Glen and Pauline Moxham
How a Melbourne Couple Created $806,000 in Capital Growth and $162,760 in cashﬂow in just 3 years.
Both Glen and Pauline are 55 years of age and live in the eastern suburbs of Melbourne in Croydon. Glen was working for Baulderstone Construction as a building supervisor and Pauline was on a disability pension when Glen first contacted Wealth For Life Institute back in August 2014. Glen was earning an income of over $100,000 at the time but like most Australians, he was not getting his money to work for him.
Whilst he had paid off his own home and had a few investment properties, he and Pauline could not see how they could create financial freedom based on how they were currently managing and investing their money. Here’s how we went about creating a property portfolio for Glen and Pauline that will now see them both retire on a passive income stream of $200,000 per annum minimum for the rest of their lives.
Both Glen and Pauline had been burnt in the past buying investment properties that performed very poorly both in Melbourne and Queensland. If anything, their dream of retiring financially free had gone backwards. They relied on these properties to appreciate in value so that they could use the equity (the difference between the current value and mortgage) as a deposit to purchase their next properties. Not only had these properties not appreciated in value, but some had gone backwards and had no rent increase for close to three years.
By the time that Glen and Pauline met with us, they were extremely skeptical and worried about making anymore wrong decisions that at this stage of their lives, could spell disaster. Glen was extremely worried and anxious as he really didn’t know who to trust and had heard so many horror stories of organisations such as ours. As the only income earner for the family, he knew that it was up to him as a father and a husband to take care of his family financially. It required a very delicate and understanding approach from us as Glen was beginning to have many sleepless nights. We knew we could help him and Pauline achieve their goal of financial freedom if he was willing to take our expert advice.
We sat down with both Glen and Pauline and after getting a list of all their current assets and liabilities, and determined the timeframe in which they wished to achieve their financial goals, we developed a tailor made ﬁnancial plan and revenue model that would take into account the next 15 years of their lives. Their goal was to retire on an income stream where they would never have to worry about money again. They wanted to be in a position where they could go on holidays together, look after the kids, and live without any financial restrictions.
Our aim was to:
1. provide an income stream of $150,000 per annum indexed (in 2104 dollars) once Glen stopped working and 2. Ensure that both of them were debt free upon retirement.
We refinanced their existing loans, sold off any underperforming property (releasing debt obligations in the process) and proceeded to acquire a number of top performing properties for them that would not impact their lifestyle (take money out of their pocket each month). Whist this was done with much due diligence and careful planning, it made it comforting to Glen to know that some of the staff at Wealth For Life Institute had also purchased investment properties in exactly the same area and in fact same street as himself and Pauline. With the careful aid of our financial planners, we secured the appropriate life insurance, income protection and total permanent disability (TPD) insurance for both of them. We helped them set up a Self Managed Super Fund (SMSF) with the aid of our financial planning team and put Glen in touch with an accounting firm close to home that had his and Pauline’s best interests at heart. We used our astute team of property managers to look after Glen and Pauline’s portfolio giving them both headache free tenants each year with an increase rent at the commencement of each lease. In addition to this, we worked with Glen’s accountants to provide him with substantial tex refunds each year as a result of his investments. We also co-ordinated the settlement of each purchase with conveyancers, obtained very attractive loans for al purchases and worked closely with our builders to ensure that everything was delivered on time and on budget. The quality of workmanship and financial results was above everyones expectations.
Both Glen and Pauline have now consolidated their financial position and are allowing the property market to grow at a reasonable but predictable rate. In the next 5 years, we will commence a debt reduction strategy with both Glen and Pauline where continued planning, tax structuring and carefully selected asset disposal will see them both in a position where they will be debt free and receiving a passive income of at least $200,000 per year (in todays dollars) by the time they reach 63-65 years of age.
“I’ve been a property investor for many years but between work and everyday life, I’ve never had the time to really understand how to build my property portfolio. One day a work colleague put me onto Anthony Peluso at Wealth For Life and since then they have helped me build my portfolio from 3 investment properties to 10. They put together a goal orientated financial plan to map out where I am and how I get to where I wanted to be. Anthony and his team take the stress out of investing and building property, as they manage everything from the finances, to construction and even finding the right tenants. After investing with Wealth for Life Institute, I now have the freedom to live my life, knowing my family’s financial future is secure. For this, I can’t thank Anthony and his team enough.”