I recently returned from a three-week holiday in Europe.
The trip was fantastic and, with plenty of plane and train rides, I was able to read a few books on my travels.
One book I read that left an impression on me was Who not How by Dan Collins.
Dan Collins is a well-known coach to successful leaders and high achievers around the world.
The book deals with achieving goals and avoiding procrastination by focusing on who can help us achieve our goals, rather than how we can achieve the goal itself.
We can all relate to having set a goal (or goals) for ourselves that seems to constantly elude us. Whether we can’t seem to find the time to put energy and effort into progressing the goal, we get stuck at a certain point, or we find ourselves procrastinating.
When most of us set goals for ourselves, the first question we ask is “how can I do this?” Our first reaction being to try and achieve the goal – or solve the problem – by ourselves.
But the “do it yourself” approach usually limits our potential to the things we can do and achieve on our own. The output being the sum of our own knowledge, skills and experience.
By instead asking “who can do this for me?” we are able to unlock a whole new level of potential. The output instead being the sum of the knowledge, skills and experience of all the different people we engage to help us.
Collins goes on to say that everyone has different goals and motivations, but almost everyone wants to achieve their full potential.
At the same time, we only have so much time. We wear different hats in life and it’s impossible to be everything to everyone. The book is a great read because it provides a methodology to determine what to do ourselves, when to lean on others, and who to lean on when it’s not something we can or should be doing ourselves. A vital skill to hone as we seek to balance our roles as ourselves – a mother/father, a son/daughter, family member, friend, colleague, investor, volunteer, business owner, community member, etcetera – while only having 24 hours a day and 7 days a week.
In Bulletproof Investing I wrote about the importance of building the right team around you when it comes to investing. Much like in Who not How, you can do all these roles yourself but it’s like mowing your lawn with a push mower versus an engine mower. Both can get the job done but the push mower takes longer, and you have to do all the work, whereas the second option is quicker and the engine (i.e. the team) does most of the work for you.
Mentor
It starts with a mentor. So many people try and achieve their goals on their own, without the guidance or someone who has done it. A mentor could be a family member or friend; someone who you know and trust. If you’re not lucky enough to have one of those then it can be a professional.
The vast majority of people who try to do it on their own, fail. Even those who do reach their goals could have achieved a lot more if they had been able to leverage the expertise of someone else.
Mortgage Broker (or Private Banker)
A good mortgage broker or private banker is essential. Lenders change their policies as often as I change my sheets. One month they are willing to lend you 90 per cent of the property value, the next month that drops to 70 per cent. One month they will lend you on ‘interest only’ terms, the next month they want you to pay ‘principal and interest’. For most people a mortgage broker will be better than a private banker because a mortgage broker has access to a plethora of banks, the exception being high income earners or certain professions that qualify for exclusive products with the main banks.
Some investors deal directly with the banks, instead of through a broker. But you will almost always end up with a lower loan to value ratio and higher interest rate than someone who has used a broker.
Property Manager
Property managers deal with the tenants on your behalf, inspect the property every few months, and pay all your bills for you. Managing a property yourself is a false economy. As is going with the cheapest property management firm you can find. When interest rates are increasing, so are rents. Getting a good property manager could be the difference between getting an extra 2 to 5 per cent in rent each week and having a tenant who pays their rent on time all the time. Not to mention they will save you hours of your own valuable time by handling things on your behalf.
Accountant
The final cog in the engine is your accountant. I use an accountant who owns investment property and specialises in tax. There are plenty available offering that level of expertise and they save their clients thousands of dollars by knowing exactly what can be claimed as legal deductions. The Australian Tax Office says 70 per cent of Australians do not claim all their allowable tax deductions. In property, there are a few different ways to run deductions.
With interest rates going up, maximising our tax deductions becomes crucial to making sure investments are cash flow positive.
That’s your team – get those bases covered and you will have all the Who’s you need to ensure you have a stress free and effective investment experience.
While I feel I have all the bases covered from an investment perspective, I admit to being a work in progress on the other aspects of my life!
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