| When you consider the core reason why humans do | | | | in order to buy my dream cottage on acreage with a |
| anything, it comes down to two of our purest | | | | small mortgage so I only had to work part time seeking |
| emotions. The strongest motivation is most commonly | | | | the lifestyle and balance I craved. |
| to Avoid Pain with a close second being to Gain | | | | Thanks to everything I learnt from Chris Howard, |
| Pleasure. | | | | Robert Kiyosaki, Richard Branson and Donald Trump I |
| What do I mean by that? Think of it this way, why do | | | | now think bigger, I think "upsize". Not only did I realise |
| you get out of bed when the alarm goes off in the | | | | that I have to Think Big, but I learnt that in order to be |
| morning? Is it because you have taken action on your | | | | financially successful you have to put aside any |
| dreams and have a business, job or lifestyle you love | | | | negative money beliefs and Think Rich. You will never |
| and you can't wait to get stuck into your day so you | | | | get rich by selling your assets, you will only get rich by |
| can gain pleasure? | | | | accumulating more assets. |
| Sounds great doesn't it, but most likely for the majority | | | | Some may wonder if the desire to create wealth is |
| of the population it is to avoid the pain of being late for | | | | greedy? I think that the opposite is selfish. How can |
| work, hitting traffic on the freeway, sideways looks | | | | you be expected to help others, your family or friends, |
| from your colleagues and getting yelled at by your | | | | your charities and the needy in the world if you can't |
| boss. | | | | even help yourself? You can't help the poor if you are |
| Relate this same concept to your wealth mindset and | | | | the poor. |
| the decision on whether or not to buy a home or | | | | So 2 years ago I took a huge leap of faith towards |
| investment property. Why is it that some people | | | | my dreams and goals and dramatically changed my |
| decide to invest and others don't? | | | | mindset and subsequently my life in a profound way. I |
| It comes down to your decision making process and | | | | let go of limiting beliefs that had previously held me |
| whether you perceive investing as pleasure or pain. | | | | back and I took massive action to create wealth by |
| Understand that we all spend our time and money | | | | quitting my job, investing in educating myself and |
| according to our highest core values. So if you value | | | | becoming both a property investor and a business |
| family and security then you may perceive buying a | | | | owner. |
| home for your family as "gaining pleasure" and | | | | Now I am not suggesting you also quit your job to |
| avoiding the pain and insecurity of renting. You will gain | | | | follow your dreams without thorough financial and |
| pleasure in the achievement and pride of home | | | | business planning, but ask yourself.. What is the current |
| ownership and avoiding the pain of not having a | | | | financial pain I am trying to escape and the pleasure I |
| mortgage free home in retirement. | | | | am trying to gain. How can I change my results by |
| If instead you value freedom and lifestyle then you | | | | changing how I associate the commitment to wealth |
| may perceive owning your own home as "pain" You | | | | creation with pleasure and not pain. How can I |
| may prefer to rent so you can avoid the pain of a 30 | | | | associate pain to my current lifestyle of immediate |
| year commitment to a mortgage and gain pleasure in | | | | gratification and excess spending. How best can I |
| the flexibility of moving when you want and the ability | | | | balance living today with planning for tomorrow. |
| to spend your time and money on having fun and your | | | | Start your journey to Wealth by not only Thinking Big, |
| immediate lifestyle. | | | | but Thinking Rich... |
| As some of you may relate, I come from European | | | | Ensure you develop what they call a "millionaire hook" |
| heritage and my dad is still to this day deeply | | | | which is the ability to see the big picture and also the |
| entrenched in a scarcity mindset with all the associated | | | | knowhow to drill down to the detail. You need to |
| belief systems. He was born in a small town in Italy in | | | | ensure you have a crystal clear vision of your dreams, |
| early 1931 and was 8 years old when WW2 was | | | | which will keep you inspired and focused and convert |
| declared in 1939 and 14 years old when the Germans | | | | them into smaller manageable goals. Then pay |
| surrendered to the Allies in Italy in 1945. So I understand | | | | attention to the small details which will become your |
| that in his formative years his "scarcity mentality" was | | | | processes and action steps. Steps without a larger |
| justified as he came from a large family and food, let | | | | vision will lack direction and a vision without clear action |
| alone money was scarce. Unfortunately for him and | | | | steps is just a dream. |
| many like him, although his situation has since changed, | | | | Start early and use the power of compounding to |
| his mindset and beliefs never have. He still lives his | | | | propel you forward. Even if you are starting from |
| financial life today as though he was back in wartime | | | | nothing, automatically put aside a minimum of 10% of |
| Italy. | | | | your income to create wealth in a high interest |
| My mum in contrast was born in late 1942 and was | | | | account. Figure out how to earn more income and |
| just a toddler when the war ended. Her family were | | | | save every cent you can to pay off your consumer |
| more entrepreneurial with their farming, they grew their | | | | debt and get into your first home to start building your |
| own fruit and vegetables, grew grain for flour for | | | | equity. If you cannot afford your own home, then |
| bread and pasta, raised chickens for their eggs and | | | | consider your first investment and let the tenant and |
| meat, pigs, plus they had goats and cows from which | | | | tax man help you save for your own home. |
| they used the milk to drink and to make cheese. They | | | | You have to work smarter and not harder. You have |
| always had more than enough food for the family and | | | | to start making your money work for you, rather than |
| also sold the extra grain, eggs, fruit, veg and milk etc | | | | always working for it. You must build assets or you will |
| for money which they used to buy non food items. | | | | find yourself in a situation of trading your time for |
| Your earliest money beliefs originate from either your | | | | money in a job for the rest of your life, even if you are |
| father or mother, or significant guardian, during your | | | | your own boss. Is that what you want? |
| formative years. As you start to live your own financial | | | | Once you have a deposit or equity in your own home |
| life you either model one parent's beliefs or do the | | | | then borrow the balance and use the power of |
| complete opposite and rebel against their beliefs | | | | leverage. Make tax deductable investment debt your |
| entirely. However, as you mature, start work and leave | | | | friend. I used to consider a mortgage or "debt" as |
| home you develop your own money beliefs which | | | | something that had to be paid off and this caused me |
| result in your personal financial situation. | | | | pain. I now consider "debt" as merely a tool in my |
| If I look back at my financial history, I see that I have | | | | investing tool belt that helps me to create wealth and |
| predominately modelled my mother's core money | | | | this gives me great pleasure. I don't ever plan to pay |
| beliefs of "enough plus a little bit more", however my | | | | down my investment mortgages, instead I plan to |
| risk profile is greater than my mother's so obviously it's | | | | shrink them in comparison to the asset they are |
| to a larger scale with my business and properties. | | | | secured against. Why would I want to pay of the |
| However, being raised by a parent with a scarcity | | | | mortgages on my investments today when $1 = $1. |
| mentality has left its mark and I have to admit that I still | | | | With time, the value of my assets will rise and the |
| catch myself having conversations with the "scarcity" | | | | value of money and the property debt will shrink. I will |
| demon while my financial focus is on growing my | | | | use my money to build my portfolio, my assets, my |
| business and my portfolio. I often have to stop and ask | | | | cash flow buffer and my wealth. |
| myself "am I withholding this spending because of lack | | | | If I have a property worth $300,000 and I owe |
| or scarcity or because it makes sense for my current | | | | $300,000 why would I want to pay this off now when I |
| goals?" | | | | can pay it off in 20-30 years when it is worth a |
| So my first question to you is, who's money beliefs did | | | | quarter of what it is worth today and the Loan to |
| you adopt as a child and how has that influenced your | | | | Value Ratio (LVR) is negligible? ie. |
| current financial status as an adult? | | | | In Year 0, the Asset is worth $300K and the Debt is |
| That's not to say that you can live your life in effect | | | | worth $300K, which is 100% LVR |
| and blame your parents for your financial situation and | | | | In Year 7, the Asset is worth $600K and the Debt is |
| say "it's your fault, you made me this way". You are | | | | worth $300K which is 50% LVR |
| an adult, you must be accountable and take full | | | | In Year 14, the Asset is worth $1.2 Mill and the Debt is |
| responsibility for your life, your decisions and your own | | | | worth $300K which is 25% LVR |
| money beliefs, regardless of where they may have | | | | In Year 21, the Asset is worth $2.4 Mill and the Debt is |
| originated. You earned and spent the money. | | | | worth $300K which is 12.5% LVR |
| Awareness however, is the first step in making a | | | | However, as your money grows so should your own |
| change. If you recognize some beliefs you may have | | | | education in finance and investing, the quality and |
| adopted from your parents along with your own | | | | experience level of your advisers and your assets |
| money beliefs are disempowering to your financial | | | | themselves. |
| situation, then change them. Model the beliefs of | | | | Only ever take advice from someone who specialises |
| someone who is wealthy, financially successful and | | | | in your field and with property specifically, someone |
| has created the results you want to create in your | | | | who has more properties than you. General belief is |
| own life. | | | | that you spend approximate 1-2% of your portfolio |
| Up until a few years ago, I used to think relatively small. | | | | value on your annual education and advisers so you |
| I had two homes, a homeowner's mindset and | | | | can leverage of their knowledge and experience. |
| therefore a full time job to support them. I no longer | | | | This way you will always stay informed, continually |
| wanted the full time job so my homeowner mindset | | | | educated and at the top of your game. |
| thought "downsize". I considered selling both my homes | | | | |