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Starting young

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GeniusPat | 25 Jan 2015, 04:56 AM Agree 0
I'm 18 years old and would like to start investing at an early age. To be honest it's very hard to land a job and save money for a mortgage deposit. Any help on how to get my head around the basics?
  • Snoopy | 13 Feb 2015, 07:07 PM Agree 1
    Ask people who have already purchased properties for investment and get some education from asking around.
    Read property investment magazines, learn how negative gearing works, but at your age, obviously finance will be a stumbling block.
    Finance companies want to see regular income that can cover costs. If you start renting and pay a reasonable rent steadily for a while, if you have a credit card (with not too high a limit!) that is always paid off and not over used, all these things go in your favour. It's called "good credit history" :)

    Whatever you do, DON'T get caught up with free courses that promise to educate you, help you to buy a property on no deposit, etc, etc. and make you a millionaire. They are all selling a business and if you can't save for a deposit, then you cannot afford them!

    There are lots of books you can buy (or borrow from the library) on the process of buying a property.

    Keep searching - you are on the right track already with your intentions - so don't give up on your hopes.
  • Divorced | 16 Feb 2015, 04:08 PM Agree 0
    What Snoopy has touched on is absolutely correct. Buying a course for 4-5k is just wasting your money. Right now you need to just save for a deposit mate, that is the number one thing you need to focus on, in addition to having a credit card with a low limit ($1000) so you don't reduce your borrowing capacity. Make sure you pay your bills on time and when buying a place, start small.

    Don't buy a property that's a serviced apartment or under 50 square metres as your capital growth sucks. Try and go for 1 bedder apartment at least. Good luck!
  • ElisaT | 23 Feb 2015, 03:51 PM Agree 0
    And of course going onto forum sites like this help to!

    One of the things that we recommend is to set up an automatic payment into a savings account of 10 or 20% of your weekly wage, then don't touch it. This combined with the excellent advice given above shows good savings ability as well as good credit history.

    Realistically if you do this for 12 months (with a stable employment and residential record) your age won't be too much of an issue with the majority of lenders.

    Best of luck!

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