Tax Planning and Gearing
The investment advice and financial strategies Lambourne Partners Financial Planning provide may be structured to minimise the impact of taxation on the returns on your investment portfolio.
Tax planning is an integral part of the financial planning process. Strategies such as structuring your salary, making superannuation contributions, managing investments together with debt management can all contribute to significant tax savings and are an essential part of your wealth creation strategy.
Borrowing money to invest in shares, managed funds, and other investments is known as “gearing”. Where your interest exceeds the income from the investments this is known as “negative gearing”.
By borrowing to invest, rather than just using your own money, you increase the potential returns from investing. The down side of this, though, is that it also magnifies the potential for losses if investments perform poorly. Given the risks this strategy is not for every investor and should be considered as a long term investment strategy.
In a similar way to investing in property where the loan is secured against the property, this investment loan can be secured against your investments or an existing property with equity.