As a young defence member who wants to use a property asset class to start securing your financial future now, this might be a bit of a look into the future for you.
If you're an ADF member, you have been for the last six and half years, and say you're on $73,000 a year, you don't have any kids, and your renting for $225 a week in RA or DHA. If you've got like $34-35,000 of savings in the bank you can commit yourself to the five year savings trap or you can do something a little bit smarter and start to create wealth for your life the modern way.
Here's how it all works. So if you come to me and say "Hey Robbie I want to buy "this brand new investment property, land and build, high growth area can you help me?" I'll be like "No deal. You don't have a deposit and costs." You then say to me "hey Mum's house in Sydney is worth about $1M." I'll be like "Right, now we're in the game."
Now we're playing the game properly. Did you know that you can use that security of Mum's property in Sydney there? Say you're going in at 20% deposit from Mum's property.
Here's some rules of the road though. You are responsible for 100% of the lending. The equity in your mum's place is used for security and deposit and costs purposes only. Your Mum's home and your new investment property are not cross-securitised. You should consider repaying your mum once that property has gone up in value. Here's how that works. So fast forward a couple years. You've got equity in that property now. You either repay mum or she's like "hey you know what, what was written on the box is actually happening. I can see that you are using property to create wealth in your life. Go ahead and buy your second property." That's how to secure your financial future the modern way and you don't have to commit to the five year savings trap.