By Author Julia Cook.

Achieving the so-called “Australian dream” of home ownership is increasingly difficult for members of younger generations. Census data shows that rates of home ownership have fallen from 64% in 1971 to 50% in 2021 among 30–34-year-olds, and from 50% to 36% for 25–29-year-olds.

The reasons for this have been well canvassed. This article focuses on some of the more unorthodox arrangements I have come across in my years spent researching young adults’ pathways into home ownership.

Buying a property as a ‘tenant in common’

Due to the high cost of housing relative to incomes, those in dual-income households are comparatively more likely to enter home ownership.

Most of my research participants over the years have purchased with a spouse or significant other as joint tenants. This means they hold an equal share of the equity in the property, and the property will immediately pass to the other if one person dies.

However, a minority of participants have purchased with someone other than a spouse, and have done so as “tenants in common”. This means they can own distinct and potentially unequal shares of the property, and there is no right of survivorship.

Data on the prevalence of these arrangements is limited. However, a recent industry survey found that 5.7% of their respondents had purchased property with a sibling, 4% had purchased with a friend, and another 2.1% had purchased with an extended family member.

When I first spoke to Sophia, aged 32, she explained she had purchased an investment property with her twin sister at the age of 25. At that time, both sisters were single, and Sophia said: “We trust each other, so we would only buy with each other, you know.”

When I spoke to Sophia initially in 2022 she was happy with this arrangement. However, by 2024, her circumstances had changed. Both Sophia and her sister were in relationships, and Sophia had just begun maternity leave.

Sophia’s sister and her partner wanted to move into their shared property and pay rent to Sophia for the portion she owned. Sophia was concerned about this arrangement because she did not feel comfortable enforcing periodic rent increases on her sister. She planned to rely on the rental income to extend her maternity leave.

While buying with a sibling or friend may provide a means of getting your foot on the property ladder, it can be nevertheless accompanied by some well-documented challenges.

Another way in: rentvesting

The strategy of buying an investment property while living in a rental property (termed “rentvesting”) has come up frequently in my research.

Indeed, analysis of Australian Bureau of Statistics data in 2024 found that rentvestors accounted for 6.85% of the first home buyer market.

When I spoke to Madeline, aged 33 and living in Sydney, she could not afford to buy an apartment in her local area. After consulting with her mortgage broker, she decided to instead buy a property in Western Australia as an investment.

While Madeline was very positive about this arrangement, it is important to note she was living in a property owned by her partner, to whom she paid rent. In this way, she was buffered from some of the challenges faced by those living in the private rental sector, such as frequent rent rises or one-year leases.

Alternative ways to save a deposit

Living rent-free in the family home is a well-established means of accelerating the rate of saving for a deposit. However, this option is not available to everyone.

Petsitting or housesitting can help people live rent-free while they save for a deposit.

Genevieve, aged 29, had migrated from France and did not have the option of living with family while saving for a deposit. So she decided to start house sitting. She organised her house-sitting engagements through an app and, over time, developed a network of home owners who trusted her to care for their pets and houses while they travelled.

After just over two years of house sitting, Genevieve was able to purchase an apartment. However, she described negotiating her house-sitting arrangements as “basically a part-time job”, and reflected on the fact she had no fixed address during this time and was “basically homeless”, highlighting the underlying precarity of her living situation.

Throughout my time researching young adults’ pathways into home ownership I have come across a range of unusual or unorthodox arrangements. Some other examples include living in tiny homes or alternative dwellings such as shipping containers, or asking parents to “invest” in their homes (although these arrangements are rarely formalised, leaving open the question of when any gains might be realised).

These home ownership strategies all share two things in common: their viability is highly contingent on individual circumstances, and those who engage in them successfully have a relatively high degree of privilege and social support.

While these strategies are successful for some, they are not necessarily possible or appropriate for most aspiring first home owners. This highlights the need to resist promoting individual solutions to a challenge that is structural in nature, and to continue to advocate for a fairer and more accessible housing system.

Editor’s note: All names used in this article are pseudonyms to protect research participant privacy.

Source: https://theconversation.com/buying-with-a-sibling-or-rentvesting-some-unorthodox-approaches-to-buying-a-first-home-265571

If you have any questions or need any information please give us a call on 039723 0522.

Investing may be all about the numbers – growth, returns and risk – to build a secure future but increasingly investors are interested in an even more meaningful approach.

Four out of five respondents to a 2024 survey wanted their investments to have a positive impact in the world.

The survey, by the Responsible Investment Association Australasia (RIAA), found 79 per cent of investors would be more likely to invest in funds or products that have been independently verified as responsible or ethical. Animal cruelty was a top concern for 66 per cent, followed by human rights abuses – 60%, gambling – 56%, companies that don’t paid their fair share of tax – 55%, as well as tobacco, weapons and firearms all at 55%.

This growing interest in responsible investment saw assets under management in Australian funds rise 24% to more than $1.6 trillion in 2024.

Meanwhile, a 2025 survey of 3,500 high net worth Australian investors found that sustainable investing is gaining traction as long as appropriate returns, clear risk and return profiles, and transparent performance reporting are in place.

Adding value

Aligning your investments with your values isn’t about changing the way you invest, it’s about adding an extra layer of meaning to the process and shaping your portfolio to reflect what’s important to you.

For some, that might mean supporting companies that innovate responsibly or treat employees well. For others, it could mean avoiding industries that don’t align with their principles. There’s no single ‘right’ approach because your values are unique to you.

And here’s the reassuring part: investing with your values doesn’t mean sacrificing returns. Many businesses that operate with strong governance and long-term strategies have shown to perform competitively over time. So, you can pursue financial growth while feeling confident that your money is working in ways that matter to you.

In fact, the RIAA noted in 2024 a ten-year return on RIAA-certified products of 13.9%, compared with 9.19% for the rest of the market (Australian share funds).

Of course, fundamental investment rules apply. Diversification is one of the keys to successful values-based investing. But it’s not about limiting your choices, it’s about finding the right mix of investments that meet both your financial and personal criteria.

A well-constructed portfolio can include companies across different sectors that align with your principles while still delivering strong performance. This approach ensures you’re not only investing with purpose but also managing risk effectively.

Taking the first step

Turning this idea into reality can be complex. Investor’s priorities are different and the investment universe is vast. That’s where a financial adviser adds value.

A good adviser doesn’t just manage numbers. They listen and take the time to understand what matters most to you, whether that’s supporting certain industries, avoiding others or balancing ethical considerations with performance goals.

From there, they help design a strategy that reflects your values without losing sight of your financial objectives.

Advisers also provide clarity. With so many investment options available, it’s easy to feel overwhelmed. We can help you navigate choices, evaluate trade-offs, and ensure your portfolio remains diversified and resilient. We can also monitor your investments regularly, making adjustments as markets change and your priorities evolve.

So, if you’ve ever wondered whether your investments reflect your values, you can begin exploring the possibilities.

Start by asking yourself about the principles that are most important to you; the industry sectors you would like to support or steer clear of and how you would define success.

Then, give us a call. We can help you to align your portfolio with your values while keeping your long-term goals on track.

Retirement has often been seen as a time to slow down and enjoy the simple pleasures of daily life. And for many, that’s the dream. But retirement is no longer defined by one image or one path. In fact, it can be something much more expansive. Today, retirement is increasingly viewed as a time of freedom, possibility, and reinvention.

Retirement isn’t about stepping back. It’s about stepping into a new chapter where you decide what comes next.

Even if you are not yet there, and retirement is still a way off, it’s never too soon to think about who you want to be, what gives you joy, and start to gravitate towards living your dreams.

Let go of conformity, embrace freedom

Of course, you can live your dreams at any stage of your life but the exciting part about retirement is that you are no longer bound by the expectations that shaped your earlier years. You don’t have to earn a living anymore, so what you do with your time can be driven purely by passion, curiosity, or purpose.

For much of our lives, we learn to conform. We wear the suits, follow the rules, meet the deadlines, and often suppress our wilder ideas or untapped creativity to fit the roles expected of us, whether as professionals, parents, providers, or partners.

But something shifts later in life. With age often comes clarity, and a new kind of confidence. Retirement can be the moment when we stop asking what others think we should do and instead, begin to ask what our hearts are calling us to do.

This is your opportunity to push boundaries, shed old labels, and express your true self without apology. It is a time to honour your inner voice, whether that means embracing bold adventure, creating, starting over, or simply doing what feels meaningful to you.

Unconventional can be unforgettable

Retirement can be the perfect time to try something unexpected or bold. Consider these inspiring examples:

Isabella Rossellini

After being let go by Lancôme at age 45 for being “too old,” Rossellini redefined what aging looks like. She went back to school in her 50s to study animal behaviour, wrote books, bought a working farm, and later, in a full-circle moment, was rehired by the same brand that once let her go. Now in her 70s, she continues to model, act, write, and farm, all on her own terms.

Diana Nyad

At 64, Nyad swam from Cuba to Florida, a journey of 110 miles through open ocean, after four earlier attempts. It was a dream she had carried her whole life, and she proved that persistence and passion don’t expire with age.

Harriette Thompson

Harriette ran her first marathon in her 70s and, at 92, became the oldest woman ever to complete one. Her story is a celebration of physical endurance and mental strength at any age.

Anthony Hopkins

Well into his 80s, the Oscar-winning actor continues to create. He acts in major films, paints, composes music, and shares his work with younger generations online. He shows that creativity and passion do not have a use-by date.

Mother Teresa

Mother Teresa received the Nobel Peace Prize at age 69 for her work with “Missionaries of Charity,” a world-wide organization that helped the sick, the poor, the dying and left an incredible legacy of benevolence that continues today.

Finding your joy

This chapter of life gives you the rare opportunity to redefine yourself, or finally be yourself, in ways that may not have been possible earlier in life.

Whether your dream is to travel the world, volunteer overseas, write a novel, take up painting, or pursue a long-held interest that never fit into your working life, now is your chance.

And it doesn’t have to follow tradition. Retirement can be adventurous, creative, active, or entrepreneurial. It can be spent on a cruise ship, in a mountain village, running marathons, making movies. And you don’t have to set the world on fire – if what makes you happy is watching your roses bloom then go for it! The point is, this part of your life, is yours to shape.

Retirement is a time to live fully and follow your own path to what brings you joy.

What will your next chapter be?

Risks of entering into a scheme

An SMSF is a trust generally run for the sole purpose of providing retirement benefits to its members. Generally, it’s illegal for anyone to benefit from the SMSF outside this arrangement.

Individuals are being targeted to start an SMSF for a range of inappropriate and illegal reasons, such as:

• to get a present day benefit for the individual or a different party
• to steal superannuation from the individual
• to convince someone to move their super from an APRA fund to an SMSF so that they can access their super before a condition of release is met
• to convince someone to invest their super money into a fraudulent investment.

You may risk losing some or all of your retirement savings and receive serious penalties if you enter into a scheme. You could also be disqualified as a trustee of your SMSF which could result in your fund being wound up.

Don’t be tempted by ‘too good to be true’ schemes and risk your retirement savings. We encourage you to consult with us before you commit to any arrangements.

You should consider how arrangements you enter affect your SMSF and whether they contravene the tax and super laws. A key issue in many SMSF’s are transactions involving parties who are familiar to you and the consequences of not dealing on an arm’s length basis.

Where you purchase business interests – whether they be property, a share in a business or similar structure, you should always check that your acquisition is at arm’s length by getting an independent valuation at the time of the transfer.

Guide to identifying and avoiding schemes

Anyone can be a promoter of an unlawful tax scheme. Recognise these warning signs, especially in the following arrangements:

• illegal early release schemes that encourage people to set up an SMSF and use their super benefits for personal purposes
• tax avoidance schemes encourage people to channel money inappropriately into their SMSF to avoid paying tax.

Avoid making an investment that could result in illegal consequences, by:

• seeking financial advice in relation to setting up an SMSF and about investments
• recognising a potentially illegal scheme
• getting independent valuations appropriate to the type of asset you’re investing in.

Promoters

Some promoters will look for new ways to exploit the law or changes in the law. They will promote schemes to people and promise benefits that aren’t legally available.

The ATO actively monitors promoter behaviour and acts against promoters through application of the promoter penalty laws.

How to recognise a scheme

Schemes have some common features, they:

• are artificial or contrived arrangements with complex structures around an existing or new SMSF
• involve seemingly unnecessary steps or transactions
• invariably sound ‘too good to be true’ and they generally are.

If you’ve been approached by a promoter

Be aware of individuals who don’t hold a financial license and promote schemes in their own right or on behalf of a business that also doesn’t hold a financial license. You should check the ASIC financial advisers register to make sure the person or business you are dealing with has a financial license.

Make sure you are receiving ethical professional advice when undertaking retirement planning. You should seek a second opinion from a trusted, licensed and reputable expert, especially if you are in any doubt.

If you think you’ve been approached by a promoter or caught up in a scheme, contact us immediately so we can help you.

Be aware of these schemes

SMSF-related schemes of concern to be aware of:

• Property
• Illegal early access
• Non-concessional cap manipulation
• Dividend stripping
• Limited recourse borrowing arrangements (LRBA)
• Personal services income
• Mezzanine lending
• Asset protection schemes
• Asset valuations
• Multiple SMSFs
• Inappropriate use of reserves

Property

The following schemes relate to SMSFs and property.

Residential property purchased through illegal SMSF schemes

These schemes often target first home buyers wanting to enter the Australian property market to purchase a house and land package.

These schemes may be structured differently, but typically involve the:

• set up or use of an SMSF
• rollover of a member’s super benefits from an existing fund to the SMSF
• SMSF investing in a property trust (an unrelated unit trust) for a fixed period and rate of return, being a contributory fund with other investors
• on-lending of money by the property trust to individuals to help them purchase real property, secured by mortgages over the property.

Once the investment is in place, the member gains access to money from a third-party entity to help finance the purchase of residential property under an arrangement commonly referred to as a ‘loan’. Depending on the scheme, this money is used for:

• all or part of the deposit
• the balance of the purchase price
• costs related to the purchase.

In some cases, the money is also used to help consolidate the member’s personal debts to help them secure a home loan.

In return for a high fee paid by the fund, the scheme promoter commonly helps by:

• establishing the SMSF and the property investment
• organising the purchase of the property, including the payment of the deposit and home loan.

These schemes are established and promoted to look like a genuine SMSF investment to help individuals purchase a home.

However, they often contravene one or more of the super laws, which may give us reason to view the SMSF as:

• a ‘sham’ and not a legitimate super fund
• providing a member with a current day benefit
• set up and maintained in a way that doesn’t comply with the sole purpose test.

The arrangement may also involve the:

• illegal early access of super benefits by members
• giving of financial assistance to a member using the resources of the fund
• provision of a ‘loan’ to a member to help them buy a home (if a genuine ‘loan’, will be an in-house asset of the fund).

To determine whether a scheme gives rise to a contravention of the super laws, we will take a ‘look-through’ approach and consider the arrangement as a whole.

If SMSF monies are used to help purchase a house for a member or a relative to live in through investments in other entities, this may be treated as illegal early access of super benefits. The amount may be included in the member’s assessable income and taxed at their marginal rate, with the potential for tax shortfall penalties to also apply.

The trustee will have contravened one or more of the super laws and serious penalties may apply. The trustee may be:

• personally liable to pay an administrative penalty
• disqualified from acting as trustee.

If trustees are involved in a scheme like this, they should make a voluntary disclosure, see SMSF early engagement and voluntary disclosure service. The ATO will take this into account when determining any penalties that may apply.

If you’re approached by promoters or think you’re involved in a scheme you can report it to us confidentially, as well as the ATO.

Related-party property development ventures

Property development in associated joint venture structures may result in substantial profits for the SMSF, especially if related group entities provide most of the services without adhering to arm’s length market values. This results in profits disproportionately attributed to the SMSF compared to the capital contributed.

Whilst an SMSF can invest directly or indirectly in property development ventures, extreme care must be taken.

Some arrangements can result in significant income tax and superannuation regulatory risks, potentially including the application of the NALI provisions and breaches of regulatory rules about related party transactions.

Residential property purchased in a member’s name

This is where an SMSF is set up to help members buy residential property in their personal name. These schemes often target first home buyers wanting to enter the property market.

Legal life interest of property

This happens when an SMSF member or other related entity grants a legal life interest over commercial property to a SMSF. This means the rental income diverted to the SMSF is taxed at a lower rate without full ownership of the property ever transferring to the SMSF.

Illegal early access

Illegal early access schemes encourage you to withdraw your super before you’re legally entitled to.

Beware of people promoting early access schemes. They might tell you they can help you set up a SMSF to withdraw your super and use it to pay for personal expenses.

Non-concessional cap manipulation

This occurs when SMSF members deliberately exceed their non-concessional contributions cap to manipulate the taxable and non-taxable components of their superannuation account balances.

Dividend stripping

When shareholders in a private company transfer ownership of their shares to a related SMSF, the company can pay franked dividends to the SMSF and strip profits from the company in a tax-free or concessionally taxed form.

Limited recourse borrowing arrangements (LRBA)

The following schemes relate to LRBAs.

LRBA and arm’s length dealings

SMSF trustees undertaking LRBA and related party lending arrangements that are not consistent with a genuine arm’s length dealing.

LRBA and intra-group lending arrangements

Any lending arrangements which involve an SMSF, whether directly via an LRBA or indirectly through an associated entity that can benefit an SMSF, must be on terms equivalent to those commercially available to people in similar lending circumstances.

Any variation of these terms may include but are not limited to:

• the risks being taken by the lender
• interest rates
• terms of repayment.

Increasing SMSF balances and profits to the SMSF through below-market value interest payments are of particular interest to the ATO when conducting reviews into non-arm’s length income matters.

Personal services income

This occurs when an individual (with an SMSF often in pension phase) diverts income earned from personal services to the SMSF to be concessionally taxed or treated as exempt from tax.

Mezzanine lending

Lending by the SMSF with complex intra-group lending arrangements that provides both finance and asset protection. While the intra-group entities bear the risk, the SMSF receives all of the profit from the arrangement.

Asset protection schemes

Arrangements that claim to protect SMSF assets from creditors by mortgaging them to an asset protection trust (known as a ‘Vestey Trust’) present a compliance risk.

A Vestey Trust is a discretionary trust established by deed. It is claimed that the trust is set up to acquire the equity in the SMSF’s assets through an equitable mortgage.

The mortgage is supported by a promissory note executed by the SMSF to the Vestey Trust. This recognises a debt is owed by the SMSF to the Vestey Trust. The mortgage is also supported by a caveat by the Vestey Trust over the SMSF’s real property. The arrangement can also allow a transfer of the SMSF’s cash holdings to a bank account in the name of the Vestey Trust.

Some asset protection schemes are a concern because:

• First, the arrangement is unnecessary because the super system already protects SMSF assets from creditors.
• Second, the arrangement is a compliance risk and may contravene one or more super laws. For example, it may
  • result in the giving of a ‘charge’ over, or in relation to, a fund asset by the SMSF trustee
  • involve the ‘borrowing’ of money by the SMSF trustee
  • expose fund assets to unnecessary risk if it’s not clear who owns them
  • cause the fund to be maintained in a way that doesn’t comply with the sole purpose test.
• Finally, SMSF money can’t be used for costs related to asset protection arrangements entered into by members to protect their personal or business assets because these expenses are not incurred in running the SMSF.

If the arrangement contravenes the super laws, penalties may apply.

If trustees are involved in a scheme like this, they should make a voluntary disclosure. The ATO will take this into account when determining any compliance action.

Asset valuations

Where asset valuations are not fit for purpose and are being applied to the intra-group transfer of assets. The assets are being transferred to the SMSF at lower values than they’re worth.

Multiple SMSFs

Improper use of multiple SMSFs can become a compliance issue when additional funds are established to manipulate tax outcomes. For example:

• switching the respective funds between accumulation and retirement phase
• rolling over potentially tainted NALI funds into a new SMSF to avoid possible reviews and amendments by us.

Inappropriate use of reserves

Many existing reserves in SMSFs arose legitimately from legacy pensions that are no longer available. Consequently, there are limited appropriate circumstances where new reserves could be established and maintained in SMSFs. Structures using reserves designed to bypass super balance and transfer balance cap measures will attract our scrutiny.

For more information or, if you are unsure about anything outlined above, give us a call.

Source: ato.gov.au September 2025
Reproduced with the permission of the Australian Tax Office. This article was originally published on https://www.ato.gov.au/about-ato/tax-avoidance/understanding-tax-schemes/schemes-targeting-smsfs
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Few investment sectors combine geopolitical intrigue, technological innovation and long-term growth potential quite like rare earth elements (REEs).

For Australians, the recent deal with the United States to supply rare earths to seed US$8.5 billion worth of new projects, has thrust the sector into the spotlight.

What are rare earths?

Rare earth elements are a group of 17 metallic elements that, despite the name, are not particularly rare but are difficult and costly to refine. Their unique properties are essential in the powerful magnets that drive electronic devices such as headphones, speakers and computers, wind turbine generators, electric vehicles and medical technology such as magnetic resonance imaging (MRI).

Almost half of the world’s known reserves of rare earths are in China. It’s estimated 44 million metric tonnes dwarf our 5.7 million and the 1.9 million in the United States. Brazil has about 21 million metric tonnes.

Production and processing

Reserves are one thing but production and processing is what makes the difference for investors.

China is leading the field by a wide margin. It extracted and processed some 270,000 tonnes in 2024. The US was next with 45,000 tonnes, followed by Myanmar (31,000) and Australia, Nigeria and Thailand, each on 13,000 tonnes.

Australia’s strategic position

The deal recently signed in Washington – the US-Australia Framework for Securing Supply of Critical Minerals and Rare Earths – commits both countries to investing at least US$1 billion each over the next six months to accelerate mining, processing and supply chain development for critical minerals.

Two of the projects were announced by Prime Minister Albanese after his recent meeting with US President Trump.

One project, the Alcoa-Sojitz Gallium Recovery project in Western Australia, will provide up to 10 per cent of total global supply of gallium, essential for defence and semiconductor manufacturing.

The second, the Arafura Nolans project in the Northern Territory, aims to supply 5 per cent of global rare earth demand by 2029.

A recently announced third project, Astron Corporation’s Donald Rare Earth and Mineral Sands project in western Victoria, is expected to become the fourth-largest rare earth mine in the world outside China.

The landmark Australia-US deal is a response to China’s dominance in the rare earths market and Beijing’s recent export restrictions on rare earths, which have left many nervous about vulnerabilities in the supply chains for defence and high-tech industries.

Investment opportunities and risks

For some investors, rare earths may be seen as a long-term opportunity given a prediction by the International Energy Agency that demand could double by 2040.

There are several ways to invest including:

• Directly in ASX-listed companies such as Lynas Rare Earths (LYC), Arafura Rare Earths (ARU) or Iluka Resources (ILO)
• Through exchange traded funds (ETFs) or managed funds that offer exposure to rare earths miners and processors
• In private equity and venture capital. For high-net-worth investors, early stage mining and processing ventures may offer high risk, high reward potential

Of course, there are risks worth considering including geopolitical volatility, growing environmental concerns over the high water and energy demands, and China’s ability to flood the market or further restrict exports, which could cause price volatility.

In any case, patience will be required. Mines can take as long as seven years to become operational.

The bottom line for investors is while rare earths are a sector still maturing, they are critical to a range of industries and expected to increase in value over the next decade. However, their share prices are sensitive to global headlines, politics and policy changes, so volatility is to be expected – particularly in the current environment.

As always, there is a lot to consider when weighing up investment opportunities and we are here to discuss any aspect of your investment strategy.