Michael Nemeth Blog

As a certified financial planner I run seminars on how to beat the banks with your mortgage and achieve financial freedom. I have principles that I apply to get a clients mortgage paid in less than 5 years. I usually get the same reaction from people who say they have seen this before. I respond by telling them that they won’t have seen what we do as the principles that we apply are very unique. By the end of the seminar the reaction is usually very different.
After the seminar I have people say to me that they have never seen anything like this before that is true as what we so is quite different. Another common reaction is that people say that can do for them is too good to be true. They can see that there are great benefit and value for them through our program but they are always asking what the catch, there must be a catch?
At this point I sit down and talk over their concerns. It think that is natural for some people to tread slowly with financial matters and I like to make sure that the client is comfortable before proceeding. I see it as my job to help them along until we can reach a point where they are comfortable. I recently had a client who took 8 months to come on board, but now he is on board really glad he did it. I am committed to ensuring that the clients feel comfortable.
Other people at the seminar will come on board really quickly and just love it. Everyone is different so as their financial planner I give them all the information and time that they need to come on board. Once they are on board we continue to support them to help to beat the banks with their mortgage and achieve financial freedom.
 

This month I attended a conference that a number of other Certified Financial Planners attended as well. All the Certified Financial Planners that attend all use the allocation based approach which is the same approach that I use in my business.  It was a two day conference that was based in Melbourne. You go and attend the course and get the opportunity to listen to lots of different presentations. I usually try and attend this once a year.
I gained lots of different ideas on how other people run their businesses. There was one Gentleman there that I found particularly inspiring. He was from the United States and had his own established financial planning business. He talked about how he had grown his business. It is now a very successful and prominent business over in the States. I found his story really interesting and I was lucky enough to have an opportunity to speak to him personally.
I really enjoyed the conference and think that it is very important to talk to other people in your area of business to get different ideas. I always enjoy discussing business with other Certified Financial Planners
 

At the moment I am reading a Jeffrey Gitomer book. It is called Little Platinum Book of Cha-Ching.  The book is really about business. It is about focusing on business to improve your profitability and your bottom line.
So far from the book I have learned things such as formal education will earn you a living but self-education will earn you a fortune. So really what I think that this is saying is a lot of your success, both on an individual level and a business level comes down to investing in your own time and your own education. I see this as investing time in things such as reading books that will help you improve your personal development and your knowledge in different areas.
I totally agree with this and I often use books for self education. Most of my books have highlighted sections, marked pages and note throughout the book.  I also like the post copies of inspirational things that I read on the wall or keep them in a file so that I can refer back to them when I need.
Jeffrey Gitomers books are really good for this. I have read quite a few of his books. Another favourite of mine is The Little Black Book of Connections which is about networking and the importance of relationship for your business and personal life.
Many of Gitomers books are about business but the principles can be applied to almost anything. I think that there is something of value in Gitomers books for everyone.
 

Most of our clients will often refer us to a friend or relative looking for an Australian certified financial planner. In fact, so much of our work is based on referrals I decided that it would be nice to reward the clients that have referred us to a friend or relative. If a client refers SGD Investment Strategies and we end up doing business with the person that they referred, we give them a choice of three rewards. The first is a dinner voucher for a great restaurant in Midlands that I like to take my family to, I was actually there on Saturday night for my Daughter’s Birthday and it was great. The second choice is a Gold Class movie voucher, which I think it is a real treat to go to the Gold Class movies.  The third option is a voucher for David Jones to buy something nice. All these choices are valued at $60. As I said most of the clients will refer us anyway but they get a very nice surprise when they receive the gift choice. I think it is really great to thank the clients that refer me as a certified financial planner as it is a very important part of our business. 

As a Certified Financial Planner I have been asked about the current mortgage interest rates and if I believe they will continue to rise. As a certified financial planner I don’t try to forecast rates. 
What I do for my clients is highlight is that no matter what the current mortgage interest rates are, it’s expensive having a mortgage. The interest on a mortgage is non-deductible and you need to first earn an income, pay the tax, pay the interest to the bank, and then finally the remainder of the mortgage. 
Even though the current mortgage interest rates are costing the clients more at the end of the day the story is still the same. The fact is that you’ve got to earn the money, pay the tax. You then pay the bank their interest, and then pay the loan. Usually it equates to about three dollars for every dollar borrowed.
What I do as a certified financial planner is to work with a client to get the mortgage paid off as quickly as possible. I do this in a very unique way that has proven success stories.
Essentially I just want to highlight that regardless of the current mortgage interest rates it is still possible to get the mortgage paid off quickly and this is the best way to beat the banks on interest rates. That is my focus as a certified financial planner.
 

As a Certified Financial Planner Michael runs seminars each month to show clients how we can beat the banks, pay off their mortgage in less than 5 years and achieve financial freedom.
The seminar is aimed at clients who are feeling hamstrung with their mortgage and want to achieve financial freedom. A typical mortgage is over 25 years. The general principle for a mortgage is that you have to earn three dollars to pay off every dollar of your mortgage. By the time clients have earned the money, paid taxes on the earnings and paid off the interest, many are finding that they have very little left over.
We just highlight what it’s costing the client in terms of their pre-tax dollars, and how they would be far better off having some form of investments as well.  When we do the numbers this will cost them around about thirty cents in every dollar to actually fund that investment, and we use the investment in ways that will help pay off the mortgage as well. So we’re looking at the typical mortgage being paid off in less than five years. We’ve had clients that are actually paying off the mortgage quicker than that.
We do the investments in a way which is lower risk. It is a combination of focusing on reducing the mortgage and getting some investments for the client, so they’re not missing out on opportunities .This means at the end of the mortgage they will not only have a home to show for it but investments as well. These investments can continue to make money for the client and how far the investment grows is really up to the individual client.
Certified Financial Planner Michael has helped many clients beat the banks, pay off their mortgage in less than 5 years and achieve financial freedom with his proven methods.
 

The more your certified financial planner knows about your affairs the more the planner can help you to financial independence.
It stands to reason that not giving the full picture doesn’t help you and yet people sometimes show reticence about disclosing their affairs.
In a way this is understandable because we are all inclined to regard our money as a private matter. But it is no good being private with your planner.
If they are going to give you the right advice they need to know a lot about you.
A planner offers you encouragement in terms of getting a better salary, or improving your business. The planner’s role is all about helping you to earn more. So help the planner do it.
Having the right planner means continuity for your family if anything should happen to you.  Your whole financial plan will be set out, all the strategies in place. The planner can pass that knowledge and history and the client’s portfolio on to the spouse or the children to make sure your affairs can be managed in a proper manner.
If you make a friend of your planner you can use him or her as a sounding board when you have your own ideas about making money.
The simple question is:  “What do you think?”
 The planner will then test it against your overall investment portfolio and give you a straightforward answer.
If you try the same question on your family all sorts of hidden agendas may arise. Anxiety on someone’s part may turn you off a really good idea.
Choose wisely when you look for a certified financial planner. Experience is essential but so is someone to whom you can talk openly and freely.  The planner deals in facts. Make sure he has them.
 

Some people would rather struggle along on the meagre returns on a savings bank account than risk investing any of their money. These kinds of people seem to fear any change even though it would improve their lifestyles considerably. Using a certified financial planner can help.
People who finally come to seek planning advice begin by being very doubtful about the advisor.
They have usually been referred by those who already are clients of the planner but they still show a very limited trust. Who are they dealing with? Are they reputable? Am I safe to put my money with these people?
Until they have satisfied themselves that they are dealing with someone of integrity, who has a reputation for honesty and a proven track record of success they won’t invest a cent.
Then there is great fear about losing their money. They need a great deal of reassurance.
Some questions to work out a clients risk profile. What is their appetite for risk? Do they prefer to be in growth assets which have a higher risk or more defensive assets that have a lower risk?                                                         People are all different. It is not wrong in any sense to be investment wary. For many the whole area of financial advice and money making is an unknown country. They are still thinking in another century when you worked for a no-frills wage and saved your money in a no-frills savings account but so much more can be done.
It has to be something the client is comfortable with before they will allow any investment.
Of course the client must be made to realise that there is always some risk involved. Reward is always relative to risk. There needs to be a right fit between their risk tolerance and the type of investments that the certified financial planner makes for them.
 

To be held at: The Medina Grand Adelaide Treasury Corner King William and Flinders Streets Adelaide SA 5000 at 6.45pm on Tuesday 8th of April, 2008.
 
 
Here’s what you will discover at the seminar:
 
►        The 4 things that are keeping you from creating wealth.
►        It is possible to pay off your home in 5 years or less and create wealth at the same time without additional payments*
►        Little known (Legal) tax minimisation strategies that will save you a heap in tax.
►        How to save thousands in interest.
►        How to get rid of and no longer suffer from Mortgage Stress even if interest rates rise.
 
►        How many houses you have actually paid for over the life of your 25 or 30 home loan term.
(I guarantee you will be upset!)
►        Why our strategy does not compromise your lifestyle
►        How to get invested and start creating wealth, even with a mortgage.
►        Plus More
 
The seating for the seminar is limited. Please call us now on 1300 881 456 or simply email your full name and address to
 info@proinvestmentplanners.com to reserve your place and I will send you out a ticket to attend this exclusive seminar.
If the lines are busy please try again.

Seminars are held each month for more details please contact Professional Investment Planners

Of course everyone gets the same interest and expertise that a certified financial planner can give, but some people are so happy with the right advice that they stand out.
I am thinking of the ones I call my perfect retired couple.
They first started off with me when they had their own business.
Through their business they started to accumulate investments. They had investments in their own names, in their family trust and in their fund.
When they sold their business they were able to retire and now they live from their investments.
They did not have to dig into their capital very much at all. They have had a really good income stream in retirement.
Now in their early 70s they travel a lot and have a good lifestyle.
It’s a real delight to see them every time they come in for a review of their investments, usually every six months.
Sometimes they have such a good busy lifestyle that they are hard to contact. They can now spend their time doing what they want to do instead of working.
I find this happens with a lot of clients. Their lifestyle in retirement is full of interesting things happening and they don’t have money worries.
 

For many people paying the mortgage is a monthly nightmare. It is a relentless grind to find the money and with interest rates rising it just keeps increasing. The loan itself just seems to remain much the same in many cases.
Over the say 25 years of the life of a loan the borrower needs to pay double or sometimes three times the amount borrowed. Of course the borrower has to earn the money first. He has to pay tax on his earnings. It is the after tax money he uses to pay his mortgage. So it is not just the interest the bank is charging. It’s also about the tax the borrower is paying. It is an extremely painful position for people to be in.
I find that most couples that come to me for advice are really just working to pay tax and to pay the bank. All the focus is on earning income and paying the mortgage. There are usually no investments to provide for their future or give them financial freedom to do what they like.
By the time they have cut back on everything possible, even selling the car, their lives have turned to drudgery. I offer them a different approach that does not impinge on a normal lifestyle.
I ask them to put 1% of their income against the mortgage. For instance if their mortgage is $200,000 I would ask them to put $2000 to their mortgage each month.
I had one client with a mortgage of $193,000 on which they were repaying $1400. 1% of income brought it up to $1900. The rest of their after tax income was for their lifestyle.
I take care of the mortgage through tax minimization.
One couple who came to me had some money in the bank and a big mortgage and didn’t know what to do with the extra money. The husband was earning a good wage but paying a lot of taxes, the mortgage on current payments was going to take 22 years to pay off. Through the advice I gave them it will be paid off in 2 years. They have been able to invest and are starting an investment portfolio. The portfolio is protected because their home is involved and I don’t want any risk for my clients.
Getting ahead is all about saving tax and getting your money working for you as much as your resources allow.

There is a curious law of nature in the world which is not quite understood, but it shows that 20% of the world’s population tends to have 80% of the world’s wealth. No one knows why this is so but when it comes to wealth creation and getting ahead, you really need to focus on being in that top 20%. How? What is the best way to do it? First of all look at the way forward. See where you want to go. What do you want to achieve? What are your goals? Make a list. If you then go to a certified financial planner you will know what you want to find out. The planner in turn brings to the table a background in finance, and all the knowledge and experience that has been built up over the years. The planner will help you work towards building that wealth. The certified financial planner will teach you to value discipline and not to rely on emotions to guide you. One of the worst ways to handle shares for instance is to be emotional. Say you have some shares and the price drops. The emotional client will often sell unwisely. Basing decisions on emotions in the market doesn’t work. Over the long term markets deliver the returns. Markets include property markets as well as shares and managed funds. History shows us that if you’re patient and disciplined the rewards will come.

Getting your mind set on the right track to a wealthy life is an important step forward. You know you want to be wealthy and you know others do it all the time but how? What’s the first step? Well reading inspirational books will often get you started. Before you invest a cent towards financial independence do some research which will probably only cost you a little time at a public library. The first book I would recommend is “The One Minute Millionaire” by Mark Victor Hansen. It is both for those who are analytical and those who are more creative. The left hand side of each page tells you about the nuts and bolts of getting into the right frame of mind. The right hand side tells the wonderful story about a person who had no money and for very strong reasons went on to a wealthy life. The next book I would recommend is Robert T. Kiyosaki’s “Rich Dad Poor Dad.” It is the story of how Kiyasaki grew up in a family where his father was a teacher and found it very hard to get ahead. They were not poor but on the poorer side of life. However he had a friend whose father was wealthy and this man taught him the value of money and the importance of cash flow. There is always cash flow if you are employed. It comes from your salary or business but it is what you do with this money that counts. He tells how getting rich is to do with attitude and Robert realises that rich people or potentially rich people think differently and shows us how they do it. The third book worth reading is “Added Twenty Principle” by Richard Cart which focuses on what is important to you, and using your time well to get ahead in life. It also touches on your personal life and its importance. The last book on my list is the famous”Think and Grow Rich” by Napoleon Hill written in the early 1900s and somewhat hard to read. But its wisdom is perennial. Actually there is an Anthony Robbins CD interview with the author which brings out all the points in the book so that might be an easier way to access the information. These books will all help you so to paraphrase Napoleon’s title - Read and Grow Rich.

There are many reasons why a person would invest, there are also many different resons why people do not invest.  One of these reasons is fear.  In this audio you can hear me talk  about some of the fears my clients come to me with, and what I do to help them.