One of the most common reasons I hear as to why someone hasn’t invested is that they have instead opted to pay down their home loan. If retirement or creating a legacy is a priority, then paying down your home loan as quickly as possible will most likely not be the optimal strategy to help you achieve either of these. That is, while home loan debt reduction is certainly something that needs to occur before retirement, the return on investment is limited to the home loan interest rate.
Typically, as long as the family home is paid off by retirement (whatever age that may be), excess cash flow can be channelled elsewhere. then it is important to consider streaming money toward creating other income streams for long term wealth creation. The earlier that an asset can be acquired, the greater the opportunity it has to grow whether it be property, shares, managed investments or extra contributions toward super.
Investing can quite often be nerve-wracking, and there are many things that need to be considered before committing to a strategy. To understand more about the importance of investing, give us a call on 13000 ACTON.