Retirement planning help and investing $50K
June 11, 2008 by Josie Kay · 4 Comments
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Q. My Husband and I need help with “financial planning for retirement“. We are both over 50 and We’ve sold our home & have $50,000 leftover. We have a $250,00 new mortgage with $30,000 in offset accountant.
We’re currently spending offset money on improving our house to use for selling when retire. We have no superannuation (self employed).
We have no great aspirations when retire, family around just want to live & pay bills no liabilities except mortgage & business vehicle.
How can we use $50,000 wisely now. My Husband is able to do all renovations to home himself…..current value of home approx $500,000. thanks
Josie’s Answer: Assuming I am interpreting your question right, your main question is that you have $50,000 sitting in a savings account. On top of this, you have $30,000 in an offset account which effectively means you are paying interest on $220,000, rather than $250,000.
My initial thoughts include:
- Why haven’t you topped up the offset account by $50,000? If you do this, your bank will be charging interest on $180,000 ($250K - $30K - $50K). I particularly like this strategy because the interest on the home that you are living in is not tax deductible. Also, you are paying in ‘after tax dollars’, i.e. your net pay.
- If you invest the $50K you need to think about your time frame and what you have to do with the funds e.g. term deposit, managed funds. Investment markets are Read more
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