Perspectives from Perth (on holiday)
I am on holiday in Perth, Western Australia (WA) and one of the few things that struck me was the relatively high interest rate in WA! I was chatting with the taxi driver as he drove me from the airport to my hotel in Hay Street and even he was a 60 plus year old taxi driver, was entrepreneurial enough to take a loan of about AUD 185,000 to buy a 2000 sq metres piece of land which he sub-divided and intends to sell for much more than that. He was paying a loan rate of 8.75% for his loan.
Wow, if that is the loan interest rate, imagine what is the interest rate for savings and time deposits in Australia!
The more I start to learn and know more about Australia, the more I believe financial freedom lies in relocating to Australia. Many Singaporeans have already taken this route to migrate there and to establish a home there. Why is that?
Perhaps it is the relatively abundant land relative to a place such as Singapore. Perhaps it is the physical space that you can have as no matter how crowded Australian cities can get, nothing beats Singapore rush hour except for Hong Kong and Tokyo. Perhaps it is the fact that costs of your home and transportation, i.e. a car is not prohibitive. In addition, the economy is currently booming in Western Australian as well due to the mining development arising from China and India's voracious appetites for the mineral resources of this continent down under.
Perth is also a place conducive for family life. People go home sharp at 5.30 pm and the Hay and Murray Street (their equivalent of Orchard Road shopping Mal) shuts down around that time on an average weekday night! In winter (middle of the year), it gets dark around 5pm plus. Only on Friday evenings does shopping hours extend to 9 pm and shops operate 12pm to 6 pm on weekends.
But the high interest rate really sets me thinking as the key financial freedom is living within your means, building up your savings and investing it for positive passive cash flows. When the rate of return on your investments is higher, you would need a relatively smaller amount of portfolio investments in order to be financially free. Our Singapore interest rate is so low that returns on your savings is abysmal. It practically forces investors who want a higher return to punt on the stock market.
Travelling has opened up my eyes and ears as I learn more about other possibilities in financial freedom.
May you have a good week and be well and prosper.
G'day from WA!
3 comments:
Hi Rod,
Looks like you sure enjoyed yourself in Perth.
I think the idea that you can happily retire in Australia is because you don't spend 12 hours a day on your job. You get to spend time with your family, and also do some other sidelines, or even leverage on rentals like what the taxi driver you mentioned is doing.
But the best thing there is you get to spend quality time with your family, and even have bbq with the neighbours every night if you want.
Hi Chris
Yeah! There is more to life than just work, work and work. Aussies are by and large quite balanced and when I was in Perth Zoo on a monday, there were many mothers (and fathers!) with children in tow in the zoo.
For me, the Aussie lifestyle is something to aspire to. :)
Be well and prosper.
welcome mate! i've emigrated to perth and basically retired at 47. if you go for a simple lifestyle, all you need is aud800k earning interest at 6.5%pa, yr own house and a car, and you'd be comfortable. you can get pension when you reach 65 but there is a limit on the amount of assets you own.
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