What is your net worth?: $2,000,000+
At what age did you become a net worth millionaire? 30's
What region of New Zealand do you live in? Papamoa
How did you accumulate your net worth, what are you invested in? Purchased first Auckland property when I was 25 years old. Renovated the property then revalued and used the increase in equity to purchase more property.
What was your highest average household WEEKLY income after tax? $2,000+
What is your career? Finance Area Manager
Do you have children? YES
Do you have a tertiary qualification? YES
Did you inherit any of your money? NO
What's the approximate value of your house? $1,000,000
Are you debt free now? NO
If NO, how much debt do you have and what is it for? $55,000 mortgage on my own home which I will repay in 2022. I still have ~$350,000 in investment property debt. I plan to be 100% debt free in 2022.
Are you in KiwiSaver? YES
Were you taught about money? NO
If YES, how were you taught? Everything I know about money is self-taught. I love the subject of personal finance and started reading all the books possible in my twenties e.g Think and Grow Rich, Rich Dad Poor Dad etc.
What is the most enjoyable thing you do with money? Travel 😀 It gets me outside my comfort zone with new experiences. Some countries I'm happy to not go back to, but post covid I look forward to more travel 😀
Do you use your money or your time to help others? YES
If YES, can you please elaborate. I still work full time and plan to for the next few years. I contribute money to two causes I value, underprivileged children and SPCA. When I transition to part-time work I will use my time for causes I value.
What is your greatest financial win? Purchasing a four-bedroom property in Auckland for $165,000. This property would now easily be worth $1,000,000 and now belongs to my sister in Perth 😀 And, for personal satisfaction, designing and building a five-bedroom home at Papamoa Beach where I work from home. With plans to be freehold in 2022 this will feel amazing!
What is your worst financial mistake? Purchased residential and commercial monolithic plaster properties in Hamilton (before there was stigma or known issues with plaster properties). I very much doubt I would be still working full time if I had purchased brick and tile property instead. Lesson learned.
What advice do you have for others? Start young, if you haven't yet started, start now. Today. Don't be afraid to take risks when you are young. I used leverage when I was young (as I knew I had time to recover if it didn’t work out). Set yourself some Goals. What do you want your life to look like in 5, 10, 15, 20+ years? Realise that at some point of your life financial catastrophe will likely happen. And it will be OK. It did for me more than once and it was a major setback for years! And importantly, only take advice from those that have and live the financial result you want (everyone has an opinion) and most are wired negatively. Stay on Track 😀
What is the point of having a net worth above $1,000,000. What does it mean to you? To be honest, it doesn't mean a lot if it includes your own home. I don't consider my own home an investment (much like Robert Kiyosaki's teachings). Everyone needs somewhere to live and a home can be a liability. The objective should be to have Net Worth of >$1,000,000 outside your own home, this is wealth creation and on the path to Financial Independence.
Finish these sentences:
If you want to build wealth do this… Take a long term view. Although the government has interfered a lot with property investment, if I had to start again I would work as quickly as possible to purchase a three-bedroom home in an average suburb and use "sweat equity" to improve the property. Yes you are using leverage (loan) but it's a much quicker way to get started in investing. Note - this is a ten-year investment. You will be very happy with the end result as long as you buy well.
If you prefer not to take the property investment route, invest today in Low-Cost Index funds that invest in a wide range of companies like the S&P 500 or Vanguard VTI. Do not leverage shares.
If you want to build wealth avoid doing this… Debt can be terrible. Over leveraging yourself can destroy your finances. Leverage works both ways. I lived through the GFC in 2008-2009 and at the time had millions in debt. It can be scary when much is out of your control. And I have experienced my main bank reducing my lending facility/exposure overnight! A bank can be like an umbrella which can provide protection however they can take it away when it rains! Very true.
If these questions don’t adequately tell your story, feel free to briefly elaborate here: Your financial goals will change with life. I believe everyone can be Financially Independent, but it takes clear goals, work and a long-term view. I am very much debt-averse these days however in my 20-30's I had millions in property debt. I'm in my 40's now and I can't wait to be debt-free soon. More of my wealth and income will now be invested in low-cost index funds. Anything is possible. Most importantly enjoy the ride and the journey.