If you’ve been with us a while, you have heard us say this before, but right now, today, it is worth repeating;
“When markets are booming, people think they’ll boom forever. And when markets are slumping, people think they’ll slump forever.”
Neither is true of course as history proves over and over.
Right now, we are in the euphoria stage. What we are seeing every day in the market is more than a ‘boom’…It’s mania out there. There are multitude reasons for this as we know, but one constant we keep hearing:
“’This time it’s different.”
Those words…Prevalent in any boom, are some of the most dangerous words an investor can ever mutter, or believe.
These words are rationalisation. And rationalisation is one of the signs of denial.
Denial of what? The inevitable outcome of all of this, which is that one day, sooner or later, the music WILL stop.
The difference between us, and many commentators out...
Not Knowing which expenses are deductible and how to maximise them
Disclaimer: Nothing is this article is meant to constitute financial advice of any kind, and is the opinion of the author only. Seek professional advice before making any financial decision.
The tax rules around deductibility of expenses for rental investments can be quite gnarly and you do need to have a good knowledge of the tax legislation to make accurate assessments on these.
Making a mistake in this area can be costly and may cause you to upset your long-term holding strategy. Some expenditure can become “black hole expenditure” where it is neither deductible nor depreciable, which is definitely not the outcome that you want.
When you are calculating your rental investment profit/loss and cashflow needs, there are normal rental expenses that can be claimed such as described by Phil in his chapter on positive cashflow. However, some items affect...