Samples from The 3 + 1 Plan

Overview

Would you like the financial security to do whatever you want when you want? Do you want to sleep easy knowing that you can retire comfortably and not have to sacrifice your lifestyle along the way?

The 3+1 Plan will get you there. It is a simple and proven way to secure your pension and lifestyle through property investment without wasting your precious time dealing with the day-to-day hassles and worrying about the market...

Whether you own property or ready or are just starting out this is essential knowledge for all investors. Now the 3+1 Plan may not be for you. in fact, most people will never read a book like this - they're far too busy working. Even the ones who do read this book, the research says, will mot do anything with the information.

The 3+1 Plan is not for those people. It's for the thousands of families I have helped over the years that are a real testament to the 3+1 Plan working. And It's for you...

3+1 is the destination, the end game!

I spend a lot of time counselling and offering advice nowadays, advice on what the next step is and how to get started and where to go from here. Regardless of what their questions are I always come back to one simple question. It's the most powerful question yet it's a question that very few people can answer with absolute certainty.

"What do you want to achieve?"

What is the outcome, the goal, the destination that you want to achieve? Most people give me a sort of; "This is what I don't want, and I think I want this and possibly I want that. " There's so much uncertainty in their voice that I don't believe they really know what they want. The 3+1 Plan will give you a specific goal. The 3+1 Plan is the destination, a clear and certain one at that.

Warning... This may not be for you

Before I go on, the 3+1 Plan is not for everyone; let's face it if everyone actually did achieve 3+1 properties there would not be enough homes in the world. Don't worry though we all know that most people will never read a book like this; they are far too busy working and even a good deal of the ones that do read will think: "great book -- I know I need to do something about it... I'll get to it tomorrow." Months will pass and nothing will happen. It will be forgotten and my efforts would be worth nothing except that I see the thousands of families that are living testament to the 3+1 Plan working.

The 3+1 Plan was born out of a conversation in 1999 that I had with Peter James. We were discussing what it takes to "practically" retire. He explained that you only needed your own home and three other buy-to-let properties to get into a position to fund your retirement. At first I thought that it seemed far too easy, only three buy-to-lets and your own home. So I ran the mathematics on some of my own properties and fopund that the numbers fit! Actually it worked out to be more money than if I had kept working. I went out that week and wrote about our conversation in my Financial Partners newsletter under the name "The 3+1 Strategy." I added the "+1" as an additional lifestyle option.

As I began to use the 3+1 Plan, I realised that it didn't always fit for every investor. Mathematically it was perfect, but as I built various clients portfolios I began to realise that no one -- literally no one -- was buying 3+1 properties and stopping there. I guess once they reached 3+1, having dealt with all the education and emotional issues, they would just keep investing. The plan was mathematically correct but that was before you factor in the human element.

The essence of this theory is to achieve a self-funded retirement and a supplemented lifestyle without having to spend a huge amount of your life creating the wealth. As I always say, building a portfolio should give you more life.

One of my clients named Martin would spend about 50 minutes per day driving to work in traffic and 50 minutes per day driving from work. He started at 9 a.m. and finished at 6 p.m. meaning that he would miss taking the kids, Thomas and Anna, to school each day. Once they had their portfolio set up they decided that Martin would approach his boss about changing his working hours so that he could take the kids to school and pick them up each day. He would be working from 10 a.m. and finishing at 3 p.m. This would mean that it would take him 15 minutes to and from work and also give a lot more time with the kids. Martin's quality of life increased dramatically as a result.

The only two reasons you would build a portfolio

I used to own a personal development company, I would travel around Australia presenting seminars and conducting teleconferences. Over this time, I met and spoke in depth with many different people; it led me to one massive realisation: people are primarily motivated by two things. They are motivated by the desire to increase pleasure and the will to avoid pain and if I am truthful, the avoidance of pain is by far a stronger motivator.

I learnt a lot about people running those seminars but personal development failed to address a big issue that was common to most people – the desire to be wealthy and abundant. My own interest in becoming wealthy and abundant, coupled with my career shift into property, led me to move into running property seminars. I was then able to use my public speaking skills to run courses that educated people on how to build a property portfolio. The same two motivators appeared again but both had a more specific and practical aspect.

The fear-based motivator of avoiding pain was in direct relation to the realisation that the governments around the world were no longer going to provide a suitable retirement. People are in real danger of being left short. It's this fear that has motivated so many to turn to people like me to help them to avoid the pain of an unfunded retirement.

Once you have successfully secured your pension (and avoided financial pain), you can focus on the much more fun task of enhancing your lifestyle. This is the increased pleasure aspect. This is what's driving me to invest in property; it's this bit I am passionate about. It's the 3+1 Plan. The "3" is solving the fear of an unfunded retirement and the +1 is the lifestyle.

Lifestyle is perhaps a harder task than securing your future. Not in terms of being able to spend the money but from the contradictory messages we have learned.

Being wealthy entails dealing with a lot of negative or antiquated programming; until we do this, the programming will impede our growth as a serious investor.

I remember Andrew, one of my mentors in financial planning. I don't know how wealthy he was but he certainly lived an abundant lifestyle. He told me that the first thing you will notice when you have money is that people will change the way they think about you.

I don't agree with him. As I have built my wealth I have realised that it's not the people around me that have changed it is just me that changed. I began to see that it's fine to spend money on expensive things or to splash out on a night out or stay in five star hotels. For me I had to get out of my scarcity thinking and begin to think abundantly. I am not saying that this will be your experience you will have your own lessons.

Throughout our lives most of us have been told that money is the root of all evil, that money doesn't buy happiness or that rich people are rude and selfish. This is apparent as I watch my clients' portfolios grow and I find myself dealing more with emotional and mental issues than actual technical or financial questions about property.

When you consider what lifestyle enhancement would mean to you, you will probably be surprised to find that what rates highest on your list isn't necessarily big expensive toys. Here are a few of my clients' most common reasons for building a portfolio:

• A massage every week in their own home (ok that one is mine)
• Dinners in fancy restaurants
• A weekly cleaner for the home
• Travelling once a month
• Staying in a luxury hotel rather than a budget hotel
• Business Class and First Class travel
• Babysitters on call
• Regular clothes shopping
• Catching a taxi rather than public transport

You can probably think of many more. The important thing that I realised some time ago is that whilst people may be turned on by the big toys (houses, boats, cars) it's the little everyday conveniences that make the true difference and increase the quality of your life now. Often you don't require a massive portfolio to achieve these. It's one of the reasons why the 3+1 Plan works so well.

One of the biggest lessons you can learn in property

"The real money in property is in the holding"

I remember a chat I had with Peter, he told me a story of a property that he bought and sold and made x amount of money on. He said he regretted selling it because about five years after selling it he found out how much more it was worth. He stopped and turned to me and said "Don't worry at some point you will learn the same lesson the hard way!" I replied "No mate, why would I ever sell a property."

I sold my home on the Gold Coast in Australia in 2002 for $580,000 having seen it grow considerably over the previous 3 years. I thought I had a great deal. Well I am happy to say that Peter was right. In about 2006 the property was worth about $1.1 million. I learnt the lesson well and since that day I am happy to say I have not sold a single property.