In this chapter I show you can become your own boss and financially independent through investing in property. This is something that I am doing right now and something I can attest is the best way, at least for me. First I want to tell you how I came to investing in property.

My Story

When I graduated from University, I didn’t have a clue about what I wanted to do with my life, but I knew I needed money, though. I got a job, I took the very first job I could get, deep in the recession of 1993. Within a few months of working in this job, I knew jobs weren’t for me. I needed to be my own boss. Jobs and employees, I thought were stupid. One problem, though, I didn’t know how to be my own boss (this was eons before Google) and I didn’t know anyone who was there own boss. I did the next best thing in my eyes and that was hunt for another job that paid more money. Wrong.

Deja Vous All Over Again

Once I secured a new job with more money, I repeated the process again and again. Finally ten years later, the penny dropped and I realised that I needed to be my own boss. To own my own company. By this time I was selling for a living and devouring self help books. I came across a book about Life Coaching which really resonated with me. This was it, my path to freedom. I was going to be a Life Coach. So without any experience, never mind any clients lined up, I handed in my notice and set up shop as a Life Coach. What happened next? Well suffice to say it was disaster. One that would take me years to recover from financially and emotionally. I didn’t get one single client. I used up all my savings and got into debt.

Rich Dad Poor Dad

Eventually I found my way back into the security of a well paid Job. Like a swimmer who gets back to shore gasping for breath, having gone out of his depth.
There were several positives to come out of this episode, one of which was that I read a book – Rich Dad, Poor Dad by Robert Kiyosaki. My only regret is that I didn’t find this book earlier. If you haven’t read this book and are striving for financial freedom, you must buy it now. I changed my life and I haven’t looked back. Property is the bedrock of my financial freedom machine. Yes I have pensions and savings, but property is the engine. In this post I share with you what I have learned through my experience and that of my mentors.

Dreams

Have you achieved everything you want to this year? Then why not? Find your reason why and do something now. Don’t let the year slip into next year and another missed opportunity. What is your WHY? What is your reason for doing this?

Financial Freedom

Let’s just recap and define financial freedom again. This is where your passive income exceeds your expenses. Put another way it is when you don’t have to work for money, because the income from your investments and businesses covers all you requirements. Once this is in place, you can define yourself as financially free.
The common model to get financially free is to get a good job, max. out your pension and then draw on this when you’re older. This isn’t for me I want my freedom now.

Your Action Plan

The next thing you need to get clear on is your action plan for financial independence. You need to come up with a figure for what your basic outgoings are and also what you need per month to be comfortable. This is your first freedom number; the amount of passive income you need per month to be financially independent.
Next you need to give this a deadline. When are you going to achieve this – ten years, five years, two?
Once you have your plan written down keep this somewhere where you will see it through the day. This is your motivation to succeed.

Assets and Liabilities

So you want to gain financial freedom and you do this by buying assets and minimizing liabilities. Another thing we need to get straight in our heads is exactly what assets and liabilities are. Basically you want to use the money you earn in your job to buy assets, which pay the passive income, whilst minimizing or even avoiding liabilities. Liabilities suck money from you.
Examples of assets are: property you let out, stocks and shares, businesses you work on (not in) and commodities. I will argue in this that property is the best asset class.
Liabilities are anything that takes money out of your account. These are things like credit card debt, car payments. Some would argue that your house is a liability because it costs you money in repairs, but doesn’t actually pay you anything, unless you rent out rooms.

Property as an Investment

There are many reasons to invest in property:

1. Low volatility: the price of property does go up and down but the pace at which this happens is extremely slow, compared to say the Stock Market. This means you can invest your money and know it won’t be lost over-night. It is also easier to time the market ie buy low sell high.
2. Long term Capital Gains: over the long term the cost of housing will increase as a result of inflation and higher demand.
3. Rental Income: By buying property to then let it out (Buy to Let) you can earn monthly profits.
4. Bank Leverage: The exciting thing about investing in property is that the Banks will lend you money in the form of a Buy to Let mortgage, to buy a property and then let it out for monthly profit (even in a recession – I know – I did it)
5. Flipping: short term capital gains. I did say above that the price of property has low volatility but that is not to say that you couldn’t buy a property and sell it quickly for immediate profits. This process is called flipping and can be lucrative. You buy property that is either distressed (in need of modernising) or from motivated sellers (banks from repossessions) at a low market price. Quickly do the necessary repairs and modernisation at a low cost and then put the property straight on the market to sell for a profit.

Goal

The goal is to get to own ten properties or more as quickly as possible. The tipping point will come at around 7-9 properties, where there is safety in numbers. If some properties are empty, the rents form the others will more than cover the costs.
Write out your five year plan. What is Monday morning like in five years time.?And what is your dream of freedom? What does it look like? What will you be doing?
Then what will it cost in today’s money per month to fund this life?
Then how many properties will you need to fund your dream lifestyle?

The three keys to success

The opportunity – IE the house? Property.
Your knowledge – your know how.
Action – doing something with what you know, when the opportunity arises.

The post How To Retire by Early Investing in Property appeared first on Mike Holden Sales.

Here is one step that more than any other can really boost your Job Free Income. That is when you invest in property.

Why Invest In Property?

This is the longest chapter in this book, because I believe that property is the bedrock of real financial independence and wealth. It is the surest way for you to escape the rat race.

The Rat Race – what about you?

What is the rat race? You come out of full time education, blinking into the sunlight of the real world. Then you get a job, because you need to stand on your own two feet. You meet and fall in love with your life partner. Then you get your first house and a mort-gage. (Agreement until death). Then there is the pitter-patter of tiny feet, more expenses and responsibility. You start to think about your future and join the company’s pension scheme, with the dream of retiring happy one day, if you’re lucky.

Meanwhile you get promotions and pay rises. The addiction of more money, which you spend on cars, holidays and luxuries. You earn more, you spend more, so that you need more and more money, just to stand still. You are effectively enslaved to your job, the bank and the credit card companies.
And what about that pension? As I write this the average life expectancy in the UK is 81 and the current state pension is going up to age 67. It will eventually reach 71 and more. Currently the UK state pension is £130 per week or £6,895 per year. I don’t know about you, but this is not enough to live on.

Then there’s the company pensions. Many of the defined benefit/final salary schemes are being closed down or at least to new members. The alternatives are the defined contribution schemes, where you are relying on the stock market, which has it’s associated risks.
Property for me, therefore is the foundation of my future financial freedom.

The post Invest in Property appeared first on Mike Holden Sales.

It’s time to trade in your passion. If you have sold your unwanted stuff, you should now have a wad of cash. Okay maybe not enough to buy a Ferrari, but what are you going to do with it? Spend it on more stuff? You could, but that’s not the way to financial independence. What I would advise is that you use it as seed money to start a little part-time business buying and selling for profit: Trade in your passion.

Finding Your Passion

Why trade in your passion? Aside from the obvious – doing what you love, it’s because if you love the subject matter, you will love spending time on it. The more time you spend on it the more expert you become. The more expert you become, the more valuable you become to other people. This means the more valuable you become to other people, the more you will get paid.

Firstly, how can you trade in your passion, when you don’t know what your passion is? It may or may not be obvious. You will need to ask yourself some questions. What do you love to read about? What magazines do you buy. Also think about what do you ‘waste’ time doing. You might think it’s a waste of time but maybe it’s not. This is your life, your passion.

Here are a few examples, although there are millions:

• Gardening
• Cooking
• DIY
• Playing a sport (there are hundreds)
• Watching a football team (do you have a season ticket and go to watch your team through thick and thin).
• Music (what genre?)
• Fashion
• Cinema – a specific genre of films or specific actor
• Gadgets
• Photography
• Theatre
• Stamp collecting etc.

Still stuck? Go to your local Newsagent’s or Superstore’s magazine stands; If you could choose one magazine what would it be? That could be your fledgling passion
Still stuck? Ok here’s £1,000,000 for you. You pay off your mortgage, buy a new car, book a nice holiday. Now what are you going to do. You can do anything – what is it?
There is money to be made in any passion or hobby, especially in this age of the internet. All you need to do is find people who want to buy what you have. Here are some ideas right off the top of my head:

Are you a massive Football supporter? – trade in match programs or memorabilia.
Are you passionate about Cooking? – trade cookery books online, write recipes to sell online.
Do you love gardening? – repair old hand tools, repair lawn mowers, trade in seeds.
Are you a sports fanatic? e.g. golf – trade second hand golfing equipment.
The list is endless, it really is. Don’t edit yourself though. Okay you might not be able to give up the day job to trade vinyl records, but you will be learning to add value and earn profits. AND YOU ARE HAVING FUN.

Where to Find Cheap or Free items to trade

The next step is to find a cheap source of what you want to sell. Here are some ideas:

• eBay – use the “Follow this Search” function so that eBay sends you an email when what you want is listed. You can set it at the price you want and also by location. Also check eBay for job lots and wholesale listings.
• Charity Shops – It is strange to think that some people might not quite value the same things that you do. You might pick up what you want for pennies.
• Car boot sales – A tremendous source of cheap stuff, if you spend the time trawling through it.
• Public auctions – You might be able to buy job lots of what you want.
• Fix stuff – Do you know how something works. Can you find a source of spare parts to fix up things and then sell them on e.g. cars, computers, white goods mobile phones etc.
• Add Value – for example restore old furniture.
• Knock on doors in your neighbourhood – do they have any broken items, which you can take away and repair?

Amazon to eBay and Back

Here’s a really neat way to trade in your passion, that I discovered by accident whilst trading in my passion – books:

Not everyone who buys on Amazon, buys on eBay and
Not everyone who sells on eBay, sells on Amazon.

What the hell does this mean? Well its called arbitrage and it means that sometimes you can pick up an absolute bargain on eBay and simply re-list it on Amazon for a tidy profit. You are exploiting the differences in the demand and prices on both platforms. Here’s how I do it, I first put all my books up for sale on Amazon. This does take some time, as I research the price for each book. Once the item is sold I buy it back at a lower price on eBay. When it arrives I simply relist it back on Amazon, at the higher price. The net result is I still have the original item plus some nice profits. In a way it’s like my personal library is paying me rent to live in my house!

The logical next step once you start to trade in your passion, is to get your own online presence. This will be the subject of our next chapter. Build a Web Based Business.

The post Trade in Your Passion appeared first on Mike Holden Sales.

The quickest and easiest way to accelerate the process of saving up money is to increase your income. One great way is to sell your unwanted stuff.

Here are some ways to raise extra cash quickly.

De-cluttering

For most people who can’t directly affect how much they get paid, I would say that the first task should be to turn your unwanted stuff into immediate cash. Yes I know it’s not regular income like a salary but it helps in several ways: First you bring in some extra cash that can be seed money for an investment. Second the process of getting rid of unwanted stuff has the important psychological effect of clearing the decks mentally as well as physically; It’s amazing how you get more ideas when your physical world is ordered. Thirdly it will prove to yourself that you can manifest money into your life, when you need it.

Be honest, how much stuff have you got that you don’t need or want? Someone, somewhere needs or wants that stuff. Sell your unwanted stuff and they will pay you cool, hard cash.
When I first started on this process, our loft was a great place to find stuff to make some money. At that time we had been in our current house for about 8 years and the stuff we had accumulated was awesome (and not in the good ‘awesome’ way).
We’d actually brought clutter in from our old house! We all do it; When our living space gets too cluttered we just shove the stuff through that hatch in the ceiling, to be forgotten.

The De-Cluttering Process

Well, the first thing to do is to confront the problem, get in the loft and have a look. I know it can be daunting, but it doesn’t have to be cleared in one go. The beauty of the method I learned was that you can just chip away at the issue.
So one by one go through each item and allocate it to one corner of the loft depending on which of the following categories it is:

The first pile can be stuff to keep – have you used this item in the last year? If not, it goes. If its sentimental, why is it stuffed away up in the loft?
Next is stuff to sell on Amazon/eBay – These are smaller items that can be easily posted and are in good condition.
Stuff to sell on a car-boot or jumble sale – These are larger items, bric-a-brac and stuff that might be ‘a bit tired, but in working order’.
Stuff to give away to the charity shop – Old clothes etc.
Then there is fifth category – To throw away and recycle. This category doesn’t have a corner because you will throw it away immediately, if possible, or at least bag it up ready for the trip to the recycle centre.

A great book on this subject is Organizing from the Inside Out by Julie Morgenstern.

Amazon

Amazon is a surprisingly easy place to sell your unwanted stuff; I prefer it to eBay. The beauty of selling on Amazon is that you only have to list the item once, then sit back a wait for the sale. The downside is that you don’t get the upside of the auction like on eBay. First check the price of similar items listed on Amazon and place yours at what you would reasonable expect to pay. If a lot of the similar items are listed as £0.01 list at your minimum and list on eBay as well.

eBay

Open an account if you don’t already have one. When you list your item, take good photos. Really ‘sell’ the item. Give the item a good descriptive title; think about what people will search for. For instance if you are selling a book, don’t just list the book title and authors name; what is the book about what does it tell you? Write a great description; again do a selling job.

Car-boot Sales

Finally if you like dealing with people face to face, the good old Car-Boot sale can be a lively place to sell your unwanted stuff. Always plan ahead, though. I have done a few car-boot sales and I can tell you from experience that if you turn up unprepared you will get flustered and harassed by people asking you ‘how much is this?’ or ‘Do you have change of a £20 note?’

So get prepared, have an idea of what price you will be prepared to sell each item. You could put price tags on, but I think it’s best to let people ask you how much it is. Also think about your lowest price as well – plan to barter. Do take plenty of spare change and empty plastic bags. Arrive early. This will mean you can set up before the masses arrive and lay out your stall. You can also choose the good spots. Car-boot sales are really fun and addictive as well.

The funny thing about clearing away clutter, physical clutter, is that it seems to stimulate the removal of mental clutter. If you have a clear physical environment, you create clarity of thought. You should now also have some spare cash and lots of space. With that clarity of thought, space and spare cash you can then start to to get creative. It’s time to move onwards and upwards by creating even more income by: Trading In Your Passions. We will cover this in our next chapter.

The post Sell Your Unwanted Stuff or things to sell to appeared first on Mike Holden Sales.

In step 7 we learnt about creating income from trading in your passion, next you will develop your own on-line presence and build a web based business.

eBay Store

Once your sales on eBay reach a certain level you can build an eBay store. This will be your fledgling web based business. Do check that your sales will cover the monthly fees, which will be about £19.99 per month for the basic store (at the time of writing).
The benefit of having an eBay store, is that people who buy an item off you or view your listing, will be prompted to go to the store. This will increase your sales. Your store and individual items will also appear in Google searches. You can also share your store on Social Media such as Facebook, again increasing your exposure to potential buyers.

Amazon Store

Again, similar to eBay, once your sales reach a certain level think about an Amazon online store. Again your can share it on Social Media.

Develop a website for your web based business

Once you are happy that your sales are good, the next step in building your web based business is to actually own your own website. This could be to promote your eBay or Amazon stores, or to sell directly on it. Your website also might have further information about your goods or services.
If people buy your product or service on eBay, what additional information might they also want from your website? Could you sell the information as an E-book? Or could you give the information free to build up an email address database, which you can then market other products to?
Do write some website content first. People visit websites for specific information – for content. So create your content first; write about what people want to know about.

Creating Your Website

The URL or name of your website should come from the keywords, within your website. What is the site going to do, what is it about? The keywords will come from the content you have written.
If your site is going to be a simple site with a couple of pages then consider using Free Web design software. I’m not going to plug any on here, but you can find them if you search online.

Do It Yourself

The problem with free sites is that the templates are generic and your URL will have some unwanted suffix plugging someone else’s site. That’s why I recommend learning how to do it yourself. If you are serious about having a web based business it will pay dividends to learn how to develop a basic site yourself.

Pay someone to build it

If you are really serious and want an all-singing-all-dancing site and simply don’t have the time or inclination to DIY, then get a professional to do it for you. Do check out what other sites they have built first and compare their fees with other designers.

Get Hosting

It’s important to think about who will host the site for your web based business. When researching for Web hosting, consider these factors:

Capacity – will the host allow you unlimited capacity, so your site can grow over time.
Uptime – does the host have an unbroken record of uptime. The last thing you want is for their server to crash.
Customer service – check their online forum to see what other people are saying.
Easy to use – is there a really easy and intuitive dashboard or does it look cluttered and confusing.
Unlimited urls – can you have many urls under one hosting? You might want more than one site.
Email – do you get an email account to really personalise your website?
Web building – some hosting providers also have web building facilities.

I can recommend Bluehost as a hosting provider, they are reasonably priced and simple to use.

SEO – Search Engine Optimisation

Once you have an online presence there several ways in which people might get to your site. One is through the search engines like Google, Yahoo, Bing etc. These search engines want to be able to provide the searcher with the most relevant website page and so they have developed programs that will analyse the content on the web to see what is relevant or not. There are no esoteric dark arts involved in this, it is just a case of simply being relevant.
So your first task in SEO is to provide relevant content. Next make sure you have relevant page titles. If you are designing your own site, make sure you place meta tags and descriptions in the code to help the search engine to find out if your site is relevant. Make the design of your site easy for the search engine to navigate. This means having a good logic sequence. Another way to make your site relevant is by getting incoming links from other related relevant sites, the more of these the better.
Remember the three secrets to great SEO: Relevance, relevance, relevance.

Monetise your site

If your site hits the spot and you start getting lots of traffic, you have an opportunity to further develop your web based business. A good way is through using affiliates programs. This is where you provide a link to another website, whose owner will pay you if people click through to their site and buy something. Be careful, though, as you don’t want to drive people away from your site.
Always remember to put a method for visitors to contact you as this could lead to further sales and also an opportunity to provide a service. Which leads us nicely on to the next step: Providing a Service. This will be the subject of the next chapter.

The post Build a Web Based Business appeared first on Mike Holden Sales.

If you have followed the steps in this book, you have learned how to trade in your passion. In the previous chapter, we discussed about having your own online presence, telling the world about your passion. Could you actually provide a service to other people, to help them in whatever your passion is? I’ve read tons of biographies of successful business people and they all have one thing in common, they learned how to provide a service. This means they learned how to become valuable to people in some way.

How to Provide a Service

Think about what your passion is. What do you enjoy doing the most? If you won the lottery tomorrow what would you spend your time doing? What are you good at? What do other people tell you that you are good at? Still stuck? What do people come to you to help them with? Fixing computer glitches? Putting flat-pack furniture together?
Could you Coach someone in your passion. E.g. Do you love gardening? You could have a little side-line buying and selling in garden utensils, then, have a website up and running giving tips for gardeners. Then you could provide a service to people, mowing their lawn or weeding their garden???
Or, are you passionate about personal development? Then you could buy and sell self-help books. Your website could show people how to get what they want in life. Then, you could become a life coach?

2 minute marketing tips

How do you go about telling the world about your business. Here are three ways that can get you up and running.

Your Website: You should already have your site up and running and remember I said to put a method of visitors to contact you, well why not tell them you offer a service doing xyz?
Word of mouth marketing: It should go without saying that because this is your passion, you will give exceptional service. Because of this, your customers will become your fanatics. They will sell your services for you.
Social media: Tell the world what you are up to and people will come.
Once you have paying customers, you could use some of your profits to buy pay-per-click ads on Google or Social Media. Check out Bluehost for more on setting up your website.

Advertising

The list of methods for advertising your services is massive but here are a few cheap ones. (Remember though, you pay for what you get.

Ads in local shop. I had a quick look in my local Newsagent yesterday and you can put up a small notice in the shop window for £3.50 a month. Just think how many people might notice it?
Leaflet drop – print off your own or maybe pay on online printer. One tip I learned is to do three leaflet drops, one per month. Statistically people only take notice of leaflets the third time they see it.
Ads in local newspaper – for a few quid, this old style marketing method still works wonders.

There are only so many hours in the day and there is only so much service you can give, so why not turn your service into a proper business? That’s the next step: Scaling Up Your Business.

The post Provide a Service appeared first on Mike Holden Sales.

We have now arrived at the final step of the process for achieving financial independence: Invest for Income.
All of your income, savings and investments, so far, will be funneled into a system that will invest in property. You will earn rental profits, after you have paid your expenses (see Step Eleven: Invest in Property). It will be tempting to go out and spend this income, as if it were a pay-rise, however, you’re not going to do that. You will invest for income.

The Goose that Lays Golden Eggs

If you read enough around the area of financial independence, you will have undoubtedly have come across the term Passive Income. All investments will need at least some attention, even the most passive and secure – cash. The money you will finally get to live off, when you reach financial independence, should be as secure as possible. With risk, comes reward, particularly for investing for growth. For income, think security. Think of this as your goose that lays golden eggs. If you feed and look after your goose, she will reward you with a lifetime of golden eggs. Your system of investments: First Security and Growth, then Property, will provide you with more and more geese, laying more and more golden eggs.
Eventually you can live off this income without touching your earned or business income. You will then be financially independent.

Which Vehicles to Invest for Income

You could buy Managed Funds, similar to those for security and growth. Again these can be equity funds, Index trackers, Investment Trusts, which could be in a Tax efficient vehicle such as an ISA (UK). These funds could be invested into Equities, bonds and cash. Consult your Independent Financial Adviser before investing. They should help you with what is termed asset allocation, this means what proportion of equities, bonds and cash these funds hold.

The post Invest for Income appeared first on Mike Holden Sales.

Congratulations if you have now bought your first investment property. Now you have to consider the next phase, property letting.

Renovating

If you do buy a distressed property, that needs renovation remember you are doing it up to either let out or sell – not to live in. You don’t need to buy the top of the range of everything – try to keep your costs down as they can spiral. Even though the property belongs to you it will be someone else’s Home. The decor should therefore be neutral and minimal . Let your tenants put their stamp on it.

Letting Out

Letting agents can take the hassle out of letting out and can be a source of help and information. You can also get them to manage the property so you never have to worry about calling a plumber out. They will charge you, normally about 10% of the rent, plus any costs.
DIY – if you are going to do it yourself. Do seek advice first – the government has produced guides for landlords. Check out the Government website.
Legal requirements – your Solicitor should highlight the legal requirements to you, such as Gas Appliance Test certificates, fire smoke detectors. Your local Council should also help here too.

Furnished or unfurnished?

This depends on your target market. Seek advice from the Letting agent if you are going to use one.

Real Life examples of property investing

Let’s take an example of an ordinary two bedroom semi-detached property. You buy it for £90,000. You then will spend a further £20,000 on fees and refurbishment. Your total spend is £110,000. Then you get the house re-valued by a mortgage lender at £135,000. You then sell it for £132,000 in six months, netting you £22,000 for six months work. (£132,000-£110,000 = £22,000). Not too shabby.
Summary #1
2 Bed Semi £90,000
Refurb & fees £20,000
Total spend £110,000
Revalue £135,000
Sold £132,000
Total Profit £22,000

Getting paid to Buy

Here’s another way to invest, without any money. Lets keep the figures modest.
You find a property which fits the bill and purchase for £36k, using the bank of Mum and Dad, friends etc and 0% credit card(s). (Yes as I write this in 2018, banks are offering 0% credit cards for up to seventeen months before you pay them off). There are £6k costs including the refurb. The total cost is £42K.
You get the house valued at £60k. Remember Rightmove.co.uk – you already knew this was the true value. You then secure a buy to let mortgage at 75% loan to value. Your mortgage is therefore £45K. You collect this money and pay off your credit card and your other creditors, leaving you with £3,000 cash out. Perhaps split this with Mum and Dad or whoever.
You then rent this property out for £450 per month. The mortgage is say 4.8% which is £180 per month. And then there are other costs of £45. This leaves you with a cash-flow of £225 per month, passive income.

Summary #2
Purchase price £36,000
Refurb & fees £6,000
Total spend £42,000
Revalue £45,000
Cash Out £3,000
Rent £450/m
Mortgage £180/m
Other costs £45/m
Total Cash flow £225/m

Houses of Multiple Occupancy (HMO)

In the UK, if you have a HMO with less than 7 people, you don’t need to declare this to the Local Authorities. For example, you could find four people, each who pay £250 per month, which will generate revenue of £1,083 per month.
Who would be interested in living in a HMO? Well if you property is in a large City, near to train stations, Universities or a Hospital, you could have Professionals or Students.
In our example number 2 above you would net £500 per month in cash-flow.

Do Not Touch these deals

Off plans – Too many unknowns and uncertainties. Its better sticking to something simple.
New Builds – almost always these properties will be priced above their actual value.
Overseas – there are so many pitfalls to this, in terms of the legals. And you are not present.

Re-Mortgaging

Once you have let the property out you should be getting nice monthly profits. If you’ve done everything properly, the equity in the property will also increase. Why not release this equity and use the capital to fund the next investment? Check with your mortgage provider when you can re-mortgage.

Summary

1. Find the area first.
2. Find motivated sellers – put out adverts, leaflet.
3. Find average houses in average areas.
4. Check the finances – does the deal stack up (mortgage, rent, fees, unoccupied, returns)
5. Put an offer in for 25% below market value.
6. If no – move on.
7. If yes – then get financing.
8. Do the deal.
9. Get an agent to manage it.
10. Repeat.

So now we are coming to the end of this book on becoming financially independent and retiring early from the Rat Race. In the final chapter we will discuss what to do with the profits from your property investment.

The post Property Letting appeared first on Mike Holden Sales.

Where do you find funding to invest in property? Well there’s the buy to let mortgage, but there are also other ways.

Save for the deposit – if you follow all the previous steps 1-10 you will find yourself in a position where, soon, you will have a growing amount of capital to invest. The first step on the property investment ladder, then, is to get an Agreement In Principle (AIP). This is where the bank or mortgage lender will agree to grant you a mortgage because of the funds you have available. This AIP can be in the form of a certificate which you can show to prospective vendors.

Interest only or repayment mortgage?

In interest only mortgages, you will only be paying back the interest on the mortgage – after the mortgage term, you will still owe the bank what you borrowed. The benefit is that your payments will be less, therefore profits higher.
With a repayment mortgage you will have paid off the capital at the end of the term. The property is yours. You will, however. Your monthly profits are therefore reduced, but you are gaining more in equity. Obviously you should seek the proper advice from an Independent Financial Adviser (IFA).

What if you don’t have the money to invest?

There is always a way, if there is the will. There are books written just on how to find finance for buying property. Here is one tip I can give you. There are people out there who have the money to invest, but simply don’t have the time. They will gladly invest in you if they are confident they will get a return. So go and find them. (More on this later).
Then there are family members with inheritance or pension payoffs who have nothing to invest in. Why not split the profit 50:50 with them. In an example later on, I show how you would both get £11,000 each. They put up, for instance, £110,000 and they get a 10% return in six months and you have a £11,000 payout for the project. Nice.

Other People’s Money

There are many ways to raise capital, here are a few:

Credit cards – especially 0%.
Loans and overdrafts
Private investor Go into partnership with someone who is cash rich and time poor.
Bridging Loans – there are pros and cons to this. Its very quick and easy, but it should only be for the short term (Days) and is high interest.
Multiple offer using creative financing.
Equity release on your home property.
Joint venture
Friends and family
Crowd funding

The post Find funding appeared first on Mike Holden Sales.

Why should you pay yourself first and what does this mean? The road to financial independence requires capital – cool hard cash. Money to give you options and to buy investments. You will only do this when you pay yourself first.

By now you should know what situation your money is in(Step 1) and you will have built a foundation of wealth protection (Step 2), if not please go back and action these steps before going any further.
So what do I mean when I say pay yourself first? Most people, when they start out trying to save up, will cut back on expenses; If there is any left over at the end of the month this goes into the savings account. This is not going to work for two reasons:

It requires massive self-discipline – most of us don’t have this.
If there is any money left over, it will not be a consistent amount.

So to pay yourself first you would take a regular amount of money out of your current account, THE DAY YOU GET PAID, and put it in a different account. You will only touch this money to buy investments. (By the way, this should be in addition to the Company or Personal Pension you set up in the previous step). The first time I heard about this method, I could immediately understand the logic but I thought about the pain of the sacrifice. What I didn’t know and I do now, is that once you start paying yourself first you won’t actually miss the money. I guarantee it. I started to do this in my late twenties and I can honestly say that it was the best thing I ever did, from a financial perspective.

How to Pay Yourself First

Here are the essential five steps to pay yourself first. Follow these and you will soon see your capital growing.

If you don’t already have one, open a separate savings account.
On pay day transfer a set amount of money into this account I would say you need to aim for a minimum of 10% of Your Net Income.
Do Not Touch This Account, except for buying investments. If you feel you might be tempted to dip into this, choose a notice account, where you have to give 60 days notice to withdraw the cash.
Repeat each month – forever!
Even better would be to make this an automatic transfer or standing order, so you can forget all about it.

I guarantee that if you do this on three consecutive months, you will do it forever. The habit will be ingrained.

Should you pay off your debts before saving up? Logic would say that the interest on debt is more than the interest you will receive from savings, so pay debts off first. I would say do both at the same time. Paying off debts and creating Capital give you a double psychological boost. So the next chapter we will be about paying off your debts.

The post Pay Yourself First appeared first on Mike Holden Sales.