A glimpse into Wealth Retreat – Part 2

Did you know that your habits can mean the difference between success and failure?

That’s one of the recurring ideas that came through at Wealth Retreat.

In this series of videos I’m sharing my reflections from that event and rich-poorin between sessions I interviewed Tom Corley who co-wrote the book Rich Habits Poor Habits with Michael Yardney.

In this interview, Tom explains the results of his 5 year study of the Rich and Poor, looking at their different habits.

His studies have found that although you are born into wealth or poverty, it is your habits that define you and there is a clear trend with the habits of successful people.

The topic of finance has was moree prominent than ever at Wealth Retreat

In this video I interviewed Director of Intuitive Finance Andrew Mirams, and discussed what is the difference between a bank or a high street broker and a dedicated Finance Strategist.

With finance being a stumbling block for many, we also touched on the current environment and how it’s playing out.

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Rich people are luckier

Each one of the 233 millionaires in my five-year study of rich and poor people was lucky. rich-300x169

Fifty-six (24%) were born into it and 177 (76%) created it.

The type of luck those 24% received was random good luck.

The type of luck those 76% received was self-made.

Luck, whether random or self-made, is a common denominator of all wealthy people.

If you want to be rich, you need luck.

While you have no control over the circumstances you are born into, you do have control over the circumstances you manufacture after birth.  

Depending on the study or survey, about 67%-80% of all millionaires are self-made.

They start out either poor or middle class.

That’s a good thing.

Success, when you think about it, really boils down to a game of hide and seek.

Luck does the hiding — you have to do the seeking.

But you must look for luck in the right places.

So where exactly do you look for luck?

Fortunately, success leaves clues.

Luck hides outside your comfort zones.

Successful people are very much like scientists.

They love to experiment.

But in the case of self-made millionaires, they experiment with new things, new ideas, and new people.

Finding luck requires that you step outside your comfort zones.

It requires an open mind; one which is curious and receptive to possibilities.

When you expand your comfort zone you also expand the opportunity for luck to occur.

Luck hides inside positivity.

Opportunities have to be seen in order to be embraced.

Positivity opens the mind to opportunities. success risk wealth

Positivity means having a positive mental outlook.

It is the springboard of all creativity and insight.

Problem solving requires creativity and insight, and self-made millionaire are, by default, problem-solvers.

Their optimistic outlook enables them to see possibilities for solutions.

Positivity also creates a higher level of confidence and an expectation that good things will happen.

Positivity is the fertiliser in which good luck grows.

Luck hides behind courage

Creating luck requires that you take risks.

Taking risk requires courage.

Courage is not the absence of fear, but the pursuit of something while in the throes of it.

Overcoming fear is something you must cultivate as a habit.

Luck hides inside new relationships.

Meeting the right person at the right time, requires that you … meet people.

People do not just drop in your lap and, voilà, luck happens.

You have to go out and find them.

You find them by joining networking groups, by volunteering at non-profits, by taking seminars, at fund-raisers, when you take up tennis, or golf.

You find the right person at the right time by doing new and novel things.

Luck hides inside intuition.

Intuition is the means by which the subconscious communicates with the conscious.

Your subconscious knows all and sees all. mind set rich money lesson think motivational learn teach money

It is constantly taking in sensory data and information that is below the radar of the conscious mind.

As a result, it knows things the conscious mind does not.

It exists to not only help you survive but also to thrive.

You need to listen to your gut.

Those who do find luck.

How much is that property worth?

In today’s fast changing property market one of the common questions I’m asked is “How much is that property really worth?” 

Obviously that’s a good question – no property investor or home owner wants to overpay. property investment

For products that are plentiful, transacted often and largely the same as each other, determining market value is really easy.

But purchasing a home is typically not like buying tomatoes at the grocer.

Each property tends to have features that make it unique.

Even two houses, side by side in the same street could be valued differently because of their individual attributes.

To make things even trickier, property is typically not transacted frequently, so it may be hard to find a recent sale of a home similar to the one you’re interested in buying.

There is no “right price 


Property is unlike most other things that you buy – there are no set prices.

Buyers and sellers must negotiate a price that is acceptable to both of them.

While the asking price is a guide of what the vendor would like to achieve or what the selling agent would like to get, for you the asking price is only a rough indication.

What about fair market value?

The definition of fair market value is usually the price that a willing purchaser is prepared to pay and a willing seller is prepared to accept, given that neither is forced to buy or sell under pressure.

In other words, if you bought a house today at fair market value you should be able to sell it again in a month’s time at the same price.

Don’t get emotional

A house is only worth what a buyer is prepared to pay for it, but value is in the eye of the beholder. stress emotion buying house

It works both ways. Some buyers will fall in love with a home and be prepared to pay more for it than you would expect.

Similarly many sellers have an unrealistic view of what their home is worth.

They tend to remember what they paid for it and how much they spent on improving it.

They may have over-capitalised with expensive renovations or they may just need a higher price so they can buy a better home.

Yet sometimes neighbours say they got more than they actually did and sometimes agents mislead sellers as to what price can be achieved.

Others value their homes according to what they heard neighbours got for their properties.

In reality, none of this really matters because at the end of the day it’s buyers who ultimately determine market value. 

So how do I determine the price? property purchase money

To make sure you don’t overpay – inspect as many comparable homes for sale and see what they actually sell for rather than what the asking price is.

While there are a number of providers that offer on line reports to estimate a property’s value, in general these are inaccurate and can under or over estimate the property’s value by 15%.

For example, these generic reports don’t know if the house has recently been renovated or if the owner has installed a split system air conditioner.

Similarly the report doesn’t know if the value of the property should be downgraded because of termites or a bathroom with water problems from a leaking shower.

My recommendation:research find search property investment location area suburb state market

Employ a proficient buyers’ agent to help you buy your next home or investment.

Sure, being a buyers’ agent makes me biased, but I know the team at Metropole has an understanding of their locals markets in Melbourne, Sydney and Brisbane.

And we have the perspective gained over years in the property markets to understand what factors makes some properties a great investment.

Action vs Self delusion | Jim Rohn

Knowledge fueled by emotion equals action.  

Action is the ingredient that ensures results.

Only action can cause reaction.

Further, only positive action can cause positive reaction


The whole world loves to watch those who make things happen, and it rewards them for causing waves of productive enterprise.Jim Rohn_2015

I stress this because today I see many people who are really sold on affirmations.

And yet there is a famous saying that “Faith without action serves no useful purpose.”

How true!

I have nothing against affirmations as a tool to create action.

Repeated to reinforce a disciplined plan, affirmations can help create wonderful results.

But there is also a very thin line between faith and folly.

You see – affirmations without action can be the beginnings of self-delusion. 

And for your well being, there is little worse than self-delusion.

The man who dreams of wealth and yet walks daily toward certain financial disaster and the woman who wishes for happiness and yet thinks thoughts and commits acts that lead her toward certain despair are both victims of the false hope which affirmations without action can manufacture.


Because words soothe and, like a narcotic, they lull us into a state of complacency.


The key is to take a step today.

Whatever the project, start TODAY.motivat

Start clearing out a drawer of your newly organized desk … today.  Start setting your first goal… today.

Start listening to motivational cassettes … today.

Start a sensible weight-reduction plan … today.

Start putting money in your new “investment for fortune” account … today.

Write a long-overdue letter … today.Start calling on one tough customer a day … today.


Even an uninspired person can start reading inspiring books.

Get some momentum going on your new commitment for the good life.

See how many activities you can pile on your new commitment to the better life.

Go all out! 

Break away from the downward pull of gravity.

Start your thrusters going.

Prove to yourself that the waiting is over and the hoping is past — that faith and action have now taken charge.

It’s a new day, a new beginning for your new life.

With discipline you will be amazed at how much progress you’ll be able to make.

What have you got to lose except the guilt and fear of the past?

Now, I offer you this challenge:  See how many things you can start and continue in this — the first day of your new beginning.

Plan for the Outlier

Many investors dream of buying a share at $0.10 and having it go to $50.   future

Unfortunately most do not consider the reverse – buying something at $50 and having it go to $0.10.

It can happen in the property market too – sure the fall won’t be as big but the values of some properties fall.

Our mind is instantly attracted to the renovation deal that netted a huge profit, or the development that was a hidden gold mine of opportunity.

Yet precisely this situation arose during the meltdown in the global financial system that we are finally emerging from.

This was an outlier.

It’s a sequence of events so extreme that no one had considered it.

The interesting thing about such events is not the size of them but rather that no one had a plan of any note.

I will accept the argument that this was an extreme event, but there were no plans at all within organisations such as banks and fund managers to deal with the collapse in asset values they experienced.

What response they did have was somewhat akin to an ostrich sticking its head in the sand and squawking “I can’t see you”.

The only response that regulatory authorities had was to ban short selling which only made matters worse.

Once this had occurred I was surprised that these geniuses didn’t go all the way and simply ban selling all together!

The interesting thing about investing is that the psychological problems that bedevil investors are universal in that they also affect all individuals involved in complex or stressful decision making.

Using the example of the bushfires, Dr Mary Omedie of Latrobe University has done some interesting work in the area of decision making by fire fighters.

In her simulations she has found that once fire fighters commit resources to a given fire they are very reluctant to remove these resources to deal with a secondary threat.

They are emotionally anchored in their decision and are therefore reluctant to change their strategy.

This is precisely the same issue that investors face when things begin to go wrong with a given trade.

We are emotionally as well as financially invested so we struggle to alter our strategy.

This situation gets worse when events begin to unfold in an entirely unexpected way.

Dr Omedei makes the following salient point when looking at decision making among fire fighters –

“We’re sort of very much thinkers of the present.

We’re hard wired to sort of think things will keep changing the way they’ve been changing up to that point.”

Consider this quote within the context of investing.  Dream-Investment-Property

Investors make the assumption that tomorrow will be the same as today and therefore any planning that is undertaken reflects this very basic perception.

There is no account taken of the fact that not only will tomorrow be different to today but that it may be so different as to be almost unrecognisable.

We perceive that change occurs at a constant rate, or at least has a constant theme, and we plan around this constancy.

Unfortunately the world, and particularly the investing world, is not like that.

Dr Omedei continues – “To put it into more cognitive terms we grossly over estimate our mental capacity.

We over estimate the amount of information we can deal with, we over-estimate the rate at which we can process information”.

In other words we are not as smart as we think we are.

Complex systems that are undergoing rapid variable change overwhelm us.

So the question becomes, if we acknowledge that we suffer from these cognitive drawbacks, what can be done in a investing sense to deal with our shortcomings?

I think the following list goes someway to addressing the situation.

  1. Leave your ego at home – if you begin to imagine that you are the master of the universe then the universe will show you who is actually boss. You are not as clever as you think you are. Property-Investment-Checklist-300x199-300x199
  2. Plan not just for trades that go to the moon but also on trades that come crashing back to earth. Scroll through the All Ordinaries and imagine what you would have done if you had instruments that suddenly lost a large amount in value. Rehearse how that might feel and what steps you would take to survive.
  3. Cultivate the notion of survival as the prime driver of your investing. Remember the market has one very harsh rule – no dough, no play. When all your money is gone, that’s it.

 Find out about Louise Bedford’s Mentor Program Course

13 Essential Things To Look For When Viewing A House [Infographic]

Looking for a new home is truly an exciting time – it’s also a big investment.  Property-Investment-Checklist-300x199-300x199

But do you know what you should be looking out for during viewings?

Aside form the obvious amenities, there’s several essential elements you should to out for to decide which home is perfect for you.

To ensure you don’t end up with any nasty surprises, it helps to have a bit of a chat sheet.

Here’s 13 essentials thing to look out for:


Source: www.homes.com

Metropole Property Home Buyers Enquiry

The ultimate guide to home and property loans

Doesn’t it seem like there are more home loans on the market now than ever before?

Well, that’s because there are! piggy bank

Let’s face it: first-tier lenders like the Big Four and second-tier banks such as credit unions are locked in a battle for your business.

The hard part, of course, is determining which is the best home loan for you amongst all their marketing noise.

Interest-only, fixed, variable, offset – finding the investment home loan that’s right for you can seem like a minefield of financial jargon and conditions.

Lucky for you, we’ve prepared this handy ultimate guide to help you decide!

Are fixed interest rate loans are a good idea?

Here’s the thing about fixed rate interest rates: they can be a good idea but they can be a bad idea… but it all depends on what your appetite for risk is.

Arranging a mortgage with a fixed interest rate gives you certainty – you’ll know up-front what you need to repay annually. 


So this means that once you know what you are going to receive in rent, you can estimate whether there will be a cash surplus or deficit and manage your cash flow accordingly.

But there are cons: such as many lenders will charge you a break fee if you repay more than the fixed rate allows for or if you wish to refinance during the fixed loan term.

Something else to consider is that banks will set fixed rates based on their expert understanding of where they believe monetary policy will go over the short- to medium-term.

So don’t forget that banks will still likely make a profit from you if you’re on a fixed rate… because they probably know more than you (or I!) do about the economic future.

If you’re intersted in 7 questions you should ask if your considering fixing interest rates read Michael Yardney’s blog here.

In short he suggests you ask:

  1. Will I want to sell my property during the fixed loan period? If so there could be a penalty for breaking your loan commitment.
  2. Will I want to access the equity in my property to invest further during the fixed period? Often this will come at a cost that may be prohibitive.
  3. Do I need an offset account? Many borrowers put their savings into this account and the credit balance here is offset against your outstanding loan balance reducing the interest payable on that loan. Most fixed rate loans do not allow an offset facility.
  4. Can I make extra repayments off my loan?
  5. What balance of fixed and variable rates do I need for my portfolio?
  6. How long should I fix my loan for? Now this is a difficult question, but if you believe that interest rates won’t increase for a year or two and after that they will remain high for a number of years, then fixing for a short period such as one or two years may not make sense.
  7. If interest rates fall further, what will locking in today have cost me?

Are variable interest rate loans more risky?

So, unless you’re keen to take a wager with your bank on the future of interest rates, many investors opt for variable interest rate loans instead. 9337186 - risk insurance

This type of loan means your payments will fluctuate with a variable interest rate mortgage, which some people might see as risky.

If you ask me, it also means that you can potentially benefit from any interest rate reductions such as the very big rate cuts we received during the depths of the GFC.

Another big pay-off is flexibility – if the loan has a redraw option, you’ll be able to redraw funds from any extra payments you may have made.

And many investors do just that to buy more investment grade properties or to use for renovations to manufacture equity.

You can also choose a split loan, with a mix of fixed and variable interest rates.

There’s also a plethora of package home loans on the market these days that feature split rates, along with credit cards, waived fees, and other products.

Interest-only loan

As the name suggests, with interest-only loans, you won’t pay anything off the principal. low interest rates

So, if the value of your property increases, you’ll have that equity even though you’ve paid nothing off the principal.

But if the market flattens, you might not have any equity, apart from the original deposit that you paid.

The sweetener for investors is that, unlike principal repayments, interest payments are tax deductible.

There has been some concerns about the high use of interest-only loans of late, so we are seeing higher rates for these types of loans, which is something to keep in mind.

If you want to, you can also choose an interest-only loan for a period of time while you renovate.

What that means is that your repayments are less than if you’re paying the principal plus interest, so you’ll have cash up your sleeve to pay for your renovations.

Should I have an offset account?

The answer to that question is: Yes!  bank reserve interest rate save money finance loan

That way you can retain control of your funds while also potentially benefiting from reduced mortgage repayments.

Let me explain: Products such as offset accounts allow you to use your mortgage as a kind of savings account, offering great flexibility and with interest calculated daily.

For example, you could have your salary paid into your offset account, which is linked to your home loan.

The balance of your mortgage will be reduced by your offset balance, meaning that you’ll pay less interest over the long-term.

But you’ll still be able to withdraw your cash when you need it!

Be mindful however that most offset accounts are linked to variable rate loans rather than fixed rate loans.

Are lines of credit more trouble than they’re worth?

Also known as a home equity loan, a line of credit home loan allows you to use the equity in your existing property to secure your investment loan.

Rather than receiving a lump sum, you can access as much or as little of the loan as you need.

As you’ve probably guessed, this type of loan means financial discipline is vital.

You don’t want to get yourself in a situation where you’re dipping into your equity for impulse spending such as a new car or exotic overseas holiday.

A line of credit is only a good idea if you have the financial know-how to manage the temptation and to only invest it into income-producing assets.

The bottom line on home loans… Home loans market

Here’s the thing: whichever loan you choose, seek professional advice and shop around to compare competitive rates before making a decision.

That way, you can make sure you’re making an educated decision on the best loan for you.

And you have to remember that home loans can be life ­– not just for Christmas – so you need to choose wisely every single time.