Money doesn’t discriminate; it doesn’t care who you are or where you come from.
No matter what you did yesterday, today begins anew and you have the same rights and opportunities as everyone else to become wealthy.
Yet the sad reality is that the majority of Australians will never achieve financial freedom.
On the other hand, a small group of Australian property investors are becoming very wealthy.
This week, I begin exploring the common myths about money that hold many people back from achieving their financial goals.
Despite what some people believe, it doesn’t really take a lot of money to make money.
Many Australians have untapped equity in their homes that they can use as seed capital for investments, while others will have to learn the discipline of saving to get some start-up capital.
Then all they need to do is invest in high-growth investments such as residential real estate and use the magic of compounding, leverage and time to grow their asset base.
You don’t need a fortune to begin making your first million; you just need to commit to making a start and stick with it.
Almost everyone makes enough money to become an investor.
The truth is most people don’t have an income problem, they have a spending problem.
Look at your current wage and ask yourself; how much am I likely to earn over my lifetime?
For most of us, the answer will probably be over a couple of million dollars.
The problem is most of us spend as much as we earn.
You’ve got to start living within your means, paying yourself first, saving a deposit for a property and investing in order to break your current pattern.
If you accept my definition of financial freedom as having enough passive income to finance the lifestyle you desire, without having to work; you will never achieve this through your job or superannuation.
Instead, you will need to take control of your financial future by investing.
Even if you try to save 5 or 10% of your income as many financial planners suggest, you’ll find it won’t give you a big enough nest egg to fund your retirement.
You just can’t save your way to wealth
In our country, everybody has the ability and opportunity to become rich.
Successful people come from different backgrounds and while some have university degrees, others never finished high school.
To reassure you that education doesn’t equal a financial fortune, here are a few multi-millionaires who never graduated from college: Bill Gates (Microsoft), Michael Dell (Dell Computers) and Steve Jobs (Apple).
The truth is you can do whatever you want; not being smart enough is just another excuse.
Developing your own financial freedom is only as complicated as you make it.
Sure gaining the knowledge to become financially independent is challenging, but many new things seem more difficult than they are until you develop an understanding of them.
- Also read:Here’s how to avoid these 12 common reasons property investors fail to build a Multi Million Dollar Property Portfolio
- Also read:Latest property price forecasts for 2024 revealed. What’s ahead in our housing markets in the next year or two?
- Also read:Sydney property market forecast for 2024
- Also read:Boom to bust: What makes property prices rise and fall
- Also read:This week’s Australian Property Market Update – Latest Data, State by State November 28th, 2023
Investing is no different.
It’s easier than ever before to learn the fundamentals of wealth creation, with limitless tools available in today’s high-tech, info-laden world.
The key is to learn from the right people – those who’ve already achieved what you want to achieve.
The process is also simplified when you select an investment niche such as residential property investment and develop specialist knowledge in that area.
The dictionary definition of “invest” is: “To commit (money or capital) in order to gain a financial return.” The word “risk” doesn’t even get a look in.
However many people speculate when they think they are investing – they buy a property in a secondary location or off the plan “hoping” it will increase in value. Speculation is risky.
On the other hand, finding a property with an element of scarcity so it will always be in strong demand, in an area that has always outperformed the averages and buying it below its intrinsic value, is a proven investment strategy that minimises your risk.
It’s often said that timing is everything when investing, but that’s not really the case.
Sure timing matters - you don’t want to buy property at the peak of the boom, but successful investors find that timing isn’t really that important.
Have you noticed how some investors do well in good times and do just as well in bad times, while others do poorly in good times and even worse in bad times?
The truth is, successful investors, know how to create wealth at any point in the property cycle while unsuccessful investors manage to lose money at the same stages of the cycle.
This suggests to me that it's not our external world that determines whether we make money; it's something inside us - our mindset.
Another 8 Myths...
Next week I’m going to share another 8 wealth myths that tend to hold back ordinary Australians from reaching financial freedom.
Note: The good news is that, as you become aware of these myths, you can do things differently.
You can choose to change your beliefs and produce outrageous results and reach every goal you set by investing wisely in the right type of property.
Of course, while property investing may be simple it’s not easy.
And that’s not a play on words.
The fact is, around 20% of those who get involved in property investment sell up in the first year and close to half sell their property in the first 5 years.
And of those investors who stay in property, about 90% never get past their second property.
So if you want financial freedom from property investment to fund your dreams, you’re going to have to do something different to what most property investors are doing.
You’re going to have to listen to different people, to whom most Australian property investors listen.
You’re going to need to set yourself some goals and follow a strategy that’s known, proven and trusted.
Then you grow your property investment businesses one property at a time.