How to Conservatively Double Your Net Worth in 10 Years
–
I recently sat down with Yuk Wong from Baser Business Services Pty Ltd.
Yuk specialises in providing business services to property investors regarding income tax planning, capital gain tax planning, assets protection, cash flow analysis and risk management. More impressive is that he owns 13 properties himself, so he walks his talk.
Yuk is a CPA and Justice of Peace with extensive experience in real estate investment and an in depth understanding of the latest tax legislation that enables him to develop various plans to suit unique client needs and maximise your return on your investments.
His company lodges more than 3000 property schedule returns to ATO annually.
Yuk also has an uncanny ability to cut through all the information and noise and get straight to the point. In a world where we are bombarded with a lot of noise, advice and opinions (from websites, emails, TV, and every armchair expert out there), I think you’ll really like what Yuk has to say.
The first part of this interview is a bit more general in what it takes to get serious about investing and building wealth for your retirement (refreshingly, Yuk can be quite blunt in getting to the point).
We then get into specific strategies in part 2 , which features in an upcoming article.
In this article you’ll discover:
- The Sort of Mindset You Need to Have If You Want to Be a Serious Investor
- Why People Leave Investing for Their Retirement Too Late… And What to Do About It
- A Simple Strategy to Conservatively Double Your Net Worth in the 10 Years
And you’ll be introduced to Yuks strategies on;
- How to SAVE $4000 in Income Tax Each Year… and Pay No Capital Gains Tax on Your Investment Property
- How to Protect All Your Assets Under Your Name Using a Trust… Without Transferring the Title of the Assets to a Trust
I hope you enjoy.
–
Part 1 Getting Serious About Investing for Your Retirement
–
Peter: Welcome Yuk. To start with, tell me a little about what you do.
Yuk: Well, we’re a little different to other accounting firms. We’re a tax agent, but we don’t just do tax agent things.
We are a bit like an investment coach. We help you figure out how to come up enough money to retire.
For example, if you want to invest in property, we don’t really care WHAT property you buy. Instead we look at where you want to be in retirement and work back from there. Working out how to get you there in the most effective way.
Basically, look at how long you have before you going to retire, then, we work out a strategy.
Peter: What would be the typical average household income of your clients.
Yuk: It varies…
Some people might have an income of only $60,000 a year. But they have $300,000 in super.
Some people have $150,000 income but no savings.
The different situations require different strategies. It’s all different. Some people have a home, some people don’t.
For example, we might design a strategy for someone that involves buying property so they can save tax.
For the first 10 year, we show them how to be a bit more aggressive in accumulating equity, but five years before retirement, they’ll shift their investment into income-generating property (for example a commercial property or apartment or something better).
Something with lower maintenance but higher income returns… because when you get older, you don’t necessarily want the hassle of a higher maintenance property.
We help people become very serious investors.
People who want to work with us need to commit to themselves to be on the investors track for next 15 or 20 years.
We’re different because we get people thinking that far ahead. When you buy your first one or two properties, you need to be thinking about number five, six, and beyond.
Each year we then review what they’ve done and if needed, put them back on the right track.
That’s how we are different, totally different. Hardly anyone ever thinks that far ahead. We’re talking about 15 or 20 years and what that’s going to mean for your tax, your super and how you’re going to service the debt.
I’ve personally got 13 properties, so I’ve been there and done that and help people down their own track.
We try to show people that we are serious. If you’re serious, we can do it together. If you’re not serious, we prefer they don’t come to us.
Peter: And what sort of investment tools do you use? Do you use self managed super funds?
Yuk: Yes, depending on the clients situation, we use super funds to help reduce the tax and to enhance the clients investment capacity.
In fact, we have what we call Service Packs. Each of these packs deals with a key wealth building strategy.
For example Service Pack A is a method of using your super fund to borrow money to buy property.
Service Pack B is a method for protecting your assets using trusts
So that’s a few things that we do.
Peter: Do you get involved in any other investment areas like shares?
Yuk: Well, I have a diploma in financial trading.
But, while we could have gone into this area, I really don’t like shares or managed funds because they are really something I cannot control. And I think that even if I diversify, and am looking for good returns, it is still quite risky.
Peter: Yes. I share your sentiment.
Yuk: Property is something that I’ve never seen go down over the long term. Especially when you buy something reasonable, not like stupid storage units or something like that.
Peter: What’s the biggest question you get from property investors?
Yuk: From a tax side, they want to know how they can manage their cash flow better, and how they can be more tax effective by planning ahead.
That’s the biggest question people ask. That’s what we focus on.
Peter: A lot of the people I speak with are getting closer to retirement i.e. They’re in their late 40’s and realising they haven’t got enough. Why do you think they have left it this late?
Yuk: Everyone has a lazy mind. Sometimes, they just don’t want to change their life.
People live in their custom. Every day when they wake up, everything is already set. They don’t want to change.
Change makes them nervous. Change gives them a headache. They are already stressed enough working 9 to 5, so they have no energy to focus on investing.
Of course they know that is good thing to do, but really, they can’t do it. My job is more like a motivator. My job is to tell people, “Look, you know that’s the right thing to do, you know there’s ways to do it with no risk, but you’re still not doing it.”
It is totally normal to put it off. But then one day, you’re in the shit. Then you will have the motivation to do it, but do you really want to wait until that day comes?
Peter: In your opinion, is it too late for them to build enough wealth for their retirement?
Yuk: I will only give you one answer for this.
In 10 years, I can guarantee whatever you have, you can double it.
Think about that. Even your superfund. Double it. Safely.
I’ll show you how right now.
For example, if you’ve got $150k in your super, you can buy property for $450k.
Let’s say 10 years later, that becomes $650. That should be very conservative.
So you have invested $150k, and you owe the bank $300k.
After 10 years, you still owe the bank $300k. So $650k minus $300k = $350k (which is actually more than double your $150k investment).
Simple as that. That is one strategy, very simple.
You’ve just got to do it, that’s it.
Please comment on this article below and list any things you’d like to find out more about in future postings.
Disclaimer
This is general information. Please do not rely on the strategy or opinions shared in this interview before discussing it with a qualified financial and or legal advisor. We do not endorse any of Yuks opinions for you. You must make your own determination of the suitability and validity of this information with the aid of a qualified advisor who will take your specific situation in to consideration.