Investing …

Hi Steve,

Reading through your book, certain areas I have become more interested in finding further information…

Through out your book, your disposition is to aquire enough positive-cashflow propeties to eventually replace your salary…..(we all like th achive this)

Although, the following must occure before you are able to venture this path

Must have a source of income to fund the investments (either though a job and or other accumilated income.

Now. to use an example, taking that you are on a good salary of 65,000, this will place you at the highest marginal rate of tax…

So, if you then aquire your first investment property – cashflow positive, any income from this will be taxed at the highest marginal rate..

now, one property will not replace your salary – its going to take some time before this will happen.. and the high rate of tax is going to slow down your time to aquire further properties (trying to save for further aquisitions

As such, as you still need to rely on a salary, would you need (or have to) at lest minimise your tax bill… as such, would the stratergy of having your initial investment as a negative geared property… then futher aquisitions can be cash-flow positive (or a mixture of both) ?

I am not so much concerned at tax saving an minimisation once you have the stratergy working.. my concern is the inital stages of getting the investment portfolio running… I though that you would need to minimise tax as you are still working and in cases already on the highest marginal rate..

Regards
Flavio