Steve book 2017 Final Print Version PDF

Invest Partners Making Property Investment Simple www.investpartners.com.au © 2006 Invest Partners

Contents Chapter 1. What is wealth. Chapter 2. What’s stopping you from becoming wealthy. Chapter 3. The Dream stealer. Chapter 4. Why bother becoming wealthy. Chapter 5. Why property. Chapter 6. How property can change your life. Chapter 7. Getting started. Chapter 8. Understanding finance. Chapter 9. What is negative gearing. Chapter 10. A step by step guide to purchasing. Chapter 11. Building your support team. Chapter 12. What more you can learn. Chapter 13. Frequently asked questions. Glossary of terms

INTRODUCTION My goal in this book is simple: To share with you the lessons I have now learnt on property investment and to persuade you not to wait five years before you start investing. I hope that one day soon you will also become an accidental millionaire. Rules: It’s not how much you earn that counts, but what you do with what you earn. Wealth is made by buying and keeping properties, not buying and selling them. “Shoot for the moon. Even if you miss it you will land among the stars.” — Lester Louis Brown, American Journalist, 1928 ~ -1-

Chapter One What Is Wealth? Wealth means “an abundance of something”, usually relating to money. But, there are many types of wealth one can have in life. You can be wealthy in health. You can be wealthy in friendship. -2-

WHAT IS WEALTH? You can be wealthy in love. You can be wealthy in your children’s health. -3-

WHAT IS WEALTH? You can be wealthy in knowledge. I hope for you, that you have already achieved the wealth you want in these areas. This book is to help you achieve wealth in a financial sense. I thought the standard definition of wealth contained in most dictionaries didn’t explain it clearly enough, so I have expanded the definition for you so you can get a better understanding of what I believe wealth means. -4-

WHAT IS WEALTH? Wealth To be in a financial position, so that you have an abundance of choices and freedom to enjoy life. Being able to wake up each morning and know that you are working by choice – not because you have to. To be able to take a holiday with your family where, when and for how long you wish; -5-

WHAT IS WEALTH? To be able to choose where you wish to live, what car you drive, -6-

WHAT IS WEALTH? what school your children attend, to be able to help family, friends and charities in need, -7-

WHAT IS WEALTH? to be able to pursue your hobbies, to have the personal time, freedom and security that comes with wealth. So you can truly enjoy your life and the time you spend on Earth! I hope you will gain from this definition of wealth the understanding that it’s not about the money, it’s about what it can provide for your family and yourself in terms of lifestyle. -8-

Chapter Two What’s Stopping You From Becoming Wealthy? Ask yourself this simple question. “Do you honestly believe it’s possible for you to achieve your dream of becoming wealthy?” If you answered “yes” well done! Fifty percent of the task for you is done. Now all that is left, is to find out how to do it. -9-

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? The information contained in this book on property investment will go a long way to help you achieve your dream of creating wealth. The only question left is – Will you use it? If you said “no” then that’s okay too! We just have a little more work to do with you, to get you dreaming again. Dreaming about how wonderful life can be. Believing that financial independence is possible. - 10 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Believing that you can soon be: • taking exotic, fun-filled holidays overseas every year; • owning a beautiful waterfront home; • driving the latest Mercedes coupé along a country road with the wind blowing through your hair; • not arguing over money with your partner. Life should be fun. It doesn’t have to be so hard. One of the goals of this book is to help you get back your ability to dream. What do you think causes someone to lose their ability to dream about becoming wealthy? Here are some possible causes: 1. Previous failures. 2. Lack of knowledge (“know how”). 3. Fear. 4. Confusion. 5. The Dream Stealers. - 11 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? 1. Previous Failures Our society is full of false promises on how to become wealthy. According to the Australian Bureau of Statistics 80% of all businesses go broke within the first five years of operation. I guess it is not surprising that people lose hope. I know, because I’ve experienced a few failures myself. Think about all the times you’ve been invited to a “get rich” seminar presentation or a multi-level marketing meeting at a friend’s home. - 12 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? They introduce to you the most amazing opportunity to “get rich” that you have ever seen. And the supposing great opportunity didn’t work out the way you wanted it to! Maybe it even cost you money upfront. How did you feel? Did you feel your goal to become wealthy had failed? Maybe this has happened so many times in your life before, in so many different ways, that you quite rightly feel indifferent about the subject of wealth. Who wouldn’t? And we wonder why people become afraid to dream again. Too many cases of being let down time and time again can easily lead to hopelessness. Constant failure can be a painful experience – a bit like the poor old greyhound chasing the rabbit around the racetrack but never catching it. He can always see it. He knows it’s there. But he will never have it. Sound familiar to you? Have you stopped dreaming? Then go ahead and try this task: - 13 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Task: Write down on a sheet of paper a list of things relating to creating wealth you feel didn’t work out the way you hoped it would and what you feel went wrong. Note: Keep writing until you have gotten it out of your system – you will know when to finish as you should be feeling better. “We haven’t failed. We now know a 1,000 things that don’t work, so we’re that much closer to finding what will.” — Thomas Edison, Inventor, 1847 - 1941 - 14 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? 2. Lack of Knowledge Where do the rich get the knowledge on becoming wealthy? Would it surprise you to learn that there are no courses in any schools or universities in the world, that teach you how to become wealthy? Most people leave school without even a basic understanding of financial matters. Think about this – who can teach these financial skills when around 94% of all Australians will retire broke? - 15 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Our schooling sets us up to get a job and work hard for the next 45 years (and retire broke!). Is this the kind of life you want? By the way, I was once given a brilliant definition for “job”. I was told it meant “Just Over Broke”. Have you ever noticed that you earn just enough money to almost make it to your next payday – but usually run out a day or so before? You're stuck in the situation where you can’t afford to stay in your job but you can’t afford to leave it either. - 16 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? You can start to feel like the mouse in the cage on the revolving wheel running as fast as you can but never really getting anywhere. The treadmill of life. So back to the question, where do people who are wealthy get the knowledge on how to become wealthy? Well, the answer to this is really quite simple: by learning from those who have done it successfully - whether it was their parents, friends or personal mentors. - 17 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? I have observed that the old saying “birds of a feather flock together” has a lot of truth in it. Generally, the wealthy socialise with the wealthy, criminals with criminals, the working class with the working class, etc. Therefore your next task on your path to creating wealth is to get the knowledge on how to become wealthy. You will only get that knowledge from those who have achieved it! Get the knowledge and use it! That knowledge is also contained in this book. Task: Your next task on your path to wealth is to get the knowledge on how to become wealthy. You will only get that knowledge from those who have achieved it! Get the knowledge and use it. The knowledge is also contained in this book. - 18 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Rules: The only difference between the poor and the wealthy is “knowledge” – the “know-how” in a particular field or area. Never ask someone who is broke how to build wealth. They simply do not know. If they did, they would be wealthy. Remember when getting advice from any professional in regards to property investment, just be sure to research and check out that the person has a proven history of financial success in the area of property investment. If not, you might find yourself in a situation where the blind are leading the blind. - 19 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? 3. Fear Fear is one of the major obstacles you will have to learn to overcome, if you wish to become wealthy. Did you notice, I wrote “learn to overcome”. Everyone has fears, including me. But you have to learn to control and conquer your fears or you will remain frozen in your current situation day after day, year after year until one day you have to face the terrible reality of retiring broke. By then, it will be too late. - 20 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? I have observed, over the years, that the closer a person gets to that line of having to make a decision, the more that their fears intensify and their whole thinking changes. Instead of trying to find reasons why they should become an investor and how it will help them financially, they start to search for reasons why they shouldn’t become an investor, and it normally begins with “What if…”; “What if I lose my job?” ”What if the interest rates go up?” ”What if I can’t rent the property?” - 21 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Do you see what’s happening? If you find yourself doing this, you have to stop and, instead of saying “I’m afraid”, change it to “What am I afraid of?” It’s a small change, but it turns your fears into a question. You can always find the answer to a question if you look hard enough. Fear is simply not knowing about something. - 22 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Example: I’m afraid because I might lose my job. Simply turn your statement into a question: What am I really afraid of? - 23 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? I might not get another job. Okay, well that’s silly. Of course I’ll get another job. I can’t sit around the house for the next 20 years. I’ve got other bills to pay. Okay, let’s say it takes 3 months to get another job, well I’d better borrow some extra funds just in case, to cover expenses during that period. Can you see the difference? Those who become wealthy learn to control their fears and carry on despite them. This does not mean you should be foolish and throw all your money on the favourite in the Melbourne Cup. It simply means don’t be afraid to take a calculated risk with a secure investment such as property. - 24 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? In reality, you should be more afraid of doing nothing and retiring broke, than of taking a chance during your working years. You can recover from such a setback while you’re working and earning money. But there is no come back or second chance when you retire. So, don’t let fear rob you of the opportunity of being all you can be. Find the courage to fight back and reap the financial rewards courage can bring. - 25 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Retirement is on its way, you can’t hide from it. If you try, it will hit you like a Mack truck and by then it will be too late. So take action now! Quoted from “Think & Grow Rich”, Napoleon Hill “Courage is resistance to fear, mastery of fear, not absence of fear.” — Mark Twain, American writer & humorist, 1835 -1910 - 26 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? 4. Confusion There are a few things that cause people to go into confusion. I have listed some of these below. 1. Too many choices. 2. Not enough information. 3. Wrong or false information. - 27 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Too Many Choices I’ve discovered, over the years, as you probably have, that the more choices one has, the harder it is to make a decision. For example: Have you ever been at a restaurant with friends and you are looking at a menu that has a huge variety of meals: seafood, steaks, poultry … You just can’t make up your mind. - 28 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Then someone says “I’ll have a hamburger”. Suddenly, half the group says, “Me, too! I’ll have the hamburger, also.” The one that cracks me up is my wife, who will go out to buy a new dress and then come home without one because she couldn’t make up her mind. - 29 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Also have you ever noticed, since cable TV came into our lives (some 50 channels) you can never find anything to watch on TV, yet when there were only 4 channels, there was always something to watch. Strange isn’t it? When you are becoming a property investor, you really should narrow down what you are looking for before you go shopping. Which suburbs? What type of property? What price range? Then find out what properties are available in your chosen suburbs. I recommend you stick to around 3 to 5 projects to choose from, otherwise you might find yourself 6 months down the track still trying to make up your mind. Not Enough Information Only having bits of information can be dangerous as people, in general, will fill any information void they have with their own opinion as to what they think is the truth. - 30 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? I met this lady, at one of our property investment seminars who had heard on the radio, and through workmates, about how great property investment was. So, she apparently rushed off to the country and bought a run down house on 5 acres for around $149,000. She said she needed to spend approximately $10,000 on the property to make the place tenantable. Even then she was worried about getting a tenant. - 31 -

WHAT’S STOPPING YOU FROM BECOMING WEALTHY? Because the property has no tax benefits, it is likely to cost her more each week than a brand new unit costing $300,000. To add salt to the wound, the property was in an area unlikely to experience any capital growth for a long time. She was very confused and didn’t want to know any more about property investment. It’s also true that if you only have bits of information, you might not do anything at all. - 32 -

WWHHAATT’‘SS SSTTOOPPPPIINNGG YYOOUU FFRROOMM BBEECCOOMMIINNGG WWEEAALLTTHHYY?? You could be saying to yourself, I know I should invest in property, but I don’t know where, how much I should spend or what type of property…? Then you’ll end up saying “Oh, I’ll do nothing just in case I get it wrong.” The answer to this is to read more books on the subject and do more research. It’s well worth the effort to spend 10 to 20 hours reading and researching so you are then able to create a multi-million dollar property portfolio. The good news is that your local book store has plenty of books on the subject and there is also a lot of information available online, containing the answers to every conceivable question you may have. - 33 -

WWHHAATT’‘SS SSTTOOPPPPIINNGG YYOOUU FFRROOMM BBEECCOOMMIINNGG WWEEAALLTTHHYY?? Wrong or False Information This is probably the worst, “opinions are like embarrassing relatives, everyone has one.” I’ve met a lot of people over the past 10 years that have accepted things they have heard about property investment as being the absolute, gospel truth. When in fact, it was just an opinion of a well-meaning friend or relative who themselves had never purchased an investment property. - 34 -

WWHHAATT’‘SS SSTTOOPPPPIINNGG YYOOUU FFRROOMM BBEECCOOMMIINNGG WWEEAALLTTHHYY?? Example “You will have nothing but trouble from your tenants; don’t you know all tenants are BAD?” You see, that statement was just an opinion of someone who has never been an investor. Yet the client, who attended one of our seminars, believed this was the truth and was frightened of becoming an investor because she did not want the stress of having a bad tenant. The reality is that most tenants are good and only a small percentage are bad. Let’s face it; most of us have rented at one time or another before buying our own home. So, it’s very important that if you have a negative opinion, or some fixed idea about property investing, that you find out for yourself what the truth is. For example, you may have heard residential property has a 50% vacancy rate. You should call the real estate institute yourself– you will discover it’s only 2.5 - 4% on average. Find out for yourself what is true and what is false. - 35 -

WWHHAATT’‘SS SSTTOOPPPPIINNGG YYOOUU FFRROOMM BBEECCOOMMIINNGG WWEEAALLTTHHYY?? 5. The Dream Stealers The greatest turning point in my life came when I discovered what a Dream Stealer was and how much confusion a Dream Stealer could put into my mind. Dream Stealers are around every corner. The topic of Dream Stealers is so important, that I have dedicated the entire next chapter to it. - 36 -

WWHHAATT’‘SS SSTTOOPPPPIINNGG YYOOUU FFRROOMM BBEECCOOMMIINNGG WWEEAALLTTHHYY?? Rule: To become wealthy you must learn to overcome your fears. Rule: If you are not sure, find out for yourself what is true and what is false. - 37 -

Chapter Three The Dream Stealer One of the greatest skills you can gain in your quest for creating wealth for your family and yourself is to learn how to recognise and avoid the Dream Stealer. So what is the Dream Stealer and how does the Dream Stealer stop you becoming wealthy? To put it simply, the Dream Stealer is anyone (and I mean anyone) who intentionally or unintentionally knocks you off your course from becoming wealthy. - 38 -

WHAT ‘S STOPPITNHGEYDORUEFARMOSMTEBAELCEORMING WEALTHY? The Dream Stealer puts doubts in your mind and makes you wonder if you are doing the right thing. Unfortunately most of us have a few Dream Stealers around us (sometimes unknowingly), such as friends or relatives,. - 39 -

THE DREAM STEALER The Dream Stealer works in a number of ways. How they communicate – a devious look. What they say or don’t say. How they act – what they do or don’t do. There is always one way to recognise them. After you share your goals and intentions with them, do you feel better about what you’ve set out to achieve? Do you feel more determined or do you feel down – like it’s all too hard? Do you want to rethink your options? Do you suddenly have doubts and fears? - 40 -

THE DREAM STEALER If you feel like the latter, then you have just been talking to a Dream Stealer. If you feel like that, make an agreement with yourself to never share your dreams with that person again. They are a Dream Stealer. Even though their advice may seem to come to you with the greatest concern for your welfare, it does not matter – the end result is the same – you’ve lost your dream. Here are a few examples of how the Dream Stealer can make you lose your dream: a) You drive your new Holden around to show a friend and he says “Why did you buy a Holden? You should have bought a Ford”. - 41 -

THE DREAM STEALER No matter what you say, think or do, to the Dream Stealer it just won’t be good enough. Recognise this kind of person? Maybe it’s a friend or a business colleague. b) You tell a friend you are on a diet and trying to lose some weight, but they keep on insisting – even nicely – that you have a piece of chocolate cake. - 42 -

THE DREAM STEALER c) You tell a friend that you are buying an investment property and they tell you to be careful; that interest rates are going to rise, that tenants will destroy the place, that you should buy shares instead and so the list goes on… The Dream Stealer will usually say things like “What do you want to do that for? I’ve heard….” negative, negative, negative…. - 43 -

THE DREAM STEALER A true friend would say things like: “That’s fantastic.” “I’m so proud of you.” “I knew you could do it.” “Good on you.” When you have finished speaking to them you should feel good about yourself. Can you see the difference? A real friend supports you in your goals, a Dream Stealer stops you. It’s as simple as that. I’m hoping by now that you are starting to recognise in your life who are your true friends and who are your Dream Stealers. Now you can still care for, be friends with, or even love your Dream Stealers, but from now on just learn not to share your dreams with them. Dream Stealers can be anyone – your wife, husband, parents, friends, accountants, even the local journalist who writes something sensationally negative about property and you or your partner just happen to read it. I believe Dream Stealers are acting negatively for different reasons – one being that they are sharing their fears, concerns and their lack of knowledge and understanding of property investment with you. The other reason, sadly, is more sinister – they simply don’t want you to succeed. - 44 -

THE DREAM STEALER We live in a society where people easily get jealous and don’t want anyone to have more than they have – you know the type of person I’m talking about. The answer is simply not to even mention your dreams to a Dream Stealer. Sometimes it may be your partner who becomes your Dream Stealer, but when it comes to a decision such as investing in a property, you will need to share this dream with them. When this situation arises then you will have to know how to handle it. Avoiding the situation is never the answer. In my experience, in relation to property investment matters, the number one Dream Stealer can often turn out to be one of the partners in the relationship. They are not necessarily doing this blatantly to harm or to hinder the investment idea. It may just be that they don’t have enough knowledge about property or investing. That lack of understanding on their part causes them to become scared or confused and act like a Dream Stealer. - 45 -

THE DREAM STEALER My company has presented property investment seminars to thousands of families over the years. We have discovered time and time again, through bitter experience, the person least likely to invest is the person who attends the seminar without their partner, they usually like what they hear, leave the seminar newly enlightened and very excited. They now believe that there is financial hope for their family and that their lives can possibility change for the better. - 46 -

THE DREAM STEALER However they will usually run into a brick wall, once they start sharing their new found information about property investment with their partner. or they will receive a polite – “That’s nice dear, but…….” - 47 -

THE DREAM STEALER You see, the partner didn’t have all the information about property investment you now have or maybe the information was transferred wrongly. That caused them to become confused or even scared. It ends up with the uninformed or misinformed partner becoming a Dream Stealer. The result is still the same; you have lost your dream. - 48 -