When investing in property, it’s largely a given that you’ll be borrowing as a core element of the transaction. Indeed often, you’re borrowing the entire purchase cost. Borrowing to buy shares however is often approached with trepidation, despite the many advantages shares offer around the ease of altering the transaction size, diversification and the speed with which investments can be liquidated.
In today’s episode, we’ll take a look at the pros and cons of borrowing or gearing to invest in shares. Is now the time for a big move?
Before we dive in, it’s important to remind you that this is general information. The appropriateness of gearing for you depends on a range of factors such as income security, savings capacity, debt levels and investment timeframe. Seek out professional investment advice before commencing a gearing strategy. Visit the Advice Page on our Financial Autonomy website to see how we can help.
Also, if you’re fairly new here, you might not be aware of our Invest in Shares online course. This self-paced course is suitable for novice investors through to those with intermediate levels of experience. We take you through all the key concepts like dividend yield, PE ratios, investment selection, taxation considerations and plenty more. One of the bonus modules is specifically on gearing so if this topic is something that resonates with you and you’re a DIY type, go to the Learn Page on our web site and click on courses.