Crank up your cashflow
by Paul Gillmore Southern Cross Financial Services
Challenging times now and ahead consist of multiple interest rate rises in the last six months, some by the Reserve Bank of
Rising fuel prices not only cost more at the bowser but have an ?add on' effect with transport, groceries, other goods and services. The Reserve Bank sees these price increases and wants to put up interest rates to kerb inflation.
Feeling squeezed by this? It's no wonder if you do because you and I have virtually no say in this process.
If we see these things coming, then the intelligent thing would be to try to do something about it rather than allow it to be done to us - yet again. Right?
So what do we do?
We've all heard of magical schemes, get rich quick, buy a lottery ticket, wait for an inheritance, go to the races but what REALLY works?
What really works is a tried and proven system adhered to over time that uses established financial principles that are applied in a methodical manner. This builds a solid foundation. We then thoughtfully construct a bunch of investments to match your specific needs, plans and goals.
Too hard? Too complicated? I couldn't do that or it wouldn't work for me!
How do you operate and manage the finances in your home? Blind faith, no idea really or tried a budget but it wasn't much chop!
How is that working for you?
What do you think of when you hear the word ?budget'? No fun, boring, never going out anymore, life is dull, tedious and you just want to run in the opposite direction, right?
If we made a well thought out plan for our finances and stick to it, would that make us feel more confident about our lives and where we are headed? Well, that's a budget, isn't it?
Your budget should contain provision for all the costs in our lives. Of course we are going to pay the bills and naturally we need to cover our living expenses but shouldn't we be able to have some fun too? Too bloody right we should!
Here's the key. We spend less than we earn OR we get on a mission to achieve that. You might need some new ideas or some help to achieve this. DO IT, because once you have, it will be of enormous benefit to you. You will feel more confident because you now have control.
Increase Your Income
"I already work my guts out!" I hear you say, and I think that is probably true. However, there may be some people that can work some more hours or perhaps you could jag a promotion and I say, "go for it". But for many of us, we are paying off our homes, sending the kids to school and juggling the bills.
The idea is to live within your means and take a few spare dollars and buy some sort of investment. Here's another thought, you do not have to have $100,000 to start with or $400,000 to buy an investment property. A hundred bucks or a couple of hundred bucks is a start.
There is another key - just start.
"It's so confusing, I don't know what to invest in!", I hear you say - good point.
If a qualified and experienced person could help you with the research and purchase of investments that suited your personal situation, wouldn't that help?
For example, you could buy investments that:-
1. Increase in value over time (capital growth)
2. Provide some income (return on investment)
3. Help you reduce your tax (tax deductions)
Pay your Home Loan off Sooner
You're getting the idea now aren't you? That's right. We simply use the extra income to add to your existing home loan payments. We can add your increased tax return to this as well to accelerate the process. This process gathers momentum as we stick to it and sooner, rather than later, you will be stomping all over your home loan and grinding it into the dirt. Hmm.... that's a lovely thought isn't it?
No Time For Procrastination
Whilst we are brutalising your home loan on the one hand, we are not procrastinating with the other. We are investing further.
In fact, you are getting the hang of this by now and we are not just investing without a plan, we are building a solid well constructed investment portfolio which is personally designed to suit you and your family's needs, hopes and dreams.
Pie in the sky? No way. Remember that we started with correct principles and built a strong foundation. We stuck to our guns and continued to build according to our plan and we sought good advice. It's more like ?get rich slow and steady' (and you know what they say about slow and steady).
In five to ten years the possibilities and options that are available to you and your family now, could be vastly different not to mention dramatically improved.
Now you might call this manner from heaven or a revelation. I call it the Cash Flow Management System.
Paul David Gillmore
DFS. R.E lic.