Hi, Beyond Wealth here

Hi,

I’m Beyond Wealth. The point of this post is a quick intro, to give a bit of information and learnings to newer investors, and for me to use as a reflection / accountability post in the future. I read something years ago about how humans tend to overestimate what we can do in a short period, but greatly underestimate what we can do over the long term. I hope to do so with my own investment goals.

I have been investing in property since 2007 and currently hold a $2mil gross portfolio spread across Melb / Syd / Bris. My investing strategy includes resi property for capital growth and some rental income, plus shares (yield focus), superannuation and some cash. My goal is as follows:

By June 2024, obtain a passive income through investments of $50,000 per annum.

In addition to this income stream I should have a good amount of equity in investment capital (real estate and shares) which I could borrow against / sell if I needed additional funds. However I’m hoping I won’t have to do this.

My property strategy so far has been to buy units in historically high growth suburbs, close to the median unit price for the suburb, that are in reasonable condition but have potential for some future renovation and value add. They should be in good positions, close (but not too close) to train stations, shops, transportation, but in quiet streets.

So essentially purchase good quality property when I am able to afford it and hold it for the long term. Use cash savings from employment income and increased equity to continually purchase. So far so good and I’ve managed to build about $600k of net equity in my portfolio. This may change in the future as I’ve always had an interest in development / commercial but I will make a decision on that strategy once my financial position is stronger.

I am tracking towards my goal, and barring any significant market downturns, I should be in a position to semi retire (work 3-4 days a week) in about 4 years, fully retire and meet my goal in 9-10, or keep on working longer if I still enjoy it and just make every day an extra bonus. Alternatively I may pursue a different career in something I’m more passionate about.

I’ve been an avid reader of investment / business / mindset books for over 15 years and have probably gotten through many hundred. My username comes from a book of the same name, which advocates a truly wealth life is not just about money, but must include all the other components which make our lives worth living – love, trust, freedom, interests, etc etc. It really sums up my investment style – passionate but balanced, I love investing and making money, but not to the detriment of other aspects of my life such as quality time with loved ones, travel, hobbies, free time for relaxing and reflecting, etc.

I don’t want to go too deep into my personal specifics on this forum but any general questions happy to answer!

 

Holy moly.

My investment journey, investment strategy, desire for work/life balance and financial goals are almost identical to yours.

I'm about to take the next 6-12 months off work to travel and to try to really rediscover myself. Finding my life has been lacking some passion in the past few years of full time work.

Will definitely look up your book.

 

Loved reading this Beyond Wealth - great introduction and i love the focus on developing yourself. User name is very cool!

Can i ask what sort of portfolio value are you looking to get to to try and achieve the 50k p.a. number?

 

Great outlook on life. I look forward to reading more posts from you in the future.

I'll have to find myself a copy of 'Beyond Wealth' and have a read, sounds like a good book.

 

Good luck with your trip and let us know how you go, sounds great!

 

Hi Redom,

Thanks, always enjoy your informative and insightful posts.

The majority of the income will not be coming from property, which are about neutral CF now, however if I add maybe 1-2 over the next few years and don’t do much else I’m expecting to get about $10-20k positive cash flow per year (conservative) once I’m retired on a portfolio of about $3mil gross (with the real kicker being the equity component). This is simply by letting rent / inflation do its thing.

My strategy has changed over the past few years, it was formerly very IP focused but I’ve realised if I want to retire well before the traditional retirement age, I need to add some yield. I’ve decided to do this with shares rather than high yielding properties but each to their own. So I expect to have anywhere from $20-40k in ETF Vanguard dividends depending on how much I purchase.

 

Thanks for the info, I'll check out the book.

 

Hi all,

A bit of an update, I have recently cracked the $1mil net worth milestone. I know it's not as big a deal as it used to be, but it's a good start.

A couple of high level points:

• Have been working full time for around 11 years
• About 9 years since I purchased my first IP
• Approx 650k is due to IP equity growth (on conservative vals)
• Remainder is a combination of shares/cash/super

My goal was to hit this by 30, i'm 31 now so wasn't too far off..

 

well done

 

Hi BW
thanks for posting, looking forward to following your journey.
X

 

Well done @BeyondWealth, it looks like a really sound portfolio and investment strategy.

Just out of curiosity, as you invested thru the GFC period, what are your investment strategies going forward as we are going thru a new phase of the property cycle?

 

Wonderful
Great to hear you will be able to reduce working hours in very near future

 

Good stuff.
How long until you chuck in the day job?

 

Thanks for the update! Do you plan on selling down part of your property portfolio to clear some debt and put more into purchasing dividend income streams?

 

Not at this stage - will keep them for long term growth and balance this against increased future purchases of shares for more income

 

I would say at least 4 years until I'm in a comfortable enough position, which is fine as I'm in no rush

 

What do you plan to do with yourself once you quit?

 

Yes I invested through the GFC (although I didn't have a lot of share holdings at that point). I have also seen 2x Melbourne booms and flat periods, 1x Sydney flat period and huge boom, and 1x long Brisbane flat period. No major property downturns as of yet.

I would say my investing strategy going forward is now different to what it was 10 years ago, given my portfolio is now a bit more mature and therefore my mindset has adjusted, but essentially it's still similar, being slow, steady and passive accumulation of high quality long term capital assets such as residential property and shares. I still believe in the long term viability of our capital markets (including shares and property). Although I realise they are based on what is a money system which could potentially collapse at some point (but I'm yet to see a viable alternative, and I'm not sitting on the sidelines just in case a catastrophic event occurs).

Therefore if I was starting now i'd still be confident in investing in assets such as good quality residential properties, however I might adjust my strategy slightly given it's unlikely we'll see the same level of medium term capital growth, so I may include things such as incorporating a few cash flow properties, or be more active in adding value (basic reno's, etc).

 

I don't actually have any definitive plans to quit (as I quite like working) however I may consider a career change, or go down to part time work and do something else with my time, or have a 'mini' retirement and take a year off to do whatever I feel like, and then potentially go back to work.. So for me it's more about the options.

 

Well done.
I won't be 'retiring' when I retire, but I think there's a whole thread on that topic.