How to balance your travel and home-owner aspirations after finishing university

It’s no surprise that after 15 or so years of schooling you want to have a break and go travelling, especially since once you start working in your chosen career you probably won’t have another chance for an extended break until you retire in another 40-plus years.

Goodness, that’s a tad depressing, isn’t it?

I went on a year-long working holiday after I finished my tertiary studies and it was undoubtedly one of the best years of my life. But when I reluctantly came home I was in debt.

It took me a few years of working full-time to get back on my feet and buy a property, and I had to buy with a family member to get into the market. And even then we had to borrow from another family member for a deposit.

So you can see it’s possible to both travel and buy a property, but not necessarily at the same time, unless you have a sizeable savings account, which is unlikely since you’ve just finished university. If you want to do both you’ll probably have to compromise on one or the other in the short-term.

For instance, you might have to scale down your travel plans and go on a shorter holiday – to a cheaper destination – before coming home, getting a job, saving some more and buying a property.

That means you might be able to keep some of your existing savings – assuming you have some – aside for a property. But remember, to get a loan you’ll need to have stable employment for a minimum period, which varies between lenders, and be able to show evidence of genuine savings, in addition to other requirements.

You could also consider buying an investment instead of your own home. It won’t be easy to find, but if you can buy a property that ends up neutrally, or ideally positively, geared, it could pay for itself or even fund a trip.

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If you’re set on travelling straight away, you should go on a working holiday because you should then be able to pay your way and avoid coming home with a debt, which would put you even further behind.

Any help you can get from family, including being able to stay at home for longer to reduce your living expenses, will be a major advantage.

If you decide your desire to buy a property is stronger than your desire to see the world then you can choose to knuckle down and work hard first, to save, buy and service a mortgage – and hopefully pay your loan down faster – and then have fun later.

If prices keep rising, in a few years you might even be able to tap into your equity to fund a holiday.

Even further down the track, when you’re a little older, you may well have the financial freedom to travel as much as you want, rather than being a slave to a job, which is what you’ll be for a long time into old age if you put off buying a property for too long.

Some would say now is the time to be financially frivolous since you’re young, footloose and fancy-free, but others would say now is actually the time to be working hard to secure your future.

If you leave it too late to buy you may get to a stage where you find yourself priced out of the market, in which case you’ll be renting in old age and trying to make ends meet while on the pension, which is tricky.

Or you might get into the market, but you’ll be unable to pay off your mortgage by retirement age so you’ll find yourself having to work for what seems like eternity to rid yourself of debt.

The misery of that financial stress may well dull the good memories you’ll have from travelling when you’re young, and that’s when you might regret splurging on a trip after university.

Vanessa De Groot is a property and finance journalist and a committed real estate investor. Send questions to editorial@domain.com.au