2 Properties To Financial Freedom
For so many people financial freedom seems like an elusive goal that is extremely difficult to achieve. With the 2 properties to financial freedom strategy that elusive goal becomes an almost inevitable reality. All that changes will be how long it will take you to experience it.
For so many people, financial freedom is this elusive goal that just seems really far in the distance and really difficult to achieve even property investors who purchased one, two, three properties often struggle to actually achieve financial freedom and have the freedom to make the choices that they want and to have the lifestyle that they want. So today, today I am super excited to have Ben Everingham with me. Hey Ben. Hey Ron. I’m excited man. This is going to be huge today. This is probably one of the biggest things that we’ve ever talked about, so really excited to be sharing this and this is the two properties to financial freedom strategy, something that’s been in the works for years but has kind of just come about and it’s a way of investing that we believe is simple enough for the everyday investor to do. We believe that it can make it not easy, but achievable for you to get financial freedom and also it just opens up so many options for you as well in your life. You don’t need to wait until you’re 65 in order to start living the life of your dreams that you can start doing it in a lot sooner and a couple of years sort of thing. So what is it about this strategy that gets you so excited, Ben? Because obviously I’m excited
right now. I get excited when you get excited for it. So this is just like me vibing off you, but when you run me the other day after you sort of had this concept, I think it was while you’re having a surf, wasn’t it like you like, yeah, something awesome is going to come to me today and he gave me a call that other like what I love about this strategy is you’re right. It’s not simple because achieving financial freedom takes work and let’s all just get real about that for a sec. But it is simple in its application. Most people earning a regular household income in Australia can definitely do this and you don’t have to be a rocket scientist to figure it out. And what I love about these compared to all of the other stuff I’ve read and listened to over the last eight years, is the fact that everyone ends up there if they just follow the strategy, right?
Like worst case scenario, you’re going to end up financially free as long as all the crazy stuff of life doesn’t get to you when you follow this strategy, which most people should be able to do. So I get so excited about that man. Like I love the fact that it helps people like me and you actually get to where we want to be in a reasonable amount of time without taking on too much risk or too much debt. And it makes the journey a pleasant one because you’re not forking out hundreds and hundreds of bucks a week. He negatively gearing just the hope in the future that, you know, you end up getting there when you want to be there.
Yeah. And you don’t need fancy strategies or tactics like options or even like things as difficult as subdivision or you know, there’s so many different strategies out there that people need to play all these games and get certain amount of capital growth and then sell a property and then buy another property and just juggle so many balls. So I liked that. This is very simple. So I’m gonna. I’m gonna. Lay out the big. Then I’m going to hand it over to Ben and we’re going to start to get into the nitty gritty. So the two properties to financial freedom idea, the strategy, what is it? Here’s the idea, right? You buy two high quality properties. We’re recommending houses. So you buy two high quality properties in Metro markets on those properties. You build a granny flat on each of those properties. So you’ve now got two houses and you’ve got to granny flats that are delivering you for incomes that a cashflow neutral or cashflow positive.
You have a principal and interest loan on these properties over a period of say, 25 years. And the thing that’s so powerful with this strategy is you purchased the properties, you build the granny flats, the properties basically pay for themselves and they’re also paying themselves off over time. So in 25 years, if you just left it, you let the property pay for itself in 25 years it’s going to pay itself off when that happens. And you no longer have a loan, you no longer paying the bank, that rental income now goes into your pocket and you become financially free once they’re paid off. So it’s a pretty simple strategy. You just purchased two high quality properties in good suburbs in metro markets. You’d build a granny flat on each of them. So you’ve got four incomes coming in, you pay off the loan over 25 years. And as we’ll talk about 25 years, sounds like a long time. But as we’ll talk about you can make it shorter.
You’re scaring me with 25 years, but we’ll get to that.
Yeah, it’s not. The goal is to do it quicker than 25 years, but 25 is like worst case scenario. And so it’s kind of very simple, it’s going to happen over time and then it’s up to you to speed that up into turn that 25 years into 20, into 15 into 10 or whatever it may be.
And I think that’s why I love this when you presented the idea to me so much because most people will get there, most people can execute this strategy, but it gets you thinking about solutions of how you can get there quicker and anything where your mind focuses on solving a problem or creating a solution or getting somewhere by being creative. Then you know, I’m all down for that man. Like that’s what I’m about. I think that’s what you’re about as well, like in, you know, that’s why we’re fortunate enough to be able to share this sort of video today as well.
Yep. And as you’re seeing this, it’s not. This is not all you’re going to do. We’re going to talk about buying your own house as well and how that fits into this or how you can expand this and purchase more investment properties as well. But we’re gonna call these, these two properties with two granny flats, your foundational properties, so these properties will lay the foundation for your financial freedom that if you do nothing else, they would go on to achieve financial freedom for you. So that’s your foundation for financial freedom that you’re building. We’re going to call it the foundational properties. So
I love that private. Like I actually get goosebumps that about that stuff because it’s so simple, man. Like we’ve been looking for this type of strategy and thrashing over these ideas for years and years and years. Now what? We’ve probably done 300 videos together. You just need to surf more man. That’s the solution here.
So that’s it. And I’ve served today as well. And then just recording now. So maybe that’s why we’re vibing so well. Alright. So this strategy is broken into three main phases. So we’ve got the first phase, which is the accumulation phase, which we’re going to talk about now within. Got Consolidation and we then got the lifestyle phase. So Ben, I’m going to pass over to you to talk about the accumulation phase to get specific about some of the numbers around these properties and just to let you guys know the numbers that we’re saying today aren’t. It doesn’t have to be exactly this. You can buy something more expensive, less expensive, it can rent from more or less. This is just a framework to start with and then depending on your life, your income, etc. You can adjust these numbers.
These numbers might like if this video is still circulating in 10 Years, which I know it’s going to be one. I hope my voice is deeper in 10 years time, I’m gonna look way older when you come and talk to me and the numbers are going to be super different. So let’s just pretend that there’s no inflation right now and we’re just talking straight up numbers, but with these two foundational properties, it’s super simple, right? The first step of the accumulation phase, which let’s call the accumulation hard work phase. IT’s when you’ve actually got to do stuff. It’s when you’ve got to decide on a strategy, that’s when you’ve got a buyer stuff. It’s when you’ve got to understand the market, it’s when you’ve got to buy the best possible property possibly can and time things and we’ve got heaps of content out there to talk about that stuff.
But let’s say you’ve nailed the market. it should always be sydney, melbourne, or brisbane. Um, you’ve now the product type. It’s got to always be houses, you know, like we know from the history that those three markets and houses constantly outperforming units. If you want to go a step further and overlay more data from rp data and matosich, then it’s got to be within walking distance to the beach or 20 ks from the city to do the best they possibly can. And so what we’re talking about here is really this accumulation phase where we go out and buy one very high quality house for 400,000 bucks and we rent that property out for $420 a week. Now, right now it’s tough to get a five percent yield in sydney or melbourne, but you can definitely do that in brisbane and then the second step of the accumulation phase is doing exactly the same thing again.
Now, as ryan said before, we’re looking for houses are nice big piece of land, 500, 800 square meters with drivable or walkable side access where you can put a high quality granny flat in the backyard in the future. We won’t get into specifics of all that today because I don’t want to overdo it, but we buy a $400,000 house. We rent it for 400, 20 bucks a week. We do that twIce. Um, hopefully you’re in a position where you’ve got some savings in the bank or some equity in your home and you can execute on those first two steps within the first 12 to 24 months if you’re just getting started now than it might take you five years to accumulate those two properties wherever you are. You just do you. After you bought those two houses and got them rented out, you then build a granny flat for $110,000 that rents for another 280 bucks a week. So overall numbers now and buIlding a granny flat supercrazy did not feel overwhelmed with it. It takes about eight to 12 weeks to build it. The builder will organize certification in council if you’ve bought the right piece of land. It’s just so, so simple to execute on this strategy. So don’t think that this is difficult for any reason. It’s something that everyone can get their head around. So
but something something important to note is that this will limit what areas you can invest in because some states, some councils don’t allow granny flats or don’t allow you to rent out granny flats. And so that may limit where you can invest and based on when you’re listening to this will depend on what counsel’s allow it and not a. But it’s pretty easy to find out whether or not they do
really, really easy. And things change over time too. So you know, now we’ve got a $400,000 plus 100, $10,000, granny flat. So what’s that fIve hundred $10,000 total value and then we’ve got $700 a week of rent return. Now the reason I like this concept of investing close to the city in brisbane is one, brisbane historically has performed exceptionally good from a capital growth perspective. So this isn’t one of those strategies that’s like all cash flow, no growth because ryan and I both love cash flow. Obviously we also love growth and so this is that combination strategy. So $510,000 for the house and granny flat, 700 bucks a week in rent. That’s over a seven percent rental yield. That’s going to cover the principle and interest components of a property plus most of the holding costs after tax up to about five, five and a half percent interest rate. So I also like it from that perspective because you’re not killing yourself every single week to pull money out of your pocket to hold these for the 25 years it takes you to repay the bank line as well. So that’s the accumulation phase by the two houses attitude, granny flats, get the four sets of income, make sure it’s a quality suburb where you can legally build an rented granny flat out and then it gets super boring. We go into consolidation phase, which is part to.
Yeah, so just with that accumulation phase, in case you guys didn’t catch onto it, property one and probably two identical in terms of their numbers. So they’re both houses that you purchased for about 400,000 that rent for four, 20 a week. And on both of them you build a granny flat for about 110,000. That rents are about to 80 per week. They’re just chop. You can chop and change them. They’re basically exactly
that is everyone make property investing so hard. Like it is really simple today.
You just do the same thing twice and as we’ll talk about further down in consolidation, you can, rather than doing just two properties, you can expand that and do three or four or more of your circumstances allow it and just something that I want to touch on before we move on to consolidation is that ben talks about trying to buy those properties in the first 12 to 24 months. If you can. If you can, that’s great. The sooner you can purchase these foundational properties, the better because the sooner you’re purchasing them, the sooner you’re paying off the debt and the sooner you’re going to be financially free, but you don’t have to do it in a 12 month period. AS ben said as well. You can stretch out to five years or however long it takes you. the goal in the accumulation period is to accumulate these properties and to get them as quickly as physically possible that you can do it, so purchasing the two properties and building the two granny flats as soon as you can and some people may be able to do that really quickly. Some people it may take longer, so as ben said, do what do you,
what a huge asterix on that prior because you don’t want to buy it, the declining stage of the market, you don’t want to miss time. The global cycle, like this isn’t a capital growth strategy, but you don’t want to overpay them. Lose 30 percent on what you buy, you know, we’re not financial advisors as well, so I just, I really want to make that clear that, you know, just take your time, make sure it’s a solid investment going out and buying two properties in adding to granny flats doesn’t necessarily mean that. Now the right to properties are the two grand. Exactly. So just, you know, been an investor. Don’t just take this as gospel and rush out there and do it because ben and ryan told you that you could be financially free in 25 years if you do. Yeah. this one work with any property.
You have to find the right properties. And as ben said, we’ve got lots of content out there on how to research suburbs, how to fight, excuse me, how to find the right properties and stuff like that. So you need to do that. You need to now down the markets, you need to nail down the suburbs now down the property. So watch our other stuff on that practice, that sort of stuff. Get better at that so that the properties you’re buying a good because obviously the better the property, the fascia this is going to pay off for you and the better you’re going to be when you are financially free. So now we’re going to move into consolidation phase. So we’ve done the hard work, we’ve accumulated the properties. Consolidation is now all about basically getting to the point where those properties are completely paid off.
So we’ve got three things that we want to touch on in consolidation phase. We want to touch on acceleration, which is paying off your debt faster. So how can you accelerate 25 years down to 20 years or 15 years or 10 years? So we’re going to talk about that. We’re going to talk about growth and so this is the idea of going from just two foundational properties, two, maybe three or maybe four because obviously the more of these that you have when they’re all fully paid off, the more income you’re going to have and the wealthier you are going to be. And then we also want to touch on this idea of change that because now you’ve acquired your foundational properties because your financial freedom is set for the future. You now have an opportunity in your life to change, to go and push your career that you love rather than working in a job that you hate. so let’s start with acceleration and focusing on paying off that debt faster.
Yeah. So the cool thing about property in life is as a thousand different ways to get the same result. And this is the problem. Like I think why most people don’t achieve financial freedom or 80 percent of aussies ended up on the pension and that is or going to. And that’s because we get stuck in the options as opposed to taking action. But once you’ve got these two properties in youtube, granny flats, you can get a second job. You can focus on your career if you enjoyed and start any more money you can. You know your partner can go back into work and their combined income can help repay debt. You can start a business on the side. You can take the pen and start of proper business and earn more income than you’re ever going to be able to earn from working for someone else, regardless of how much they pay.
You’re probably, if it’s the right business, you know there’s just, you can buy another property, you can start investing in the share market and you know, get that compound growth over time and then invest the profits back into paying your properties off faster. You can try god. You can do commodities, you can buy bonds, you can, you know, whatever the hell you want to do. Like that’s the fun part. That’s the solution side of you deciding what works best for you and then having the confidence to go down that avenue which with whatever feels best and right for you to ultimately. It’s all about just paying off debt faster.
Yeah, and the thing that I really like about this is that you’ve accumulated your foundational properties. Now your goal is just so blatantly obvious, like it’s just right there. Pay off the debt, just pay off the debt. It’s right there. It’s staring you in your face. Whenever you log into internet banking, you can see how much debt there is and scary and when you’re earning extra money or when you’re budgeting or whatever it is you’re doing and you’re putting extra money on that debt, you can see how much that’s going to accelerate your period so you can see when 25 years becomes 24 years, you can say you just gained a fricking year of your life where you don’t have to work anymore. You’re going to be financially free, and so the stuff that you’re doing today is going to buy your year in the future or then two years and then five years.
And so it’s just. It becomes like a really clear goal of what you’re trying to achieve, which is to get these properties completely paid off. And as ben was saying, there’s so many different ways you can do it. You can budget, you can earn extra money, you can start a side business or you can go down the property investment route as well and you can invest in property, you can sell property for capital growth, you can use those big chunks of capital growth to pay down big chunks of debt. You can invest in property for cashflow and if they’re spinning off extra cashflow, that extra cash flow can go into paying off your foundational properties as well. And to speed up that process. And so a quick
example of the property option, which is my option, like as you know, I’ve sold bunches of properties to pay off debt on other properties for myself. Like I’ve, I’ve done this and if you’re paying principal and interest of your loan for the next 15 years, it’s a 25 year term. You’ve probably paid off at least 40 percent of the debt in the next 15 years anyway. If you were to just buy one other property, let’s say it’s worth $500 and over the next 15 years it grows by four point eight percent a year without you doing anything. You’ve turned 500 k to a mil. You sell the property. You know maybe you’ve done it as your principal place of residence. Maybe you’ve done it outside of it. Either way, you might have some tax to pay, but you know you’ve already. You’ve created a good chunk of cash.
You’ve got your deposit back. Hopefully with that other property that you bought, you’ve been paying principal and interest as well. You might be in a position after everything. We’ve got 500 grand in your hand. The original property prices were only $500 each on the two foundational ones you paid 40 percent off. You might be able to just use the sale of that one property to wipe out 90 percent of the debt on both lines in 15 years. Like that’s if the market does well and continues to do well, but that’s. It’s just so easy. If you use, if you’re smart about trading solutions with this stuff, you know what I mean, and if you want to speed it up, you could renovate the property or you could do all the thousand creative, different strategies online, but just always remember your risk associated with this as well.
Yeah, well, and there’s also the fact that overtime rents tend to go up, so if you’re buying in a good area that’s growing. We talked about how this strategy doesn’t rely on capital growth, which you’re probably starting to see because we’re buying these two properties. The goal is to just have them pay off to pay off the debt on these properties. You don’t actually really need them to grow in value in terms of capital growth, to access any of that growth in value. You want the cash flow from these properties so you don’t need the capital growth, but if we’re buying in growth areas, we’re also going to get rental growth as well. And so when we first purchased these properties, we’re looking at kind of a cashflow neutral situation up to about a five percent interest rate, but over time rents tend to go up.
We’ve also got inflation as well, so money becomes less valuable, which means your properties rent for more money and so over time each year, if you’re increasing the rents, which you should be doing, if you should be charging market rent, then you’re getting more money coming in as well. And so you can use that extra money to now put that onto your loan and to pay it off faster. So even the properties themselves earning more money as time goes on, which is going to allow you to speed it up as well. So the properties are helping you speed it up and then you can speed it up as well.
Why I love these strategies. One, it doesn’t matter about market cycles because you’re not chasing capital growth constantly like a madman in planning for a future that you can control. And secondly, the worst position you’re ever going to be on it is basically when you start, you know, like we can’t control if we go into a major financial crisis, but from looking at the history in Australia, every time we do rents crates, because there’s less people buying property. So yeah, you know what I mean? Like There’s more supply, less demand and rents go up in financial crises as bad as that sounds.
So. And if markets go down, what does it matter to you? You’re still getting the rent, you’re still, your focus is paying off that debt and getting to a point of financial freedom. So it doesn’t matter if you have one, two, three years of sideways market or even a downwards market. Not really like you’ve still got that goal in mind that you’re charging for. And so this is lousy.
I love this. Like it just is turning property on its head. You don’t need to do all the tricks of the old market to make this work. But guess what? Your property is going to be worth twice as much as you bought it for. And probably 15 if not 20 to 25 years anyway. And so if you’ve got kids like ryan and I do, you know, I’ve got three kids, I hope to be able to pass them on a property. They’re going to be getting cash flow for life. They’ll have all of this equity like it’s going to be happy days for, for not just you, but for future generations as well.
Yep. And so this episode, if you think this episode, it’s good. It’s about to get better. My wife just delivered me a coffee, so I’m really happy. Now we’re going into the growth phase. So we’ve talked about acceleration and accelerating the rate at which you pay off debt. I now want to talk about growth and actually expanding your foundational properties from two properties up to three or up to four or up to five or however far you want to go. So I’m just going to pass over to you ben, so I can have a sip of this delicious coffee.
I’m not a coffee drinker, but it looks amazing. So obviously not everyone is content with a 100 k per year of passive income in 15 years time and, and that’s the reality. Like I’ve got three kids, my first one’s just gone into private school. Hey, there’s an extra six grand a year that I wasn’t expecting. Now she’s in ballet, now she’s wearing a school uniform plus plus plus plus. You know what I mean? Inside different stages of our lives. We need more money in retirement, you know, we probably need the least amount of money. It’s more for like all of the stuff in between
whether disagree. I think in retirement, my mom is retiring at the moment and she’s going to europe next year and she’s like, this is going to be my last europe trip because she doesn’t have enough money to feel like she can do it every year even though she would love to. And so I think in retirement, you know, 60 is the new 40. My mom calls 60 is the youth of old age. We’re gonna live longer, we’re to want to do stuff. We’re going to want to have fun and go on adventures and go to europe every year. Like why not? If you can, why not
100 percent bro. And that’s what I’m sort of getting or trying to get to, which is, you know, if you’re like me and you want to, you want a little bit more because you don’t want to say no to any cool experiences that you decided to have in the future. Then you know, the two foundatIonal properties are going to get you there. Worst case scenario and as long as the whole house of cards doesn’t come down because you overdo it during the journey, buying another couple of high quality properties, whether their cashflow growth focused or manufactured growth focus, you know, it is a stepping stone into where you want to be. Now. I’ve bought a number of properties in the last eight years and I’ve just gone through a period of selling a bunch of them and that’s enabled me to, you know, outside of this to property strategy potentially on mine home outright very soon as well.
Which is another part of the equation, which we’ll get to in a sec, but doing strategic buying that has great cash flow with great capital growth and the ability to feed add value can just take you to the next level. It can take you beyond, you know, two properties at 700 bucks a week to data for properties at the same rate, which means now you’re doubling longterm position and there’s safe ways to do this. If you’re running an okay income, you’ve got a good savings buffer in place and you’re timing the market to support the investments that you’re making.
Yeah, and I want to give just a real simple example of growth and acceleration mixed together. So we go out to foundation or properties that are gonna deliver us financial freedom on a decent income so we can live a decent life. Let’s say we want to expand that and we want to go to four properties instead. So we’re buying four properties for granny flats. We’ve got eight levels of income in order to mix growth and acceleration. What we could do is we buy properties one and two, we’ll call them the foundational ones, and then we buy probably three and four, which are growth properties, but it’s three and four positive cashflow. We can use the positive cashflow from three and four to start to pay off one and two faster so we can accelerate the payoff of one and two. And so let’s say we cut that down from 25 years to 15 years, so in 15 years time we’ve paid down one and two and we’re now financially free on a decent amount of income.
Three and four still have debt on them, but now the extra money that three and four will offloading onto one and two. We put back onto three and four and so we focus on paying off three and four, so we’re financially free on a decent income of one and two were living off the income from one and two, three and four working in the background, paying themselves off. They mIght take another five years or something like that, but in five years time when three and four paid off, well now you can take the income from that, put it in your own pocket again and your income just doubled and so that’s a way to both grow and accelerate your financial freedom so you don’t achieve all of your financial freedom and the full wealth in one go, but you can achieve financial freedom and then you get wealthier as time goes on and your extra properties get paid off.
The thing I love about what you just said is that it’s up to every individual that understand where they’re at from a risk perspective. Like when I was buying my first couple of properties, I didn’t think I was going to go on to do some of the things that I’ve been able to do. I couldn’t see that in my mind at that time because I didn’t have the knowledge, skills, strategy, focus or time in the market to see how things exponentially compound with growth and time. So I love that concept, man. Mike, I love that you can draw your own line in the sand. Worst case scenario, you know, where you sit, but you know, stuff. Worst case scenario like leave for what you really want out of your life, you know what I mean?
Yep. And so that kind of covers acceleration and growth and we want to touch on this idea of choices at this point in time or change. We can call it either. And basically this idea came, it just comes from so many people we’ve talked to like how many people are there out there that are like, oh my goodness, I hate my job, I just want to achieve financial freedom so I don’t have to work in this stupid job anymore. So I can tell my boss to just kick it and do my own thing. So there’s a lot of people living like that and I’ve been in a situation like that where I didn’t like the job that I was working in but needed to for my family. Um, and so we want to touch on this idea of change that if you’re able to use your job, maybe you’ve got a high income.
Oh my god. The perfect example, right. I went to my mate’s wedding. This was a guy that I met when I was in year 11 or 12 at school. At space camp. Yeah, that’s right. I went to space camp, wanted to. Anyway, I met him. He’s from New Zealand. Anyway, he gets married last year and so I go over for his wedding and he’s now a doctor and he hates being a doctor. Absolutely hates it. But everyone at the wedding is doctors basically. And the table that I sit at all doctors are not kidding. It was 50 slash 50. Either love their job or hate their job to death like that absolutely hate it, but they’re earning such good wage, like 300 grand a year or something like that, doing their job that they can’t get anywhere else. And so they’re like, oh, I just wish I could do something else, but it’s just such good money that I can’t do it.
So someone in those situations could use their good income in a job that they hate to save deposits, to purchase their foundational properties, and then once you’ve purchased the foundational properties and you know that you will achieve financial freedom in the future, now is the time where you could change jobs. You don’t need to wait till you’re financially free. You know that you’ve built that foundation. It’s going to happen. You can now get out of the job that you hate. maybe take a pay cut, all right, but you get to start pursuing something that you enjoy. Start pursuing a career that you enjoy, which is gonna. Make your life overall better. I don’t want you guys to waste five years, 10 years, 50 years of your life working on something that you don’t like. I love this concept,
right? Because when you have choices, you start making better decisions and when you making better decisions, you show up in your life differently and that attracts different things to you. So you and I, I think the very first video we ever did after we recorded it, you know, I’d be horrified to watch it now because we’ve grown so much, but like you, you like, dude, why the hell aren’t you leaving your job? And I think like a month later I was out of my job and started this business and that was a choice because of the properties that I bought at that time, I wasn’t anywhere near any, no two properties completely outright, but I did have enough basic income coming in to look after my family while I made that transition to take a huge pay cut to do something that I’m so passionate about, which is helping people buy a property.
So, you know, by me doing that, my brother works with me now. My mum works with me now. My sister works with me, heaps of friends have gone on and started to invest in property, got to help heaps of cool people do really cool things. And it’s kind of like showing up in an authentic way where you love what you do. You know, financial freedom isn’t aBout not working anymore, it’s about choosing what you do in a day and choosing what you do everyday for the rest of your life based on how you’re feeling and what your passions are and what’s interesting to you. Okay. Working and we’ve talked about this before, probably till we’re like till I’m dead, like I’ll always have businesses and always have properties that I’m interested in. I’ll probably get into shares later on because it looks hates interesting with the way my mind works and you know, like I’ve, I’ve learned so much from working with the man about this, like the choices that that’s given me.
I now only work four days per week. take six to eight weeks off every single year I get to work with my family life. That can be awesome. Some days and really hard. Other days when you know someone’s got to be the boss or the later, you know, like it’s just, it’s just cool. LIke choices doesn’t necessarily mean you stop doing everything and you just turned into a hippie and moved to byron bay like 30 years ago because byron bay is like commercial bill now. But you know what I mean, like choices means I get to hang out with my kids. I get to drop them off at school three days a week. I get to start another business. If I feel like a passion coming on, I get to do these videos with you man, which is one of my highlights of my week. Like I love this stuff.
I love the impact that it makes. I love the ideas that it sparks in arson. Some people that listened to it and you know, like it’s all part of a journey. I love that this strategy, you know, enableS the average person that you know, hasn’t got the choices that we’re, you and I are lucky enough to have right now. Get those choices really quickly. Like, you know, go ready, try and go find another profession. A friend of Mine who I’m playing soccer with tonight is a painter and we’ll talk in last week or he was talking about soccer and he’s like, man, my mind is just not being activated, panning, but I’m earning such good money. I don’t know what to do. I want to Become a youth worker and I’m just like. If he had. If he had a choice and he knew that worst case scenario longterm was going to be financially free anyway, then he would just not even think about this cut back to painting three days a week, re train himself and interior years be doing what he thinks he’s going to love doing and probably get there and go. It’s not all like roses. On the other side of sometimes jUmping from stuff doesn’t necessarily mean make you happy, but trying different things. You’ll figure it out.
Yeah, and I think there’s a lot of big ideas that we’re talking about in this episode, but I think this is actually one of, if not the biggest idea in the episode, which is that you don’t need financial freedom to change your life and to live a better life and to be happier. That’s. I totally thought that. I totally thought I need financial freedom when that happens. I’m going to click my fingers and like I’m going to be super happy. So 28, I achieved financial freedom through my businesses and uh, I know I wasn’t happy. In fact, I went into a deep dark depression and it took me a period of about 18 months to work out, okay, now that I don’t need to work and that’s not making me happy, what is going to make me happy? And I don’t want other people who it’ll take longer to achieve financial freedom, to spend their life in a job they hate, hoping for something at the end of the rainbow. That won’t happen anyway where you can do thIs now. You can make a change now.
Yeah. Everyone should work four days a week. that’s all I’m saying. Like in terms of the benefit to lifestyle, like artists want to say, everyone has that choice and as soon as you bought those two properties, even if you don’t like your job that you’re earning so much money, you can’t leave it or you’re in a stage of life like me where the reality is I have more costs at the moment than I have before and we’ll have those costs for awhile and you know, you’ve got them to a certain sort of lifestyle and us putting pressure on you to stay in the jail or something. You know, like just cut back to four days a week. Man. Like if you can’t talk your boss into four days away, every single one of my team members will be working four days a week by july.
There’s absolutely zero reason for them to show up any longer. In fact, they probably wasting a day of my time per week just being here because they’re just stuffing around. Like the human brain is so powerful and this is. This is the choice thing. It doesn’t have to be one way or the other. You can trade solutions that suit you, your family, your lifestyle, or you can just do what I did for my whole twenties and work like a mofo and you know, if that’s. if that’s your thing, you know, just just remember that the other side is not always cracked up to be what it’s supposed to be in thinking that it’s going to fulfill you when you get there is going to be a big slap in the face if you wait 15 years to do it.
Yeah. Well, I think the big thing is that we want to get across is that you have choices, choices to change careers. You have choices to drop down from working five days a week to four days or three days or whatever it is that you want to do or you have choices to go hard to work, harder to earn more money to start a business, to pay off that debt faster. It’s up to you, but just know that once you build these foundational properties or once you own these foundational properties, then because you’ve set up your financial future, now you have these choices already. Don’t wait until you’re financially free to start thinking about this stuff. Start thinking about it now and whether or not you do anything that’s up to you, and so that’s kind of consolidation phase. We’ve got acceleration, we’ve got growth, and then we’ve got the change or the choices and that then moves us into lifestyle phase, which is when these foundational properties are completely paid off, so up to this point, the properties, any extra cashflow that you’re getting ideally is going to paying off the debt faster on these properties so you can accelerate it.
so lifestyle is when you’ve paid off the debt on these properties, you own them outright, and now the rental income that’s coming in after you pay your expenses, like maintenance, you manage your fees, your insurance says council rates, all that good stuff. Once you paId that, then whatever’s left over goes into your pocket and you become financially free.
Yep. And what? Bang, focus for this period of time, which is the accumulation and consolidation phases allows you to do is once you hit stage three, whatever the hell you want to do.
Yeah, well that’s when the journey really begins, I think. Yeah, and the thing is once you achieve financial freedom, me and ben have both testament to this. You don’t stop. It’s not like you just stopped living life or you stop trying to earn more money or you stopped trying to do good things for the world. In fact, once you achieve financial freedom, the world opens up to you and you’re like, I don’t have to work. So if I’m ever working, I’m choosing to work and so what do I choose to work on? What’s gonna create the most value for the world? What’s going to make me the most money? Et cetera. Your life opens up and there’s so many possibilities both in your career, in your businesses as well as in relationships as well. Like, I mean, kelly had this problem in that we don’t need to work and so we’re always free to hang out with people like monday to friday during the day, but everyone’s at work and can only hang out at night or on weekends and so we spend a lot of our time hanging out with each other, going to the beach and stuff like that because no one, no one else is around, but we do have flexibility in our life that we can go and hang out with people during the week if we want.
So it opens up new relationships to that. Right. Ron
and I liked the coMplete yin and yang thing going on because like I’ve probably lock our eyes, respect the way that you live, but if I’m not working four days a week, I’m a nutcase man. Like I’m actually insane. And I was like that. That’s stuff that I’m like learning as I go through this journey, but just give you 18 months man, and then you’ll be. When I’ve got this burning desire in me that I don’t even know where it comes from. It’s just been there. To have a meaningful impact and you know, take, take things as far as I want to take them and you know, like that’s cool. Like that’s, this is just the perfect thing like you know, you and I have both achieved it in completely different ways in a completely different way to get there. We both got there, had a realization that, you know, it’s amazing and also not exactly what you think it’s going to be and have to redefine your identity once you’re not hustling every single day to how you want to spend your time, who you want to be, how you want to help people.
but the fire gets relayed in different ways. Man. Like you’ve just been a bit crook, you’ve come out of it like excited as your excitements, like wash all over. Me and I had a similar sort of experience about july last year when I went to four days a week and for the first month I was so uncomfortable and now I couldn’t imagine not doing that anymore. Like it’s pick your own adventure in the loft style phase. You know what I mean? I choose to show up four days a week at the moment because that’s where I’m at and because I get a massive kick out of it and really enjoy the work, but you know, if you don’t have to do that and you don’t want to do that man, like you just do you just as she choice, isn’t it? Like whatever we want to do we can do.
Yep, and that’s the thing. I choose to work less than you, but when I show up, I try and show up as my creative self that is delivering epic amounts of value when I am working and so that’s like how long channeling myself at the moment. And so that’s kind of lifestyle that’s up to you, how you do that and what you do with that. Everyone’s going to be different. Just know that when you hit financial freedom, life doesn’t stop. you’re not instantly happy to go through some stuff, but also you can keep working. You cAn keep earning, you can keep growing your portfolio and stuff as well. So you don’t just hit this one point and then that’s it for the rest of your life. You can keep growing from there, but lifestyle phase is where the journey really begins and that’s where you really get to decide who you are and who you want to be, but hopefully even in the consolidation phase, you going through parts of that anyway and exploring what you want in your life because I think that’s what we want for you guys, is for you to live your fullest and happiest life and be your truest selves to the world.
For us, it’s not so much. When we say lifestyle, it’s not about mansions and yachts and lamborghinis. It’s about choices to do what you want and to be the person that you want to be
100 percent like it’s so much easier to shop in the world is who you are and we used to do this as kids. It’s not something we have to try and do. It’s just it’s what we’re supposed to do as people. You just get. I just get caught up in the system of it all and you get taken off path, but like financial freedom takes away their scarcity survival mentality that a lot of us have and replaces it with like, well, I don’t care anymore because it doesn’t matter anymore what I do, and then when you don’t care, stuff comes to asia and you start to care because you don’t care anymore. It’s really weird, man. I don’t even know how to explain it, but I’m very, very grateful that we get to share this message and you’ve been able to figure out a way, ryan, to make it so simple and then to break that down into a series of such simple steps for people to action and we’ve talked about a lot, but I want people to remember that the only thing that matters is if you don’t own any property right now, buying the first quality house.
If you own a couple of properties already, you know a couple of houses with some granny flats might fit into that. If you own your own home outright or with, you know, good equity in it, then the first step and the next step is the only one that actually matters like the 15, 10, 15, 25 year journey that you’re on to financial independence. The only thing that actually matters is like that next immediate step and absolutely nailing the right property, the right market, the right suburb, the right price point, the right return, the right characteristics of the property is just going to make that second step or third step wherever you’re at. So much easier.
Yeah, so definitely focus on what’s in front of you right now. Doing that well because that’s going to set you up for the future. One thing we’re getting towards the end now guys, but something that I just want to touch on before we go is what about your house? What about your principal place of residence? Because it has come up that this strategy doesn’t talk about your principal place of residence. It doesn’t talk about owning your dream home or things like that. And while me and ben understand that this is a really important goal for a lot of people, that a lot of people want to own their own home outright, we see a lot of value in that. We also see it as being separate from financial freedom. So owning our own home is epic. It’s a great goal, but financial freedom is also epic and a great goal.
It’s up to you what you do. ideally, we think you should do both, right? We think you should have your cake and eat it too. And so how you go about doing that is really going to be up to you and dependent on your situation. For a lot of people, they want to purchase their own home first, and this can be a great step because equity and growth, capital growth in your own home, can they be used to leverage into purchasing these foundational properties so you could purchase your own home first and then use that to help you purchase your foundational properties, or you could purchase your foundational properties first and then go ahead and purchase your own home and work to pay that off, and obviously if you own your own home, if you’ve completely paid off your own home as well, then that’s a mortgage or rent that you no longer have to be paying, so money that would usually go that you were earning from your foundation or properties that would usually go into a mortgage, you’re into rent is now staying in your pocket, and so your then wealthier as a result.
Without a doubt, there’s
not one way or the other. It’s about finding that balance for you. For me personally, I bought the two investment properties first before I bought my own place. For everybody. that’s going to be different. Now that I’ve got the three kids and I grew up in such a stable home, you know what I mean, like two houses I lived in for my whole life. That was really important for my family. I’ve got amazing memories that were solidified. That was my foundation for my strength now and owning my own home is very, very, very important to me. You know, I’m enough to live on the sunny coast, close to the beach and chill. But you know, as ryan and I’ve talked about, I didn’t have to own that home to have that feeling I could have for a long time before this. I either rented it or I, you know, sacrificed some of that home ownership stuff in terms of the drain drain home for just a place that served my immediate needs in all of my money.
went back into investing. So it’s different for everyone. I think if it’s important for you, you know, you can figure out a way to make it work as well as doing this as well. and again, it’s just about focusing on a solution rather than the problem that most people get into. Which is just owning your own home, taking 30 or 40 years to pay it off and unfortunately missing financial freedom because of that. Yeah, and that’s. That’s something to think about is that we think you should do both. I always just think do both one or the other. Just think
both. Both for people who just focus oN owning their own home. Think about the end goal of that. If you paid it off, then obviously you have less expenses that you have to pay because you’re not paying a mortgage or you’re not paying rent, but you’re not financially free and so you have less choices if you only have that, but if you own your home and have financial freedom, then you have more choices. So we’re all about giving you choices and so it’s really up to you how you go about working to do that and to make that happen in your own life and what decisions you make around that.
But yeah, we’ll touch on that really quickly. Just to finish it off, I just want to make people aware of the step of going in owning your own home first. Let’s say it takes you 15 years to pay off your own home before you get started on this journey and the journey takes you another 15 years after it. There’s no such thing as like a free lunch with all this stuff. I fully agree you should do both, but you need to recognize what it’s gonna cost you and what it’s going to cost you is time. So just be aware of that timetrade, unless your creative and you want to start a business or you want to, you know, go find a solution for owning your own home outright without having to pay it off using your own money which says hates of different ways to do that. I just, if you’re going to do it the traditional hard way, you know, use your income to pay off the debt on your own home and then start investing. Just remember that 15 years of your life you probably going to try to do it that way. Yeah,
and there iS also the question to ask yourself is that if you were financially free, where would you want to live? If you could live anywhere in the world, because let’s face it, if you’re financially free, you also location independent, then it’s like where would you want to be? So just because your dreaM home now might be where you are, which is near where you work near where the kids go to school in 15 years when the kids are finished school and you don’t need to work anymore. You might want to live somewhere else. So there’s always that balance to think about as well is that your dream home now might not be your dream home in the future. And so that’s just something.
It’s exciting to think about it like the creative. Let’s say you own a one point $5,000,000 property in sydney right now in melbourne. It’s going to be 3 million bucks in 20 years, you know, at four percent growth rate per year. You know, you might go out and buy it, you might have the home and you might love that and that perfectly searching now and you might go and buy these two other properties and the granny flat. So foundationals, you might just be able to sell that one property in 15 years that you no longer need because your kids are out of the home and you might try it for one point $5,000,000 home. You’ve all of a sudden got all this cash in the Bank, you wipe out the debt on the two other properties and you can use your own home as a trading solution to achieve the same result. So this is what’s cool, like there’s so many different ways to get there. It’s just up to you choosing your own adventure and seeing what works for you.
Yup. So that kind of wraps it up guys. To summarize is basically there’s two properties to financial freedom is a really simple strategy. The goal is to buy those two foundational properties. So two houses worth about $400,000 each that rent for about 4:28 per week. And on each of those houses you’re building a granny flat. That’ll cost you around $110,000 each running for two 80 per week. So that’s going to give you a total price for each property of $510,000, approximately renting for about $700 per week, which is giving you above seven percent rental return. And then the goal becomes how can I pay off these properties as quickly as possible and then once they’re paid off, you can then achieve financial freedom and be financially free. You can also grow that. You can go from two properties to three to four, et cetera. And there’s also that option to change careers and to do that once you’ve accumulated the properties but you’re not quite yet financially free, so you still need the income, but you have that freedom to go out and to make other choices as to how you actually earn your income.
So, but that’s basically it. So pretty simple stuff. I think simple simple stuff. Men who can’t buy one property in the next day,
five years who can’t buy two properties in the next 10 years. A lot of people listening to this will be able to do this significantly faster. Like how exciting that there’s a solution for everyone to get financially free long term and for people that are a little bit more ambitious to speed up that process. Like
I love it. yeah. Well, and even you could even scale down from two properties to just one and your income would have, but you would still be able to be financially free just on a low income as well. So there’s, there’s the option to simplify it even further to make it one property to financial freedom. But I think two properties kind of delivers the result that most people want and the income level that most people are kind of after, which is around $100,000 a year mark in today’s money.
Without a doubt. No, I’m really excited. Brown. Thank you so much for thinking of this in the seth mann and us being able to deliver it as well.
Yeah. And so if you guys want to learn more about this, I have created a pdf which kind of outlines this strategy in an easy to follow format. So if you’ve listeNed to this, obviously we’ve talked for almost an now, but this would just kind of outline it really simple foR you. It’ll show you a bunch of the numbers as well. So if you want to take this home and talk to your spouse or talk to your partner or talk to your business partner or tortilla cat or whoever about this, then this will really help you kind of outline it. Or even just some people love to read it and to really get it to sink in. So if you go to on-property dot com, you eu us freedom, then you can download that for free. So I’ll leave that over there on property dotcom, forward slash freedom.
If you want to see more of the nitty gritty of this strategy, have a laid out for you in a really simple to understand format which will help you understand it. And then one of the best ways to learn something is to teach it. So you can always take this and then you can go ahead and teach it to your partner or teach it to your friends or pass it on or whatever it may be. So again, that links on property dot condo, you for us as freedom, if you want to get that free report. And also ben is a buyer’s agent. He runs pumped on property and humans and his team have purchased over $150,000,000 worth of property and also tends to specialize in these types of properties. He’s bought a lot of these properties for his clients. And so if you’re thinking that, yeah, ryan, this is something that I would love to do two properties to financial freedom sounds great, bit overwhelming for me to purchase in a different state or a bit overwhelming for me to find out the right counsels to invest in or to go ahead and build the granny flat or to find a good property in a good suburb.
I just want some help. I want someone to help me. I want someone to help me find these properties and to make it happen so I can get my foundational properties set. If that’s you, so you’re ready to invest, but you just want some help. Then go to on property dotcom w four slash session, and you can book a free strategy session with the team over at pumped on property. You can talk about your situation where you’re at. now, you can talk about your savings. Talk about where you want to be in the future, how many of these foundational properties you want to buy a and they can look at, okay, here’s how you can do it and they can set the strategy for you. So that’s a free complimentary strategy session that they offer. That’ll help you get set in your own life of how you can do it and then it’s up to you as to whether or not you want to work with pumped on property and hire them as a buyer’s agent to find these properties for you. Or if you just want to go on your merry way and do it yourself, which is absolutely fine as well. So if you want to book one of those sessions, go to on-property dot ford’s our session, and then there’s a calendar over there so you can choose a time that suits you. So that wraps it up. Basically. Is there anything that you want to add at the end, ben, before we sign off?
Yeah. So just wanted to reaffirm that I love the two properties strategy. I personally bought properties, built granny flats on them. I’ve bought piece of land and built houses with granny flats on them. I’m completely behind this strategy. I really can understand how it can help not only the average person get financially free, but if you want to go further than that, you know, set you up in a positive from the bank’s perspective that you can get that growth and that cashflow and yeah, we’d love the opportunity to learn more about your situation and your goals for the future and just share some different ideas with you. Um, so that you get as much value out of that session as well
possible. Awesome. So again, guys, those links for the free pdf that is on property dot, you forward such freedom or if you want to book a strategy session with one of the team over at pumped on property, then that’s on property.com forward slash session. I hope that you have absolutely loved this idea. I hope that you grab hold of it and that you run with it, that you do it and then tell all your friends about it because we want to see more australians be financially free. We want to see more people living in their true selves, being themselves, adding value to the world and just absolutely loving life. That’s, that’s what we’re passionate about. And so I hope that we share this in a way that was succinct to you, that you understand and that you can run with it. We wish you the absolute best in your property journey. We, we just hope that you can go out there and you can do it, that you won’t be stopped by fear or starts by anything else. So you are awesome. We think you’re awesome. We absolutely love you. Thanks for tuning in. Until next time, stay positive.