Help me to Retire

So what should you be doing today?

Well the greatest piece of advise I can give you is SOMETHING. Thats right, at least do something in preparation and start today as time literally means money when it comes to your retirement.  You have the basic things such as add as:

• Add as much extra $ into your Super / 401k plan as you can
• Look into salary sacrifice to top up your super before you pay tax on it
• Make sure you have some life / permanent disability insurance just in case - you have to think of your family! (Most super funds offer this free with their account.)
• Save up an emergency fund - enough to get by for several months

Then we have the more serious things you can do:

• Educate yourself - such things as reading this website - taking an investing course etc
• Get your self some property - or more property - and then some more
• Decide what path you want to take - either pay more off your home - or borrow to the max and buy more properties
• Start a stock portfolio or learn to trade or put some money into a high performing fund
• Invest in a business or franchise - remember work on your business not in it.

And my favourite:

• Stash some cash away that your partner doesn’t know about to get that toy you always wanted! ( I can’t be held responsible for recommending this one)

How much in savings and superannuation do you have? I’m sure you’ll agree that in order to retire you’ll need a lot more than $25 thousand. Unfortunately there is a lot more people than you’d think that only have about this much. Yes, a lot of them are in the under 35 years old category as you’d expect, but there is also a lot of older people in this quite worrying situation.

This article I found gives you the percentages of what you need to be saving for your age group and also links to an online calculator to help you. Remember, now is the time to start planning for your retirement. There are many ways to help you get there quicker, just search this site for ideas.

I reccomend that superannuation and savings is your security/backup plan not your main and only investment vehicle.

If you haven’t already, Start today!

This site has some great tips for getting the most out of your day.
If you can get your work life, your family and your self on running smoothly and on time your going to have more spare time to enjoy life and focus on your investing for the future.

This article will help you get the most out of yourself so you can be the best you that you can be!!

Have a read!

Having trouble finding any left over money at the end of the month to save up and invest? Well this simple budget could be your answer. It is set up in excel and gives you a basic layout to input your income and expenses.

The following article will lead you through the process and give you a link to download your budget template in excel format.

Check it out here.

This question remained in a state of confusion, mystery and frustration for me for several years.
Just like most new people to the world of property investing I didn’t even consider structure when I bought my first property. It was just put in Joint tenants, 50/50 mine and my wifes. Years later when I sold this piece of land it cost us thousands of dollars in extra capital gains tax due to the lack of structure set up. Also at risk during the whole time I owned this property was everything my wife and I owned. If we had have been sued for something happening on our investment property, everything we owned would have been up for grabs as we had no asset protection with the property in our own names.

As I’ve outlined above, the 2 main advantages of setting up a structure for your property investing and not putting them in your own name are:

1. Tax benefits
2. Asset Protection

So when I say structure, what do I mean and what types of structures are available?
This is originally where I got confused, and it is still very easy to get confused as you will be told many different ways by different people. Basically the structure options that are available are:

• Company
• Trusts (there are dozens of types)
• Discretionary (Family Trust)
• Unit Trust
• Hybrid Trust (A cross between the above 2)
• Self Managed Superannuation Fund

With a Company, you pay a flat rate of tax of 30%. It offers some asset protection, but losses such as negative gearing are trapped in the company and cannot be claimed by the individuals. You also miss out on the 50% capital gains tax discount after 12 months.

Self Managed Superannuation Funds are a type of trust that are very usable in property investing, but I’ll go more into detail with them another time.
Trusts: A discretionary or family trust also trap losses in the trust not allowing you to claim negative gearing.
A unit trust I believe allows you to claim negative gearing but is not flexible in the way you can disperse income like a discretionary trust.

This brings us to the Hybrid Trust. But not just any Hybrid Trust, the trust that took me all these years to find and locate and one I actually purchased and am using is called strangely enough the Property Investors Trust. It is a Hybrid trust that allows you to claim your negative gearing and also disperse any profits to whom ever you like within your family, either by blood or marriage relations. The trust also does not expire in 70 years like many other trusts. This trust is built from the ground up for property investing.
In Australia there is one place that sells it as they set it up and copyrighted it. You can get yours from Chan and Naylor Accountants. The cost isn’t cheap ($1700), but over many years will save you thousands of dollars. To become a Chan and Naylor customer you must also first complete their financial health check assessment ($395) to see where you are and to create a plan for your future. I found that very worth while and exciting!

For better asset protection, you may find you are recommended to create a company to be trustee for your trust, this will add another $1085 to your bill, but may save you everything you own in the future.

After speaking with Chan and Naylor they may recommend something else for you, but the above is what I ended up with, and if your only doing property investing, you will probably end up with the same structure.

Remember, you need to set up your structure before you start acquiring property as it is expensive to move ownership of properties later. If you already have investment properties in your own names, don’t worry, just speak to the guys at Chan and Naylor.
I hope this has saved you several years of confusion. Head on over to Chan and Naylor’s website for more information.

Do you have a plan for your life. Do you have it written down?  Do you refer to it daily, weekly monthly with your written goals?

Most people don’t, so how do they know where they are going? Think about this, when you plan an overseas holiday do you have everything planned out with what you want to see and do? Of course you do.  You get your itinerary with your flight times and numbers, where you going to and when you’ll get there.  Most of the time when we do all this planning everything goes generally to plan and turns out how it was written down. So why don’t we do the same for our lives?

Think about this also. How effective is your general use of time in your normal life? How effective is your use of time the week before your going overseas for a month? Usually very different. You seem to be running on auto getting a huge amount of things done and tidied up before you leave.  Wouldn’t it be great if you could be this effective all the time?

Please, set aside and hour or so and plan you life. Write down where you want to be in a year, 3 years, 7 years etc. For example, write down the steps you need to take to get that business or investment idea going and follow through reviewing your progress all the time. Write down your goals/plan for personal development, relationships and every other area of your life until you have a complete plan. Refer to it and update it regularly.
Plan your life. Your results will be rewarding!

Here’s an interesting article I came across today, have a read -

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Source - Deppro newsletter

The significance of the baby boomers in the Australian property investment market is underlined by new figures released by DEPPRO.According to Paul Bennion, Managing Director of DEPPRO, some 50% or around half of all property depreciation reports prepared by DEPPRO are for baby boomer investors. “Baby boomers have been very active in all the markets now serviced by DEPPRO throughout Australia,” Mr Bennion said. “A growing number of baby boomers in Australia now view property investment as a low risk way of building wealth for their retirement compared to the stock market or even superannuation,” he said. “Many baby boomers have been attracted to buying investment properties because they can leverage the large amounts of equity they have in their owner occupier homes to organise home loans in excess of $1 million to purchase several investment properties. “For many baby boomers, property investment is now a financial imperative because a recent survey indicated that less than 10% of all baby boomers have more than $100,000 in superannuation. “This financial imperative is further underlined with the year of baby boomers (people born between 1946 to 1965) turning 60 years of age during 2006,” Mr Bennion said. “DEPPRO is finding that baby boomers are now particularly active in the ‘red hot’ property markets of the Northern Territory and Western Australia,” he said. “For example, more than 65% of depreciation reports for property investors in WA which are prepared by DEPPRO are for baby boomer investors.
Paul Bennion - Managing Director of DEPPRO - Depreciation Specialists

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There sure are a lot of Baby Boomers out there that will be relying on the government for assistance! Do yourself a favour while you still have time, get into property! The next property cycle is already upon us. Prepare now, do your research and look into living off your equity, you’ll be glad you did in years to come.
Also keep this in mind about your Super (401k). At the moment everyone is putting money into (topping up as they are encouraged to do) their Super funds and therefore into the markets… the markets have been going up… As the baby boomers retire and start taking their money out, where do you think the markets are going to head? Real estate could look pretty dam good then! Get yourself a copy of the book Rich Dad’s Prophecy by Robert Kiyosaki, it goes into more depth.

InvestSmart is a great  resource for everything to do with the Australian Stock Exchange,  Superannunation,  Managed  Funds , Insurance, Finance and much more.
This site was one of the first sites that got my attention when I realised I wanted more from my life than the 9 till 5 drudgery.  When I first started investing in the stock market, my strategy was to get into just about every new float that I could as when they were averaged out you could effectively sell on the first day and the end of the year have a 30% plus return. It was a good theory, but I soon found out getting into every float was pretty dam hard as a one man show. I usually got into all the average ones and missed out on the doublers!
Any who back to InvestSmart where they have all the info and prospectuses of up and coming floats or IPO’s. Very handy in deed.
Another great thing about Investsmart I found out and used is their entry fee rebate on managed funds. They also refund you their commissions!!

If you sign up and become a member of the site (Free of course ) you can set up your portfolio with their online tools showing you your assets and liabilities and your end result your net worth.  It’s good to get it down and actualy see where you are! You can also track things in a watch list like certain stocks or managed funds performance.

There are a heap of great tools and services on this site, your best off to just head over there and get into it yourself!

Investsmart 

Ok, I’m figuring as its seminar season, I’ll only get a few more days worth of these and then we can get onto some different topics.

Tonight it’s Aspire. Run by Perth based self made millionaire Craig Turnbull. Aspire now works in Education, Finance, Property and Wealth Planning. Craig is a well known author and Aspire also runs a metoring program.

The Aspire seminars or Investor updates as they are called are now in Melbourne, Adelaide, Sydney, Brisbane and Perth.

Here are Aspire’s 5 Great Reasons to Attend

1. Share in Craig Turnbull’s market analysis and property predictions for the year ahead.
2. Network in the company of like-minded investors.
3. Hear Craig’s most up-to-date thinking on the current market.
4. Tweak your strategy to best take advantage of market opportunities.
5. Craig will address issues that your wealth plan cannot.

I have read one of Craig’s books and was impressed, I’ve also seen him speak once before. I am very tempted to join his mentoring progam ($99 a month). But for now I’ll be paying the $25 to attend this investor Update, might see you there!

Click here for details 

Tonight there was a good show on TV for once.  The ‘Money’ show special, on what to do in these times of huge comsumer debt and high petrol prices.

Is you missed it, the show went through several couples and a single and worked through their current financial mess’s.

Basically most of them where able to get more money in their hand every month with the consolidation of all their debts into their home loans, giving them a lower repayment due to a lower interest rate and more time to pay it off.

Other key points were salary sacrificing into your Super (that way your money is taxed less), saving / investing 10% of your weekly wages and the number one thing you need….  A plan, without it you’ll get no where!

Check out the Money website, there are some great tools there to get your started including a budget planner and heaps of calculators for savings and investments!   Check it out