Advice Needed - What to Do with Our Money?

I'm 31, married & this year we're going to be hitting a major milestone in our lives. Our mortgage should be paid off on our home(valued at approx 800k.
What should we do with our money moving forward?

Considerations are the standard, shares and/or property.
Property - We had an investment property years ago, but there's just stress and additional expenses associated with it. With the housing market the way it is today with a potential oversupply and significant capital growth highly unlikely over the mid term, we're keeping this as a plan B.
Shares - volatile, as always. Will probably invest some to spread the risk.

Before anyone goes and makes any unneccessary comments, I'll explain our situation.

Straight out of uni I got a f/t job at 21. My manager sat me down and asked what I wanted to achieve. I responded and said I wanted to buy a 300k house(just before the huge boom) and have it paid off by the time I was 30. B*tch laughed in my face. I took that throughout the years as my motivation. Bought a unit at 23, paid most of it off then rented it out for a couple years. Then bought a house at 25 that should be paid off this yr. My wife and I got married last year and also travelled the world for 5 months, which was a very expensive year(cost about $130k) for us.

We believe we've gotten to where we are because:

  • we work hard(standard hours) but have been promoted several times
  • we don't live outside our means(we weren't buying LV bags when we were earning 50k a year)
  • we have a good savings strategy
  • we didn't receive 1 single handout from anyone to get to where we are
  • we use ozbargain

Any advice would be great.
Thank you

Comments

  • Congratulations! Obviously you've been very good savers. Can you share your strategy?

    It seems that you will have 100% of your assets held in real property, and you're young, so you should be looking at higher yielding/more volatile in short term investments. Perhaps shares.

    What are you doing about superannuation?

    Have you considered looking at a fee-for-service financial planner (not ones that receive trailing commissions, as they are more likely to recommend solutions which pay them more money)?

    • +4

      Thanks!
      I think everyone's capable of getting somewhere in life without the financial stresses in life, regardless of how much you earn.
      Some tips:
      - If you live within your means and be happy with what you have in live, you should consider yourself rich.
      - Get ahead of your debt. Don't just think about the minimum
      - Stay away from the traps of trying to impress others.
      - Get out and see the world. Change your perspective in life by seeing how others value the things you take for granted.
      - Just because you can buy it, doesn't mean you can afford it.

      Especially with how housing is today, almost all our friends have taken on huge mortgages, with little income and a hugely diminished quality of life. Im sure everyone can relate to the seemingly repetitive week just to make minimum repayments. Sleep, work, eat repeat x5. Hate to say it, but that's not what life should bet. That's slavery.

      Will definitely be investing in blue chip shares.
      Thanks for the advice.

  • Very well done. It seems you already have the right strategy and attitude.
    And you managed to get there without depriving yourself of life's pleasures. Wow $130k for a 5 months around the world travel!!!
    "What to Do with Our Money?"
    It is not a problem with an easy answer.
    But it is a nice problem to have. Much better than the opposite…what to do when you do not have enough money?
    Investment property is a sort of safe bet, but you will have to deal with tenants and that could be unpleasant.
    Shares is a lot more risky. Even the blue chips are not so "blue" anymore. Take a look at Woolworths, BHP or the banks!
    A good strategy could be keep upgrading your house to the best you can afford and in the best area possible. That way you will have an appreciating asset, no tax on it because your home is capital gain tax free when you decide to sell and you will be able to live in a very nice house in a very nice area.

  • Go with a balanced portfolio regardless on what kind of investment that you do. Be sure to factor in your risk tolerance as a couple.

    The least thing you want is to get stressed financially which to me is the complete opposite on why you are investing :)

  • Invest it in The Bank of Dasher.
    If not put it all on black.

  • +2

    Firstly, congratulate yourself on a job bloody well done. You've hit a goal and you'll have plenty of people envious.

    Secondly, keep paying off the mortgage - whatever you are already paying, keep paying it once you're done into the next investment - whether that's shares, savings, other properties, buying into a business or snake oil - just keep going. You don't miss the money if you're used to not having it already so don't let the momentum go.

    Third, the idea of diversification is good. Get off Ozbargain and talk to a financial planner. Yes, it will cost you a bit to get the advice prepared, but they'll actually look at your risk appetite and future goals and provide a strategy that considers everything including tax. The most expensive advice you can get is often free.

    (Failing that, I'm with dasher86… all on black!)

  • Always great to read a story like this instead of the usual woe is me stories from the whinging, shiftless layabouts.

    Obviously your wife is one of those rare breeds that can manage without 200 pairs of shoes with matching handbags.

    I have a friend who is always complaining about money. Have given up telling her to stop buying lunch, coffees etc, every day and pay the money down on her mortgage, and alleviate her stress. She earns a good wage, just wastes money like it's going out of fashion, and is envious of me, because I own my house, and manage to travel, even though I am on the pension with a little bit of super. I don't live like a hermit, but I don't waste money either. Sadly I don't own any Eneloops though.

    • +1

      Yes I am lucky my wife doesn't have 200 pairs of shoes, but she does have quite a few. Luckily she buys them because she thinks it looks good not because it's branded to show off.
      It is very frustrating to hear and talk to people always complaining about money, yet they are the only ones in control of their choices. I do strongly believe that there's not enough done to educate people coming out of school regarding money. Unfortunately it sets up a lifetime of bad habits.
      Good to hear you're definitely one who just 'gets it', and great work on the house and travel!
      I am always seeing these eneloops on OB, but never looked into it. So I don't have any either. Whatever they are. Haha

  • Assuming you don't go with the typical advice of indexes etc, perhaps you can look into some form of REIT's? I wouldn't directly hold investment properties either with all the headache's and time involved. A publicly listed alternative sounds more appealing

  • +1

    Sell your house and I estimate you and your wife can go for a 3 year holiday

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