ADVANCED STRATEGIES • STEP 4 OF 4
Check It: Final Quiz
Knowledge without action is futile. Action without knowledge is dangerous.
— Ancient Proverb
Test your understanding of the borrow vs sell strategy. Pass with 80% to complete this module!
Your Learning Journey
Your Learning Journey
This Quiz Takes: ~10 minutes
10 questions testing your understanding of collateral loans, tax treatment, and risk management.
Passing Score
Get 8/10 correct (80%) to pass. Don't worry - you can retake it as many times as needed!
Ready for the Boss Quiz?
10 questions. 5 minutes. Game-show style. Can you beat the clock?
Rules:
- •Answer all 10 questions in 5 minutes
- •No going back to previous questions
- •Score 80%+ to pass and get your certificate
- •100% = Perfect Score badge!
Your Action Plan
Now that you understand the strategy, here's how to implement it safely.
Identify Your Collateral Assets
List your assets that could serve as collateral:
- • Bitcoin/crypto holdings (held >12 months for CGT discount)
- • Physical gold/silver in allocated storage
- • ASX stocks in your portfolio (blue-chip preferred)
- • Property equity (if you own a home)
Note: Only consider assets you plan to hold long-term regardless. This isn't a leveraged speculation strategy.
Research Lenders
Compare at least 3 lenders for your asset type:
Crypto:
Ledn, Nexo, BlockFi
Gold:
Perth Mint, ABC Bullion
Stocks:
CommSec, NAB, Interactive Brokers
Property:
CBA, Westpac, ANZ
Calculate Your Safe LTV
Use the calculator from Step 3 (Try It) to determine:
- • How much you can borrow at 30-40% LTV (conservative)
- • Expected interest cost vs tax saved
- • Break-even point (how much asset must appreciate)
Safety Rule: Never borrow more than 40% LTV unless you have significant cash reserves to add collateral if needed.
Set Up Monitoring System
Before you borrow, establish a monitoring routine:
- • Weekly: Check collateral value and current LTV
- • Alerts: Set price alerts if collateral falls 20%+
- • Cash buffer: Keep 6 months interest + 10% collateral value in reserve
- • Trigger plan: Know exactly what you'll do if LTV hits 60%
Consult Professionals
Before implementing, speak with:
- • Tax accountant: Confirm interest deductibility for your specific use case
- • Financial advisor: Review overall strategy fit (if you use one)
- • Lender: Understand their specific liquidation terms and LTV policies
Reminder: This content is educational only. We're not licensed to provide financial advice. Always seek professional advice for your specific situation.
Module Complete!
You now understand how to borrow against assets to access liquidity tax-free. This is an advanced strategy used by wealthy investors to preserve and grow wealth.
Continue exploring other tax strategies in Layer 4, or return to your learning journey to build on your foundation.
Borrow Strategy - Check It: Complete
- Borrowing against assets is powerful but risky—liquidation risk, interest costs, and leverage amplify losses.
- This strategy works best for appreciating assets with low volatility (property, blue-chip stocks, gold) held long-term.
- Always maintain a safety buffer: borrow at 30-50% LTV even if lenders allow 70%.
Homework
After completing this module, do you feel confident using collateral loans? What's your biggest concern or question about this strategy?
If you're serious about implementing this, book a consultation with a financial adviser who understands collateral lending. Discuss your specific assets, risk tolerance, and tax situation before proceeding.