WiZDOM Loans – Going Pro – 30th April 2025

In this session, you will learn how to make a smooth and financially sustainable transition from a day job to full-time property investing. Andrew Kubenk from Wizdom Finance walks you through the key requirements and structures needed to go professional, highlighting the importance of strategic planning, borrowing capacity, and smart use of legal entities such as consultancy trusts.

You’ll explore how to create a foundation that allows you to continue investing, even without a traditional PAYG income, and how to leverage your property profits in a way that banks will recognise when assessing loan applications. Whether you’re early in your journey or planning your exit from employment, this session lays out the roadmap.

What You’ll Learn in This Session:

The Meaning of “Going Pro”:
Going pro means replacing your PAYG job with property investing as your primary income source. However, doing this without a plan can backfire if your borrowing capacity disappears. The session stresses the importance of preparing your structures and income sources in advance to preserve your financial momentum.

Two Key Pathways to Replace PAYG Income:

1. Equity Funding:
   Drawing on equity from your principal residence to fund deals outright or to enter joint ventures with servicing partners. Andrew explains how to structure deals using cash (from equity) to buy and renovate properties, particularly once you can no longer qualify for traditional loans.
2. Passive Income Replacement:
   Building a strong portfolio of positively geared assets to eventually replace your job income. A conservative approach is to aim for double your current income in passive returns before going pro, ensuring financial resilience.

Introduction to Consultancy Trusts:
Consultancy trusts are self-employed property businesses designed to help property investors shift income from their deals into a structure banks recognise as legitimate business income. Banks typically disregard profits from renovation flips or chunk deals, viewing them as non-repeatable. But if structured as consulting income—especially through proper invoicing—these funds become “serviceable” income for borrowing purposes.

Why Invoicing Matters More Than Distributions:
Banks can trace distributions through tax returns and discount income accordingly. Invoicing from a consultancy trust, on the other hand, presents the income as part of an ongoing business, making it more acceptable to lenders. This is key for preserving serviceability post-PAYG.

The Role of Bucket Companies:
Bucket companies can receive distributions from trusts and pay corporate tax rates (25–30%). Over time, investors are encouraged to move away from being the “centre of the financial universe” and shift wealth accumulation into entities for better asset protection and tax outcomes.

Risks, Timing and Setup Costs:
Andrew warns that consultancy trusts must be set up early in the lifecycle of a deal to be valid for invoicing. The setup cost for a full “Investor Pro” structure (including a consultancy trust) is typically around $5,000, with annual costs depending on usage and accounting needs. Legal and tax advice is bundled via Investor Pacific Structures to ensure compliance.

Action Items:

• Watch the session on “gift and loan back” in the Property Genius Blueprint.
• Consult an accountant for advice on using a bucket company to loan money to yourself and charge interest.
• Provide feedback to Wizdom on any issues booking appointments through the portal.
• Complete a finance strategy review with a Wisdom Finance strategist to understand options for the transition to full-time property investing.