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earthspirit
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@earthspirit
Join Date: 2010
Post Count: 5
June 24, 2010 - 2:41 am
What interesting conversation in this thread!
I can not speak from experience as I've yet to reach my financial aspirations. I've started late with minimal resources.
However, I've noticed by studying wealth creation being taught there are some principles which are common among those who succeed in creating and maintaining wealth (in all forms including lifestyle and personal fulfillment aka happiness)
These are:
1) desire….clear goals to work towards with passion
2) save…."pay yourself first" (not less than 10%), pay your creditors, live within your means whatever they are
3) acquire income producing assests….in any form eg. real estate, stocks, royalties, business etc.
4) embrace opportunities
5) invest in yourself….learn about wealth creation and anything else you want/need to know in order to achieve your desire. Also leverage the knowledge & skills of others towards your goals.
6) reduce consumption & share surplus…..give generously with love
7) learn from failure….protect yourself from losses with insurance & appropriate structures.
Best wishes for the achievement of your goals whatever it is.
Susan.
earthspirit
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@earthspirit
Join Date: 2010
Post Count: 5
June 24, 2010 - 12:45 am
G'day. It's really great to hear of someone so young being as switched on as you seem to be. Congrats on already having acquired a significant property portfolio and being ambitious enough to be looking for more.
My suggestion is that you continue your financial education learning all you can about wealth creation from a variety of sources. Also, consider looking for cheaper, positive cashflow investment properties further afield. For the same amount of money as you would pay for anything in Sydney, you could buy 2 properties in regional SA or possibly even Adelaide, for example. Don't be in any hurry. Look at the opportunities which come your way from multiple angles to see how it might best be manipulated to work for you.
Good luck in all your future endeavours.
Susan.
earthspirit
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@earthspirit
Join Date: 2010
Post Count: 5
June 24, 2010 - 12:04 am
Thanks KY.
You're right about my income being miserable which is why I can't do anything financially on my own and will need the involvement of my kids. Inspite of having always paid more than minimum on my mortgage(s) (on different properties) for nearly 20yrs, and acquiring other unmortgaged property besides, the banks won't loan me anything for anything because of my lack of income. It's very frustrating!
The purpose in establishing a structure first is because I am ambitious enough to see that we could need it once we do become successful in building a significant property portfolio. Also because relationships fail and I think our assets are best protected against claims by any future partners my children may connect with (or me for that matter but that's very unlikely.) The proper structure should help prevent disputes over who gets what in the event of the death of any of the beneficiaries and allow for pre-determined portions of the assets to be distributed accordingly. It could allow for the entry & exit of beneficiaries and it keeps our investing to create financial freedom seperate from our personal lives & incomes. It can be managed as a business without entangling emotions. I am definitely discussing the workings of such things with an accountant before moving ahead with our development plans. I think the costs of operating our investing business are valid tax deductions so it should offset what is spent on accounting.
I, too, am excited about our plans and am eager to proceed….just being careful too.
earthspirit
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@earthspirit
Join Date: 2010
Post Count: 5
June 23, 2010 - 7:58 am
Thanks for your comments KY.
In effect there would be potentially 3 rentals: 2 new houses @ $200/wk each plus my renting of existing shop/house for $150/wk. So total income potentially is $550/wk less expenses. About $28k/yr less expenses.
I would ideally prefer to keep all of the properties but might look at selling one of the new houses and paying down debt if it seemed like the most profitable way to get ahead….free up some cash for deposit(s) on next properties.
It could be possible to get the houses cheaper. The $110k cost is the upper expected cost and includes connections to mains water, power, a Biolytix waste system (type of septic…there's no sewerage system here), flooring, fencing, rainwater tank etc. I anticipate being able to negotiate some economies of scale by purchasing two of each system at the same time. Figure it's best to work on upper costs rather than lower.