Financial Goals and Tips for Success in 2025

Ever wondered why some people with sudden wealth end up losing it all? Join us for an eye-opening exploration into the world of financial discipline as we promise to unravel the secrets of maintaining wealth. With strategies to transform your savings habits and investment approaches, this episode will empower you to set and achieve your financial goals for 2025 and beyond. By breaking down your aspirations into manageable daily and weekly savings targets, we promise to guide you towards a path of sustainable wealth, regardless of income level. Listen closely as we illustrate vivid examples of lottery winners and athletes who, despite their earnings, fall into financial pitfalls due to a lack of structured planning and education.

Elevate your financial game with proactive banking and investment strategies designed to maximize returns. We'll share insights on securing competitive savings rates, harnessing the power of compound interest, and automating your financial processes for efficiency and consistency. Property owners will gain valuable tips on using offset accounts to minimize mortgage interest and prioritizing debt management. Consistency and discipline in financial practices are key themes, and with the help of accountants, you can tailor your roadmap towards financial freedom. Get ready for actionable insights that promise to transform your financial landscape and keep you on track to reach your goals.

Chapters

• 0:00 Achieving Financial Goals Through Structure
• 10:33 Maximizing Savings and Property Investment

Transcript

Speaker 1: 0:00

Welcome back to another episode of the Tailored Property Wealth Podcast. In this episode of the podcast, we're going to be discussing your 2025 financial goals and tips for success. We're going to be talking about goal setting. We're going to be talking about effective systems so you can consistently save and achieve those savings and finance goals. We're going to be talking about effective structures when you're holding property, and we're also going to be talking about obtaining finance and speaking with a high quality mortgage broker.

Speaker 1: 0:34

If you simply just have a goal to save more money, structuring everything is going to be important, right. But if you've got a goal of you want to invest in shares, you want to invest in property, you simply first have to start with saving it's all a finance game at the end of the day and then you're using that finance discipline and that structure to be able to go out and put your money into high-performing assets. So finance is always going to be crucial when you're investing, no matter what it is, or you're simply saving money. We see it a lot in our business A lot of those people in like that mid-income range. Right, they're the ones that like they've got the solid income, but it's not crazy income. It's not extremely low, but then they have that consistent habit of saving every single week and they're the ones who have the really solid savings balances, and it's just because they're so consistent and they have these structures in place to be able to do that. So it is super important. It's it's good to balance having that strong income but also having the financial discipline. And this is why and I think I've touched on this in a previous episode but if you see people who go out there and win the lotto they win millions of dollars a lot of them end up in a worse financial position than when they actually won that money, and that's simply because they gained this amount of money not because of discipline and not because of structures, and then they didn't have the education, the discipline and that consistency to manage that money and they blow it all. So it's super crucial. We see it with athletes as well. They go out and make extremely good money while they're playing sport on a professional level super crucial. We see it with athletes as well. They go out and make extremely good money while they're playing sport on a professional level, but when it comes to keeping that money, saving it, investing it, a lot of them, unfortunately, they don't do that and then once they retire, they're back to working a full-time job, whereas you see some of those outliers who go out there and are very disciplined, very well structured their finances and they do very well.

Speaker 1: 2:51

So it's an important, important thing that we want to focus on, no matter who you are, where you are and what your profession is. So, goal setting for your savings. If you do not set a goal, you will most likely not get to your target. Goal setting is so important. I'm a strong believer in goal setting. I, every single year, create goals, I write them on the board and I look at those goals and I stay familiar with them, because it helps motivate me and keeps you accountable, especially if you're putting it out into the universe right, or you're telling yourself what you want to achieve. It's very important.

Speaker 1: 3:38

So make sure you're writing your goals down and you're setting some goals for yourself. You're writing your goals down and you're setting some goals for yourself. And if, for example, you set a goal of I want to save $10,000 in the next 12 months that is $200 per week what you then want to do is you want to set up those daily habits to make sure you're hitting that goal to meet that in 12 months' time. If you've got a goal of $50,000, $100,000, whatever, it is obviously saving, that can be quite challenging. But you want to reverse engineer those goals. Break it down into daily habits, weekly habits that you need to transfer across every single week to hit that amount. Okay, so it's all based on projections. Break it down. If I need that 10,000 in 12 months time, I need to hit that $200 a week. Break it down, week break it down.

Speaker 1: 4:51

Or what I did was when I was first building my portfolio, I actually broke down my budget of what my fixed expenses were. I gave myself very little money as discretionary to spend every week and then I worked out the percentage of my net income that I could save and my goal was to hit that percentage every single week. Now, something very powerful as part of that is over time, as I increased my income, as my career built, I moved up, income increased, I actually kept my discretionary and my fixed expenses very much the same, and this was before we had a big case of inflation. So it is a little bit of a different environment. But as your income increases, if you are used to spending this amount of money for your fixed expenses in your discretionary and you delay your gratification, that percentage of your net income can actually increase over time if you're just keeping those where it is. So I got to a point where I was saving about 60% of my net income, which was massive. Yes, it was before inflation. It's probably not achievable now. However, it's super powerful if you can do that delay that gratification and just continue to build on that savings Super important.

Speaker 1: 6:13

So make sure you're setting goals, set those projections. Reverse engineer what you need to do on a weekly basis to get to that 12-month goal and then break it down into what those daily habits need to be. Do you need to get to that 12-month goal and then break it down into what those daily habits need to be? Do you need to miss out on the coffee here or there? Every little bit adds up. When I was, when I was saving really hard in those early days, I did not spend money on anything I didn't need to. I was very, very disciplined with my savings. It sucked to do that, but it well and truly pays off and it is possible to do it. You just got to have the discipline and you can still treat yourself right, but there's a lot of things that you can do to be able to save more money and just be effective with that. All right, effective systems to save consistently and how you structure it is really, really important, I believe. So, once we've got our goals and we're getting down to those daily habits and those weekly habits, what's some really effective systems we have in place that are going to help us implement that every single day, every single week?

Speaker 1: 7:32

Now for your savings. One of those is creating a separate savings account to where you're traditionally getting paid, what your transaction account is, what your main account is, and with that savings account, you want to create it with a view-only access, meaning you can transfer money to the account, you can log in, you can check the balance, but you can't actually withdraw money from that account in your online banking. You've got to go into the branch or you've got to call up to be able to access that money, and that's just that little separation from the money, that little barrier that makes it harder to get hold of. So if you're out on the weekend and you've had 10 drinks and you think you're rich and you can spend money here, there and everywhere, it's just that layer of protection. Actually, it kind of helps just make that decision for you, make you remember no, I'm saving towards something. Okay, I think it's very important and it's just. It's even online shopping or whatever those little habits are. If you can just make it that little bit harder to access, it's very powerful. We live in this day and age where we've got everything at our fingertip right, so creating that discipline is very much worth it. It's what I did back in the day when I was saving. I restricted that and have helped other people structure it in that way so that they can consistently save. People structure it in that way so that they can consistently save.

Speaker 1: 9:04

You also want to set up an automatic payment from the day that you get paid, straight across to that savings account, straight across to that account that we discussed as view-only access. So Robert Kiyosaki, who wrote Rich Dad, poor Dad he touches on this in that book pay yourself first. If you can't pay yourself first, then you got problems. Right, you should prioritize yourself, definitely need to pay your bills, but you want to look after yourself as well. That just takes again that layer of temptation away, because it moves straight across that savings goal that you've set every single week, every single fortnight, every single month, and it's in the account and it's ticking away. So make sure you set that up. It's so easy to do that then because all of a sudden, you've created that budget, you've created that savings goal and now it's all in place as soon as each week you paid. Okay, this is what I've got to work with each week and you just we're great at adapting and changing right. It's the same with the interest rate environment. Interest rates go up, people have less cash and they start to adapt and rein those expenses in. Okay, there's a lot of stuff that we spend discretionary that you can rein back in. All right, so it's important. It's an important thing to focus on.

Speaker 1: 10:33

The third thing is be proactive with your banking. Banks want to lock you in and they want to keep you there and they prey on people who are lazy. They prey on people who are not proactive with their finances. So go out there and research what is the most competitive savings rate right now so you get the best return on your investment. And as a savings account, it's a lot better over the last couple of years than what it was in the past, so there's some good returns out there. Make sure you go out there and you research those savings accounts, get that highest interest rate in the marketplace and typically they'll do a period of time three months where it's a higher rate and then it drops a little bit. And the banks understand that from that psychological level that people will move their finances somewhere and just leave them there because they're lazy. If that means every three months you've got to revisit where's the best savings account with the highest rate and move it there. Do that because it's going to help put more money back in your pocket. Do that because it's going to help put more money back in your pocket. So they're some of the most crucial and simple things from an effective systems point of view to achieve those savings goals.

Speaker 1: 11:49

Set up that savings account with view-only access. Remove that barrier. Create that discipline so it's harder to get to the money, because it's more important to put that money towards your ultimate goal, not blowing it on the little bits and pieces. Set up that automatic payment. Pay yourself first, exact same day as you get paid, every single week, fortnight, month, however you get paid and then be proactive with your finances. Always be researching every three months. Look, am I getting the best rate in the marketplace? If not, do I need to move that savings account elsewhere to really reap the benefits of a higher rate? Because it's that little bit extra that's going back in to your account. That compounding effect is so powerful.

Speaker 1: 12:38

Now, if we're holding property, we want to effectively structure our finances to really implement effective ways just to hold property. Now I want to make it very, very clear here. This is not financial advice. Speak to your accountant around some of the things that we're going to be touching on today. Now, if you are an owner-occupied property holder, you own your own home, you live in your own home. You want to reduce your interest rate or reduce your interest on that home loan, so you want to set up an offset account. Any of the balance in that offset account is going to offset your mortgage. If you have a $500,000 mortgage, you've got $100,000 in your offset account. Calculated daily, you are only paying interest on $400,000, being the difference between the $500,000, the $100,000. So the more you hold in your offset account, the more beneficial it's going to be.

Speaker 1: 13:45

You want to separate it because anything you pull out of there can have tax implications. This is more for investment properties, but it is easy to separate the two and get in that habit. We'll touch on that in a minute. With investment properties, your owner-occupied debt isn't a tax deduction. Okay, again, speak to your accountant. But just remember it's the same thing with savings and that compound effect the more interest you can save, the more you're going to help pay that home loan off faster, and it's just simply sitting in that account.

Speaker 1: 14:25

Now, if you don't own your own home, but you hold property, you're a rent investor, you're renting somewhere, you have an investment property elsewhere or you have multiple investment properties you want to set up that offset account again. However, we want to make sure that that offset account is offsetting the debt that has the highest interest rate. So if you've got two investment properties one's at 6%, one's at 7% you want to offset the one with 7% because you're effectively going to be saving an additional 1%, having it offsetting that higher interest rate. So that's an important one to remember Don't look at balances this and that you really want to focus on what's the highest interest rate. Now, if you've got a debt of $400,000 and you've got $500,000 in your offset account, then we've got $100,000 doing nothing and you want to effectively move that $100,000 to the next debt with the highest rate. So balance does matter in that point of it. But a lot of the time you're probably not getting to have that offset account higher than what the debt is Okay. So just important to remember there always be offsetting the debt with the highest interest rate if you don't have an owner-occupied mortgage.

Speaker 1: 15:46

If you have an owner-occupied mortgage and you have an investment property, then what you want to be doing is offsetting that owner-occupied property Because, remember, owner-occupied property is non-tax deductible debt we're not generating income on. The owner-occupied property is non-tax deductible debt. We're not generating income on the owner-occupied property. We can't claim that. So we want to reduce that and then we'll claim it on the investment property because it's a tax deduction, because we're generating income on that.

Speaker 1: 16:14

Speak to your accountant. Automate your repayments. Automation is key. Okay, we're investing in property or we're purchasing property because ultimately, at the end of the day, we want to save our time, we want to create passive income, we want to have that freedom, right. So automation is going to help us along the way until we get to financial freedom by simply just working smarter. So, in your main offset account, automate those payments. Set up so each lender that you have automates takes the money from that offset account or you're setting those monthly payments up as an automatic payment across to each of those debts on its due date Super crucial one to remember.

Speaker 1: 17:03

You don't want to sit there and manually be making payments every single week, month, whatever it is, especially when you're starting to build up multiple properties. It's just time that you can be spent relaxing, doing things that you enjoy spending time with your family, friends, whatever it is. The next one automation as well is investment property. Make sure your property manager is receiving all rates notices. They're going to pay those for you and then it's going to come out of your rental income statement. Again, if you're getting to multiple properties every three months, you got to sit down and be making these payments, soaking up your time. That's what we're paying high quality property managers for to take care of that, for us to effectively manage that property and save us time. So make sure that you're doing that. Each different council might have different processes in how you need to update and have that sent through to property management, so just make sure you're across that. Speak to your local property manager. They'll be able to really guide you on the local government area. So that's it for effective structures.

Speaker 1: 18:15

Owner-occupied property. Have your offset account. Helps reduce that interest, gets you ahead, pays that debt off sooner. If you're rent-vesting, have your offset account offsetting the debt with the highest interest rate. Automate your repayments every single week, month, whatever it is, and make sure you're automating those rates. Notices to your property manager. They'll pay them and they will come out of your rental income statement.

Speaker 1: 18:47

The last one obtaining finance. The most important part of the puzzle, the no point saving towards a goal if you can't, then ultimately get the finance. There's a lot of different things that you want to look at to obtain finance and ultimately you want to speak with a high quality mortgage broker, because they're going to be key to help you get finance based on your individual situation. The way I look at this is if you go to one lender, you have one option, one door to go through to get finance. If you speak to a high quality mortgage broker who understands your individual situation, understands they've got a panel of lenders with lots of different policies. They've got many different doors that they can go through to get you finance. They've got many different doors that they can go through to get you finance, and it's going to be up to them to know what policies are going to best suit your situation and get lending.

Speaker 1: 19:48

Sometimes it might just mean you can get the lending. Sometimes it might mean you're going to get a better rate, or sometimes it might mean that you're going to get a higher and stronger borrowing capacity, which means you're going to get a better and stronger borrowing capacity, which means you're going to get a better quality asset, or just get the finance in the first place. If you're looking locally to purchase, they're going to be crucial. Okay, you don't want to just speak to some guy that you know who's a top bloke, but he's got no idea, because there's a lot of brokers out there that start up, but they're just not super high quality. Okay, you want the competence and you want the customer service. They are crucial. They go hand in hand.

Speaker 1: 20:31

Don't always, though and this has been key for me to build a portfolio don't say no if you can't get the best rate in the marketplace. Sometimes you have to get a higher rate to be able to make things happen. I've got pretty much the highest rates in the marketplace at points in time because I'm high risk to the bank based on having a new business and the way things are structured. However, I went out there and I made a purchase with a higher interest rate and ultimately let's call it $10,000 in additional holding cost per year with the higher rates has made me hundreds of thousands of dollars in growth in capital, growth that I've then been able to leverage again and go into more and more purchases. So don't get caught up on the interest rate. You want to really focus on a lot of the things that we've just discussed as well, because when you're submitting your information to a lender and the broker is doing that for you, they're going to be looking at all these things and they want to understand that you're across your finances, because it's going to give them the confidence to give you the approval and that tick to get it done.

Speaker 1: 21:52

So, speaking to a high-quality mortgage broker, having your finances structured is extremely important. Don't be going out there every Saturday night and getting $300 ATM withdrawals at 2.30 in the morning. Don't be punting and having that consistently in your statements. Clean your statements up. Clean up your spending for at least three months prior to going and getting your finance approval, because it's going to make the broker's job easier. It's going to make your life easier and it's going to get you better results. So discipline is key. Finance structures are key to help you get to those other finance goals. That's pretty much it for today. I hope this one has been valuable. Finance, like I said, is super, super important. You want to set yourself up for success in 2025 so you can help achieve those property goals. Thanks for listening. I hope you enjoyed and we'll see you on the next episode.