Jule Corp

Hi All,

I want to follow-on from what Cosi was recommending to Peter. 

Firstly, I want to say that I agree with everything that Cosi is suggesting, except for one thing. As investors we need to use our time wisely on matters relating to investing. See as an investor we
earn incomes most people only dream about. So when you work out our actual “hourly rate” it’s normally off the chart from what most people know.

That being the case I have this attitude that I never invest my time, energy and knowledge into something that I can pay someone else far less than what I earn to do. It just does not make sense for me to waste my time on such things. That is why I have both an accountant and a book-keeper. I have had this conversation with several people only recently. Why learn book-keeping skills yourself? Why go and do a course in MYOB? Why not invest that time looking for your next property deal instead. I pay my book-keeper (Raymond is his name) to do that stuff for me. Raymond has been working for me for about 4 – 5 years now. You know what I use MYOB but would not have the foggiest clue how to enter the information. I get Raymond to do all of that for me. He comes in for a couple of hours every few weeks and all I do is give him my bank statements, trading statements, receipts and a few other bits and pieces which I collect in my “Raymond file”. When he walks in I hand him the file, a few hours later he lumps a report on my desk and says “sign here”. That is it. 

I pay $40 per hour. You know what I can’t believe how cheap that is, compared to the time I save and the money I make doing other things instead.

Now here’s the thing. I maybe spend a total of 4 hours per quarter myself keeping these bits and pieces in order. If I were to do it all my self, it would take a heck of a lot more time than that, I can
assure you.  

Here’s the other thing. I am completely up to date with all of my tax matters. You could not be more up to date than me. In fact I am almost ready to do the coming tax return. Why, because all we have to still do is this current quarters info. All the rest of this financial year is already done. I already know what I have earned for this past year, and all the previous years. And as I said it only takes me about 4 or maybe 5 hours of my own time (per quarter). All because I hire the right person to do it all for me.

So don’t do a course in MYOB. Go through your local newspaper instead and find someone in there advertising book-keeping services. Do the ring around. Within an hour you will find someone to do all
your book-keeping for you. They will probably even bring along their own corporate licenced version of MYOB, so you won’t even have to pay for the software, let alone do a course. That is crazy. Don’t do that to yourself. Focus on investing and investing only. Pay others to do the rest. You will make far more money, and save yourself a huge amount of pain doing it my way. Trust me!

To your success, 

Jules

1) Research Unit Trusts and Family Trusts.

 

Find out how each structure works and what benefits they offer you as a trustee.

 

Recommended Reading This Month:

 

‘How To Legally Reduce Your Tax’  by Ed Chan & Tony Melvin

 

2) Revise Trading Wisely. For those of you who have not completed the Trading Wisely program, please email me as the next two sessions will be covering Options Trading Strategies.

1) Using our Share Investment strategy, identify a company that you believe is good for investing at the moment.

- Bring along all data and findings and present to the group at our next Mentoring Session.

2) Also, bring along to the next session:

• Details of a margin lender.
• Supply a list of all the shares they margin lend against and the LVR’s for each.
• Obtain details of their interest charges.

3) Open an account with a stock broker.

Recommended Reading This Month:

“How Buffett Does It” by James Pardoe

If you have trouble getting hold of this book, I have included a direct link to it in Amazon.com on the side of this page.

Now we currently have a situation where demand for housing is higher than the available supply. Affordability is also at an all time low with most investors already benefiting from booming rental prices as a result. 

BIS Shrapnel’s statistics show a current shortfall of 30,000 dwellings, and that figure is expected to continue rising. They are forecasting 60,000 by June this year and 129,000 by the middle of next year. 

So what does this mean to you as an investor?

Rising interest rates are making people nervous at the moment and they are choosing to wait for rates to stop rising before they buy or build a property. 

And we know that demand for housing is already quite high. So if the forecast is correct, and by the middle of next year there is even LESS supply, what will then happen once interest rates plateau (or eventually start to fall) and these people are ready to buy?

The demand will be so strong that it may even explode…BOOM! 

So when would be the best time to buy a house? I’d say right now!

To your success,

 

 

Homework – Part 1 : Joint Ventures:

1. Brainstorm different hurdles that stop people who are wanting to purchase real estate for investing.

2. Work out how a JV could help in each case.

3. Describe how the deal could be structured for each, and what each party could contribute.

4. Describe how each JV partner could benefit in receiving a share in the profit/assets at the com pletion of the deal.

5. Come up with as many different scenarios as possible.

6. Present this at our next session. 

Homework – Part 2 : Joint Ventures:

1. Identify what are your own strengths & weaknesses currently in relation to real estate investing.

2. With that in mind, research & identify a potential joint venture partner.

3. Describe the reasons why you be lieve they could be a good JV partner. E.g. How they cover your weaknesses with their strengths and vice versa.

4. Find a potential property investment opportunity.

5. Using the info on JV’s covered, write a potential JV plan. Include: 1) a risk analysis, 2) a Money Flow. 3) Provide details of roles and responsibilities.

6. Buy a House! 

Homework – Part 3: Own home or Investment First?

• If you were someone who had not yet purchased a home, would you be better off buying one to live in or buying one for investment purposes first?

• Create a case describing the advantages and disadvantages of each, and conclude why you either should or should not start by buying your own home first. 

Book of the month:

• The book to read before our next Mentoring session (Sun 27th April) is:

• “The New Buffettology” by Mary Buffett & David Clark