The Barefoot Investor argued that a young woman was entitled to her $30,000 inheritance after complaining that her mother was withholding it from her.
Olivia, 26, wrote to Mr Pape that her mother was withholding the sum left to her after her great-aunt’s death for fear she would misuse it.
She said her plan to put the money into a high-interest savings account to help save for a deposit on a house with her partner was not good enough for her mother.
“She says she would tell me to invest it in shares or use it to pay my HECS. Is that true?” Olivia’s letter to Mr Pape says.
“Until I accept the ‘Barefoot Way’, she won’t let me.”
Mr. Pape sided with the young woman in the debate, explaining that she seemed to be already following the “Barefoot Steps” to achieving financial freedom.
“In the matter between you and your mother, I rule in favor of… YOU,” Mr. Pape wrote in his News Corporation column.
Mr. Pape said Olivia’s plan to save for a home was the fourth step of her nine-step plan.
A mother withheld $30,000 from her great-aunt’s inheritance to her daughter for fear she wouldn’t invest it in a similar way to barefoot investor Scott Pape (pictured)
“You should definitely put your inheritance earmarked for your house down payment into an online savings account,” he wrote.
After passing the fourth step, Mr. Pape urged Olivia to increase her retirement contribution to 15 percent, which will be a “tax-effective investment in the long term.”
“Well done, and please say hi to your mom for me!” she wrote.
If Barefoot Investor’s advice helps Olivia access the inheritance, it will only be about one-sixth of a standard 20 per cent deposit for an average Australian home.
Data from the Australian Bureau of Statistics revealed that the average cost of a home rose by $14,300 to $959,300 in the first quarter of 2024.
The cost of securing a mortgage has risen substantially for those looking to buy in capital cities where property prices are soaring.
New data from Domain has revealed that a 20 per cent deposit on a median-priced home in Sydney has increased by $125,424 over the past five years.
It showed that buyers now need to save $332,000, compared with $207,066 in June 2019.
Meanwhile, the amount needed for a median-priced home in Melbourne has increased from $165,212 to $213,761.
The daughter, Olivia (file image), won Mr Pape’s approval as she planned to put the money towards a deposit to buy a house.
Compare the Market economics director David Koch warned that the growing deposit could price young Australians out of the housing market.
“With property prices rising by tens of thousands of dollars in some parts of the country, many buyers feel like they’re being left behind as they try to save up that 20 percent deposit,” he told Yahoo.
Brisbane had the second largest recommended deposit increase from $81,498 to $195,293.
Adelaide followed with $78,563 to $186,994, Perth up $64,313 to $170,000, Canberra up $58,143 to $208,286, Hobart up $41,039 to $137,211 and Darwin up $12,012 to $117,009.
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