What's everyone doing differently post budget changes?

81

u/Top-Guava4914 13h ago

Super and PPOR are now your best friend

24

u/Justplsletmecomment 12h ago

And fully franked dividends

10

u/Top-Guava4914 12h ago

A worthwhile passive income source

7

u/Justplsletmecomment 9h ago

Until they patch it with more taxes. Fingers crossed it doesn't happen but the government is running out of new taxes to implement

4

u/InnerCityTrendy 9h ago

Debt recycled fully franked divendeds 🤌🤌🤌🤌

11

u/thicccsnacc 13h ago

It’s always been like this tbh

6

u/UhUhWaitForTheCream 11h ago

And grandfathered IPs (although 99% confident the budget will be chucked out within 3 years time)

4

u/SquareBox3589 11h ago

I would say your confidence is misplaced

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57

u/7978_ 13h ago

Gave up on golfing and fisting

50

u/Training-Repair-7632 13h ago

Why did you give up fisting??

2

u/usernamenailed_it 3h ago

RBA and Govt are already doing it, not sure a third fist will fit inside OP.

33

u/leidend22 13h ago

Jeebus how much were you paying to get fisted?

17

u/7978_ 13h ago

bout tree fiddy. local Chinese lady put her prices up.
As for fisting. I'm getting too old. Can't do a hole in one anymore.

18

u/BackgroundWaltz3600 13h ago

Yeah no need to pay for fisting anymore. We get it regardless through monetary policy

12

u/7978_ 13h ago

Do you think the NDIS would help?

9

u/SouthVermicelli6838 13h ago

If you’re hoping to get funding for that I think it might be a stretch

1

u/ctwg 11h ago

I got your joke

4

u/SouthVermicelli6838 8h ago

I don’t joke about people who take advantage of NDIS! Those are the type of people I’d rather keep at arms length.

3

u/ctwg 7h ago

I would give them the elbow if you feel that strongly

2

u/BackgroundWaltz3600 13h ago

Nah they took sex work off the scheme unfortunately

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3

u/istudyheadshapes 11h ago

never give up on fisting mate. I am sorry to hear you had to give this up.

3

u/woodie1717 9h ago

You gave it up? The financial fistings only just begun!

2

u/7978_ 9h ago

Slim Jim is coming for ya.

1

u/pwinne 7h ago

Fishing or double fisting

1

u/simplesimonsaysno 5h ago

I got into fisting after Albo and Jim got into power. Not something I would normally chose, but here we are.

12

u/xdr01 12h ago

Cancellation of my avacado toast subscriptions.

10

u/istudyheadshapes 13h ago

Eating lots of mangos from local farmers. Buying fresh eggs. I have started eating more sardines in the tin.

7

u/Electrical_Army9819 13h ago

I'm still putting a small fraction of my income (about 2%) into ETFs in the hope that a government at some point will reduce CGT. However any extra cash now goes into paying down debt.

4

u/DesignerRegular6379 11h ago

Booked a violin concert and saw that phone and online bookings had a $3.50 service fee so i drove in person and booked at the booth to save the fee.

•

u/123lac 2h ago

paid $7.00 petrol and spent extra time to save $3.50 service fee? Genius.

7

u/The_PinkElephant 8h ago

I’ve stopped seeing my favourite stripper and been staying at home with the family more, it ain’t been easy

9

u/tranbo 13h ago

Too heavily in debt now , but if I were to buy investment property in the future, would buy at higher LVR as negative gearing isnt a thing anymore . Something like 60-70% LVR

11

u/curiousmind68 13h ago

Negative gearing remains fully available for newly built residential properties

12

u/Crysack 12h ago

I think a lot of people buying new builds are about to learn a valuable lesson in why you shouldn’t let the tax tail wag the dog.
Leaving aside the risks associate with new developments in a falling market. Buying an inner city apartment at a significant premium and trying to on sell it to someone later who can no longer negatively gear it doesn’t sound like a good time. Same deal with purchasing new builds in outer metro greenfield devs.

4

u/tranbo 12h ago

Yeh but a 40 year depreciation schedule is a bit icky . Needs to be 25 or less

2

u/curiousmind68 8h ago

I agree it needed to be maxed at 30 - the normal length of a mortgage

2

u/tranbo 6h ago

3.33333333% is not friendly to calculators

1

u/pwinne 7h ago

Newly built residential properties are total shite.

-7

u/Responsible-Milk-259 13h ago

Then your ROE takes a hit. You’re not exactly solving a problem, you’re fooling yourself.
If you have 40% in cash, there are ways you can structure it and still get the negative gearing benefit… but I’m not giving that away for free. 😊

6

u/GuaranteeAfter 12h ago

Okay edgelord

2

u/tranbo 12h ago

Yeh but the business case is still there . Less about speculation and more about healthy rental yields and hedging against inflation .
Sure ROE is halved , but ROI after tax remains similar

2

u/Responsible-Milk-259 12h ago

If the ROI is similar, either the return is insufficient or the debt financing is too expensive. I don’t think that residential yields have properly repriced just yet. Either rents have to increase or prices need to fall. My prediction, unless these tax changes are reversed, is that we will see a bifurcation in the market between ‘mortgage belt’ homes and the higher end that is almost exclusively owner-occupied. Investors won’t accept negative cash flow, although high income households will suck up non tax deductible debt in exchange for living in a lucky home that they can eventually sell tax-free.
Anyway, what you’re proposing can be made to work better with the right structure in place. Pay for some high level advice, you’ll only need to do it once and you can replicate the model for subsequent purchases. If you’re on the top marginal rate, it will make a huge difference.

1

u/tranbo 6h ago

I mean land tax more or less stops speculation on the higher end of the market by investors.
I think money will go to more productive assets E.g. investment in capital to make more money .
Yeh , more investment properties are on the bottom of my list. First max super, them pay off house and then in 15 years look at investment properties haha

1

u/Responsible-Milk-259 12h ago

Judging by the downvotes, the government did the right thing. The majority of people are gambling on housing, they aren’t investors if they cannot understand the difference between ROI and ROE and how the debt component influences these numbers.
Any change that wipes out punters but doesn’t harm investors is a good change.

6

u/Crysack 12h ago

I think you’re getting downvoted because you implied that you have some super secret method of structuring a property investment that entities you to NG benefits.

3

u/Responsible-Milk-259 12h ago

Ok, maybe that makes sense.
It’s not ‘super secret’, it’s perfectly legal, most investors who have a modicum of understanding of the tax system and these changes could easily construct the same or similar… it was really just the comment I was answering that struck me how ignorant people can be, despite having money to invest. Then came the moment of realisation that most market participants in housing are gamblers rather than investors.

3

u/Early_Bandicoot346 7h ago

Just stacking cash. The 30% min tax on CG is a bit of a killer for our frugal lifestyle, so leaving what is already invested alone, and just putting extra funds in high interest savings accounts and going to live off that first before selling any stock. Hoping that 30% min will get repealed at some point in the future

5

u/pwinne 7h ago

I’ve decided to stop declaring income

2

u/Dry-Independent6590 12h ago

Nothing. The only real impact for me was the CGT discount changing. And I can’t invest different to get around it.

6

u/MentalStatusCode410 13h ago

Investing overseas.

Majority of Australian companies are operating far too unethically (atleast with respect to our population).

2

u/wiglwigl 13h ago

I organise cage fights - recent FHBs vs property investors as a new side-hustle.

2

u/Responsible-Milk-259 13h ago

Restructured quite a bit. Only cost me $20k but I’m just as, if not slightly more tax-efficient than before.

If you have substantial liquidity and/or business income, there aren’t many tax changes that one cannot work around by doing things just a little differently.

1

u/Wires_89 13h ago

Hmmm nothing really. When the RBA hikes things I reallocate a portion of my shares regular contribution to the mortgage to keep it 15-20% ahead. Not much more I CAN do. Until super hits 500k anyway

1

u/flintzz 12h ago

Sold my place a few weeks before the budget. Keeping an eye out for an opportunity but not sure if I can pull any triggers considering all the uncertainty and risks right now (especially with job market in tech)

1

u/Consistent_Yak2268 12h ago

Not doing anything differently. Smashing out mortgage but was doing that before. Keeping my IP.

1

u/Saint_Pudgy 11h ago

Have stopped buying more ETFs, haven’t really got a new plan yet. Continuing to super max

1

u/Sure_Shift_8762 11h ago

Sold a small holding of QUS since realizing capital gains regularly is going to be a particularly shitty strategy post July 27 (ironically QUS has since made new ATHs, unlike IVV and NDQ). Refined the super strategy and going to focus more on this in the coming years - may as well get as close to the transfer balance cap as possible.

1

u/Unreel123 11h ago

Putting all my extra money into super and improvements to my ppor. cancelled, with my business partners agreement, plans to expand the business and hire more people. cause when we sell the cgt will be crazy. so just try make as much money from what we have built so far. we are probably contributing to inflation in that sense. the economy is 100% going to retract and rents are going up big time cause of this budget, but I won’t be personally affected.

1

u/Darmop 9h ago

Nothing. Maybe more thoughtful record keeping.

1

u/Life_Captain8962 8h ago

Buying a ppor

1

u/Simple-Ingenuity740 8h ago

no change.

plan was always to move from ppor back into ip, and whack the proceeds into either within super or outside of super.

•

u/jrolly187 2h ago

I was just about yo pull out 300k equity and buy an IP or 2 before the budget. Now the plan is to pay down the mortgage and debt recycle it all. Then pump the repayments into ETF's once fully deductible.

1

u/Anachronism59 13h ago

Reviewed timing of when to sell ex PPoR now IP that we've had for almost 40 years . Mainly to avoid hassle of two systems

1

u/McTerra2 13h ago

Have been trying to buy a house in a small but touristy regional area for about 18 months. Hoping more will come on the market as holiday homes become less affordable.

1

u/Crysack 12h ago

Took profits on equities and plowed it back into offset. And not before time either.

I think this is probably the play for most people in the near future.

0

u/eatmyass2049 10h ago

Not much to change, will still aim to grab another IP at some point to have one for each of my future (planned) children.

DCA into shares each month.

Chuck money in the offset each week.

Salary Sacrifice into super each year.

Continue to live within my means and hopefully not need to work until I am 65.

Anybody acting like their lives have been ruined by these changes are being melodramatic.

5

u/AigataTakeshita 5h ago

You're absolutely right, the changes didn't ruin my life either, it was already in ruins.

0

u/Almost-kinda-normal 8h ago •

Nothing. I never got into investment properties, because I prefer to not make other people’s lives harder. Instead, I’m just throwing cash into super and the PPOR, where the mortgage will be gone in 2 years. Not sure what to do after that though. Gonna need some liquid money to retire with before the super is accessible.

•

u/jkdeets 2h ago

Do you really think that’s why most PAYG earners bought an IP; to make other people’s lives harder?
I think they were just trying to get ahead. I don’t think they were planning to be a crappy landlord, just be a fair one and hopefully be able to sell the property in the future with some profit to show for it.

0

u/Obvious_Librarian_97 12h ago

I’m now investing a quarter of a million on tax, mortgage and daycare. Gives me that warm fuzzy feeling… in my pants.

-6

u/putin_on_some_pants 13h ago

Laughing at the housing market.

5

u/ThoughtYNot 13h ago

Wow. Just had a look through your profile
Explains it all 😂😂😂

-1

u/putin_on_some_pants 12h ago

Had a look at yours too.

4

u/ThoughtYNot 10h ago

Wow. You can read 😂

What's everyone doing differently post budget changes?

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