Investopoly

It stands to reason that not everyone needs a financial plan or relationship with a financial planner. There might be various reasons for this. However, perhaps the best way to answer this question, i.e. “who doesn’t need a financial plan” is to discuss what’s involved in a plan and then you can draw your own conclusions. In this podcast I discuss: •    what’s involved in the financial planning pr...

If you sell a dud investment property, you may have to pay capital gain tax (CGT), selling costs and then stamp duty again when you reinvest… it can be a very expensive exercise! And if you have owned the property for a while, it is probably putting money in your pocket each month (i.e. more than covering its expenses – not costing you anything) and the CGT could be significant – even more reason...

Mistake # 1: The absence of a methodology – most investors make ad hoc investment decisions. How can you expect to win the game if you have no game-plan? Mistake # 2: Belief that they can make quick profits – too many people thing too short term. Mistake # 3: No patience – invest in quality assets with a quality (proven) methodology and then have the discipline to ride through the volatility. Mist...

How you structure your loans can have a large impact on the tax you pay, your risk, your ability to build wealth, your cash flow and your general financial strength. Efficient loan structuring is a commonly overlooked and rarely understood topic but that’s not to say it’s overly complex. Like anything, you don’t know what you don’t know until you know it. Many people tend to carry a reasonable amo...

How you structure your loans can have a large impact on the tax you pay, your risk, your ability to build wealth, your cash flow and your general financial strength. Efficient loan structuring is a commonly overlooked and rarely understood topic but that’s not to say it’s overly complex. Like anything, you don’t know what you don’t know until you know it. Many people tend to carry a reasonable amo...

In my experience, novice investors can talk themselves into believing that an investment exhibits less risk than what it actually does. They think they are investing but in reality, they are closer to speculating than investing. The solution is to understand what evidenced-based investing is and how to use it effectively. This podcast discusses the difference between investing, speculation and bus...

Parents always want their children to have the best education. For some people, that means sending their kids to a private school. Of course, private schooling can be expensive and can have a big impact on your cash flow. But I’d like to suggest that the ‘cost’ is a lot more than the initial cash flow impact which parents should take into account - it can be more than 5 times the actual cash flow...

In Melbourne, investment-grade apartments have not appreciated in value very much in the past three to five years when compared to houses – as illustrated in this chart https://www.prosolution.com.au/time-to-buy-apartments/ I would like to explore why this might have been the case and share my opinion of whether this performance differential will persist. My new book is available for pre-order now...

When it comes to almost anything you buy, you have to weigh up three considerations: price, service and quality/features. Almost always, you can't have all three - choose the most important two . When it comes to financial advice, I believe that 'quality' is the most important consideration. There are 6 factors that you need to consider that will impact on the 'quality' of...

Investment-grade properties should double in value every 7 to 12 years on a perpetual basis. This equates to a 7% to 10% annual compounding growth rate – assuming inflation is in the RBA’s 2% and 3% band. https://www.prosolution.com.au/makes-proprty-investment-grade/ My new book is available for pre-order now: Pre-ordering the book will help me get it into bookstores. So please do me a favour - pl...

What is more important to do first? Contribute into super or buy an investment property? How will investing in property help you fund retirement? What can you do (invest in) to minimise the risk of running out of money in retirement? These questions all relate to your investment strategy. Most of these questions can be answered by acquiring an understanding of a typical investment strategy life cy...

I believe that very few investing mistakes are the result of random bad luck. Most mistakes are predictable and preventable. And there are some mistakes that are very common amongst novice investors. My belief is that if you can avoid these most common three mistakes then you will have a very high probability of being a very successful investor. https://www.prosolution.com.au/top-3-mistakes-people...

I’m sure you have seen the glossy ads espousing various benefits such as stamp duty savings, rental guarantees, discounts and incentives, state-of-the-art gyms, beautiful kitchen appliances, a concierge and the list goes on. As the title of this blog suggests, I strongly believe that off-the-plan apartments do not make good investments. And I put new-build townhouses and houses in the same boat. I...

When you compare the Australian market to the US, the difference is frightening. The Australian market is very concentrated (a handful of companies dominate the market), has nearly double exposure to risky ‘ cyclical’ sectors and has almost no exposure to technology. I’m going to suggest (below) that you can solve most of these problems by investing in just two low-cost, index ETF’s to achieve bet...