Some might wonder if planning for your retirement at the young age of 22 is a bit absurd. For Stephanie, it was a no-brainer. But how will she go about it?
“I have wanted to fund my own future since data came out from the Australian Bureau of Statistics around the year 2010, saying that about 90 per cent of people retire on less than $25,000 a year. I thought that was a really scary thought, and that’s a sad position that I never want to be in.
When it comes to having a goal for my portfolio, I would really like to build to 22 properties, to mark the age that I first started investing. That would also give me the cash that I needed to invest in other people’s start-ups, which is something I’m really passionate about.
I also want to have a particular amount invested in a share portfolio, and then cash at bank. I think it’s really important to maintain liquidity, whereas property isn’t that liquid. I think it’s great because it’s tangible, and it’s got the capital growth. But a share portfolio is really good for the liquidity aspect.
It’s harder to invest in shares than property, simply because there’s a lot of knowledge that you need to have. It’s also harder to get enough of a sum to provide a good enough fortune without taking debt against the share portfolio, which I think is high risk because if you ever get a margin call, you’re going to be in trouble.
It’s been easier to build the property portfolio first, and then my next step is to build the shares that I do have to a certain level and also build on the cash at bank. I’ve got the liquidity that I need.
To get deposits for my property acquisitions, part of it is cash that I use, but I try to always put that in an offset account because I prefer to have control over my money than to give it to a vendor. I feel it provides me with more options.
Usually I secure against the equity and then I keep borrowing off that, because I’ve bought in areas that have had a huge amount of growth. Like Manly Vale, for example – I bought a property for $386,000 and it’s now worth over $600,000, and that’s all equity. I also have income from my work, and then income from the properties.
When it comes to having financial freedom, I still don’t think I’d ever stop working because there are so many things that I want to do. I just think it’s nice to have that option.
I’m really heavily involved with Lifeline. Lifeline is an organisation that helps people in many different ways, whether it’s getting youth off the street, budgeting issues, suicide, domestic violence – they’ve got a lot of areas that they try and help people with. They’ve got a phone centre where people can get counselling.
I’d love to donate more of my time and money to be able to make sure that every single call they receive is answered because at this stage, only about 80 per cent of calls are answered.
That’s sort of a personal passion of mine based on a friend who took her life; that’s why I’m really keen on supporting them.
If I have the money and resources then why not help other people?”