925 husband wants her to quit, $7m inheritance & feeling broke on $375k
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What is the main topic discussed in this episode?
Today on the show, we're talking, and I'm with John Pigeon from the This Is Property show. These questions today, it seems to me it's like this collision of... life and money. And what do I do? And there's, I just think it's, you know, there's a couple here about, we've got high income earners, high mortgages that basically feel broke. We've got people here that trying to work out what they want to do with their business.
What should I consider if my husband wants me to quit my job to help his business?
We've got a mid-40s with a partner and a house paid off with some inheritance coming. We've got someone far out. This is the property hour. There's another one here, someone in their 20s that owns their house outright. Huge. And I think before we do get into these type of questions, everyone needs to know that money is relative to your situation. Like how many people, like the one that we talk about soon, it's like they're on incomes that people would dream of, like near 400K household income, but they're like, we've got no money. It's this frog in the pot.
It's in perspective, isn't it? Boiling.
And that's no different than someone living here out of a capital city earning β 130 grand a year household income and still relatively feel too tight. It's just fascinating.
Can't make this stuff up, Glenn.
No. That's why we go to you in the Facebook group. All right, let's read this first one. just mulling over some ideas. My husband has a small business and has been struggling with over 500K worth of debt. He has put it to me to quit my work and be a stay-at-home mum so he can fully concentrate on the business. At the moment, I'm in a job with pay that we need to survive and I love my job. We also have an 800K plus mortgage that I have ill feelings towards as it's a massive debt. We are on 10 acres with an okay size house in a semi-rural area in Western Sydney. I've been thinking about the option of selling our place to downsize and eventually repurchasing with the capital growth or gains, the CG. We would have roughly 700K left over once our current mortgage is paid.
I would ideally like a mortgage of less than 500K so we can pay it down quicker and be closer to our FI, financial independence, I guess. High fidelity, I-F-I, closer to our fidelity.
Financial independence.
Financial fidelity. Selling would lessen the pressure off my husband and reduce mortgage repayment so I could continue working. What would you do? Man, there is a lot there. I actually went to the Facebook group and I'll just log in to bring it up. What's your initial response there, John?
Yeah, so many bits and pieces that I want answers to, to be able to come to some sort of conclusion or not a conclusion, but just my thoughts. But I think, yeah, there's, there's... the debt on the small business, how much stress is that creating? Or is it relative to the asset value? Is it like, you need to know the turnover of the business? Like 500K of debt in some examples is very minor, whereas others it's like, oh, well, how did it get to that when my income's only X? So you want to, like, if we've got to put things in perspective and say, well, what does it actually mean? Is it that bad?
Yeah. So I asked for some clarity because I'm reading this and I'm like, there's something here that ain't computing.
Yeah.
And I'll read. So I basically said, like, firstly, what is the business? Yeah. Right.
So what is it?
Vehicle manufacturing and custom work.
Right.
And then I said, and what is the 500K debt for and what does the business turn over each year, as you asked?
Yeah.
She says, I'm not 100% sure what the business turns over each year. The debt is a mix of land taxes, workshop mortgage repayments that are behind, income tax, super, and a billion other different insurances. And I said, well, what is the debt on the workshop itself and the value of the workshop? This is where it's like this information is material. And there's a whole thing here, John, because there's one giant thing that's standing out, and we'll get to that. It's a $1 million mortgage and the workshop's worth $2.5 million.
Right.
So there's a one and a half ton of equity sitting there.
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:06β0:35
2
What should I consider if my husband wants me to quit my job to help his business?
0:35β6:42
3
How should I manage a $7 million inheritance while building wealth?
6:42β8:59
4
What investment strategies are best for someone in their mid-20s with no debts?
8:59β13:06
5
How do insurance costs impact financial planning?
13:06β20:46
6
What regrets do homeowners have about their mortgage decisions?
20:46β24:07
7
How can I balance high income with feeling financially broke?
24:07β26:47
8
What are the considerations for downsizing a home?
26:47β1:11:52
Speakers
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