Ask Noel

WE ARE finding it hard to find a financial adviser to get some advice from. We have a very large mortgage of $470,000 with no other assets. We have a 60 per cent fixed mortgage at 5.99 per cent for another 18 months. We are coming to the realisation that we will not be able to pay the monthly mortgage payments when the fixed rate is gone (we are struggling now). Should we cut our losses, sell the property, rent and invest the money we have made, or sell and buy something more affordable. We are both 29, with a combined income of $110,000 a year.

I think you need a financial counsellor more than a financial adviser. It would be very sad for you to lose your house at a time when the market is down and you could be severely out of pocket if you sold on a down market and then had to buy back when it was much higher. You should look at all your expenses and try to cut out anything that is not essential. As a last resort consider moving and renting the property out the tax deductibility would reduce the effect of the mortgage payments and you could be absent for six years without losing the Capital Gains Tax exemption.

I'm 61, still working full time, and want to access my super to pay off my home mortgage, is it possible?

Now that you have reached 60 you can access your super by resigning from a job. It need not be your main job. If this is not possible, take advice about starting a transition-to-retirement pension the income stream from this would enable you to boost your loan repayments.

I am in my 20s, have a good job, am well paid and have accumulated about $30,000 in savings. I feel like the money is being wasted in my savings account and that I can use it for something more productive. However, I am reluctant to do anything too risky. I would be devastated if my very first nest egg, that I have worked so hard for, disappears into the well of a bad investment. What is a relatively secure investment option?

You have done well to date but you need to understand that cash can be unsatisfactory as a long term investment because there is no possibility of growth or tax benefits. Your best strategy will depend on what you want the money to do. For example, if you intend to buy a house in the next few years it is fine where it is but if you are prepared to take a seven to 10-year view, you could take advice about investing it in shares or managed funds.

Noel Whittaker AM is a co-founder of Whittaker Macnaught. Advice is general and readers should seek their own professional advice.

Contact

noel.whittaker@whittaker macnaught.com.au.

Questions to: Ask Noel, Money, GPO Box 2571, Qld, 4000, or see moneymanager.com.au/ask-an-expert.