Originally Posted by
Bjauck
Your marginal rate of income tax is certainly dependent on your total income. Like investments in real estate, investment in bonds and other financial arrangements are indeed taxed on their "income" but, for the fixed interest financial arrangement investment, income includes capital gain as well as interest! There are many tax consequence differences between investing in shares, fixed interest and real estate. The tax take as a percent of gains (capital and income) differs markedly between these asset classes.
Of course, both shares and property have had their down times and periods of angst for investors. So indeed has fixed interest - the Credit crunch and NZ finance company woes are well known. Is today's money in the big Aussie bank as safe as it used to be, when so much is lent out on mortgage to people buying in the current highly priced housing market?