51:59,719 --> 00:52:02,000
Speaker 4: Yeah, he was irresistible. Once you said the word.

1174
00:52:01,920 --> 00:52:04,319
Speaker 2: Super, I care about my super and I was like, oof,

1175
00:52:04,880 --> 00:52:09,839
Speaker 2: that's nice. Yeah all right, tell me about your emergency fun.

1176
00:52:10,960 --> 00:52:12,840
Speaker 2: Yeah that's basic. Let's move on. I haven't got allowed

1177
00:52:12,840 --> 00:52:15,279
Speaker 2: dirty talk on this show. Okay, okay, I'm sorry. I'm

1178
00:52:15,280 --> 00:52:16,560
Speaker 2: sorry I brought us down.

1179
00:52:17,000 --> 00:52:19,520
Speaker 4: This next part I'm very excited about because I actually

1180
00:52:19,520 --> 00:52:23,360
Speaker 4: have no idea what positive and negative gearing is, but

1181
00:52:23,400 --> 00:52:25,319
Speaker 4: I've always wanted to know, and I feel like you're

1182
00:52:25,320 --> 00:52:27,959
Speaker 4: going to explain it in such a nice, gentle way.

1183
00:52:28,000 --> 00:52:30,440
Speaker 2: For me. It's not going to be gentle. It's going

1184
00:52:30,520 --> 00:52:34,040
Speaker 2: to be sexy. Whoa, she's getting very hot.

1185
00:52:34,120 --> 00:52:37,520
Speaker 5: So positive and negative gearing. A lot of people talk

1186
00:52:37,600 --> 00:52:40,640
Speaker 5: about this when they buy property, and they're like, I'm

1187
00:52:40,680 --> 00:52:42,600
Speaker 5: going to positively gear it and it's going to be

1188
00:52:42,640 --> 00:52:45,319
Speaker 5: really sexy, or they're like, yeah, well it's negatively good.

1189
00:52:45,440 --> 00:52:49,640
Speaker 5: Negatively gid properties don't really exist that much nowadays because

1190
00:52:49,640 --> 00:52:52,640
Speaker 5: our interest rates are so high, and I'll explain why.

1191
00:52:52,800 --> 00:52:56,080
Speaker 5: So it's really worth bearing in mind here the financing

1192
00:52:56,120 --> 00:52:59,200
Speaker 5: options that you are choosing when picking an investment. That

1193
00:52:59,320 --> 00:53:01,719
Speaker 5: is why I harp on about the fact that you

1194
00:53:01,800 --> 00:53:03,120
Speaker 5: need to talk to a mortgage broker.

1195
00:53:03,600 --> 00:53:04,440
Speaker 2: Can you bet go.

1196
00:53:04,400 --> 00:53:07,160
Speaker 5: And get a mortgage or a loan on your own? Yes,

1197
00:53:07,440 --> 00:53:09,799
Speaker 5: absolutely you could. You can walk straight down to your

1198
00:53:09,800 --> 00:53:10,560
Speaker 5: bank and you can.

1199
00:53:10,400 --> 00:53:11,360
Speaker 2: Sort it out yourself.

1200
00:53:11,440 --> 00:53:14,640
Speaker 5: Okay, why would you do that when you could talk

1201
00:53:14,680 --> 00:53:17,360
Speaker 5: to someone who does this at a minimum of forty

1202
00:53:17,520 --> 00:53:21,200
Speaker 5: hours a week, day in days out, knows exactly what

1203
00:53:21,280 --> 00:53:23,600
Speaker 5: they're talking about to put you in the best possible position,

1204
00:53:23,719 --> 00:53:26,200
Speaker 5: Because I promise when you walk into your bank, if

1205
00:53:26,200 --> 00:53:28,319
Speaker 5: you talk to a mortgage broker that works for a bank,

1206
00:53:28,360 --> 00:53:30,400
Speaker 5: and I'm so sorry to any mortgage brokers that are

1207
00:53:30,400 --> 00:53:32,560
Speaker 5: listening to this and you're like, I work with a bank,

1208
00:53:32,640 --> 00:53:34,000
Speaker 5: I'd like, I get it. It's a good job. At

1209
00:53:34,000 --> 00:53:36,200
Speaker 5: the end of the day, nobody's better than anybody else.

1210
00:53:36,440 --> 00:53:39,040
Speaker 5: But as a consumer, if you walk into a bank,

1211
00:53:39,360 --> 00:53:41,000
Speaker 5: let's call it the Bank of Victoria, because we're not

1212
00:53:41,040 --> 00:53:42,160
Speaker 5: going to pick on any one bank.

1213
00:53:42,360 --> 00:53:43,759
Speaker 2: Go to the Bank of Victoria.

1214
00:53:43,880 --> 00:53:46,600
Speaker 5: The Bank of Victoria only has access and the brokers

1215
00:53:46,640 --> 00:53:48,880
Speaker 5: that work there only have access to the products that

1216
00:53:48,920 --> 00:53:51,000
Speaker 5: the Bank of Victoria is able to issue.

1217
00:53:51,080 --> 00:53:52,200
Speaker 2: Sure, so they.

1218
00:53:52,160 --> 00:53:55,200
Speaker 5: Might go, oh, well, we have two different mortgage OPTIONSPEC

1219
00:53:55,320 --> 00:53:57,640
Speaker 5: this is the best one for you. They're not lying

1220
00:53:58,239 --> 00:53:59,960
Speaker 5: that is the best option out of all the op

1221
00:54:00,320 --> 00:54:02,799
Speaker 5: that they're able to write for you. They go, beck,

1222
00:54:02,840 --> 00:54:05,239
Speaker 5: this option A is the best for you, and you go,

1223
00:54:05,320 --> 00:54:08,759
Speaker 5: oh yeah, why oh, because compared to B it's just

1224
00:54:08,840 --> 00:54:11,600
Speaker 5: not you know, as good for your situation. You go, oh, okay,

1225
00:54:11,640 --> 00:54:14,680
Speaker 5: no worries. But if you go down the street and

1226
00:54:14,719 --> 00:54:17,880
Speaker 5: talk to a mortgage broker who is independent of a bank,

1227
00:54:18,000 --> 00:54:20,880
Speaker 5: they're going to have access to seventy plus options, so

1228
00:54:20,920 --> 00:54:23,680
Speaker 5: they might go, oh, Beck, I see your situation. Actually,

1229
00:54:23,960 --> 00:54:26,520
Speaker 5: don't go with that original Bank of Victoria that you wanted,

1230
00:54:26,520 --> 00:54:28,759
Speaker 5: because you're actually going to have to have a full

1231
00:54:28,800 --> 00:54:31,920
Speaker 5: twenty percent deposit, or if you have less than twenty

1232
00:54:31,960 --> 00:54:34,839
Speaker 5: percent and you do ten percent deposit, you're actually going to.

1233
00:54:34,800 --> 00:54:35,600
Speaker 2: Need to pay LMI.

1234
00:54:36,040 --> 00:54:38,600
Speaker 5: But because of your career, because of what's going on,

1235
00:54:38,760 --> 00:54:40,839
Speaker 5: I actually have the Bank of Beck and the Bank

1236
00:54:40,880 --> 00:54:42,759
Speaker 5: of Beck they're going to actually wave your LM I

1237
00:54:42,800 --> 00:54:44,920
Speaker 5: and put you in a better possible position. And you

1238
00:54:44,960 --> 00:54:46,759
Speaker 5: know it has all these bells and whistles that you

1239
00:54:46,800 --> 00:54:48,960
Speaker 5: said was really important to you. You're right, well, V

1240
00:54:49,120 --> 00:54:51,560
Speaker 5: I didn't know that that credit union even did mortgages

1241
00:54:51,840 --> 00:54:53,799
Speaker 5: go yeah, no, they're not as big, but they're really

1242
00:54:53,840 --> 00:54:55,160
Speaker 5: good and they're going to put you in the best

1243
00:54:55,200 --> 00:54:56,000
Speaker 5: possible position.

1244
00:54:56,360 --> 00:54:58,880
Speaker 2: You go, great, I've got the best outcome for me.

1245
00:54:59,320 --> 00:55:02,000
Speaker 5: So please make sure that when you are you know,

1246
00:55:02,320 --> 00:55:06,000
Speaker 5: considering your financing options. You're not just going oh, I'm

1247
00:55:06,000 --> 00:55:08,600
Speaker 5: a smart individual and I can absolutely do this. You can,

1248
00:55:09,080 --> 00:55:11,280
Speaker 5: I promise, Beck, if you were going to get a mortgage,

1249
00:55:11,280 --> 00:55:13,840
Speaker 5: you could go on every bank website, look at the rates,

1250
00:55:13,840 --> 00:55:15,560
Speaker 5: look at the interest, look at the fees, and make

1251
00:55:15,600 --> 00:55:17,879
Speaker 5: a decision that makes sense for you. But you don't

1252
00:55:17,920 --> 00:55:20,160
Speaker 5: know what you're looking for, right. You know what the

1253
00:55:20,200 --> 00:55:22,280
Speaker 5: bank is trying to tell you from their sales pages

1254
00:55:22,320 --> 00:55:23,080
Speaker 5: on their mortgages.

1255
00:55:23,560 --> 00:55:23,799
Speaker 2: Right.

1256
00:55:23,880 --> 00:55:25,960
Speaker 5: You go into a bank and I promise that person

1257
00:55:26,000 --> 00:55:30,120
Speaker 5: has been trained in sales, not in financing options, because

1258
00:55:30,120 --> 00:55:32,160
Speaker 5: that's just what works for that environment. It doesn't mean

1259
00:55:32,200 --> 00:55:34,720
Speaker 5: it's wrong, it doesn't mean it's bad. It just means

1260
00:55:34,719 --> 00:55:37,400
Speaker 5: that you, as a consumer, deserve to be educated in

1261
00:55:37,480 --> 00:55:40,839
Speaker 5: what a mortgage broker does. I'm obviously wildly passionate about

1262
00:55:40,880 --> 00:55:43,520
Speaker 5: it because with Kate, I own Zella Money, which is

1263
00:55:43,520 --> 00:55:46,239
Speaker 5: a mortgage broken company. But something that we super pride

1264
00:55:46,280 --> 00:55:49,720
Speaker 5: ourselves on is just this super transparent nature of working

1265
00:55:49,760 --> 00:55:51,560
Speaker 5: with our clients and going all right, Beck, well if

1266
00:55:51,600 --> 00:55:53,680
Speaker 5: that's a goal of yours, Like the amount of times

1267
00:55:53,719 --> 00:55:56,160
Speaker 5: we sit down with people just like you and go, oh,

1268
00:55:56,280 --> 00:55:58,680
Speaker 5: you're not ready. I don't want you to do this

1269
00:55:58,760 --> 00:56:01,040
Speaker 5: yet because you don't have enough of an emergency fund.

1270
00:56:01,200 --> 00:56:03,160
Speaker 5: And that's not me going, oh, you can't afford it, like,

1271
00:56:03,200 --> 00:56:04,799
Speaker 5: it's me going, I actually want you to be in

1272
00:56:04,800 --> 00:56:07,279
Speaker 5: a stronger financial position so this doesn't screw you in

1273
00:56:07,320 --> 00:56:09,560
Speaker 5: the future, yep. Like, And that, to me is one

1274
00:56:09,560 --> 00:56:11,680
Speaker 5: of the hallmarks of a good mortgage broker or a

1275
00:56:11,680 --> 00:56:13,880
Speaker 5: good finance broker, or someone who actually cares.

1276
00:56:14,280 --> 00:56:19,319
Speaker 2: And that's not that common in our industry. Yeah. Sorry, but.

1277
00:56:20,880 --> 00:56:23,080
Speaker 5: All I could do is talk about finance all day.

1278
00:56:23,160 --> 00:56:25,319
Speaker 5: But let's talk about positive and negative gearing. You're going

1279
00:56:25,360 --> 00:56:28,440
Speaker 5: to walk away so educated. So positive is where you

1280
00:56:28,520 --> 00:56:31,640
Speaker 5: borrow money to invest and the income from that investment

1281
00:56:31,760 --> 00:56:33,960
Speaker 5: or that property, for example, like the rent that you

1282
00:56:34,000 --> 00:56:38,400
Speaker 5: get is more than the cost of keeping that investment. Okay,

1283
00:56:38,440 --> 00:56:42,799
Speaker 5: so that sounds sexy. Positive means more than So you

1284
00:56:42,920 --> 00:56:45,879
Speaker 5: might have a mortgage and it is three thousand dollars

1285
00:56:45,920 --> 00:56:47,600
Speaker 5: a month that you pay to the bank, but you're

1286
00:56:47,600 --> 00:56:50,600
Speaker 5: renting it out for four thousand dollars, right, So that

1287
00:56:50,640 --> 00:56:54,080
Speaker 5: means that you're making quote a thousand dollars profit. Sure,

1288
00:56:54,120 --> 00:56:56,240
Speaker 5: you will have to pay tax on that. But positive

1289
00:56:56,239 --> 00:56:58,640
Speaker 5: gearing is essentially where you end up with more money

1290
00:56:58,680 --> 00:57:00,799
Speaker 5: on the table than what it costs you to run

1291
00:57:00,880 --> 00:57:03,719
Speaker 5: that investment. So then obviously we need to take into

1292
00:57:03,760 --> 00:57:06,440
Speaker 5: consideration things like interest and other expenses and you know

1293
00:57:06,800 --> 00:57:09,040
Speaker 5: daily maintenance and you know property fees. But we're just

1294
00:57:09,160 --> 00:57:11,359
Speaker 5: with simplifying this down. It's where you end up with

1295
00:57:11,360 --> 00:57:16,560
Speaker 5: more money. Negative gearing is something that obviously it sounds

1296
00:57:16,640 --> 00:57:18,880
Speaker 5: very sexy and a lot of people want a negatively

1297
00:57:18,920 --> 00:57:21,840
Speaker 5: geared property. And I'll give you an example of why.

1298
00:57:22,640 --> 00:57:22,720
Speaker 1: So.

1299
00:57:22,840 --> 00:57:25,320
Speaker 5: Negative gearing is where you borrow money to invest and

1300
00:57:25,360 --> 00:57:29,040
Speaker 5: the investment income is less than the cost of the investment,

1301
00:57:29,520 --> 00:57:32,520
Speaker 5: so you're out of pocketback. So you might be paying,

1302
00:57:32,640 --> 00:57:35,080
Speaker 5: same example, three thousand dollars a month on a mortgage,

1303
00:57:35,520 --> 00:57:38,480
Speaker 5: but the tenants that you have only paying you two

1304
00:57:38,560 --> 00:57:40,400
Speaker 5: and a half thousand dollars a month, so you have

1305
00:57:40,440 --> 00:57:42,600
Speaker 5: to cough up an additional five hundred bucks.

1306
00:57:42,440 --> 00:57:44,600
Speaker 2: A month for your investment property.

1307
00:57:45,000 --> 00:57:47,040
Speaker 5: And there's a number of reasons why you might do this,

1308
00:57:47,120 --> 00:57:51,760
Speaker 5: and that's why negative gearing is relatively popular and not

1309
00:57:51,840 --> 00:57:53,840
Speaker 5: popular because you go, I don't want to put additional

1310
00:57:53,840 --> 00:57:57,520
Speaker 5: money in. But when you do, investors negatively gear because

1311
00:57:57,520 --> 00:58:01,160
Speaker 5: they can generally claim a tax deduction for investment loss

1312
00:58:01,440 --> 00:58:04,840
Speaker 5: and that kind of brings down their taxable income or

1313
00:58:04,880 --> 00:58:07,440
Speaker 5: helps them in another portion of their life. Right, Like,

1314
00:58:07,480 --> 00:58:10,200
Speaker 5: the aim for that property is that it increases in

1315
00:58:10,320 --> 00:58:13,600
Speaker 5: value so significantly that it will offset the losses that

1316
00:58:13,640 --> 00:58:16,360
Speaker 5: you made in earlier years. So like, as you know,

1317
00:58:16,400 --> 00:58:18,600
Speaker 5: the property market over the world the last thirty or

1318
00:58:18,640 --> 00:58:21,320
Speaker 5: forty years has called gangbusters. And we all know the

1319
00:58:21,360 --> 00:58:24,720
Speaker 5: story of the mediocre, middle aged white man being like

1320
00:58:24,840 --> 00:58:28,320
Speaker 5: I bought my first investment property at the age of twelve,

1321
00:58:28,600 --> 00:58:29,280
Speaker 5: and like you.

1322
00:58:29,200 --> 00:58:29,600
Speaker 2: Know what I mean.

1323
00:58:29,640 --> 00:58:31,440
Speaker 5: They bought it for like twenty thousand dollars and that

1324
00:58:31,520 --> 00:58:33,080
Speaker 5: house is now worth two million or something.

1325
00:58:33,160 --> 00:58:33,680
Speaker 2: Ridiculous.

1326
00:58:34,120 --> 00:58:36,480
Speaker 5: That is why they're doing it, because they might have

1327
00:58:36,520 --> 00:58:38,360
Speaker 5: rented it out and been making quote a loss, but

1328
00:58:38,400 --> 00:58:41,360
Speaker 5: now that property is worth two million dollars, right, so

1329
00:58:41,400 --> 00:58:42,080
Speaker 5: they're in.

1330
00:58:41,960 --> 00:58:44,000
Speaker 2: It for the big bank. Okay.

1331
00:58:44,320 --> 00:58:47,360
Speaker 5: Why I said before that negative gearing is not something

1332
00:58:47,400 --> 00:58:51,400
Speaker 5: that is attractive these days is because properties aren't increasing

1333
00:58:51,480 --> 00:58:54,880
Speaker 5: as much as they used to. Sure, So historically, Beck,

1334
00:58:54,960 --> 00:58:56,560
Speaker 5: let's buy a property in ten years, it will be

1335
00:58:56,600 --> 00:58:59,920
Speaker 5: worth double. That's hot, Like that's where the real value is, right,

1336
00:59:00,000 --> 00:59:02,600
Speaker 5: I mean, ten years will sell that property and we'll

1337
00:59:02,640 --> 00:59:06,320
Speaker 5: have a whole heap of cash money win. But unfortunately,

1338
00:59:06,480 --> 00:59:09,080
Speaker 5: nowadays property doesn't increase in the same way that it

1339
00:59:09,240 --> 00:59:11,560
Speaker 5: used to, and so it's not something that is as

1340
00:59:11,600 --> 00:59:16,240
Speaker 5: attractive to investors. Obviously, in a perfect world, from my perspective,

1341
00:59:16,280 --> 00:59:19,040
Speaker 5: i'd have both. I'd have a property that's positively geared,

1342
00:59:19,040 --> 00:59:21,240
Speaker 5: where my tenants are paying me more than my mortgage,

1343
00:59:21,280 --> 00:59:24,080
Speaker 5: and also the property increases in value significantly. We're not

1344
00:59:24,120 --> 00:59:26,880
Speaker 5: talking about thoughts or feelings on landlords or property ownership

1345
00:59:26,960 --> 00:59:29,040
Speaker 5: or whatever that is right now, that's just us talking

1346
00:59:29,040 --> 00:59:32,520
Speaker 5: about basic economic spec sure, not opinion. But I think

1347
00:59:32,600 --> 00:59:35,280
Speaker 5: it's really important to understand the difference between positive and

1348
00:59:35,320 --> 00:59:38,040
Speaker 5: negative gearing. And that's why if you sat down with

1349
00:59:38,080 --> 00:59:40,040
Speaker 5: me and said, v I've saved house to posit, I

1350
00:59:40,120 --> 00:59:43,160
Speaker 5: really want to buy an investment property, we would extrapolate

1351
00:59:43,200 --> 00:59:43,840
Speaker 5: that all out.

1352
00:59:43,720 --> 00:59:45,280
Speaker 2: And a mortgage broker will do that with you.

1353
00:59:45,480 --> 00:59:47,520
Speaker 5: So they'll sit you down and go, okay, Beck, what's

1354
00:59:47,560 --> 00:59:50,800
Speaker 5: the intention of this purchase and you go for investment? Okay, Well,

1355
00:59:50,840 --> 00:59:51,920
Speaker 5: what do you want to get out of it? Do

1356
00:59:51,920 --> 00:59:54,200
Speaker 5: you want to own this property until you're in your

1357
00:59:54,240 --> 00:59:56,000
Speaker 5: sixties and you're retiring or do you want to own

1358
00:59:56,000 --> 00:59:57,479
Speaker 5: this for like ten twelve years?

1359
00:59:57,480 --> 00:59:58,200
Speaker 2: What's that look like?

1360
00:59:58,560 --> 01:00:01,000
Speaker 5: And you would share that information and we would sit

1361
01:00:01,040 --> 01:00:03,440
Speaker 5: down and work out, all right, well, what does rental

1362
01:00:03,520 --> 01:00:05,960
Speaker 5: yield in that area look like? A rental yield is

1363
01:00:06,040 --> 01:00:08,720
Speaker 5: just basically saying how much will the tenant page week?

1364
01:00:09,040 --> 01:00:10,960
Speaker 5: And so you'd work out, all right, well, the tenant

1365
01:00:10,960 --> 01:00:12,960
Speaker 5: will pay this month each week, and a property in

1366
01:00:12,960 --> 01:00:15,760
Speaker 5: this location costs five hundred thousand dollars to buy, so

1367
01:00:15,920 --> 01:00:17,960
Speaker 5: this is what you'd be paying on your mortgage and

1368
01:00:18,000 --> 01:00:21,160
Speaker 5: what that looks like. And then because it's investment, we

1369
01:00:21,240 --> 01:00:24,360
Speaker 5: might actually look at a few different options. So as

1370
01:00:24,400 --> 01:00:26,640
Speaker 5: you know, beck a lot of properties around you know,

1371
01:00:26,680 --> 01:00:29,000
Speaker 5: five hundred thousand dollars is probably on the low end

1372
01:00:29,120 --> 01:00:32,080
Speaker 5: nowadays of what you can purchase, because the average property

1373
01:00:32,120 --> 01:00:35,040
Speaker 5: price in Melbourne right now is about a million dollars,

1374
01:00:35,040 --> 01:00:37,120
Speaker 5: which is insane. Let's not talk about it too deeply

1375
01:00:37,120 --> 01:00:40,040
Speaker 5: because it will make us very depressed. But let's go

1376
01:00:40,120 --> 01:00:41,960
Speaker 5: with that five hundred thousand dollars example.

1377
01:00:42,040 --> 01:00:43,360
Speaker 2: You might be able to buy.

1378
01:00:43,320 --> 01:00:46,560
Speaker 5: An apartment in Richmond, but you also for five hundred

1379
01:00:46,600 --> 01:00:49,080
Speaker 5: thousand dollars might be able to buy a house in

1380
01:00:49,120 --> 01:00:51,840
Speaker 5: an estate an hour or so out of the city,

1381
01:00:52,400 --> 01:00:56,080
Speaker 5: and both of those are valid options for you, but

1382
01:00:56,160 --> 01:00:58,920
Speaker 5: it will depend on what your expectations of rental yield are.

1383
01:00:58,960 --> 01:01:00,640
Speaker 5: So you might look at it and go, all right, well,

1384
01:01:01,000 --> 01:01:02,880
Speaker 5: the if I spend five hundred thousand dollars on an

1385
01:01:02,920 --> 01:01:05,680
Speaker 5: apartment in Richmond, I might be able to rent it

1386
01:01:05,680 --> 01:01:07,800
Speaker 5: out for four hundred and fifty or five hundred dollars

1387
01:01:07,840 --> 01:01:11,080
Speaker 5: a week. Sure, But if I buy a house in

1388
01:01:11,240 --> 01:01:13,720
Speaker 5: the suburbs, in an estate you know might be new

1389
01:01:13,720 --> 01:01:16,680
Speaker 5: build for five hundred thousand dollars off, the plan might

1390
01:01:16,720 --> 01:01:18,680
Speaker 5: be a relatively small block, and you might be able

1391
01:01:18,720 --> 01:01:20,560
Speaker 5: to rent it out for three hundred and fifty dollars.

1392
01:01:20,840 --> 01:01:22,800
Speaker 5: So you might look at it and go, wow, the

1393
01:01:23,160 --> 01:01:27,160
Speaker 5: properties in Richmond to get more rent That is unequivocally true,

1394
01:01:27,240 --> 01:01:29,640
Speaker 5: because it is closer to the city lifestyle. All of

1395
01:01:29,680 --> 01:01:32,680
Speaker 5: those other things come into play, But that apartment might

1396
01:01:32,720 --> 01:01:34,880
Speaker 5: not increase in value as much as the house will

1397
01:01:34,920 --> 01:01:35,400
Speaker 5: over time.

1398
01:01:35,680 --> 01:01:36,600
Speaker 2: Sure, the house is.

1399
01:01:36,520 --> 01:01:38,800
Speaker 5: More likely to increase in value, but it will depend

1400
01:01:38,840 --> 01:01:40,720
Speaker 5: on when and where and how what the economy is

1401
01:01:40,760 --> 01:01:44,520
Speaker 5: looking like. Because recently those properties they are increasing in value,

1402
01:01:44,560 --> 01:01:48,000
Speaker 5: but not by too much. Sure in comparison to if

1403
01:01:48,040 --> 01:01:50,800
Speaker 5: you had done that exact same thing thirty years ago,

1404
01:01:51,160 --> 01:01:53,680
Speaker 5: guarantee that property would have made a fair bit right.

1405
01:01:54,080 --> 01:01:57,000
Speaker 5: So I think it's important to take into consideration, like

1406
01:01:57,040 --> 01:01:59,600
Speaker 5: what does that mean when it comes to purchasing property,

1407
01:01:59,640 --> 01:02:03,040
Speaker 5: because you might go, be, I don't think that property

1408
01:02:03,040 --> 01:02:05,160
Speaker 5: prices are going to go up that much more, and

1409
01:02:05,200 --> 01:02:08,240
Speaker 5: I can afford, you know, five hundred thousand dollars to

1410
01:02:08,240 --> 01:02:10,760
Speaker 5: buy an apartment, but I've realized that if I pay

1411
01:02:10,840 --> 01:02:13,360
Speaker 5: a little bit more, I can get a better property

1412
01:02:13,400 --> 01:02:15,680
Speaker 5: further out, and I might get more capital gain in

1413
01:02:15,720 --> 01:02:17,960
Speaker 5: the future. And at that point you might look at

1414
01:02:18,000 --> 01:02:20,440
Speaker 5: it and go that means I'll be negatively gared and

1415
01:02:20,480 --> 01:02:22,520
Speaker 5: it will cost me some money to owe, but like,

1416
01:02:22,600 --> 01:02:24,920
Speaker 5: that's a risk I'm willing to take. So there's just

1417
01:02:24,960 --> 01:02:28,200
Speaker 5: a lot to take into consideration. But essentially, positively geared

1418
01:02:28,280 --> 01:02:30,840
Speaker 5: is where you borrow money to invest and the income

1419
01:02:30,840 --> 01:02:33,720
Speaker 5: from the investment is more than the cost to you

1420
01:02:34,000 --> 01:02:36,920
Speaker 5: to keep that property or that asset, and negative is

1421
01:02:36,960 --> 01:02:37,920
Speaker 5: the exact opposite.

1422
01:02:38,000 --> 01:02:38,880
Speaker 2: I love that.

1423
01:02:39,200 --> 01:02:42,280
Speaker 5: Also, to throw another spanner in the work, something called

1424
01:02:42,320 --> 01:02:44,520
Speaker 5: a neutrally geared property, and that's where all of the

1425
01:02:44,600 --> 01:02:45,480
Speaker 5: costs break even.

1426
01:02:45,640 --> 01:02:48,400
Speaker 2: Ah, beautiful, It makes sense, doesn't It does make sense.

1427
01:02:48,440 --> 01:02:50,320
Speaker 2: The math is mathing. I think this is a really

1428
01:02:50,320 --> 01:02:51,120
Speaker 2: good place to leave it.

1429
01:02:52,320 --> 01:02:57,000
Speaker 5: Else No, but I am so done. I cannot fathom

1430
01:02:57,440 --> 01:03:00,000
Speaker 5: how we would make an investor's Guide to tax time.

1431
01:03:00,040 --> 01:03:01,800
Speaker 5: I'm more sexy. So we're just going to drop it

1432
01:03:01,800 --> 01:03:03,200
Speaker 5: here and hope that you guys enjoyed it.

1433
01:03:03,520 --> 01:03:05,840
Speaker 2: Awesome, That sounds great. Have a good week, guys.

1434
01:03:05,960 --> 01:03:10,440
Speaker 3: We will see you on Friday for you then bye.

1435
01:03:14,360 --> 01:03:16,920
Speaker 3: The advice shared on She's on the Money is general

1436
01:03:16,960 --> 01:03:20,800
Speaker 3: in nature and does not consider your individual circumstances. She's

1437
01:03:20,880 --> 01:03:24,320
Speaker 3: on the Money exists purely for educational purposes and should

1438
01:03:24,360 --> 01:03:27,520
Speaker 3: not be relied upon to make an investment or financial decision.

1439
01:03:27,920 --> 01:03:30,160
Speaker 2: If you do choose to buy a financial.

1440
01:03:29,720 --> 01:03:33,720
Speaker 3: Product, read the PDS TMD and obtain appropriate financial.

1441
01:03:33,280 --> 01:03:35,080
Speaker 2: Advice tailored towards your needs.

1442
01:03:35,440 --> 01:03:39,400
Speaker 3: Victoria Divine and She's on the Money are authorized representatives

1443
01:03:39,440 --> 01:03:43,480
Speaker 3: of Money. Sheirper Pty Ltd ABN three two one six

1444
01:03:43,640 --> 01:03:47,440
Speaker 3: four nine two seven seven zero eight AFSL four five

1445
01:03:47,600 --> 01:04:02,080
Speaker 3: one two eight nine