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The flip side of this is that: 1. As long as your LVR isn’t too high your interest payments on a home loan will probably come in well below what renting an equ
by jeeeb 5y ago
The flip side of this is that:
1. As long as your LVR isn’t too high your interest payments on a home loan will probably come in well below what renting an equivalent house would cost. Further rent will generally rise over time with inflation, whereas your interest will decrease to zero over time as you pay down the loan.
2. If you’ve got a home loan with a 100% offset account (very, very common in Australia) then a credit card makes financial sense. I purchase everything on credit and pay the full balance each month. I pay no interest, earn points and this maximises the amount of money in my offset account at any one time.
3. Depending on your usage and tax situation a noveated lease (car lease) can make good financial sense.
- nl 5y agoThese are all entirely correct. The thing worth pointing out that explains how both this, and the person you are replying to are correct is that in Australia we haven't had an unemployment crises since the 1990s. If you have never seen unemployment, and can't imagine not having a job then arranging your affairs for tax efficiency makes perfect sense, even if it means you are carrying more debt.