Lunch Money Property Investing - Step 3 - Get Street Smart


The third step to successful investing is Getting Street Smart.  Setting up what I call the 3 Foundations Of Wealth to help you succeed in your property investing.  Lets check them out together.

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Transcription

Hi, I'm Phil Anderson from LifeCorp, the home of street smart property investors. For years, I've been advising property investors to make sure they protect their pockets when they buy an investment property. Gone are the days of shelling out hundreds of dollars a week to service property loans, including rates and insurances, and all of those other costs that come hand in hand with buying a property. Today, I believe you should put in less than $20 a week. They call me the Lunch Money Property Millionaire because I've been saying it for years- if you can't buy a property with your lunch money, why the heck would you buy it? But today, I wanna take it one step further, not just about protecting your pocket. I believe we should be setting up what I call the three foundations to wealth when it comes to how you set up your property portfolio. Let's have a look at it together.

So, what are these three foundations to wealth? Well, let me show you how it works. We have to take into account the fact that most Australians will choose to buy a family home. And unfortunately, that family home will be the hardest home you ever have to service, because it must be paid for out of your take-home income. You've probably also heard me talk about, in the past, the fact that most investors, when they buy an investment property, get it very, very wrong. They buy properties that are incredibly hard to service because they mostly need to be serviced by your take-home income. And I think this is a classic mistake in the Australian investment market today. What I would encourage you to do instead, what I'd encourage you to do is to be very, very careful of knowing how to set your portfolio up to tap into your tax. And this is part of protecting your pocket, but the three foundations to wealth go one step further, like I said. Instead of being too heavy on your take-home income, I love seeing people tap into this tax money, buying one or two investment properties, like I said, deciding to protect their pocket up front by not using any more of their take-home income than perhaps $20 or $30 a week. With today's interest rates, I believe the maximum should be $20 a week, maximum holding cost to service- rates, insurances, everything. All of the costs associated with holding those properties.

But with regards to those three pillars, those three foundations to wealth, I think number one should be reduce your tax. Reduces tax. Why would you give the tax money to the tax man when you can get it back in your hand each week? You don't even have to wait until the end of the year. You can do a tax variation form and get that money put back into your take-home wages each and every week. This must be explored. Why would you go through your working life just giving the money to the tax man? He doesn't know what to do with it either, so let's get it back, and let's put it to work buying some properties for us. Number one, reduce your tax.

Number two, the next thing I would say is pay this house off sooner. As soon as you get at least one investment property, please look into the new, great ways that you can leverage the finance and the way you structure your finance to pay your house off sooner. Pay your house off. For a lot of people, they can pay their family home off in half the time, and save them hundreds of thousands of dollars in interest, you would service to the banks. Please, once you have one investment property, please, pillar number two, foundation number two, look at ways that you can pay your house off sooner.

And number three- have a look at what you can do in this portion of your finances, your superfunds. Great new government laws will allow you to use your superfunds- you're gonna have to get advice, of course, you'd want to investigate this properly and get the proper advice- but the ability to perhaps put another property inside of your superfund is new leverage that's unfamiliar to Australia, unfamiliar to Australian property investors in the past. And this new law is very, very exciting.

They're the three big foundations. Make sure you reduce your taxes as quickly as possible. Pay your family home off much sooner without using any extra money out of your pocket, potentially. And if you have got any budget left over where you can afford to put in more than your $20 a week to service your investment properties, of course you put it into your family home. And you could smash that loan in a fraction of the time. And then your super. Consider this as well. Get some advice, explore what those laws are. And those three foundations to wealth are game-changers.

Now these three steps are all within- or, these three elements are all within one of the steps that I follow, one of the steps that I promote. I try to show people the seven very key steps that you can take to be incredibly effective, improve your safety and your productivity when it comes to property investing. This is all within step number 3. It's a step I call getting street smart. It's about getting street smart in how you invest in property. And how you make sure you get those pillars, those foundations to wealth underneath your property portfolio.

To see all seven steps, I've actually attached an inforgraphic, a visual diagram, which will show you all seven steps in detail. It's attached below, so please click on the link. It's a free gift from me to you. I think you'll get some great, great use out of it. I think you'll get some great ideas as to how the seven steps are changing, the way the property investors are getting incredible results in the Australian property market today.

Thank you for joining me. But remember, if you're gonna add one of these properties, if you're gonna add an investment property, remember my golden rule: if you can't buy a property with your lunch money, don't buy it.

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