PLEASE NOTE: We have changed the names of the folks in these case studies.
We've all experienced the gut-wrenching anxiety that comes with property investing but what happens when it becomes an overwhelming feeling that wakes you up at 2am?
Folks, this is a REAL story from today's honest and inspirational Case Study episode.
From Billy, a single dad holding onto his ambition to secure a future for his son amidst personal and financial upheaval, to Liz and Michael, a couple who found themselves constantly fighting their financial fears.
Hear how these investors confronted their anxieties, took that first big step with a qualified accountability partner and created their path to freedom.
P.S. Huge thank you to today’s guests for opening up about their journeys, we know it’ll inspire many folks in the community to take action.
FREE STUFF MENTIONED
LISTEN TO THE FIRST 20 EPISODES HERE >>
MOORR MONEY MANAGEMENT APP:
👉 Apple: https://apple.co/3ioICGW
👉 Google Play: https://bit.ly/3OT86bW
👉 Web platform: https://www.moorr.com.au/
FREE MASTERCLASS:
- How to Build a Property Portfolio and Retire on $2,000 a week >>
FREE BEST-SELLING BOOKS:
- The Armchair Guide to Property Investing
- Make Money Simple Again
FIND US HERE:
- Website
- Instagram
- Facebook
- Youtube
PLEASE NOTE: We have changed the names of the folks in these case studies.
We've all experienced the gut-wrenching anxiety that comes with property investing but what happens when it becomes an overwhelming feeling that wakes you up at 2am?
Folks, this is a REAL story from today's honest and inspirational Case Study episode.
From Billy, a single dad holding onto his ambition to secure a future for his son amidst personal and financial upheaval, to Liz and Michael, a couple who found themselves constantly fighting their financial fears.
Hear how these investors confronted their anxieties, took that first big step with a qualified accountability partner and created their path to freedom.
P.S. Huge thank you to today’s guests for opening up about their journeys, we know it’ll inspire many folks in the community to take action.
FREE STUFF MENTIONED
LISTEN TO THE FIRST 20 EPISODES HERE >>
MOORR MONEY MANAGEMENT APP:
👉 Apple: https://apple.co/3ioICGW
👉 Google Play: https://bit.ly/3OT86bW
👉 Web platform: https://www.moorr.com.au/
FREE MASTERCLASS:
- How to Build a Property Portfolio and Retire on $2,000 a week >>
FREE BEST-SELLING BOOKS:
- The Armchair Guide to Property Investing
- Make Money Simple Again
FIND US HERE:
- Website
- Instagram
- Facebook
- Youtube
Alright, folks, welcome back to the Property Couch podcast and have we got an amazing episode for you today? We've got a TPC listener who created $1 million just by listening to the Property Couch. We'll tell you how, and we also cover case studies, ben Exciting day where we get to unpack and show you behind the veil of some real life case studies, real life decisions and stuff real people are facing. What else do we cover, ben?
Speaker 2:That's right, bryce. What we're talking about here is overcoming anxiety, overcoming cautionessness, because guess what? They're the enemy of ambition. So through these case studies, we're going to hear about holding onto that ambition, getting that drive, getting that confidence to take action. So it's a big show, bryce Plenty, to unpack in today's show.
Speaker 1:It's definitely a big show, folks. Let's rip into it now.
Speaker 3:Welcome to the Property Couch where, each week, you get to listen to two of Australia's leading property and money experts Bryce Holdaway, co-host of Location Location, location Australia on Foxtel's Lifestyle Channel and co-host of Escape from the City on the ABC. And Ben Kingsley, chair of Property Investors Council of Australia and a back-to-back winner of the Property Investment Advisor of the Year Award. And both the partners of the multi-award winning Empower Wealth, co-creators of more, the free lifestyle design app, as well as bestselling authors of the Armchair Guide to Property Investing and Make Money Simple Again. Stay tuned as they bring you the Insiders Guide to Property Finance and Money Management.
Speaker 1:All right folks, Welcome back to the Property Couch podcast and welcome back to you too, mate. How are you?
Speaker 2:Well, mate, let's go straight into the show. We're not talking footy this week. There's just nothing good to talk about at the moment. So I'm really excited about getting on with the show.
Speaker 1:Okay. So, owen, is it all right if I call you Owen?
Speaker 2:Who's Owen?
Speaker 1:Owen too. I'm calling when you're Owen too, and if you don't pick up your socks quickly this week, made against St Kilda, you will be Owen three. Brisbane is likely to be Owen two at the time when you two meet the following week.
Speaker 2:Yes, I know, Good win for you guys over in the West wasn't it?
Speaker 1:Oh well, spotted yeah watch the last call, one of very few people on the East Coast that's noticed that there was a game over there, over in Perth. So I was at a music festival on Sunday so I wasn't tuned into the footy, other than it was four goals zip on the app and I figured okay, all right, I'll stay connected to Ziggy. Halbertson here, and don't worry about what's going on the footy. So good result. I'm happy to move on too. Mate, you got to pick a webinar.
Speaker 2:Yeah, I just thought I'd shout out on Wednesday, the 27th of March, putting my picker hat on as the chair, we've got Samara Bedwell who's going to be talking about the stage two property reforms in Queensland. So if you wanted to register for that free webinar it's free for our members so all you need to do is become a member and the details will be on the picker website, which is picaasnau. Is the website there? So we'll also have the link in the show description.
Speaker 1:Go and check it out, folks. Samara Bedwell, if you didn't catch that, wednesday, the 27th of March, 6.30 Eastern Standard Time or 7.30 Daylight Saving Time as well, so check that out. I've got a little reach out to me via socials, Ben, on my Instagram it's probably the quickest way to get my attention to be on, since the only socials I'll really go on. This is from Curtis. I was listening to the pod today of you being interviewed, obviously me. I recently did last week's, on Tuesday's, episode, ben. We did a replay and it's got a lot of my backstory in it, right, and you mentioned how you started the pod and Ben didn't know what one was and that was the reference to when I come to you. So do you want to do a podcast? And you're like, huh, what's a podcast? I'll remember those many months ago. Yeah.
Speaker 1:My close friend, jen Duke, messaged me and said I was on a podcast today and I think you would really like it. I replied what's a podcast? So there you go, ben, another person at the time. Seven years later, I've been through them all. We've been all through them all twice, some of them more than that. I'm also happy to say. It helped me buy two investment properties and I'm sitting on close to a million, a million, ben, a million dollars in equity, and my principal place of residence.
Speaker 1:So, first of all, curtis, I just want to let everyone know what your success trait is here, so that they can be letting on what the secret is. And it's this. Ben, he took action no, surely not. Action knocked me over with a feather. So, folks, curtis took action and has created a million dollars in equity. And I promise you, with property investing, if you don't take action, you can't create the equity. Ben, I'm just, it's just, it's. You heard it here first.
Speaker 1:On the podcast, I always also want to say Curtis created a million bucks because someone was kind enough to share that they should listen to a podcast. So I want to encourage our community who might have done a couple of laps, who might have had a few listens. Can you please also share? How about screen shotting the episode that you're listening to, or perhaps one of the favorites, putting it up on your socials? Tagging me, I would love to tag. I will share it on my socials too, if you do that, and we would love for you to share it. So that episode that Curtis is talking about was Jen Duke back in the 90s, 96, ben.
Speaker 2:The wonderful Jennifer Duke who's gone on and she's now. She's a journalist and so she's done a lot of economic reporting and social reporting. In fact I saw her, probably last year, on one of the press club interviews where she stood up and asked the question, trying to remember who the politician was. But anyway, the wonderful Jennifer Duke has passed on that. So thank you, jennifer, for making Curtis a million dollars.
Speaker 1:Yeah, exactly, jen, he, I think he owes you a drink, it's his share Exactly. When you see, hey Ben, we might just change the temperature of the tone here. We've got some some news to share.
Speaker 2:Yeah, we do. Unfortunately, one of the titans of our industry and I talk about the industry of the property investment advisory industry, steve Waters, who we had on episode 42. So Steve is one of the good guys of our industry and we're talking about those people who are buyers. So when Steven Victor first set up their business, there wasn't too many of us around and they've obviously got a great business called the right property group and unfortunately, we had the very, very sad news over the weekend that Steve Waters had passed away. And so, for those in our community who have listened to Victor and Steve over the journey, he had a lot of great insights, a lot of great knowledge and he's helped he and Victor have helped, obviously, thousands of people similar to what the work we do in our business.
Speaker 2:And so I just wanted to to recognise Steve for the enormous contribution he's made, not only to the clients that he served but serving on the property investment professionals of Australia Board when I was on the board and also the chair of that, that association for a period of time.
Speaker 2:So he absolutely gave back to the industry that he was very passionate about and to Chris and also, you know, the four children that Steve leaves behind. It's obviously a very, very challenging time for them at this particular time, and so we pass on our deepest condolences and sympathy to Chris and the kids, in terms of their situation, that are in. So he battled hard against this illness. He kept it very, very private, and so ultimately, it has been a bit of a shock to a lot of us that we no longer have Steve with us, but his legacy will live on for all of those people who listen to his podcast with Victor and Phil Tarrant. A shout out to those guys I'm sure they'll be doing it tough at the moment as well, and so, yeah, we're going to put our arms around them and our community and our industry in this difficult time and, you know, again give our best wishes to the family in these very, very sad times.
Speaker 1:Well said. Ben Vale, steve Waters, he all of those things you said were true. He was an incredible man who made an incredible difference, and I think the full stop here is he was one of a good guy.
Speaker 1:He was a good guy. That's sad news. So, yeah, all those heartfelt words to his family and, of course, victor as well, who'd be feeling it tough. Okay, we will change temperature just a little bit again, ben. But my mindset minute theme today is, for those of you watching this on YouTube, you'll see the visual and for those of you that are just listening to this, only I'll try and describe it to you.
Speaker 1:But I saw there's a very smart mind, ben. His name's Jim Quick. I love a lot of the stuff that he puts out and the content that he shares. And he's he had this image of what people think consistency is right. So, for those listening only, I'm going to build the picture for you. Imagine six glasses of water and those sorry, I can't even count them seven glasses of water, and imagine each and every one of those glasses is a metaphor for a day, right. And so what people think consistency is is seven glasses all totally full. Right, but what consistency actually is is a different picture. So, again for those listening, imagine those same seven glasses and in the first glass, totally full. Second glass, two thirds full. Third glass, totally full. Fourth glass, about a sixth full. Then the fifth glass is about two thirds full. The sixth glass is about, you know, a sixth full, and then the last glass is full. That's what consistency actually is, ben. We have this mind image in our head that it's always the same every single day. But what, what? The what? The imagery here is. What the message is here that I really love is it's as long as there is effort every day, or as there's, as long as there's consistent effort where something is going in every day. Some days you're energetically going to be filling it and the glass will be full. Other days you're going to have a mental battle and you're going to be fighting some demons, but as long as you're putting something in the jar and putting something in the glass, that still counts. So I really love this. I think it's a really powerful visual, and so it made me think about our seven day float system, ben.
Speaker 1:So at first, when you start the seven day float, I remember gosh. I've been doing this for a decade now, but when we first started the money smart system, my wife and I day one glass full, no problem, we are in seven day float, let's get this done. And then, week two, we got wobbly and the addiction to tap and go was hard to break, and so you had to remind yourself. But the thing is we were doing some things right and we're doing some things wrong. But the next week we renewed our energy, stopped the tap and goes. Fourth week, old habits crept in, and so the sixth or the seventh week of actually consistently doing the money smarts over time.
Speaker 1:Now the consistency is every week. We do not miss it. It is the driving force behind how we manage our money, as I noticed. For you, ben. So it is seven day. Float is something that we would not manage our money without ever again. But in the early days, when we were setting it up, consistency did not look like seven glasses full glasses the whole time. So it's about staying in the game, not getting it perfect. That'll make the difference. Any thoughts, reflections, feedback on that? For you, ben.
Speaker 2:Well, yes, it is about building those habits, bryce, and I think you're right. You're not going to be perfect. No human is perfect. You are going to be sort of teased by temptation as part of you know sort of living, and you might find yourself in situations with friends and love one, and so there's going to potentially be overspending at a having a quick drink or whatever that looks like. So that is true, but it's about trying to maintain that level of consistency, because with that you'll be able to attract more surplus.
Speaker 2:So we, you know internally, refer to what, as you just called it, the seven day float. It's the living and lifestyle account, it's the debit card that sits separate from your primary account and your main funds, which is usually sitting in an offset, right? So I think from that point of view yeah, I mean, you know we all have overspending weeks, and so whether you adjust for that and if you do, that's great If you don't, then effectively that targeted annual surplus is going to be adjusted by that particular amount, and so that's about trapping more surplus and then when you do that, guess what it's in your offset for longer you pay less interest or you can put it to work for you, which will ultimately create greater outcomes for you.
Speaker 1:How's this for a story from a listener that's written into us? Ben Hi, I just wanted to share how MoneySmartz has just saved us. We've been using MoneySmartz since 2019 and not really doing a very thorough job of an annual update. That's actually worked in their favor. Folks Stick around, the result being that our weekly float hasn't moved, despite increases in wages as well as the cost of buying stuff a hidden compounding benefit of using the system Nice.
Speaker 1:And this week we've had our bank card hack. The criminal doing this pinged us for $185 dollars again and again and again. Because of MoneySmartz, there was only the weekly float linked to the card, so only the first one got paid. While the bank will hopefully sort to be able to recover the money, in our old world system, one of our accounts with all the cash we would be worrying about potentially losing thousands. As it is, we're not too concerned as I have to write off the loss. Thank you very much. So, folks, again, consistency for this particular listener meant that they set it up and they got it in a way where they quarantined some money. So a nice little benefit, ben. But I like the compounding benefit going on here that they forgot to update, that they could increase their everyday float. So all of a sudden their surplus started to build on. The compounding benefit of just making sure you see payday as the amount that goes in on a Thursday, not the fortnightly, weekly, monthly big sum that comes into your world. So I love the change of thinking here.
Speaker 2:Yes. So, Bryce, in this particular case, I've got some positive news about also what we're doing with MoneySmartz on the More platform. So in this particular case, this guy here what he's been able to do by not doing that annual update has actually worked in his favour. But a lot of people who have used MoneySmartz until your point they're not continually working with their seven jars for their seven days fall away, and so we're making some upgrades to the MoneySmartz system in More. I'm super excited to give a bit of a teaser.
Speaker 2:One of those things that will be updated is in terms of doing the rollovers. A lot of people go oh, I didn't track for a period of time and now I can't rollover. With this upgrade, You're not going to have to wait for the annual period to actually rollover and reset. So that's going to be a big improvement, and there are a lot of other incremental improvements that we're working on. So that's all being coded up at the moment and I'm hopeful we'll be able to announce something in a couple of months time where that's actually gone live inside the platform. So we're just getting some incredibly positive feedback about all of the components that we're building in there now, and that's just going to be another huge step forward in terms of being able to run a money management system that works, takes less than 10 minutes a month to run. It's a proven system, so hopefully more people will pick up that system and track more surplus and we'll be helping more people in our community.
Speaker 1:Oh, we love sneak peeks around here. For those folks that are new to our community, if you go to morecomau and the way we spell more is M-O-R, go and check it out. It's a free money management system, as Ben said, so it helps you. Do that seven day flow, trap your surplus and hopefully you get a choice on what you want to do with the surplus and in our world, we hope that you put some of that away for investing in something that will look after your future and, of course, for us, that is established residential real estate. Hey, ben, today we're going to talk about real life case studies, and so I just want to shout out we've got a couple that we shared. We've reached out to our team and just want to say thank you to Amanda Jachowski, who, for those summer series listeners, will be familiar with Amanda and Stu Bartram, because the both of them have first of all gone to the client and said hey, listen, we want to share your story. I think it's got powerful impact for our community. Those clients said yes, and so they've helped us curate these stories. So they're real world.
Speaker 1:At the cold phase, these are the decisions that people are making Now. What we're going to do, ben, is we're not going to use people's real names because they've been brave and courageous to share their circumstances, but we don't want to identify them and we're also going to try and keep locations as anonymous as we can so that just keeps it fair for the people that are sharing. So these are real life people who have faced real life decisions and you're going to get to look under the bonnet and see what's going on. It kind of helped me, didn't help me.
Speaker 1:I've been reflecting, ben, that because of the world of podcasting, we now get to quite easily and quite simply be flies on the wall in conversations that only 10 years ago you would have dreamed of being a fly on the wall. So you know, in terms of us talking about property and property investing, it's hard to get on there's. You know, if you were listening to a billionaire, how did they do it? If you're listening to someone who's overcome minds that you listen to someone who's manifested, some of those conversations are very, very difficult to get in the room and now all of a sudden, for free, you get to do it.
Speaker 1:So today we're excited to be able to showcase a couple today. All right, first one I'm going to rip into. We've changed his name to Billy. It's not his real name but Billy was recently separated from his partner. So it's raw new and fresh right With a two year old son Not only that starting his own business.
Speaker 1:So for anyone who's just started a business, ben, you know it's a pretty steep learning curve because you're good at your craft. But when you start a business you're still going to be good at your craft. But you've got to be good at putting stuff around, being good at your craft and you know bass and the books and getting clients and keeping the lights on and paying staff and all those sorts of things. So Billy was previously a pay as you go earner in the mining industry but now for a couple of years has been self-employed. Now folks stick around. There's a story around being early stage business development and self-employed and lending, which we'll get to shortly.
Speaker 1:But within the confines of the previous relationship there was a property in a mining town. So as part of the divorce that was a really negative experience. It took 18 to 24 months to sell. There was lots of negative cash flow involved and they sold at a loss. So that loss, when it's crystallized, been on paper that's fine, but when it's crystallized you've got to carry that loss.
Speaker 1:So Billy had to not only carry that loss but get themselves into a position to get to the starting line again, so started behind the eight ball and had to get on that on top of that debt from that previous decision, which wasn't amazing. So this definitely shaped him considerably as he just wanted to move forward and get professional help and help with the other plan. So he's West Australian based and travels in and outside of Western Australia for the work. So that's kind of set in the scene here. Ben of the person that we're talking to but not too dissimilar to a lot of people that we chat about with Ben is that relationship status when it changes. You're in sensory overload with everything that's going on in your world, let alone just your financial circumstances.
Speaker 2:Yeah, bryce, there's a lot to be said for if you're in this situation which we find, billy basically two steps back from where he probably envisioned his life to be right being in a relationship and having an investment property under the belt. He now finds himself with the sun and ultimately feels like he's starting from ground zero. He's also trying to build a business up. So in terms of stress levels, billy would probably be up there, and my advice to people who are going through these types of events is it's really helpful to have a sounding board, someone who you can bounce off ideas with, because Billy wants to live his best life right.
Speaker 2:Like the rest of us, we only have a short amount of time here to do things and have meaning and live a purposeful life. So I think what we're about to find out because obviously we know Billy got help that that is a really important part of trying to get through this. If you think you can do it all by internalizing it and trying to keep battling through all these challenges without having you know whether it be a guide or a trusted partner in terms of that professional partner that is, it's going to be harder. So I just want to commend Billy for his critical thinking and holding on to a bit of ambition. You know it's my favorite word at the moment. But holding on to, you know, a belief, a dream, some hope, because that is a powerful driver and motivator to be able to get people where they want to get to.
Speaker 1:Yeah, yeah, 100%. So here's the problem that Billy was experiencing. It shows up in an external form and an internal form. So let's go externally first. So he's essentially a blank slate now no property, limited borrowing capacity available and currently no home because living in a cottage on his parents' rural property. And that's not untypical. What's, what's the? Are you typical?
Speaker 1:Unusual, unusual, there we go, that's not unusual when there's relationship stress, right, but he wants to go back onto the property ladder. But the other problem is with working with a mortgage-broken capacity. He doesn't have sufficient lending at the moment to jump back in, and we'll unpack that shortly. So that's because his business is building up and so he needed to invest in purchasing equipment, but last financial year declared a loss, which is fine if you are trying to minimize tax spend, but it's actually a real challenge when you're trying to get lending and it's this real tension that builds up for people that are in this situation, because your accountant is trying to minimize the amount of tax you pay and your mortgage broker is trying to maximize the amount of serviceability that you can offer.
Speaker 1:So in this case, billy needed to wait until getting the coming tax return done, sort of in that July or September period, because once that gets done, there will then be an opportunity to get some lending. So so this is a very important lesson. I want to pause here and reflect with you, ben, but that tension that people have around the accountant if they're doing their job well, then the accountant's job is to say, right, let's just drive down all that we can. So you're declaring that minimum amount, which is great, and it's usually good for cash flow for these businesses that are in startup. But let's, ben, you're the mortgage broker. Let's talk to some some experience and some examples that you've seen in your journey, where someone says, yeah, I actually earned this amount of money, but I've only declared 16,000 in my tax return.
Speaker 2:So yeah, I mean that's right. The accountant's thinking they're doing the right job by minimizing their tax legally. And one of the big things that's become part of the normal process in federal politics is instant asset write offs. So when we're purchasing equipment and you know, in the past that was up to $20,000. And I think at one point there it got to $100,000 on larger machinery and so that's really great for businesses because it ultimately means that I can write off that total asset, which reduces my profit, which means my income is lower, my tax, my tax liability is lower. But it does nothing for the ability to be able to borrow money. And even though we have some lenders out there now who look at 12 months of income and you know, recent basses predominantly most will still want two years of financial results. And the reason for that, simple, is that most small businesses don't necessarily, you know, survive over that three to five year early window. So they're looking for consistency of income because they're going to lend you a significant amount of money over 30 odd years. So that's the story.
Speaker 2:Now. Wealth creation through property is a game of bricks and mortar, but it's also a game of finance, and so having the ability to borrow is absolutely critical. So good news story here is a man just put them on to an investment savvy broker. That broker has given some clues about potential borrowing power, subject to income. Then bringing the accounting into the conversation to understand, ok, what's the trade off between having that money now in terms of minimizing tax, versus creating wealth over the long term? And if you think about the power of compound over the long term, that property is going to do an incredible amount of heavy lifting that's going to build wealth out for him and his son over time.
Speaker 2:So that's the bottom line here. In terms of the challenges that we have for people who are doing their tax returns, it's always our recommendation to bring your trusted mortgage broker into the conversation, remembering that they still have responsible lending legalities around their recommendations, so they're doing stress testing on that sort of story as well. But to your point, bryce, this is about realizing the full value of equipment in one year. If that is amortized over five years or whatever the standard amortization period is, we can still potentially get those deductions. But it just means that we have higher income, and higher income ultimately means that we can borrow at an amount that allows us to get into the market.
Speaker 1:Yeah, I guess the takeaway that we want everyone to just catch with what we've been chatting about is there's a spectrum Right and you've you've got to find the spot on the spectrum where you're comfortable, where you're paying enough tax that you can cash flow that allows you to get the borrowing capacity but also getting that right. So to your point, ben, you know Matt Kirk is working with the the account to find that right. So that's the problem up front. So, but here's what's going on internally for Billy, right, his questions were around well, how do I actually do this? What is the sequencing I need to do? What do I need to do first, even having those conversations around lending, because his previous experience with buying that property in a mining town has left him licking his wounds a little bit.
Speaker 1:So he wants to avoid making mistakes, so therefore very, very keen to work out do I pay with my time or do I pay with my money, right, and so previously he's already been paying with his time, so he's quite happy to pay with his money to get some professional help here. So so what's at stake for Billy? Well, it's pretty obvious. He's got a family. He's got a two year old son. That is incredibly important to him and you'll see how that comes out as we develop the plan here.
Speaker 1:He's clearly building up a business, so needs to make sure that he gets that right whilst dealing with the relationship stuff. Doesn't want to be wasting any more time from before and as a single person, it's just his income. So he needs to be relying on himself and he wants to be a good role model for his son and have that positive impact on creating the home, but also wants to make sure that there's a passive income and some good financial flexibility that comes with that. So he would really like to have a place for him and his son to call home and personalize it, and he has quite a few skills that he can do, so clearly quite handy.
Speaker 2:Yeah, I mean you know ambition, so so it hasn't broken him. He still sees a pathway forward. There's still an opportunity for him. He's not. He's not done, and I know we've talked about age recently right, in terms of people are not done in their sixties in some example. So there's still a huge amount of time for Billy to be able to plan, to become what he plans to become 100%, yeah, well, said so.
Speaker 1:Ok, well, what's next for him? So he, he, he got an epiphany through the planning exercise, ben, and it's a. It's a really good one, right, because he could. He could have got a property that he could have put some sweat equity into when it comes to his own personal home. Handy got the skills, been able to do that, which is great, but the the penny drop moment was jumping into the home isn't actually the key priority that he originally thought it was right. So he went into delayed gratification mode and decided that the first property needs to be needs to be an investment property because he's got the opportunity to stay on the parents property rent free, which obviously saves a bit of coin there. And it may not be the ideal home, but it's got networks and close support and around his sister and his parents and all those sorts of things.
Speaker 1:So, whilst he is raising his son, that that for anyone and I have never been in this in this spot, Ben, but I know plenty of people have that is critical right, so that we can get that support when we need it. So, but at the same time, making sure that's under control, whilst putting a growth asset into the portfolio and doing that as soon as possible so that we can you know as to your point before Ben start that compounding. So what was the plan that he entered into?
Speaker 2:Well, bryce, just before you do jump on to that, what, what's also part of that epiphany is this whole idea that by getting someone who cares, but not as much and I know, is not living Billy's life. So what Amanda's job is to do is she's she's basically putting all cards on the table. Now what have we learned that? The clue here cottage, free rent, close to family, assistance and resources, sister and also family. Now that helps him to have a bit more free time to also continue to develop out the business and get that on a really strong footing. But here's the other secret source income from the rental property. Income from the rental property gets added to his personal income, which gives him greater borrow and power, which means he can get into the game, you know. So all of a sudden it's about controlling that asset, which then allows it to breathe and go over time. So that's, that's the.
Speaker 2:That's the story here, and you know this is how it plays out. It plays out in a plan to buy three properties. So the first one. So we're going to be rent vesting to start, but in, in essence we're not really rent vesting because we've got free accommodation on, on, on mum and dad's rural property. So that is the X factor here, for for Billy's story, there's no doubt about that and we're taking full advantage of it in the short term. Then the second property is going to be the home. So you know, a lot of people do believe strongly in the Great Australian Dream, as do you and I, bryce, in terms of eventually owning your own property and being in control of that property. So that's property number two, and then property number three is an additional investment property. So what we're now seeing is a really nice story, sequenced in an optimized way to be able to get into the market as early as we possibly can and build off that over time.
Speaker 1:Sequencing and optimizing. I think that the two key words that you just said there. But here's Amanda's, here's Amanda's feedback on this. Right. She goes I'm creating a plan for a single gentleman who's unlikely to be single for the rest of his life, but at the moment she's called it the single gent plan and she's also said I've made plenty of single lady plans before, but he hasn't really focused on when am I going to find another significant person into my life?
Speaker 1:It's like this is what I can do with my resources now. How resourceful can I be? And then with that, with that goal of being financially independent, and when the time comes, if a new person comes into his world, they'll have their own preferences, their own buying capacity, potentially their own income. Well then he said well, we'll just regroup at that point and we'll make the appropriate changes at the time. I like this, ben, it's not just the single lads, it's for the single ladies as well, but it's just saying if it's to be Ben quote the great man it's up to me. I'm going to go forward with a plan and then I can walk a mile, see a mile, and if I need to pivot, I'll pivot.
Speaker 2:Yeah, it's a bit more upside in that story, isn't it? So, in the event that that doesn't materialize, I've at least got a baseline level that's going to charge me towards a comfortable retirement. And, yeah, if I happen to fall in love on that journey and we've got that additional income that's coming in as part of that particular story, that's a great one. I also love some of the other elements of this in terms of he's thinking about his son and he's thinking about look, let's provision for a little bit more of an upgrade in secondary school. So we'll do public primary school, but we'll you know, I'll provision for that.
Speaker 2:And there's also another provision in there in around you know the final separation and you know the divorce settlement. There could be some legal costs associated with that. So we've put a little bit of a buffer in terms of allow, or Amanda's put a little bit of buffer in there, allowing for that as well. So I think that's also thinking about the risks of what could fail, what may go wrong, and so that's going to be a really important part of that particular story. So I feel like there's been, you know, the ABCD has been well played out here, right, you know, cash flow management, borrowing, asset protection and defense. There does appear to be enough of that sort of sentiment around how we're going to be thinking about things that might surprise us on the downside as well as a lot of upside, over the next couple of decades.
Speaker 1:So to summarize that, folks, it's investment property, first one, 625, then the new family home a couple of years later. So this is pegged in for 2028 at around the $800,000 mark in today's dollars. Don't worry, folks, we know that it's going to cost more to get an $800,000 property in today's money. We definitely have factored that in, but just so it's got context to today at 800. And then the second investment property, which is the third purchase, will be around the $600,000 mark in today's dollars. Again, by the time Billy gets to buy that it'll cost more than that. But again, bringing context in today, we get that question a lot. Then won't it cost us more in the future than when it does? Yet 100%? That's why all of our models have future value factored in, and present value is the context that everyone gets to see it through now.
Speaker 2:And Bryce. I'm also looking at the plan and there's also a delayed gratification, little short term incentive in there as well, and anyone who lives on the West Coast knows that boating and fishing are two great pastimes at Bryce and I also enjoy when we're over in the West and there's an $80,000 boat also being planned in December of 2028. So he's got a sort of five year within five year sort of objective to be able to do that. But that's a really exciting story. I mean, if this materializes as planned, then he's going to be able to have some, create some great memories and experiences with a growing sun on a boat and then ultimately still build up that sort of significant wealth over time to provide for him and his family.
Speaker 1:Yeah, that's super important. So the delayed gratification has a light at the end of the tunnel. There's a vision in a North Star that Billy's working towards. I love it, I love it. So I guess at the moment he's got the savings position around $70,000, but he's saving very quickly. That's going towards $150,000 very quickly because he's still paying himself a salary out of the business. Some expenses go through the business, he's rent free and he's got that.
Speaker 1:As I said, he's got that target for $150,000. So he'll be very close to getting in a position to be able to get that first one soon. He'll use Lenders Mortgage Insurance. But it means that you know, you remember our theory on Lenders Mortgage Insurance, folks, if you haven't done a couple of laps of our podcast embrace it when you have to and void it when you can. It's one of those necessary evils at times for you to get in. So if you can't avoid it, great, because it's actually ensuring the bank against your default. It's not ensuring you, but it means that you can get onto the ladder and enjoy the bigger picture benefits of what that has. So embrace it when you have to, avoid it when you can. He won't get any first homeowner benefits spent because of that previous mining town property. So there's no thirsty benefits. Billy's going to use a buyer's agent, he's going to use an investment savvy mortgage broker and, of course, there's some collaboration with the accountant.
Speaker 1:So we think that the plan is conservative, which is really our MO here. It's our baseline foundation. We don't like to take any aggressive risks. So, yes, you heard that right, folks. One investment property and, sorry, one owner occupy a home and two investment properties, three in total. The stats tell us that anything more than three is quite an outlier. So there's not five, there's not seven, there's not 10 properties here, ben, there's three in total, which is really, really important. There's a plan where you can keep reinvesting back into the business, so building up that cash, and also get some debt reduction ready for the next property as well.
Speaker 1:Interest only loans and offsets Ben, you can never get bored with talking about the basics because there's so incredibly important. So you can keep investment, interest only and offset accounts and then basically what he wants to do is fill up the account in those offset accounts so that essentially, when they move on to the family home and keep upgrading the family home yep, for those on YouTube can see the action you just did, ben. For those listening, it's kind of like picking up the bucket of cash and moving it wherever you move, yourself and your family so that you can still get maximum tax deductibility of the loan because you haven't changed the purpose of the loan. So that's really, really important in this case, ben.
Speaker 2:Yeah, it is. I mean, it's a classic case of setting up the next offset account against the parental place of residence. That's then moving that as your primary account, and we would always argue to get your lending as high as you possibly can, but park all your liquidity in your offset bucket. No need to go into LMI if you don't have to. But if you do an 80% lend on your own or occupied home, but parking every dollar in an offset bucket and then also reverting all of the rental income into that one central primary account is essential and then making all the repayments out of the different loan splits that you might have as part of your lending structure. And remember, uncross-securitized properties is an important part on that.
Speaker 1:Yeah. So what's the end goal? Well, there's two things right. One is the achievement. So the goal is to get $2,000 a week at the age of 60, so currently 35. So there's 25 years in this plan, ben. So the question is okay, 25 years? Well, what are you going to do? Anyway, those 25 years are going to come and go. So you either do what Billy's doing and plan the next 25 years, or you do what most of the population does, ben, and they get to 60 and look back and go oh, should I make some decisions? So, but that's a goal. There's a note that Amanda put here, for when I was talking to her about it, the goal is the equivalent of a couple. So usually couples come in, they want to retire at 60 or 2,000 a week, or Billy's single and wants to have $2,000 a week at 60.
Speaker 1:So we've talked about that previously, where there might be some pivot that comes with a future life partner that comes into Billy's world.
Speaker 1:But this case he's got a really, really strong goal when it comes to his outcome in retirement and it's that equivalent of what two people typically would do.
Speaker 1:So but here's, the internal sort of end result for Billy is this it's become very focused. How many times do we see it, ben, when someone comes in and they are a bit of a wandering generality and then obviously they come in and two people in the case of two life partners, in this case it's for Billy like it's super clear on where they're going and then everything tightens up and that path it's almost like that path becomes illuminated very, very quickly. So that becomes razor like focused, and where your focus goes, your energy follows. So he's very excited, he feels in safe hands and, importantly, his, his I guess this would be a transformation that a lot of our clients have been is I have this feeling now that they they're not going to make a mistake, because that that can cause a lot of inertia when you, when you feel like, oh, that's the procrastination, that's, you know, raising action thresholds, that's. That's the number one thing that a lot of people want to overcome.
Speaker 2:Yeah, you know, again, my favorite word at the moment is the ambition. So the transformation for me has been that, even though with the setbacks that he's had at 35, he's not giving up on his lifestyle by design there is ambition to make sure that he can provide for his son and provide for himself. And, you know, if he also has the boat which isn't really so much a material thing in the West, they aren't there, they're basically experience machines, right. So they allow people to create great experiences where it's fishing or or getting out with the family for a, for a boating day or whatever that is. And, you know, going over to Garden Island and parking out the picnic rug and doing all of those types of things.
Speaker 2:All of that is plausible over there in the West, right. So that's the sort of stuff that I think is really exciting. For for what Billy Story is going to roll out and, to your point, I mean, you know where ambition and preparation is met is met. He's now got a line of sight. So that focus that you were talking about is allowing him to to get busy in these formative years at 35. The next decade is going to be important for him, for both his business, his relationship with the, his son and, ultimately, in terms of the, the foundations of wealth that he's going to create, and then he'll get the, the beautiful compounding benefits of that over the next several decades.
Speaker 1:Good on you, billy, great story. We know it's not your real name, you know who you are, but I think you hopefully will inspire a bunch of single dads who might find themselves in that situation where they can use you as a, as a track, to start conversations around how they might be able to do that for themselves and their families as well. So I've been our second case studies from Stu, stu Bartram, who who, when I was chatting with him yesterday, this, this, this particular couple, was a real joy for him, because there is there is so much more at stake for this couple than just the outcome of money and the planning process and the pathway. There is. There is a real there's, there's, there's a lot going on for them and Stu had a lot of joy out of helping them get to this point. You'll see as we build this story, ben, what I actually mean by that and I'll make it more obvious later. But we've got Liz and Michael here who are great, a great couple in their in their late twenties, who are happy sharing their current situation, their background and how it's affected their mindset, and that's really important. I really want to labor on that shortly.
Speaker 1:Liz is a nurse, michael is in Victoria police Now. Liz is both FIFO and casual. So this is this is important, because when you've got casual income and you're FIFO, that can create a little bit of uncertainty for you as well, but that'll play out shortly. Liz, they've got an owner occupy a home and they've got an investment property. They wanted to get some feedback about that investment property, which is not uncommon, brent Ben.
Speaker 1:So the last six months Liz has been focused on increasing her income through doing more. Over time. They've both been really focused on getting into better spending habits through reduced discretionary spending. Obviously, looking at that seven day float, and they feel a lot better when it's. It's a nice feeling when you start to see cash in bank start to increase noticeably. So but through through the process that Stu went through with this particular couple, digging through and agitating, some of that tension brought up a lot of emotions which were linked to childhood and the younger year. So great, great couple, very open, very vulnerable in the planning process and, as I said, it's it's been more than just numbers and dollars and cents and spreadsheets. It's been really, really important to help them with their mindset. So, yeah, feedback, ben, before I move on.
Speaker 2:Yeah, well, again, I think you know there's a bit of a theme coming through these two case studies that we're talking about, and that is that having that accountability partner you know, in this case a trusted property investment advisor has allowed them to open up and share that story and and in some cases, get some validation on some of the ways they're thinking. But in Liz's case here, what we're going to see is, you know, she's got high anxiety and I'll talk about my anxiety. You know I can relate very, very much to Liz's story in my early twenties as well. You know you want to try and get to a destination really quickly and you're, you know, because you want to try and be financially secure, but then you don't want to make a mistake as part of that. So I call it about this vicious circle. You know, and I use the fishing analogy fish or cut bait, fish or cut bait, and you never do anything Right. You just get caught in this anxiety pitch story that you're telling yourself because you, you know you're talking about from a property point of view, it's hundreds of thousands of dollars.
Speaker 2:So it does feel like, you know, there's a lot at risk and there is um to some degree. Obviously you can minimize those risks by, you know, buying whale and getting good land value and doing your research and making sure you're not overpaying. But it just comes back to if your partner and you can't resolve, whether it be anxieties or even in Billy's case. I want to rebuild ambition. I want to rebuild my life after a separation, then getting some professional help to be able to do that where the advisor cares, but not at the same level. They're not emotionally attached to that. They can separate out that emotion. Stuse sounds like he's done a great job in hearing about these tensions and these emotions. That has really in some cases kept Liz up at night. I think that there's a big story there.
Speaker 1:It has kept Liz up at night. Right, because here's the problem that I'm facing. We'll go what was obvious to people outside and what was actually going on in the inside. First of all, they were living week to week financially right, they did credit. The TPC is to help them build those habits, ben. That's really encouraging. They were overwhelmed by different options. And what if they made a mistake? Here we go, folks. It's popped up again. What if they make a mistake?
Speaker 1:How many of you listening to this have that as a potential reason to procrastinate around whether or not you will do the same? They had an investment property in the northern part of Melbourne, on the outskirts of Melbourne. They wanted to know was that property performing, because it was actually a unit that doesn't have a lot of land, right, her anxiety around that was causing elevated inertia. There's also stress around the job, which has been casual. How do I get the pre-approval that anxiety made it a lot worse, right? What's interesting is that anxiety was false evidence appearing real, ben FVRA. False evidence appearing real, because later on it proved to be just true in mindset but not true in reality, right, but the thing that was going on for them internally here was they were overwhelmed due to different philosophies and options. I empathize with that, ben. If you listen to us, we're a get rich slow program. We talk about retiring out the debt and then you go to another seminar and they might do options and they talk about getting rich quick and then you go and get to another seminar or you go and listen to another podcast. So how do you bring us all together and say what's a meaningful plan for what I want to do? That is normal and understandable, that a lot of people in our community can feel that way, because I'm sure some of you might be listening to a whole range of sources. So in this case, liz was definitely feeling that right.
Speaker 1:So and those mixed voices were externally we're just continuing to compound that anxiety. I didn't know where to go and this anxiety around debt and finances was showing up to the point where it was impacting Michael as well, because you could see the impact that it was having on Liz and, as you know, with your loved ones, you really want to help them. So that is a big part of this story, right, and when we reached out to this couple, we said we really want to help others who are feeling the same way, ben, you've just described it in your own world. Lots and lots of people are doing it, experiencing it, but here's what we do know for the people that experience is they think they're the only one right, so it's super helpful to hear that other people feel this way as well.
Speaker 1:So what was at stake? Well, like you, don't achieve your financial goals, but I think remaining in high anxiety was really affecting quality of life, and it'd be interesting to know, ben, how long that's stuck around for you and when the shift happened for you that you were able to go. Well, I'm not going to let this be the master that I serve.
Speaker 2:Yeah, well, in my early 20s it culminated in me seeking some professional advice from a psychologist around why I was feeling that way, and so we worked through a couple of things in terms of backstories and also just started to think about live now, don't think too much into the future, because that's what I was doing. I was basically 21, 22, wanting to be 35 and wanting to be set up and successful and all of those things. So I was putting this extra pressure on myself and it was ultimately affecting my mindset and how I was acting at that time. So I think that's a big part of it If I could see a roadmap or make the invisible visible and then fast forward. Now I still have some moments of anxiety because I had really strong anxiety in my late teens, early 20s. So that just gives you some idea that you can build the muscle memory around mindset and change.
Speaker 2:So, no, do I worry about money anymore? When you worried about money as much as I did in the environment that I was in, I'd be lying if I didn't say that. Do you ever fear that you will lose at all? There is still a small element of that and I don't think I'll ever get rid of that, similar to Jerry Harvey, I think he's sorry because he obviously grew up incredibly poor and so he's got financial and actually I don't have that sort of level of that sort of story. But I'm always making sure that I'm not ever risking more than a small percentage with the decisions that I make around our money.
Speaker 2:And if I keep doing that and I've been doing that over the decades now I'm in a financial position where ultimately it would be quite I don't know what would take all of that money away and get Jane and I and the kids into that sort of difficult position where we'd be starting again. I don't think there's anything that would do that. So, and I think, coming back to obviously Liz's position here, when you go through that exercise and part of one of the things that I would go through is if I was feeling that way, I'd just reset in terms of, okay, well, just bring the numbers up, are you employable? So in her case she's a nurse, so I'd reinforce that. There's lots of nursing jobs around, so I'm not going to lose the ability to earn income. And then you know that would calm me down If I ever felt like there was a big moment of lots of money going out and you know how was I going to pay for all of this.
Speaker 1:Yeah, okay, good Chairman. I reckon that's super helpful for people who, because they see you as the version you are now, they see the highlight reel but no one gets the behind the scenes.
Speaker 1:I must admit I didn't have anxiety growing up around taking action. I had anxiety that I wouldn't be in a position to take action. I remember I was working at the casino it was the Burswood casino back then, it's now the Crown and I remember I was 21 and I was casual. I'd walk around on a Saturday night. I was fixing the poker machine. Someone would call. They'd press the button, I'd pay them out. I'd have to go and write the thing, call them in, I'd basically got paid to socialize. It was brilliant, right. But I remember I was talking to one of the leaders at the time and I just kept on saying I'm running out of time. I'm running out of time. He goes what do you mean? So I'm just running out of time and you know how. You are the average of the five people that you spend the time with. If you remember, my backstory was a benchmark to a mate who bought his first investment property at 19.
Speaker 1:So, I'm 21, I'm thinking I'm two years. He's had it for two years, and so my benchmark was, every day that I got older, that I didn't get into the game meant that I was getting further and further behind. So that's where my anxiety was around. And look, I love my dad. In fairness to my dad, he was born in 1939, he was a builder generation, but he wasn't a risk taker in any way. So there was no sort of family tree guidance on how I was going to do it. I just knew that that's what I wanted to do. So I did have the anxiety around not being able to get into the game. So, but, beautiful share from you, thank you.
Speaker 1:But I guess what I loved about we have this roadmap analogy that we have in the business, and it's basically we hate one size fits all approach. We've said that from the very first episode of this podcast, ben, but we live and breathe that in our business, with our team, and so what happens is they say to a client what we want to do is we want to set the Google map and we actually want to go. Here's your starting point. So let's you know you and I are Victoria, so our starting point is, let's say, melbourne, and in my case I want to go to Perth, let's put it in. And do I want to go the quick way? Do I want to go by Calguli? Do I want to go by Esperance until I get home? And we can tailor that and so we use that language a lot. That people may want to go from Melbourne to Sydney or Sydney to Brisbane and you might want to go quick way, fast way, visit the parents, all that sort of stuff. And that's the beautiful thing about Google Maps is you can actually do that, you can put it, you can hit the three dots, put a stop in, okay, we'll go via here, then put another stop in so it actually gets you to the end destination. But it allows it to be tailored.
Speaker 1:Here's what Stu said in this particular case, that roadmap analogy applied. But he was he. This is what he kept on saying to Liz that I want to make sure that you don't actually put the Google map in, say it's Melbourne to Sydney, but then you get, you stop at Albury and you're on the side of the road and you're looking at the map and you don't get back in the car and you don't take it all. Worse still, you're just on the fringes of Melbourne and you've got the map out and you don't get in the car. And so he was really strong about saying don't get stuck. If you have the roadmap and you have the dedicated steps that you need to take the pebbles and the creaks, pebbles.
Speaker 1:That helped you get across because, he said, the prior behaviors meant that this could have showed up, right? So therefore, he spent a lot of time focusing on that passive income at retirement. So again folks, ben said it, I said it, we've got Liz here. If you're feeling some anxiety around this stuff, it's normal, but sometimes some of the way that you clear is, it's not the monster under the bed that we're afraid of, it's the thought of the monster under the bed, right? So therefore, if we can actually get super clear on what that looks like, it usually helps chip away and break away at some of this stuff, right so? But the epiphany was super clear. About six months ago they said and this was quote, unquote stuff this we're spending too much and we got too much anxiety. We've got to get on top of this. We're sick this is again quote we're sick of living week to week and treating above water. I wonder how many people think that too, ben.
Speaker 2:Yeah, just it's a good example of okay, you know, and for people who suffer from anxiety, it just doesn't just disappear, right? That's my message. It's taking me decades to get to the position that I'm in today. So, but, having that trusted advisor and that trusted partner, you know that my psychologist really helped me in those earlier days and you know I spent probably six to 10 sessions with her and then, you know, was able to find my way in and I've just found mentors and other things and, you know, got into books and really started to work on myself, because that was ultimately where the work needed to be done. You know, I decided it needed to be self driven and it was obviously going to be my story that I needed to rewrite, and so that's, you know, that's the journey that I went on.
Speaker 1:Yeah, and I think getting it out of your head and into some form of clarity outside of your head where the anxiety lives up here, right.
Speaker 1:So the plan was simple right, Implement money smarts that's done. They did the money smart system. Trapping more surplus, living on seven day float Okay, baseline done. Then we answered the question around the property on the fringes of Melbourne. The answer was to hold that right for a whole range of reasons, which include cash flow and recycle costs and all that comes with considering selling.
Speaker 1:That wasn't a sense of enormous relief, right that. Just that clarity alone stripped away some of the anxiety that was being experienced in this household. And then the plan was to buy two more investment properties Because, remember, they got their own home, had more investment properties to. The plan is to buy another two. So, folks, in this case we got one property, one home and three properties. Again, we're not talking seven, we're not talking 10, we're not talking 20, we're not talking about renovating and redeveloping, it's just these having these long term buy and hold assets, right. So the first investment property was equivalent today of $600 and the second investment property equivalent today of $500,000 bent. So that was how they were going to achieve the plan.
Speaker 2:Yeah, they were. And what's interesting also in regards to their situation, they're debating about whether to have children or have a child, and so part of you know feeling like they're financially okay could trigger them to think about, okay, do we want to have children because? And so part of what you then did was plan for that child, so in 2028, there's a contingency in there for a child to arrive. And, interestingly, part of that story then is, you know, some some great schooling and great education through a private school fee provision. That's also in there as well, right?
Speaker 2:So as Liz and Michael start to go on this journey, they're going to get a lot more confidence in their numbers. They're going to get a lot more ambitious about. You know what their life looks like for them as the. You know the results start to come and then you know they can start to release those mooring lines, build up more of that confidence and ultimately, you know, continue to think about ambition. And again, that's where the child might come in as part of that particular thing as well.
Speaker 2:So I think from that point of view, it's a good story.
Speaker 2:They'll continue to build their education out in terms of the fundamentals around property, investing, wealth creation.
Speaker 2:Hopefully they'll keep listening to us babble on week to week in terms of what that looks like to reinforce that confidence and it because it also helps to you know whether we're that silent mentor or whatever to continue to reinforce those basic fundamentals, make sure that you know we're landing the plane over a long period of time and staying true to those principles of asset selection, borrow and power, cash flow management and defense and obviously the five steps you know clarify, evaluate, plan, implement and manage to all of those fundamentals well, and then that should then allow Liz to make sure that she's continually reducing her levels of anxiety and she can get on with her and Michael living, you know, the best version of their lives that they want to, and I think that's that's the story here.
Speaker 2:It's about reducing that anxiety and then, basically, you know, not feeling worried about money is the greatest joy I've ever had, to know that you know my wife and my family are going to be financially cared for and then from there, you know the sky is the limit right In terms of that peace of mind, that security that a lot of us are striving for as part of, you know, being the you know the primary provider of the financials for our family.
Speaker 1:It's a wonderful feeling. It's a feeling that we want every single person in our community to feel and we look forward to you applying these principles and having the takeaways that you can do in your own portfolios. Now, when I was chatting with Stu about this to try and be a fly on the wall in the process, the, you know, you touched on it, the education on the fundamentals. That was profound, right, because that's satisfied her curious mind and it underpinned the confidence to take action, right. So there's a fine line here where we don't want to say just get fully informed.
Speaker 1:Fully informed, which is an opportunity for procrastination, ben, we want to get the action dialed in. But just through that process of making sure that Liz was fully informed of what we're doing, what it takes to land the plane, from what's been set on the podcast to how we actually fulfill that in the plan, that was, that was a, that was a stress reducer and, as Stu said, it definitely well, significantly reduced anxiety and underpinned that confidence to take action, because it is the number one success trait. If you were to listen to all of the podcast summer series we've done, ben, and you were to take copious notes of all of those summer series and see if there's common threads. I can assure you I can save you the shortcut, ben, because some of them have done different stuff, they did different properties, they did different strategies and they're different approaches, but the number one trait that is common is the action.
Speaker 1:So we spend you and I spend a lot of time encouraging people to take action, right. So how did they take action? They, they, they said yes to proceeding in the initial conversation that they had. That's significant, ben. So they booked the next chat straight in that initial consultation. I think that's important because some people want to go and think about it. I think that's fine.
Speaker 2:Yeah.
Speaker 1:Totally fine. But in this case I think it's a really good sign. Yep, we're going ahead, next meeting, right, and then the planning process was complete in seven weeks. That's from that initial chat to the plan. Now some of you go, okay, that's fine, that's. That's significant for someone who has anxiety been because, that easily be 10, 12, 20, 52,.
Speaker 1:Oops, we never got back to it. So, from start to finish, seven weeks. This is, you know, a really good sign that the anxious ways of the past but continue to go through that process, which was a great sign. So then they engage professionals. They got involved, chatting to Bede, which is their investment savvy mortgage broker. They had a conversation with Brad around buyers agency. They got the pre-approval and then those significant milestones that were factored in the plan were all based on their mental wellbeing. So significant outcome. But I just we got a pause on a bit because yep, this is this is the actual nuts and bolts of went on. You know, this is the drill bit.
Speaker 2:But what?
Speaker 1:we're actually talking about. The whole is is that we want to hang a picture frame up.
Speaker 2:That's right. The drill bit is a means to an end. That's the debt. So another compliment here is around setting up money smarts. So rules based money management system means that you know people who have anxiety do want structure, they want you know they build habits around that as well, and so you know, I think that that's going to be a huge advantage for Liz and Michael in terms of because they can play around with their numbers in there and they can look at annual surpluses and and they can obviously use money stretch as part of that. So I think that that's going to reinforce when those anxiety levels start to ratchet up, get back into the numbers and, and you know, cool yourself down in terms of looking at that.
Speaker 2:So let's have a look at the end result. What do we see in terms of the achievement? Well, they've got plenty of time up their sleeves, so that's always a good story here. So early retirement, so not the technical access to super time which is probably for them is going to be at 67. They're going to be able to retire both at the age of 60 because they're putting in the hard work now they've already got.
Speaker 2:Remember, they've done well by getting one investment property and also they're unoccupied home. So they're talking about 160,000 in passive income. Now there are benefits of that with three properties in terms of being able to do that. Now, of course, having one child versus two or three child, that's what does play with those leavers. So you know that. But that's the beauty you get if you want to, you know, to have that independence that's definitely part of that debt free by 2045, eight years before their technical retirement. So even if they don't want to chase down that 160, they could go earlier if they ultimately wanted to, based on those cash flows and by reducing those debt levels earlier. You know, basically the three investment properties plus the family home, that's going to create an enormous amount of comfort for Liz and Michael and again they'll be able to get on with, you know, building other experiences and just have their passive small business on the side doing its thing and ultimately build out over time as well.
Speaker 1:And that helped with the anxiety been knowing that they could pay it off before retirement as well. Here's the kicker net wealth at retirement 17 million.
Speaker 2:Sounds ridiculous, doesn't it?
Speaker 1:Most people are just going to go oh, that's ridiculous, right, that's ridiculous. But all you have to do is do doubling cycles each year and look in the revision mirror and have every cycle before and see if it was realistic or not. No, it's not going to happen in the future, ben, they haven't in the past. It won't happen in the future, well, okay. Well, there's a. There's a heap of money that's going to be inherited from baby boomers through to Gen X and Gen Y, and they'll be using that as a positive to go into the property market. So, therefore, that's so. When the DTI debt to income ratio objection comes up, ben, we go.
Speaker 2:okay, well, not going to be funding all of these, so and that present value means that that's probably going to be in today's dollar terms in that sort of six to seven million as a rough guess.
Speaker 1:Yeah, so it's, it's it's future value folks. So but it's real. And but here's what went on in the internally for for this couple right, they got the clarity on the current investment property tick done. The anxiety is largely around this particular topic. Ben has largely been dissipated because here's the, the marker that Liz no longer wakes up, michael at 2 am and this is a true story to talk about anxieties related to money and finance.
Speaker 1:So can you imagine just the just the impact on the partner who's not in peak anxiety mode Cause in this case it's Liz and Michael, but easily could be the other way around, or whatever? Um, those chats at 2 am where your mind is ticking. Imagine just being able to sleep through that is, that is transformational stuff. So they got a a very um clear direction and they're very happy that they've got that and no longer stressed about money. No longer stressed about money Just for those of you that are listening to this, that you jog, you're running, you're driving you. That is. That is the whole reason.
Speaker 2:It's a whole reason.
Speaker 1:Want to listen to us, that you even want to execute on what we bang on about. Ben is, for that last thing, no longer stressed about money. It is a wonderful feeling when you achieve it, and so we want to do whatever we can to help people achieve that. So um Stu's notes his final notes on this. For me, when I, when I um was gathering this with him, is the emotion, and the anxiety is the biggest barrier to taking action. He sees that a lot. He's at the Colface, ben.
Speaker 2:Yeah.
Speaker 1:He's talking to him and Amanda and the rest of that team, they're at the Colface. They see this a lot Um, and in this case, um, as we've um detailed quite significantly. Her anxiety was massive and he wanted to. He wanted me to highlight that it was massive.
Speaker 2:So um, and thank you for allowing us to share that story, right Um, liz, you, that's obviously not your real name.
Speaker 1:All right. So very special Thanks to um. First of all, to Amanda and Stu for highlighting these wonderful cases. I think they've done really good at highlighting that, because I'm always asking what's the maximum benefit for our community, to Eve's drop on this, and I think there's um that's that's actually been achieved. And also to Billy, not his real name, and, of course, liz and Michael, not their real names. Um, they know who they are. Thank you for being brave and letting us use your circumstances, um, to educate and teach um other people as well.
Speaker 1:So, hey, my life hack today, ben, is a bedtime routine that I've started doing. Saw it from a pediatrician. I've been trialing it. Yep, um, now, one of the things I'm pretty self-critical as a, as a parent, ben, because I'm, I'm here's my excuse. I'm born in the seventies. You know there's been a lot of school in me. You know, if my kids' legs aren't falling off and they're bleeding out, they got to go to school, even if they got a sniffle, and you know, so I'm. I'm probably and my wife says, because I'm so driven and ambitious, she reckons I'm hard to be around. So I'm sure my kids will need to borrow a few Bob off me one day for the psychology bills to deal with that like me.
Speaker 2:I mean I'm in the same camp, mate.
Speaker 1:But but one of the things I never want them to say to me when they're older is that I never didn't know their heart Right. I spend a lot of time understanding who they are as characters and their heart Right. So one of the things I've said before as a life hack on this podcast is I turned the lights off and I talked to them and I make because I noticed they open up to me and I get to. I get to delve into their hearts a little bit there. But this is a little one that I've been trialing, ben. So I wonder if anyone wants to try this as well.
Speaker 1:But it's just three questions that I can be asking when the lights are out and I've seen some pretty good results on it. So the first question I ask them is what's one thing that went well today? Second question is what's one thing that was difficult today? And the third thing is what's one thing you want me to know about today? And it's and I thought, oh, they're probably just going to dismiss me, but made it opens up a can of worms for them, and they, they let it flow. And sometimes my youngest is tired and I say so what's one thing that went well today and he tells me that I says what's one thing that I don't know. I just want to go to sleep. So sometimes I love you Good night, good night.
Speaker 1:Yeah, yeah, all the best. Can you scratch my back? So that's cool and I'm happy to stand down on that, but I just like to. As I said, ben, I do not want my kids to accuse me of not knowing their hearts at all, and I feel like self-assessment. I do know them, but this is helping me dive a little further. So here's what the benefits were from the pediatrician that I saw from one. It calms your child and strengthens your connection with them. That is true, yep, and it's just a reinforcement of in the past.
Speaker 1:The way we interact with our kids at bedtime has the power to change their lives. Now I just want to put a disclaimer here, ben, for people listening to this. I'm not a super dad. I get tired. I want to rush through the nighttime routine. I've got my eye on the couch and the remote control as well, because it's finally my time. So, yes, I've got all that, but then, when I just take the time and I pause and I just go, all right, I've got to get through this process with them anyway. I might as well make it meaningful for both of us. So do I do it all the time? No, it looks a little bit like the consistency jars that I spoke up in the mindset minute theme, ben, sometimes I am jar, full on it and I'm fully invested. Over time it's like, oh my gosh. But anyway, folks, if you're a parent, if you're an uncle, you're an arty, you're a grandparent, you've got kids in your world.
Speaker 1:Give it a go See what you think. Let me know.
Speaker 2:I'm going to give it a go. I should say, give it away, give it a go. I need some help in that space. Most of the time when we're going to bed, I'm either using my stubble to give them a scratch on the side of the face, or they're trying to wrestle me or whatever, just trying to settle them down and they want to have a wrestle with their dad. So, no, it's not, but as long as they yes, they certainly know that I love them, but I'm going to try and see if I can do a more calming thing like what you're doing and that's their heart crew.
Speaker 1:You will never regret it. What's making property news, ben?
Speaker 2:Oh, there's a lot going on in the property space price and obviously there's been. You know, the big story at the moment is still the Victorian property market and the challenges it's facing. Something that we said would happen is seriously materializing. So there was a couple of articles in the FIN review, so we'll put these in the show descriptions as links. But there's a story here two stories actually that caught my eye over the last few weeks Housing crisis. You know I don't own five houses, I own five debts. Victoria investor sells up. So there's a story of Craig Doyle says he's had enough and he's selling up all of his investment properties in Victoria after facing increased land taxes, body corporate fees, council rates, compliance costs and interest payments. So the 61 year old and his wife bought these properties over the journey and he's tapping out. And that is what I'm going to get to in a moment in terms of the crescendo of this particular update. In addition to that, we saw House and Land Sales dive as investors also sell up Is another article a couple of days later, and this is basically interviewing some of the major developers in both Victoria and Geelong, and their story is real they're going to sell less, lots less subdivisions and the demand from the investor has significantly dried up on the back of those taxes that have been introduced.
Speaker 2:And that's where this story starts to take shape. I've been mentioning this before, but we've just recently seen a release of the Victorian bond registration data and the numbers are disturbing to say the least. When you look at the chart you'll see that we've got you know, we're watching on YouTube. You can see here that it is falling off a cliff. So just to give you some idea, in the last from peak to trough so peak in Victoria there were, in terms of March there was 681,429 investment properties. That has dropped by 11,789. Now you might say that's fine, owner occupiers are potentially buying that and that could be true, but ultimately it's going to increase the shortage of private rental accommodation and ultimately means that the Labor government's land tax will turn into a tenant tax because, yep, investors will put the prices up to recover some of the costs that we've been talking about. So that should be highly concerning for those markets. So that's the peak to trough in terms of the overall market. That's 10,900 less rental properties in Melbourne metro area and in regional Victoria there's 1,104 less, and that's only up until December. You know, the land tax bills didn't start coming out until January and we've been talking to groups of accountants and they're getting lots of calls. What's this? I've got to pay another $1,600. Can you get rid of that? I'm selling that, probably about enough, you know.
Speaker 2:So that's the sort of story that's happening, unfortunately, in Victoria. So you've got developers saying that there's no appetite. We've got chronic shortage. You've got the federal government and the state government pledging to build X number of properties. You know they're just simply not going to realize. And so if you've got a really short-term view of the next one or two years, the Victorian property market is going to be challenged from an investor point of view.
Speaker 2:But keep saying this if you've got a long term view, is this a time where to be greedy when others are fearful? Because we do know that this will force the hand of either this current labor government or the next government that will take power after this government is passed and we'll see those changes. So it's not our first radio. I've said this. I've seen these sort of policies come and go after this. Over the 30s I've been doing this New South Wales have dabbled in sort of stamp duty, provisions for vendor taxes and all that. It just any time that you play with an open free market, you've got unintended consequences. This is the big one. We're going to see vacancy rates get to chronically low levels and we're going to see rents growing. The fastest out of any other state is going to be in Victoria and they're already the second highest. But to give you some idea, I think they're up about 16% or 17% so far in this cycle, so I can see them going to 30%, 40% higher. So that's a critical number unless they do something about it.
Speaker 1:So the message is clear for anyone who's heard your message just then Ben, and they have Victorian properties. Is we're saying lift your eyes? Yeah, it is a.
Speaker 2:Don't panic.
Speaker 1:Don't panic. It is a consequence of to your point, ben a consequence of messing with free markets. But do not lose sight of the fact it is the second biggest metropolis in the country and there is lots of people over the journey still wanting to move here. We have a housing policy and immigration policy that is woefully out of alignment, so the sentiment for investors is the lowest it's been for a long time in Victoria. But the outlook for Victoria to your point, ben is when the politicians finally get it. They will then create incentives to get us back in the game and then, all of a sudden, we'll be off to the races again. So we have got a lot of clients in that particular market.
Speaker 1:I also have real estate in this market, you also have real estate in this market. So, and we're not selling up folks. But is it mildly irritating? Yes, but we haven't lost sight of the bigger picture, because go back to 85 and then 87. They changed it. And then, to your point, with the changes that in New South Wales, they will change it. They have to, because supply and demand will suggest that they can't supply it anywhere near as efficiently as the private sector when it comes to the housing shortfall that they are going to be creating. So there you go, big show today, ben.
Speaker 2:Huge show, long show, but worthy show. Hopefully everyone's hung around to the end, because there's value right to the end today.
Speaker 1:Yeah, definitely folks. So again, I just want to do a little request. If you heard me at the top of the show, I'd like to ask you to get at the bottom of the show. We have grown our community baseband through organic reach. Only. Usually someone who says, hey, I'll listen to the property couch, you should check it out. So we're just going to ask you if you're one person who likes what you're listening to with us, can you just tell two people? Because then those people can tell two people and all of a sudden we'll start to get our message out into the marketplace and help more people create lifestyles by design. Ben, great show. I always love to hang out with you, mate, until next week.
Speaker 2:Knowledge is empowering, but only if you act on it.
Speaker 1:Go Sinkilda. See you next week, folks. Hey folks, bryce, here again. I just wanted to catch you real quick before you go.
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