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7 ways to create wealth in the current economic climate

We’re living in an interesting world aren’t we? Global equity markets are in turmoil, some countries are in recession and others are likely to default on their debts. Fear rules.

With uncertainty ahead for some time yet, I’d like to share 7 tips for building wealth in the current challenging economic times.

While Australia seems, and is, a long way from these problems, confidence here is low in the fear that we’ll be dragged down by these overseas problems. Our share markets have tumbled and our property markets are flat.

And it should come as no surprise that things are unlikely to get better for a while…

So what should an investor do?

In my experience, times of economic change always create opportunities; so let’s look at 7 tips to building wealth in the current economic climate.

1. Risk comes from not knowing what you’re doing, so pay the price to learn what to do!

Sounds obvious I know, but many investors commit hundreds of thousands of dollars to buy a property yet have gained their property investment knowledge from attending a one day seminar or reading a book.

The first step for most investors should be to invest in themselves. Invest in their knowledge. Get a mentor.

But be careful who you learn from.

Find a teacher who has achieved what you want to achieve, has invested through a number of cycles and has kept their wealth through the ups and downs.

I guess what I’m saying is it is better to learn from someone else’s mistakes rather than your own. If your mentor hasn’t had some challenges and failures along the way, they probably haven’t tried hard enough.

By the way…you can learn advanced property investment techniques from the best faculty I could put together at this year’s “Property Development and Renovation Workshop”. Click here to learn more.

2. Adhere to a proven strategy

Most property investors don’t have a plan or a proven strategy to adhere to. In fact they spend more time planning where they’re going to holiday than they do planning their financial future.

If you don’t have an investment strategy to keep you focused, how can you hope to develop financial independence?

Adhering to a proven investment system will give you more predictable results, and will help you make more consistent and less emotional decisions.

Let’s face it…it’s too easy to get distracted by all the “opportunities” that keep cropping up.

Unfortunately many of these supposed opportunities don’t work out as expected. Look at many of the investors who bought off the plan or in the next “hot spot”, only to see the value of their properties under-perform.

3. If you’re the smartest person in your team, you’re in trouble.

Successful investors surround themselves with a good team. This may consist of a property accountant, a proficient finance broker, a lawyer and a property strategist.

However, you must become your own most trusted investment advisor—no one can do it all for you.

Too many investors make the monumental mistake of thinking that success is a matter of choosing the right investment advisor to handle their wealth. It costs them dearly!

No one—no one—will be able to manage your wealth like you can. Yes, you need good advisors, but you need to have the sophistication to filter and use the best of your advisors.

This means you’ve got to invest the time, energy and money to master the skill of managing your own net worth.

If you are serious about taking your property investing to the next level and want to learn the fundamentals of property investment, renovations and development from a group of “real world” experts then please join me for 3 days in October at my “Property Development and Renovation Workshop.

Click here to find out all about it including the 9 bonuses, my money back guarantee and grab one of the last few early bird seats before they go.

4. Have Financial Buffers in Place.

Smart investors don’t only buy properties; they buy time to help them ride through the ups and downs of the property cycle.

After all…one thing that is certain about the times ahead is that there will be uncertainty.

Over the next few years we’ll have some good times and some bad. Some periods of low interest rates and then they’ll rise. We’ll have some boom times and we’ll probably have another recession.

Savvy investors will protect themselves by having financial buffers in place to see them through the difficult times.

5. Sometimes it’s best to do nothing.

A great quote from Warren Buffett is “The trick is, when there is nothing to do – do nothing.”

Yet many investors get itchy feet and want to do more, put another deal together or buy another property. There are stages in the property cycle and times in your investment journey when it is best to sit back and wait for the right opportunities because wealth is the transfer of money from the impatient to the patient.

6. Become an expert

Successful investors specialize. That’s how they become successful. They find something they are good at and do it over and over again, rather than moving on to the “next shiny toy.”

Do you know a specific area and have a network of contacts that gives you information advantages?

Of course if you are investing in publically traded securities you have to be wary of trading on “insider information”, that is information that is not publically available.

Which is one of the reasons I like investing in property; not only do I get paid for my “insider information”, but it is totally ethical and legal to trade on this privileged information!

Take the example of Bruce F from country Victoria. He’s a ski instructor who attended my Property Development and Renovation Workshop a few years ago. Last year he was featured in Australian Property Investor Magazine explaining how he made over $250,000 from his first property development – a two townhouse project in Bentleigh East.

What are your advantages? What contacts, expertise, and experience do you have that you can leverage?

If you want to upgrade your knowledge of property investment or learn the fundamentals of property renovations or development, then you must join us at this year’s Property Development and Renovation Workshop.

Click here for all the details, including the 9 bonuses and my money back guarantee. Then reserve one of the last early bird spots now.

7. Treat your property investments like a business

Investing is a serious business and if done correctly can, over time, replace your personal exertion income. I’ve seen some property investors, those who treat their investments like a business, become very, very rich by growing a multi-million dollar investment property portfolio.

They do this understanding “the system” and getting the right type of finance, setting up the correct ownership and asset protection structures and knowing how to legally use the taxation system to their advantage.

Here’s a bonus tip… Buy Australia while it’s on sale.

If you have a system, a great team of advisors, your finances organised and the right knowledge, now could be a great counter cyclical opportunity to buy good properties that will appreciate in value over the long term.

I guess you could call this the upside of a very challenging economic climate.

I hope you put these 7 tips to great use in your financial life. And I would really love to see you at my 2012 Property Development and Renovation Workshop.

Click here to check out the top line up of Australian property experts and find out more about the curriculum as well as the 9 FREE bonuses. Please give yourself the chance to assess this opportunity properly – it will take about 10 minutes to read all the information.

This is likely to be the most important year for you to attend. While we can’t predict the future, we have lined up Australia’s leading experts to help you formulate a plan to protect your position and exploit the opportunities ahead.
When you come you will have the opportunity to spend 3 days with:

• A leading property tax expert – who will show you how to legally reduce your tax and set up the correct structures.

• A top finance strategist – to show you how to beat the bank’s at their game.

• A property savvy lawyer – to explain how to protect your assets.

• A hands on property developer worth over 20 years of “real word” experience.

• A plethora of property experts, some who specialize in property renovations and development.

The intimate class room format of this workshop will give you plenty of time to ask your own personal questions of our faculty of speakers.

Use the online booking form to reserve your place or call Jo Fitt at our Melbourne office on 03 9591 8888 to discuss this further.

It’s up to you now – I look forward to meeting you in Melbourne and being part of this exciting workshop.

 



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About

Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


'7 ways to create wealth in the current economic climate' have 4 comments

  1. Avatar for Property Update

    September 13, 2012 @ 7:34 pm GRace Stubbs

    Thanks Michael
    SOme good insights as always. What do you think of the guy who came over here this week fro overseas and said property values are going to fall 15%?

    Reply

  2. Avatar for Property Update

    September 14, 2012 @ 11:35 am Mike King

    Hi Michael,
    Perhaps another tip that should be included is to be careful with debt. If you borrow too much, and an unforeseen issue comes up that means you are unable to meet your debt obligations, investors could end up being forced sellers, or worse, losing the lot. You only have to look to the equity markets and see what happened to ABC Learning and the Real Estate Property Trusts during the GFC.

    Cheers
    mike

    Reply

  3. Avatar for Property Update

    February 28, 2014 @ 5:58 pm Wealth Through Property

    Hi i really like all investment tips that are showing their and understand the different way how to become financially independent through property investment for making a smart choice to get high income over time. Nice to see your help full post.

    Reply


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