Essentials of a Written Investment Plan
The process of investment planning is not complex.
REMEMBER THAT THERE ARE ONLY 2 TYPES OF INVESTMENTS
EQUITY or INCOME producing. SOME INVESTMENTS MAY PRODUCE BOTH
HOWEVER THEY WILL USUALLY START OUT PRODUCING JUST ONE.
Think \’Big Picture\’ when planning. When the plan is complete from a big picture
perspective, then and only then start to fill in the detail.
The list below contains the major elements of a written investment plan. This should be completed FOR EVERY
planned investment purchase or acquisition.
A downloadable version of the list is available here.
| 1 | Know your Entry finances |
| Establish your EQUITY and MAX LOAN SERVICEABILITY figures by arranging a Finance and Strategy Review ( FSR) from Wizdom Loans . If your starting position does not allow for property purchase, you will need to consider \’No/Low Money Down Deals\” to grow your Equity. Webinar # 99 describes the various options available to all levels of finance. | |
| 2 | Finances – Which is Weaker? |
| Establish which of these is the weakest – EQUITY or INCOME. Wizdom Loans will assist you to assess this. | |
| 3 | Choose your deal type ( EQUITY or INCOME) |
| Based on which is weaker choose a strategy which strengthen that weakness ie. If EQUITY is the weakest choose a Chunk Deal which suits your profile, timescales and locality. If INCOME is the weakest then choose a Cash Cow , however always consider how the equity used to buy into this deal can be replaced. | |
| 4 | Get an approximate idea of where and what to look for. ( Big Picture) |
| Write the specifications of a property which will fit your criteria. The state, price range, property type, investment purpose(Equity or Income) Please view session 2 day 3 video from the 2016 3 day Bootcamp. | |
| 5 | Write in any potential works associated with this property.( Detail to be completed later) |
| Details of any projects to be undertaken and the timescale planned ie. | |
| Cosmetic Reno | |
| Structural Reno | |
| Subdivision | |
| Development | |
| 6 | Work the numbers for this deal.(Detail to be completed later) |
| PLAN BOTH EXITS – Sell and Hold
Work out the potential equity and /or income gains for BOTH exits. This is most important as it will highlight any potential concerns about income cash flows. |
|
| 7 | Know your Exit finances ( Detail to be completed later) |
| Add the above equity/ income gains to the entry equity/income finance figures to arrive at the exit finances figure. Carry forward these figures and use them as entry finances for the next planned deal.
Note that if the exit finances do not allow any further investments using the remaining funds, consideration will have to be given to Low/No money down investments in order to continue investing. If this does not suit the investors profile then this would strongly suggest that the deal may not work |
I do not have any operating business neither a high income earner As a property investor is there any benefits in setting up a family trust .
Do we pay CGT on sold property
How much money is needed in operating the Family Trust to be tax effective
Hello Stanley,
Yes there are benefits. Please review session 1 of the 3 day Bootcamp video.
If you are classed as an investor and sell property that is not your PPR then you do pay GCT on the sale of that property.
Family trusts are asset protection vehicles that offer some tax flexibility. Not sure about what your last question is driving at.
Regards
Michael & Sara
Ultimate Coaches
Hi there, Can you provide link to this please.
‘No/Low Money Down Deals” to grow your Equity. Webinar # 99 describes the various options available to all levels of finance.
Thanks for making comments about this in Facebook… it’s a good to place to put reminders like this since most people read Facebook daily!
Thanks Michael Franks for making comments about this in Facebook… it’s a good to place to put reminders like this since most people read Facebook daily! Cheers.
Stanley,
Answers to your questions:
An investor can only profit from the assets that they HAVE – not from the ones that they don’t have.
Your first trust question is answered in FAQ 4
CGT is paid on capital gains made by INVESTORS when selling assets ( property, shares etc) FAQ 18 provides detail
A trust is NOT a tax driven vehicle. It’s primary purpose is to protect assets.
FAQ 5 describes in detail.
Stephen,
Try this link /opm-other-peoples-money-bootcamp/
Regards
Michael & Sara
Hi all, Yes I am logged in. As I am new to the Dyphna’s program and have been since 2011 and not computer literate, I are having trouble finding my way at present. At 70 yrs old and as keen as mustard with good health, I will achieve my goals.
Les. McKenzie.