Looking for feedback and inspiration

Discussion in 'Property Investment - Other' started by troyhunt, 14th Feb, 2010.

  1. troyhunt

    troyhunt Member

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    Hi folks, I’m looking for some inspiration regarding future direction for my wife and me. I’ve pretty much reached analysis paralysis so am after some fresh ideas. Let me outline the situation without disclosing too much personal info;

    We’ve been investing in IPs pretty heavily for about 7 years now, purchasing frequently and having a pretty robust buy-and-hold portfolio now worth many millions. We caught the tail end of the last boom on the Gold Coast and have made some great buys in Sydney over the last few years so even though we financed everything between 90% and 100% we now have an LVR under 70% so heaps of equity. At today’s interest rates we’re also pretty much CF neutral after taxation advantages so everything is ticking along nicely on that front. We’ve also both been going gangbusters in the corporate world with a couple of high incomes and consequently lots of savings even whilst putting a lot of it into IP purchases. Given we’re in our early thirties, we’re obviously pretty happy with how things have been progressing.

    My wife is now on maternity leave and at this stage goes back to the office in September (our son is four months old). We’re starting to throw around ideas about alternative sources of income and in particular, what other options she might have beyond returning to a professional life. We’re ideally looking for greater flexibility and more opportunity to spend time with family but without paying a financial penalty. She’s a qualified town planner and has spent the last 10 years working in various areas of the property industry including with a council in the UK, a large national apartment developer in Australia and in recent years for a global real estate services company servicing corporate clients. Here she has done everything from development management, strategic consulting (highest and best use of real estate assets, portfolio analysis) and most recently client relationship management (matching existing customers to real estate services offered by the firm). Obviously this has given her some pretty valuable skills in the industry.

    So this brings us to the current conundrum; with our personal investing experience and her professional property experience, what should she do next? There are obviously a bunch of common avenues to pursue such as developments, renovations, subdivisions, etc but I don’t think the best use of her time and expertise is hands on renovation work and it seems like every man and his dog is doing small developments. I feel our position gives us a great advantage but the difficultly is in identifying the best way to leverage it. I would like to see wheels being put into motion now and her retaining the option to return to work if necessary and pursuing personal interests in parallel for the sake of keeping options open. Having said that, we’re pretty comfortable with risk so long as we’re confident about what we’re doing.

    This feels a little like one of those crossroads in life and is the cause of much pondering. There has been a huge amount of hard work put in to get to this stage and I want to keep the momentum going in this next phase of life. We have very high aspirations and are loving the journey; hopefully there are some good ideas out there about where it could take us next.
     
  2. The Y-man

    The Y-man Member

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    I'm sure many people had your problems!! :D

    Does you wife enjoy her profession? How about yourself?

    Cheers,

    The Y-man
     
  3. Slim Pikins

    Slim Pikins Member

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    If the missus has such a good job, could you become a house husband, look after the kid and watch Heaven Forbid! The bold and the Beautiful and the missus keeps her high flying job with you doing the renos and developments and stuff as well as look after your son?

    Slim:)
     
  4. troyhunt

    troyhunt Member

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    Good question! She enjoys her profession but isn’t real red hot on her current job. Alternative employment opportunities are definitely a consideration regardless of investing.

    I’m a bit hot and cold on my own job lately. I could happily focus purely on real estate if it got to the point where I could turn my back on IT without possibly regretting it a few years later.

    Both the jobs are a means to an ends. If they’re leading us in the right direction then the satisfaction we get from "the bigger picture" offsets a degree of dissatisfaction. In my wife’s case, I suspect the offset won’t be sufficient to go back to the same job without an alternate strategy in the works hencthis post :)
     
  5. troyhunt

    troyhunt Member

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    As I just posted in my response to Y-man, she’s not relishing returning to the current role. Partly this is because of the role but obviously she also wants to spend time with the little bloke. I already do a fair bit of work from home (spend a lot of time on the phone to other countries so kind of odd hours), so I get to see a fair bit of him.

    On balance, it makes sense to look at alternatives she can drive in the short term but I may join in on in the medium to longer term depending on success. Plus, if I suggested your idea she would probably make me incapable of having a second child!
     
  6. marg4000

    marg4000 Member

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    You already have a substantial portfolio and really do not need to add much to it for lifelong financial security.

    As you are both not too fussed on your jobs why not go part time and spend more time with your little one?

    As someone of near-retirement age I can say that time spent with children is pure gold, and something you only get one shot at.

    Just how much money do you want/need?

    Enjoy life!!
    Marg
     
  7. troyhunt

    troyhunt Member

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    Thanks Marg, "smelling the roses" is certainly important to us. We haven’t been solely work and IP focussed and have taken a lot of time out in recent years for family and to generally enjoy the fruits of our labour.

    “Financial security” is a very relative term though. We could stop, relax and not worry but it would mean forgoing other objectives we have in life.

    The thing is, we do both really enjoy the process of investing. I love negotiating, coordinating and seeing things build around me. We’re simply trying to find a way to combine both passions.
     
  8. MTR

    MTR Bling Bling

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    hi Troyhunt
    What about taking 1 year off work, leave without pay? Is it possible? Clear the head, and gives you lots of time to look at all options.

    This is what I did, over 4 years ago now, never went back.


    Cheers, MTR
     
    Last edited: 14th Feb, 2010
  9. HandyAndy888

    HandyAndy888 Member

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    Um...get out.
     
  10. The Y-man

    The Y-man Member

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    Does she share that with the same passion, or something else? Just trying to figure out what she loves doing.

    Cheers,

    The Y-man
     
  11. troyhunt

    troyhunt Member

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    Yeah, she’s trying to figure that out too! Yes, she does share the passion but has found it hard to come home from a property job each day then spend evenings and weekends doing something in the same field as her day job. Who knows how she’ll feel when returning to work, possibly part time, and having the little guy to come home to. It’s really a big unknown at the moment which is why we’re trying to explore a broad range of options now.
     
  12. Rolf Latham

    Rolf Latham Member

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    90 % of the battle is recognising what you were made for.

    Often we chase success of various sorts such as finance, career, sport etc, yet we still have a significant yearning that we dont understand.

    I have found with our thousands of clients and business partners, the role of "significance" in one's life is very much not understood.

    Significance can be seen "beyond" success, or even in place of traditional financial success as an example.

    One thing I can suggest is to get around some different people. The power of association can be huge, both in a positive and a negative sense. Dont get me wrong, obviously you already hang around with other financially succesful people, but thats not what you are chasing, otherwise we would not be here with this life question.

    Ta
    rolf
     
  13. jaycee

    jaycee Member

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    Marg what did you say to peopel who said that to you while you were on your journey & not ready to settle on that's enough yet ?

    What makes you so sure he & his wife are not enjoying life ?

    What's wrong with a little more if that's what you want and you're capable ?
     
  14. Kath Russell

    Kath Russell Member

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    Hi Troy

    We don't have your holdings yet! But I want to respond to your thread because I'm a full time Mum who's self employed, and partially live off our equity.
    We've just experienced our two & only children going to school for the first time and I can't believe time has gone so quickly since they were born. If only they were four months old again. Before we had children, we agreed that one of us would work, one of us would look after the children. We are both so besotted by our children, like everyone else I'm sure, that I hardly work and my husband only works seasonal so we can both be full time parents. Having children was the reason we sold our business. We didn't want them having to fit in with our working life.

    Time really does fly when you have kids. We moved closer to family but it just 'wasn't us', my husband wasn't happy at his then full time employment, we felt a bit lost so we bought a 40ft coach & went travelling! It was the best thing we could have done!

    Obviously everyone's wants & needs as individuals, married couples & parents are different. We have a plan of high expectations for our future of freedom but it had to get slowed down until now because of our decision to be with our kids. I commend you for getting way ahead before you started your family. If we were as educated as we are now 10 years ago, we could have been in the same situation (buy & hold instead of buy, sell spend). You can't turn back the clock, whether it be investing or spending time with your kids.

    If I was you, I'd adjust the investing plan, partially live off your equity, work part time if you must & make the most of the precious time with your little bloke......and possible with the next?!

    Sorry if my reply's a bit personal and obviously not knowing your lifestyle & personal needs for cashflow, but those little people are only little for so long. All they need are nappies, boobs & love so make the most of it because once they're on the solids & want everything they see on tv commercials, that might adjust your investing budget :)
     
    Last edited: 15th Feb, 2010
  15. troyhunt

    troyhunt Member

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    That’s a good point Rolf and something we’ve often discussed. Most of our friends have chosen more traditional paths both in terms of careers and investing so we’re not surrounded by people that have inspired us to push to the next level financially speaking.

    I really appreciate all the comments about focussing on family and this is a critical part of our future plans. Ideally, we will gain more flexibility in both our career arrangements to spend more time working in a fashion which allows us to dictate time and location. At this stage neither of us wants to take a large financial hit or career break (other than maternity leave, obviously). Naturally balance is required and whilst I appreciate many would scale right back on the professional side of life in this situation, our goal is to build on top of it whilst retaining the option to work how we want and we see establishing a more independent means of income as a solid step in this direction.

    Just trying to bring focus back around to the crux of the original question, I think an ideal scenario at this time would be to identify either investing or consulting activities my wife can drive from home. Her expertise coupled with our equity and cash should mean a fairly broad range of things she can lend her hand to but we just haven’t been able to clearly identify what this might be yet. This is what I’d really love to get ideas on.
     
  16. HandyAndy888

    HandyAndy888 Member

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    Just in case i wasn't clear enough the first time, GET OUT! With finances as you've said before, get out of the rat race...:)
     
  17. troyhunt

    troyhunt Member

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    Understood that and believe me, I’ve contemplated it! Usually it’s after a shocker of a day at the office and you get that “everyone else can go and get stuffed” feeling. Funnily enough, IP never does that to me and I suspect it’s because for the most part you’re the master of your own destiny and a lot of the usual corporate politics doesn’t apply.

    For my wife and I though, it’s still too early. The capital and the equity is great but with neutral cash flow I’m just not prepared to pull the pin and live on savings. I’ve looked long and hard at LOE but I’m not willing to go down that path just yet. We have financial goals we haven’t yet met and need to get a few more runs on the board first. We’re driven by these and are happy to keep putting in the hard yards, it’s just a question of where our time is most productively spent in order to do this.
     
  18. Lofty

    Lofty Member

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    Hi Troy

    My wife, Karen and I needed a change and jumped into the residential vendor finance market back in 2003. Initially Karen worked the business from home while I held down a job that involved touring, i.e. 6 weeks on, 6 weeks off. As the business grew I was then able to quit my job and we now both work full time in our own busines.

    I mention this as, with a new child, it may be an idea for your situation.

    Cheers, Paul