Gearing (Borrowing to Invest)
Today, there are a wide variety of investment products available to cater for investors who want to gear to invest. From the humble home loan to purchase the family home through to 100% lend products that have the option of capital protection built in to them.
Gearing is the act of borrowing to invest. This can be achieved in a number of ways.
- Instalment - regular loan draw downs over time
- Lump Sum - one single larger amount
- Internally Geared Managed Funds
- Structured Products
- With or Without Capital Protection
Gearing strategies are not necessarily appropriate for everyone. In the advice process we will identify and advise you if we believe a gearing strategy is appropriate for your needs and circumstances. We will assess the appropriateness of a gearing strategy on a number of key factors:
- Risk Tolerance
- Affordability / Cash Flow
- Investment Time Frame
- Strategic Flexibility
- Tax Effectiveness
