Reluctant to move from comfort zone

Hi Reg,

Been there done that.

In addition to Crusher’s comment – I would add keep it simple.

Explore the ‘let’s get ONE investment property’ train of conversation with the wife. If you have leaped off the great divide and talked about a multiple property portfolio before taking the initial steps this can be overpowering to someone just starting out.

I also add you need to show your wife how one property should not affect the current lifestyle you enjoy. To do this you will need a full budget scenario before and after property.

Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113

Will she read a book?

Something like “Ordinary Millionaires” by Jim McKnight will probably have a story she can relate to.

I totally agree with the one property at a time approach. Don’t scare her to death!

cheers
ani

http://www.tradeoff.com.au
the new card for investors

Hello Reglinda,
I’m not sure liberate the equity is the right kind if thinking.
Your partner fears the later part of life with no financial security.
Fear is a natural instinct to protect us from loss.
I have noticed that people who have kids that wanted for nothing or were not taught the value of a dollar at an early age will usually spend every cent they earn shopping or lifestyle things.
But someone who went without will use everything they have to build a better more prosperous future.
New immigrants are a classic example they bust their guts working to give their kids a good start in life only to see their kids go shopping.

Ok perhaps I am a little off topic or perhaps not.
You see perhaps in the past your partner had a reason to fear loss.
Being understanding and open minded is the way to go.
Perhaps that very fear can be motivation instead.

As is education for with it understanding of how investing can strengthen the financial future.
Investing can reduce the risks in life by having fingers in more cake and thus get to eat some.
Investing can bring in a cash flow stream that never ends while protecting the very house that you live in from loss or sale for retirement living.

Show your partner a clear path, walk through the steps one at a time showing time and risk and balance with returns.
There is a block of land my wife would love to build on, every couple of weeks she walks me through the house we are going to build there one day.
This house is a few years away but there are times when walking through the paddock I am thinking about not walking into walls.
This is how powerful positive reinforcement can be, not bad considering we don’t own the 50 acre block yet.

Reduce the risk; don’t ever be foolish enough to place all the eggs in one basket.
If something goes wrong you are history.
I am not a gambler but I do take risks educated that is and like a professional gambler I risk nothing more than I can afford to lose.
Kerry Packer may have lost millions gambling but none of it would have been on a single roll and all of it would have been well with in his comfort zone, true a huge comfort zone but each of us is different.

Planning and revision is vitally important.
Ask yourself where you are both going financially and what events will befall either of you along that path.
Explain your fears and the solutions you have to over come those problems.
Than ask your partners thoughts on the problems ahead and how they see the way ahead.
Think if you were on a ship where is it going, how is it going to get there.

If your partner cuts in and starts to talk bight you tongue and let the information flow.
That should be repeated because most people enter into an argument rather than finding solutions to problems.
Take it from a guy if I keep my big mouth shut I stay out of trouble and I have a much better chance of finding the solution to others problems by listening and can come out in good favour when I provide the solution or better still guide others to the solution (if the idea is someone else’s not only do you have a solution but they have the motivation with their idea to see it through, catch the drift).

If your partner does not talk or stops prompt with a question.
Perhaps an easy one to start, try not to ask a yes or no answer but rather an answer with some original thinking in it.
Please don’t make it 20 questions, as this is frustrating and repulsive of any ideas or suggestions to follow them.
Ok many of my friends now know that my maths is not as bad as all the mistakes I make.
However the mistakes I make do tend to get others involved in the project because I am having trouble and or once they have done some work they own some of the project and don’t walk away quickly.

Now having said this the net step is to involve your partner.
By doing things together the risk is shared and the blame is halved should something go wrong.
Two heads are better than one and
A problem shared is a problem halved etc.

My beautiful wife is my partner, most of the time she is silent but when she speaks I listen no matter how quiet she is because if I cater to her needs I can get away with murder the rest of the time, boy do I love her so.
Together we will always find a way thus when examples-

Our youngest daughter (Number 4) has some medical troubles and my wife had to leave work to care for her.
During this process we battled with an amc franchise and lost heaps yet survived and even came out in front because not all our eggs were in the one basket.
Going back further my wife had little worries when I was laid up with a smashed leg while our third child was on the way again because I had my fingers in many pies.

Going back further again when I left work into our own business it was not a jump but a gradual change as I reduced my work hours as income from the business and available time dictated.
In fact when I found my better half she was kinda a break for me you see I was cutting her mothers lawn and about 100 others, working as a DJ and in my spare time working in my wholesale nursery and yet given a chance I jumped at anything else offered, thank goodness I had to slow down and spend some time with her else I probably would have added a 4th business in there some place.

If I lost one income stream than another would quickly take its place.
Funny she considered me to be a good reliable income earner.
Yet her family considered me a wild cannon and taking way too much risk.
Over the years since they have relaxed their thinking about me and even allowed me to help them (trust me doctors don’t earn as much or are as secure financially as you think).
They had a lot of fear as my wife’s sisters watched their parents business fall apart and destitute each of them.
Only one of those girls picked herself up dusted herself off and got on with the necessary job, give you one guess which one I married.

Perhaps I am being a little long winded but most of us have been down the same track.
The decisions are to be made together and the risks reduced as much as possible.
You are a loving couple so share your thoughts needs and wants.
You may be surprised when simular thoughts start coming back.
My better half has a fantastic business idea and thus one of my financial goals is to find a way to fund it for her, now it will have to be a few more years down the track when our youngest is medically ok.
Guess what happens if it fails, so what its just one investment amongst many but if it succeeds then guess what I will say honey sweetie can I have some more money to invest into this property or idea or a gut feeling this company etc.

Try to remember life is an adventure so involve each other in it as much as possible.
“Life is a daring adventure or its nothing” Helen Keller.

Your friend Colin,
Email [email protected]
Home 02 46531376.
Fax 0246531079
Mobile 0425201055 (best contact as always working).
For all your CLEANING and GARDENING work.

Hi fernfurn,
If by desk you really said car bonnet, sleeping in back, eating next to pantry while driving tools and equipment in boot to contractors for days work and return via a few quotes before shower at factory graveyard job than yes this was my earlier years.[comp]

fernfurn these days at least 50% of my time is spent behind a desk.
95% of the work perhaps more is done by contractors this includes some quoting and sales.
And we are still a hell of a long way from where we wish to be.[evo]

Don’t trust life make it happen.
If you have someplace to go drive yourself there.
If you want to get there faster find a co-driver.
Don’t wait for the vehicle to come to a halt before you jump out and push.
Be realistic most people have more than one vehicle in their life, the next one is always going to an improvement.
The fun doesn’t start until you get out of the comfort zone.[medieval]

‘Our days are like identical suitcases, all the same size, but some people
can pack more into them than others’ Richard Denny

Your friend Colin,
Email [email protected]
Home 02 46531376.
Fax 0246531079
Mobile 0425201055 (best contact as always working).
For all your CLEANING and GARDENING work.

Hi Hellofawedge,

I hope you don’t mind me commenting on your questions about equity that you were asking Colin.

I can see what Colin is saying about the fear involved in using equity, especially if it’s from your own home. However my wife and I would have missed out on profiting from the last property boom if we did not use equity in our own home to invest. I think that the key is minimising the risk and having a plan B if something goes wrong so you can sort things out financially without the need for the bank to get your owner occ. home.

We approached it by buying a new property (house) for our first investment and we put a lot of research in to making sure it would be easily tenanted and we also got the right insurances etc.

Now, from what I understand if you can’t pay the mortgage the bank will go through a number of steps to get their money back. The first obvious place for the bank to get their money back if you cannot pay is through the IP, so as long as you haven’t paid an ‘over the market ‘ price or had a massive drop in capital value, you should be able to just sell the IP and pay the bank back .There are also all sorts of reduced payment plan options and other strategies that could be used and the money doesn’t necessarily have to come out of your owner occupied house unless there is no other way.

There are also lots of insurance types that can cover you in situations such as disability ,losing your job etc. I doubt whether house repossession is as likely and common as most people think it is.

The thing I like about using equity is that it can allow you to keep money in savings (as a backup). Money that you would usually have to fork out as a deposit. This to me provides a level of safety and risk management in itself because the savings could be used to support an unexpected time of vacancy or at least keep the banks at bay until you find a solution to whatever has put your IP in danger.

That’s my two bobs worth. It really comes down to your risk v’s return profile. My view is that you have to take some sort of risk or you won’t get any return at all. It’s just a matter of educating yourself on how to put risk minimisation strategies in place so that there is very little chance of getting to the repossession stage.

I would also like to know what idea Colin has for helping to fund a property purchase.

Todd Burns
http://www.freepropertyhelp.com.au