Good news stories

Accountants and financial advisors, let alone people interested in wealth creation, will always tell you how important it is for you to create wealth for yourself. Obviously, we tend to agree and as you know, we have a long history of demonstrating just how much we agree with this concept through our practices, advice, and actions; both personally and professionally.

However, one of the reasons for creating wealth that is not necessarily spoken about as often is that it also creates the opportunity for you to make decisions to help others. In this way, your wealth creation empowers you to make a difference. It allows you to give, not take, and that is a rare and valuable trait in any person. We have long believed that whilst it is nice to receive every now and then, the real joy comes in giving to others.

So, it is with this in mind that we will occasionally mention projects that we, our friends, and our families, are involved in where other people benefit; not ourselves. These are good news stories and we encourage you to applaud those people, and, where it suits you, to offer your own assistance in any way that you can. In this way, we hope to help make this a better place for everyone and uplift us all in the process.

The first of these that we'd like to let you know about today has been put together by our good friend, web designer and social entrepreneur, Chantelle Baxter.

Project Eight is a grassroots, not-for-profit organisation based in Melbourne. Committed to ending extreme poverty by 2015, Project Eight is joining the front-line, helping to achieve the 8 Millennium Development Goals developed by the United Nations in 2000.

Their current project is to help with the completion of a girls' secondary school in Kenya. This will be the second African school that Chantelle has been involved with building and we are extremely proud to support her endeavours. Awesome stuff by that girl, there.

The second of those good news stories for today is one that my parents, Dale and Sue, are supporting. Those of you who have dealt with them before will no doubt remember how strongly they felt about giving back, and, the standards that they expected of those organisations that they did donate to.

A famous Australian artist by the name of Robert Bosler is going to paint three massive paintings that capture the iconic essence of his home town in The Coffs Coast. These paintings will be created over a period of three months and will be painted inside the local shopping centre, then auctioned off with 100% of the proceeds going to local charities.

The local council, chamber of commerce and charities are right behind this project. There is more goodwill generated with sponsorships possible at the art school (both in-house and on-line) that Robert has created where people who would not normally benefit from such teaching will get the chance to do so. I understand that Dale and Sue jumped at the chance to support this project and were thrilled to do so.

As you can see, we are great fans of giving back to local and global communities, to share our wealth with those less fortunate, and we encourage you to do the same where you can. Again, this is one of the beautiful things about creating wealth; it is much easier to give to those in need, when we are not in need ourselves :-)


Vision, Integrity, and Passion

Generally speaking, we're big fans of the Somersoft community; in my opinion, it's far and away the best of its kind when it comes to online forums for property investors. I've been a part of the group there for almost seven years now, so that might give you an idea of how highly I still regard the place.

That said, there were a couple posts there by an individual or two lately that I found rather disappointing. Perhaps my view on the world is a little simple, but to my mind there are three key qualities upon which we build success within any endeavour:

Integrity, and,

Most investors that I speak to will have the third. That passion can have any number of drivers but for many of, that burning desire to create freedom through investing is what keeps us up until 3am hunting around online for new deals.

Vision is a little harder to come by. We all know roughly what that end goal is - financial freedom - but I do see a few people who have no idea what that actually means for them. Working that out is the hardest part, I believe, but well worth the effort. After all; how do you know when you get there, if you don't know where you're going...?

Integrity... I believe this to be the most important of those key values and I hold it - and those with an abundance of the stuff - in particularly high esteem. It is all too easy to create wealth without having to compromise it, and keeping one's integrity intact is amongst the most worthwhile of pursuits. And yet, from time to time I still see people willing to do the wrong thing in their efforts to get ahead.

One of those posts on the afore-mentioned forum revolved around someone wanting to hide income from the tax office. Another, thought it was perfectly reasonable to lie to a real estate agent; since they all lie to us anyway.

Lying to the tax office - and, to us! - is not cool. Even if we don't find out, the tax office have a ridiculously broad scope of information, and will most likely know what's going on. They generally won't appreciate petty excuses.

Lying to real estate agents is not cool, either, regardless of how they treat you. Nor is withholding information from banks in order to get finance. Two wrongs don't make a right. Play the game, by all means, but surely it's not worth lowering one's standards of self just for the sake of a little coin.

Now for most of you reading this - and indeed, most forumites, too - I'm sure that the above is not an issue at all. For the minority that inspired this post, I do hope that it's not a sign of where the world is heading today.

We always prefer dealing with people who can display all of the above traits. A vision towards achieving something awesome, the integrity to do so with honour, and the passion with which to motivate yourself and inspire others. It's a fantastic way of doing business and dealing with so many people who operate in this way is a constant plus for us :-)


Are you reactive, or proactive, with property?

Even now, it seems to be a common investment philosophy that buying and holding, and never selling, is the best way to make money from the real estate game.

It's relatively easy, passive investment. Over quite some time, historical medians indicate that average values will increase in cycles that work out to roughly 7% per year. When using substantial amounts of leverage and reasonable yields, this allows for some pretty good returns.

Assuming, of course, that you do get your 7% every year.

In many areas, average values have been fairly level - or even backwards in say, parts of Sydney - over the last few years before the first home owner grant has done it's magic for 2009. In that scenario, we're seeing many people negatively gearing without the capital growth to compensate.

Robert Kiyosaki has spoken about the dangers of negative gearing in the hope of seeing future gains. In many ways, with an uncertain financial environment at the moment, I tend to agree.

Perhaps it's because I like to take risks. Perhaps, it's because I'm amongst the "want-it-and-want-it-NOW" generation. Regardless, I am a fan of investors being proactive with their investments, rather than reactive. Creating value in a flat, falling or rising market, instead of waiting for the market to move for you. This is often cited as one of the main reasons to invest in bricks and mortar instead of shares; yet, we see many investors reluctant to do so.

And, we also see many people who are afraid to move money from a non-performing asset into something that will get a better return. As with most traditional concepts, we like to question, to ask 'why?'

Often, the response can be as fickle as a simple reluctance to pay tax, stamp duty or agent commissions. Oddly, these are simply costs of doing business.

Like any other such decision, it's all a numbers game. If the deal stacks up whilst standing still, then all the better. If it doesn't, then these costs should be taken into account and new opportunities analysed and compared until that decision can be reached with confidence.

Having a strategy that's built with the intention of creating a win, rather than waiting for the market to deliver you one on a platter, makes a lot more sense to me. Especially when the alternative is simply losing money whilst you're waiting...


Happy new year!

It's the 1st of July. A new year starts today... and, a new day started this morning; just like every other.

This, to me, is a good reminder of the folly of new year's resolutions - regardless of whether you celebrate the holiday in January or any other month. Goals can be set at any time and so, waiting until a particular day before committing to its achievement just doesn't make any sense. In many ways, it's simply a procrastination technique. Almost every smoker that I know will tell me in December how they plan to quit in January. Nevermind that they're usually lighting up again by the 3rd, which is another issue altogether.

Regardless, chances are pretty damn good that you've already got everything that you need to set these wheels in motion and to start taking steps towards achieving your goals; whatever they may be. So if you haven't already, cliched as the date may seem; resolve to do so, today. Go!

You can see some of our personal goals on each team member's page on our website. For the company, our plans include increasing the existing client base, hiring more staff, reducing turnaround times, and investigating other avenues with which we can help you to achieve your goals.

The 2010 financial year started this morning. Less than 365 days left of this financial year - so, tell us, what are your plans for that time?


Check out the new House Rules...


Thanks to the fantastic work by Chantelle Baxter, we now have a House of Wealth blog! Huzzah!

This will replace the House Rules newsletter that we used to email out every few months. We figured that really, three months is far too long to wait for new information, when there is just so much happening in the financial world around us at the moment. Beyond that, we reckon this should be a lot of fun.

So, we'll be updating this for you at least once a week.

Please subscribe by using the RSS feed button down the bottom of the page there, and of course, feel free to forward this along to anyone that you feel might find enjoy what we have to say. Comments to all posts are more than welcome, too, as we'd love to hear your thoughts on things as we go along.