Australian property investors come in all shapes and sizes. Some are professional investors who have been around the block a number of times. Others are retirees, looking for a source of passive income to rely on in order to fund their golden years. Many are ordinary households - families - working in all manner of different occupations, using their investment properties to boost their financial status.
The different careers Australians take on have a significant impact on their capacity to invest, and their ultimate strategy. One of the occupations which DPN frequently deals with is that of medical professionals, who have a number of unique considerations when it comes to building a property portfolio.
The problem
There's no way two was around it: Medical professionals end up in a higher tax bracket than the average Australian. According to a 2012 survey conducted by the Australian Bureau of Statistics (ABS), male doctors earned an average of $3,015.60 a week, while female doctors earned an average of $2,644.10 a week.
Of course, this is just an average. Depending on the individual's experience, type of work, position of responsibility and the number of hours they work, they could end up making significantly more than this. No matter which way you cut it, however, medical professionals end up paying a higher marginal tax.
The dilemma here is that even medical professionals will retire someday - and when that day comes, they need to have enough put away to fund their lifestyle. It can be hard when it seems so much of your salary is being siphoned off for tax purposes. But a smart property investment plan can help ensure retirement savings end up being more than adequate.
Being an investor without the sufficient time to properly take care of your investments can be tough, however. Medical professionals are known for being time-poor, at times working extremely long shifts - the same ABS survey found one-quarter of male specialists and 12 per cent of female specialists worked 60 hours or more a week.
The solution
Individuals in this position need to be able to build an investment portfolio, which will include property. Investment real estate can not only generate a passive income for added savings, but the capital growth can be taken advantage of to create a substantial nest egg.
At the same time, they'll want to be able to reduce their tax burden. This can be as simple as putting the right financial structure and loans in place to minimise their tax bill and maximise returns.
This is no pie-in-the-sky fantasy. Just take the case of Dr Nguyen, one of DPN's medical professional clients. Having paid off his home loan and saved up a substantial amount both in super and out of it, he knew he was doing well. But he was still paying more than $300,000 in tax per year, and knew he could be doing better.
He came to DPN with the aim of reducing his tax, setting up a self-managed super fund (SMSF), finding a company to do the research for him and building a $7.8 million property portfolio. Years later, he's on track to retire by age 55 on an income of $6,000 a week, and he's built a $4.2 million portfolio of 8 properties.
Selecting and managing the right investment services company
In order to choose a property that is most likely to get you the financial boost you need, you must use a proven selection methodology. This means looking at the major cities, finding areas set for growth, as well as discovering affordable properties with a land component.
But it is more than just about finding the right property. You also need the right strategy, the right financial structure and loan, and the time to manage the entire process from purchase to handover - as well as regularly review your property's performance at least once a year.
For that, you need a professional and experienced property investment services company to guide you through the process and save you time - particularly if you're in a time-intensive career like medicine. Look for a company that:
- Is established and has the appropriate certifications
- Is interested in your unique situation, rather than simply pushing a product
- Understands your time is important, and will therefore minimise paperwork, be able to get in touch with you in the hours it suits you, and do the difficult legwork for you
- Shares the risk by offering guarantees on rental yield, fixed price, build times on new dwellings and more
You'll also want a company that is experienced in helping healthcare professionals, and can provide additional benefits, including:
- Reducing lending rates on home loans
- Loans of up to 90 per cent with no lenders mortgage insurance
- Free trading and asset structure review by certified accountants
- Risk and review analysis
- Bonus legal fee rebates
- Subsidised SMSF set-up
By contrast, be wary of companies that offer information only with large up-front fees, as well as those that can only work with you on their time and not when you're available. Also avoid those that offer little or no after-sales service.
As a medical professional, it feels like you'll never have time to get started on your goals. But the sooner your start, the more time you'll have to increase your capital growth and wealth for the future. There's no time like the present, so contact DPN today.
