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By Michael Yardney

Fifteen wealth myths that hold property investors back

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.

Myth # 1: It takes money to make money

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.

Myth # 2: I don’t make enough money

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.

Myth # 3: My job and superannuation will take care of my financial future

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

Myth # 4: I’m not smart enough

In our country, everybody has the ability and opportunity to become rich. Bill Gates Steve Jobs

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.

Myth # 5: Investing is complicated

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.

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.

Myth # 6: Investing is risky

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.

Risk Factor

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.

Myth # 7: You have to know how to time the investment markets

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.

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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.

About Michael Yardney 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 one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media.

Hope you are well. Iam currently reading your book “Guide to investing successfully” and have few questions. I have watched so many videos too but may be Iam so dumb. Everyone talks about building property portfolios using OPM which is fine but if we ...Read full version

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Dear Michael I am stationed overseas on work commission and can not attend your seminar in Oz. I am interested in investing in some real estate which you call scarcity type in NSW. I can communicate from here via email , phone and fax. What do you ...Read full version

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Quote: ".....high growth investments such as residential real estate......" Wow that is one very big lie. Real estate will be barely keeping up with inflation, maybe even going backwards, at least for the next 5 years. You could buy today or buy ...Read full version

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