Forum Replies Created
Hi Jarred,
Have you determined what it is that you actually want to be, do, and have in life? Might sound a bit philosophical but it is really important in that it provides direction and then from that come plans/goals etc.
Seems like you enjoy your uni course, which sounds fascinating. Why would you want to give this up?
My background is a professional one involving uni, which was great fun when I was there in the late 60’s and early 70’s. I have since found that a degree is useful for obtaining good positions in the workforce to earn a good income, but not for financial freedom, if that is what you want. Passive or residual income is essential in order to have financial freedom. Robert Kiyosaki’s book “Cashflow Quadrant” is great for explaining that.
It was a great impetus for me to start and develop my own “right hand quadrant business” which provides cashflow for investing and also allows me to continue in my profession, which I love, on a part-time basis. Although I don’t have any regrets I do wish that I had this understanding earlier so that I could have started younger. That is why I was asking you the questions above. Having residual income allows you to pursue the things you enjoy.
Best wishes for your future.
pr
Hi Luke,
Your motives for saying what you have said are certainly well intentioned and to be applauded. There is however, a difference between amassing wealth and being rich. The latter refers to a state rather than simply accumulation of assets/money. It is considered by many as a state of mind, happiness/contentedness etc that comes with having worked hard to achieve something worthwhile over and above wealth. This is when people have freedom rather than just chasing the dollar, and many of these people contribute enormously to the community and society through significant donations and personal time. So in this sense striving to be rich can benefit many.
I’m sure that many people on this forum would love to be in the position where they are rich so they are free from chasing money and free to ehelp others.
Cheers
pr
Hi DrX,
I understand the reasons people act the way they do when the subject of money comes up. Usually those appearing to do well are labelled materialistic. However, when you delve into their perception of materialism it appears to be anyone who has more than they do, and so it is a relative term.
I wonder why you shy away from the truth. Why allow other people to determine how you feel and what you say? That is giving them a tremendous amount of control over you and your feelings. Isn’t it really their problem? Why not let them deal with their problem rather than allowing it to become yours? I realise that it can be difficult, especially with friends and relatives, but I was always taught to retain control of the way I feel and not give others power over me.
“A person convinced against their will is of the same opinion still”. No sense in trying to change people’s opinions and it is unproductive. I try to continue to be proactive and productive. Do you want to be rich or right?
Congratulations on what you have achieved and I can’t see why you should allow others to influence your dreams. They are yours and no-one elses. Good luck and best wishes.
pr
Hi Trajik,
There are many factors that will influence the tax benefits if any and as such may be unpredictable or unforseen. e.g. losing one’s taxable income (job), or reduction in income etc.
In Steve’s templates the sums are done prior to tax considerations, and for me if I am evaluating a property I would like it to be CF+ before tax. Then, if there are any real tax benefits they are a bonus.
Like capital gains the tax effects can change as can other factors to change an investment from CF+ to CF-. Having the investment CF+ before tax provides a bit of a buffer.
Regards,
pr
Hi Zyleth,
Steve has a number of templates that can be used to do the sums. The templates are available on this site. In addition there is Investment Detective software that does a similar thing.
Good luck
pr
Hi Brijo,
Not doing anything with the money at the moment might be called masterful inactivity [biggrin] rather than just not doing anything. At the moment there are many who are saying that cash is king.
Are you looking primarily for cashflow positive investment or for capital gain?
Your money is working well for you in your UK property because it is generating cash and probably capital gain since the time of purchase. If you want to make the most out of those gains as well as out of your hard earned income then it would seem wise to ensure maximum returns. To invest in a negatively geared property simply because you have cashflow to support it is not necessarily a good reason, especially if the anticipated growth is going to be relatively slow. In other words, if the investment is not CF+, the returns may be less than bank interest and the risk free return, in which case masterful inactivity may be appropriate in the short term.
Procrastination is harmful but patience is a virtue. There are many views and opinions expressed and not infrequently they are diametrically opposed. I have found great value and benefit in seeking mentors. I have one for business, one in my profession, and one for property investing, particularly in commercial property. These are all people very successful in their areas, and it is a great way to learn from their experiences -> wisdom.
Best wishes for your success in Australia and good luck.
pr
Hi Tim,
It’s great that you’re looking to learn and accessing some of the resources that are going to help you. With regards your comment about finding cashflow positive investments it is not that straight-forward.
When you read into Steve’s books a little more and look around this forum you will discover that these days it’s extremely rare to be able to purchase a residential property and find a tennant and expect it to be cashflow positive at the outset. Cashflow positive investments are made by adding value, either by renovating, subdividing and building, or wrapping etc. There’s a lot more to it than “finding” a CF+ investment. As Steve says, you have to solve somebody’s problem, and in doing so you may be able to create something that becomes CF+.
Good luck.
pr
Hi Angel,
Like Geoff I found “You Inc” a good book and Junker’s advice is very sound. Knowing where you want to go, seeing yourself there and having a plan are critical. Above all, find yourself a mentor who is successful in the way that you would like to be and learn from her/him. In fact it may open doors to other businesses as it did for me, after 25 years in my profession. Still enjoy my profession which generates an active income, but it is no longer the sole income source.
Good on you for exploring options and best wishes for success.
pr
Hi Rob,
Thanks for clarifying my confusion. I obviously misunderstood your comment earlier where you stated that not all low doc loans are higher.
Cheers
pr
Hi Rob,
I can see how a low doc loan at one institution may be “cheaper” than a standard loan at another institution but please correct me if I’m wrong, how can a low doc loan be cheaper than a standard loan at any given institution?
Cheers
pr
Hi Ally,
Dazzling is right on the ball here. If it is at all possible to have all your loans with the one institution then this demonstrates loyalty and this then allows leverage. The ability to leverage is very important in business.
Low doc loans bear a higher interest and if your loans are geared positive (just) then will they remain positive? Especially if interest rates rise a little more, as they are predicted to do so.
Good luck.
pr
Hi Carlin,
The only way you know that due diligence has been done to your satisfaction is if you have done it yourself. If you don’t know the other investor how do you know what he has done? Are you prepared to simply accept the vendor’s statement, which even if accurate, may not reflect the other investor’s success etc.?
There may be short cuts in investing but not when it comes to due diligence. When you have done that you will be in a position to make your own independent bid based on your findings.
Good luck
pr
Hi Damo,
Congratulations on having a dream and being prepared to step outside the negativity of those that don’t understand. However, as you are probably aware, to be successful in addition to a dream you need to have a system that you can apply to an activity which will ultimately free your time through developing a residual income.
However, it appears that your thoughts/plans involve substituting one active, predictable & reliable income for another income that is unpredictable and still active in the short to medium term. If things go astray where will cashflow come from to allow you to complete your projects?
I admire your determination and have no doubt that you will succeed. All you need is to keep an open mind and look for the options, as there are many out there
As a professional I have spent many years deriving an active income working many hours per week, but now through some creativity have resolved that situation. Robert Kiyosaki’s book called Cashflow Quadrant was a great help.
Good luck
pr
Hi Colbert
Are you asking if all seminars are scams or more specifically that all 2-3 day seminars might be? Or just those that cost over a certain amount?
If one looks at this realistically it is obvious that seminars are just another form of business, and the purpose of a business is to make a profit. And there is nothing wrong with that. The question is – what benefit is there to the attendee. If the purpose of the seminar is to make money by offloading properties at a profit then this is of no educational benefit and almost certainly not win-win.
If however, the purpose is to educate people, such as Steve’s seminars then this is win-win and the benefit is ultimately determined by what the attendee does with that education.Good to be sceptical, good to be cautious but also good to be open minded (mind works like a parachute – best when it’s open).
Cheers
pr
Hi getting
How did you work out your rental returns? Either the numbers are so small or there may be an error in your calculations.
Regards,
pr
Hi
We are very fortunate to be able to access a site where we can gain wisdom through others’ experiences. From my own perspective both as a student in a similar position to yours in the past and now in professional life I can’t emphasise enough that you must have a plan with written goals, and I fully concur with Chewy – have fun at uni and enjoy while you are doing the other essential things such as learning etc.
Some say that in any business one should make money, have fun and make a difference.Networking is the crux of any business, including investing.
The other thing that is critical is to have an open mind and explore all the pathways that will take you to your ultimate goal – or if the pathway isn’t there yet make your own lol.
Starting your own business while you are studying may be feasible depending on your schedule and if you keep an open mind you will find ways.
Finally there is risk in everything we do, the trick is how we manage that risk and how we mitigate it. There are options that could suit your situation, as I have discovered for myself.
Good luck
pr
Hi Lily,
There was an article in the Australian Financial Review about a month ago that showed what was happening to the housing market in the various states. From memory, there were only 2 states demonstrating continued growth and they were WA and I can’t remember now whether it was Tas or NT, all others had flattened or dropped.
In more general terms of developing passive income I found Robert Kiyosaki’s “Cash Flow Quadrant” most helpful. Interestingly his recommendation is to develop a system based leveraged business and then to use that cashflow for investing. I believe that Steve’s approach to property investing by developing a system is in keeping with this concept.
If you are interested in any further information please let me know.
Best wishes
pr
Hi Brad,
Congratulations for starting so young and for having the courage to look outside the “normal”. The risks may be higher but you are young and the best way to learn is to DO, even if you make mistakes first, just like most of us do when we are starting. Your father hopefully is fully aware of the risks and supports you on that basis.
Covered calls can be great, have done that myself for some time but generally work well in a rising market. Require more thought in a volatile market. Most advisors advise diversification whereas Warren Buffet is a focussed investor. Choice is yours because the risk is too.
With regards to “making a property cash flow positive” by paying a larger deposit does not change the return you are getting on the investment. Although it may be CF+, if you could do better with your cash then it might be wise to consider altering your investment plan. It really depends on what your investment strategy is and what your goals are.
Good luck and all the best for your future.
pr
Hi easymoney,
I am relatively new to residential property, having invested mostly in commercial, but am interested in the US. I have recently started looking in the US and need to do some more research.
With several people involved and brainstorming there might be some advantage. It is possible that I may be able to go to the US in August depending on what part of August and would be happy to be involved in further discussion.
Regards,
pr
Hi Nehal
I applaud you for your interest at such an early age and for your courage to ask questions. The difficulty you face is that in response to your questions you may get differing views depending on the clarity of your questions, and the opinions and experience of people in the forum. So how do you then make a decision?
It is better to empower yourself through learning, wisdom and knowledge so that you “learn to fish” rather than rely on others to “feed you” because then you will be able to make informed decisions.
You probably have lots of study to do but I found the following books very helpful:
“Rich Dad Poor Dad” by Robert Kiyosaki
Steve McKnights booksIn reply to your original question I presume that you are asking about the difference between receiving rent from a property you own and investing in property. If that is the case then renting is just one of the many ways that people invest in property. Robert Kiyosaki’s book explains investing.
Good luck and best wishes for your wealth creation programjavascript:insertsmilie(‘[grad]’)
Graduated [grad]pr
