Accelerated Wealth

As a passive wealth builder you can look for returns of 10% to 20% p.a. in property or equities. But with active gearing - or borrowing for investment - that could increase dramatically. The higher the gearing, the higher the risk - and the higher the potential returns.

Accelerated wealth building... Basically, there are two ways to do it: the right way and the wrong way.

The right way means doing your homework. It means having a clear process - even a checklist - for making disciplined, rational decisions. It involves putting in place a solid structure or system which minimises your risk...

I've bought and sold thousands of properties and made millions of dollars - without using my money and without debt. So you might say I'm pretty well qualified in that area to give you some advice. At the same time, my advice will always be to stack the cards in your own favour - and to do your own homework. Break that golden rule, and you'll end up like all the other 'punters'

Because that's the wrong way to attempt accelerated wealth-building. 'Punters' are people who don't do the homework... and don't follow any clear strategies or structures. You may not think you're a 'strategy' kind of person. But think about it. There's a saying in our business:

"There's no such thing as a bad deal, just bad timing."

If you haven't identified your exit strategies - before you commit yourself to a deal - bad timing could haunt you into bankruptcy. Or take another saying:

"Cash is like oxygen: if you run out of it, you're dead within two minutes."

In actual fact, it's probably 2 months - but 2 months goes very quickly in the property market: you need contingency plans for your cash resources, in place, in advance... Don't be a punter: be a planner.

Accelerated wealth building is about becoming active: doing the homework and taking a part in the process yourself. Becoming the driver. You can make a thousand percent return - or more... Might be worth the extra effort?

I once bought a block of land for $1.5 million. I put down a $10,000 deposit and borrowed 100% from the bank - on settlement. When I sold the property six months later, I made a profit of approximately $2.8 million... For a total personal outlay of $10,000. High risk, high return? There was simply no risk in that deal for me. I had an exit strategy - a customer for the property - worked out before I committed to the purchase. I had a bank valuation, based on that exit strategy, of nearly double the required amount. And I had options if that strategy didn't come to fruition: I could have on-sold the property to other interested parties. If I had to invest anything, personally, in that deal, it was brain space, belief, commitment and energy. If I'd sat back and let it happen, it wouldn't have happened. But that's what accelerated wealth is all about.

Does that sound like a contortionist act? getting your hands dirty, putting your best foot forward - and covering your butt all at the same time? Well, this is what successful property traders do. What successful business people do. The process I've outlined could be duplicated in any business context.