How late is too late when it comes to planning?

Me and my big mouth (or more correctly, me and my big finger) .

That was not my intention and I am sorry my post caused you to feel this way.

As you have already worked out, I am a zealot for planning.

Most of my working life was spent in the project management arena. That is, assisting organisations to do their projects “right”.

I am continually dismayed that most people do not manage their most important project, either at all or very poorly at best. That ”project” of course, is the life they are living.

I was one of them. In January 2004, I applied my project management learnings to my life and especially to my Net Worth creation journey.

Less than 7 years later, I reached my goals and retired. The impact of applying good management techniques to one’s life was amazing.

For the 27 years prior to developing a plan, I was on an investment journey of sorts but it was totally haphazard (bit like “any road will do” from Alice in Wonderland) and the paltry results I was achieving reflected this approach.

In 2004, when I developed this plan, I was 48. So, you are a youngster in comparison and you have a 5 year head start on me .

So am I and I have the same mental deficiencies as most/all other IT people .

I don’t know whether the following comments are wise but I trust you will find them helpful:

One of my guiding principles is:-

“You can’t change the past BUT you can influence the present AND you can plan the future.”​

Plans are like planes on Auto-Pilot. Most people don’t know that these planes are more often off their pathway than on it. Planes are continuously comparing their position to their designated path and taking corrective action. That‘s the magic and that is why they arrive at their destination. The same magic applies to plans.

To continue the plane analogy, every day there are hundreds/thousands of planes on Auto-Pilot, all heading towards their chosen destinations. But one can’t ”steal/copy” one plane’s flight path and hope to arrive at another plane’s destination. The flight path is dependent on where you are and where you want to go. The same applies to plans. Each person has to work out their own.

A lot of people spend more time planning their Christmas holidays than they spend planning their lives. I know both are important but it is so disappointing to see this.

Finally, later in my career, I got involved in portfolio management or doing the “right” projects. There is little benefit in doing projects right (project management) if they are the WRONG projects. Portfolio management techniques can be applied to property portfolios, share portfolios, ...

 

@kierank would you mind elaborating on the portfolio management statement a little? What were the specific things you did?

 

I could write a book on this topic .

I will try to give an abbreviated version but, based on my post above, that may be impossible . I will start by relating it to projects in the business world and, hopefully, one might see how it can be applied to other portfolios such as property and shares (watch out for the mud that will come my way).

The basic concept behind project portfolio management is that no organisation has sufficient money that they can do all the projects that they would like to do. So they need to ensure that the list of projects (and programs) that are approved are the RIGHT projects.

There are a number of terms/criteria that organisations use to determine the right projects such as outcome, benefits realised, value-for-money, ... The one I particularly like is impact.

In my experience, a lot of organisations (not all) do projects right (on time, on budget, to the scope, ...) but not all of organisations delivered projects that achieved the desired impacts for the organisations (they do the WRONG projects, in same cases very well).

I was called into one organisation (a Government department) where they were about to kick off a third project as the previous two projects hadn’t achieved the desired impact. The scary thing was that they only had a vague idea of what the outcome/impact they were seeking.

The first thing I did was halt the third project until they had absolute clarity about what they were seeking.

Portfolio Management is vital to the long-term viability of an organisation. It is a technique aimed at senior management/key stakeholders. It allows organisations to “live” their strategic plan.

In the property world, each property is like a “project” and the group of properties forms one’s portfolio.

How many times on PC do we read about people complaining about the land tax bills, about having to sell properties as they don’t create sufficient net income in retirement, ...

I would contend that they bought the wrong properties (did the wrong “projects”).

If one has a clear definition of their portfolio before they commenced, they may have a better chance of success.

Hopefully, one can see also how it could be applied to share portfolios.

I trust this gives you a better idea.

One final comment:- for most people, portfolio management is easy to understand but they find it hard to do (well).

PS
I knew I couldn’t keep it short .

 

About time you commercialized your knowledge.

I make a fantastic PR agent you know....

 

I haven't yet read the post you mention and hats off to those who plan and carry forth etc. That road is not for everyone, some of us are better at reading more immediate circumstances and jumping while the iron is hot. There are some things you must remember if you want to enjoy this site:
1. Everyone is different and has different strengths of character to utilise. Use your own strengths.
2. Observe where you are not as strong and consider working on skills that you don't normally use. But only to support your own strengths, not to replace them.
3. Be realistic about your goals - what is it you want, anyway?
4. We all start from different places and with varying levels of support.
5. 43 is not too late for anything. If you take an objective look around, you'll see that many, many people are in the same boat.
6. Property investment is a little over-rated on this site.
7. Don't be swayed too much by prolific posters. Posting can become addictive.
8. Don't compare your insides to someone else's outsides.
9. Congratulations on your baby. It's natural for you to be motivated to provide.

 

As I posted earlier, most people plan their holidays in more detail than they plan their lives.

For example, where they are staying, how they are going to get there, how long they are staying there, what they are going to do, how much they are going to spend, ...

They have great holidays but their lives leave a lot to be desired.

I struggle to understand why they don’t apply their holiday planning skills to their lives.

But that is OK. It is their holidays and their lives.

Doctors are great at this and it is what you want/need in a doctor.

How many doctors have great income (all) and how many create a Net Worth worthy of that income?

But that is OK. It is their life.

 

One piece of advice I'd give is don't try and get fancy with your investing at this stage in live - it's to easy to misread the market and have to start over (us 15 years ago).

Buy what people want to move "up" to when times are good - and "down" to when times are bad - good middle of the road properties in good locations. Don't be fooled into buying what "you" want to live in as your dream home.

If you're a bit handy, then look past the rubbish bathroom and god-awful orange paint. As long as the property is structurally sound, you can work miracles in value improvement with cosmetic renovations.

The hardest purchase will be the first one - you'll have a brain implosion will all the new information and decisions to be made. By the time you're onto your third then it's simply "where do I sign?"

 

I gotta finish the first book before I write this one.

Unfortunately, the sun and surf are getting in my way atm.

 

Please carry on.... i find the lengthy contents interesting

 

Mate if only portfolio management theory is so simple....this is just a theory! I come from a Project/Programme/Portfolio theory...hate to say it but t depends on the Project Leadership/Governance...I have seen the easiest projects stuffed up due to leadership. Look at the clown Morrison.....

It is not the planning which goes wrong..it is about people getting some basic education....and above have realistic expectations.

Once can become financially independent in 10 years but it requires a lot of sacrifices...but 20 years is a no brainer if done right.

Have a look on this forum ...so many people want to jump straight into development. They have no understanding of development. Sometimes the simplest things are the ways to make money....look at what @ellejay @MTR they are all doing simple projects no complicated projects where it will take 18 months to get money out...you need to get in and out quickly for flips and you need to buy quality with CF (look up Balanced Appoach) for the buy and hold portfolio.

@kierank .. if you follow the Portfolio theory...why are most of yours in just Brissie?

 

I'm glad of creating this thread, this is what I wanted to read.

Very interested points here, again, I think I didn't write the post in a way that it didn't sound pessimistic, also I'm not comparing myself to others here, I just wanted to read someone else's stories or insights. I always said that I am where I am at the moment because I decided to do so.

I think this thread happened because I have been having a lot of time in my hands (which is going to end this Sunday as I come back to work) and in addition we have "no money" I mean we just gave all of our money to pay the deposit of the house... and I don't like having no money lol.

I just know I need to be more patient as it has been just 2 months since we moved in and we have to do lot of things! You will continue seeing my in the maintenance forum asking silly questions about repairs and maintenance.

Thank you guys for posting really, I enjoy everyone of your posts.

 

Welcome.

What and where to buy is dependent upon your chosen investment strategy.

You see property is merely the vehicle. The strategy is how you intend driving that vehicle.

Unfortunately the mistake I see newbies and sometimes not so newbies is that they are property focused instead of strategy focused which is like putting the cart before the horse.

Property investing is not about property rather about the strategy and the way you intend to use the vehicle to get to where you are wanting to go. No good buying a small shopping car if you intend driving interstate on a family holiday.

What strategy/s are best for you is determined by where you are wanting to go, the time frame you want to get there in and how hands on along the way you want to be - all based around your personal risk profile.

If you dont know what you are looking for all property's will appear the same. Thus the confusion and frustration.

I hope this provides some food for thought.

What is your chosen investment strategy?

 

I agree, its like those that have a excel spreadsheet for projected growth for the next 30 years and they base their income/cg from it and work from that. (Like the LOE strategy)

I think those sort of planning is absolutely insane,
One deviation from the graph and all your figures are out.

I approach mine as a general strategy and not a plan,

Eg create as wealth through this means, and use the gains/profits in excess of $x to invest into something else for an example.

If i dont reach my target that my fault or bad luck or both

If i exceed my target, then i will use the excess for something else of my choice

I wish life were so predictable

 

I have found over the years that the clearer you can be on your goal/goals, the faster and greater chance you will have to achieve it. The brain is a remarkably amazing computer .. it somehow operates very differently when it knows clearly what you want to achieve. The more vague your goals, the more confused the brain gets and it doesnt know how to direct your thoughts in a way which will get you to where you want to go fastest. So it takes much longer to work it out and subsequently longer for you to achieve what you want. I have read similar countless times in autobiographies of all kinds of succesful people. I have also read the more technical explanatons of why the brain does this. It's truely facinating.

Long story short, planning, goal setting and trying to be clear on what you want has great value. You will always refine and add/change along the way, but being engaged in such a process is immensely beneficial imo.

 

Most people have a plan...but fail to deviate when required..100% agree with you.

You need to fail to learn..but quickly learn not to make the same mistakes. Another wards you have to fail faster...

 

Totally agree.

Did you miss this bit of my post:

As you would know, theories feed into methodologies. Methodologies give people processes, techniques, etc to apply the theory.

I taught people the theory, then a methodology and then helped them apply the processes, techniques, etc in the real world.

I hate to say it but it depends on more than Project Leadership/Governance. I have seen seen projects fail even with good leadership and governance. For example, external factors to the organisation.

As you know, there is a lot more to this stuff than good planning, good leadership, good governance, ...

So have I.

My first IT project was way back in 1977 that I joined as a PL/1 programmer. It was Stage 1 of a three stage project. It was an absolute disaster. I was still there for Stage 2. Total success. The difference was mainly leadership, the Stage 1 project manager was sacked and replaced with someone who was a competent leader.

Did you miss this bit of my post:

Holidays can be very simple, short projects.

Did you miss this bit of my previous post:

By the time I got a good handle on Portfolio Management, could run training courses on it and apply it to large corporates/government departments and then realise it could be equally applied to one’s life, we were nearing the end of our accumulation phase.

So too late for us but I don’t believe one should around and watch others make the same mistakes as us.

BTW, I need to correct you:- 52% of our IPs by value are not in Brisbane.

Sometimes @sash, I get the feeling you might have a reading and comprehension issue. Not good for a competent project/program/portfolio leader .

 

I actually never use the word plan, and hate it to be honest, when it comes to investing

The only things certain in life are death and taxes.

I think its very dangerous to set predictions in stone

But im sure no one here does that!

 

In my training courses, we discussed the three phases:

Definition => Implementation => Evaluation​

This is a DIE (a template) for repeatable success.

If one does NOT follow this approach, there is every likelihood that they will DIE (that is, fail or not be as successful as they could have been).

Totally agree

You been reading my posts .

 

+1

+2

 

You are learning many bad habits from Euro...is there a 2 line summary of this monsieur?