Property Hub - Investment Insights & Inspiration - Get Invested: Part 1 - Michael Johnston on asset investment

Episode Date: December 1, 2023

Understanding access versus ownership as well as opportunity cost is key for investors. You have the option to pay less of your hard earned cash now to get access and control over an asset, while your remaining monies are invested elsewhere. By putting on a pair of investment glasses you can start to make your financial decisions differently, by asking yourself: How can I control and enjoy access to this asset now at minimal cost, while freeing up my funds to invest in other high growth opportunities? To talk about this and more is our guest, Michael Johnston.  Michael is the Director of National Direct Finance and a top asset finance broker. In an environment that is getting increasingly more complex and overwhelming, Michael and his team combine decades of experience across multiple lenders and loan solutions, helping you source, structure, negotiate and deliver the best available result to suit your specific needs. This week we unpack Michael's personal journey before we deep dive into the detail of asset finance in next week’s episode. Connect with Michael: www.nationaldirectfinance.com.au New - join our Facebook group, The Property Hub Collective: https://www.facebook.com/groups/1857513011165686  Join the Property Hub community on Substack! Sign up to get Australian property news, opinion and episodes in your inbox: https://propertyhubau.substack.com/  Three easy ways to Get Invested right now: Subscribe to this podcast now, if you haven’t already, and get the inspiration delivered to your podcast feed each week Get a copy of my book, Get Invested, for FREE, and find out what it takes for you to invest in living more, working less. Go to: https://knowhowproperty.com.au/get-invested-free-ebook Join the Get Invested community. Each month Bushy sends a free and exclusive monthly email full of practical ‘Self, Health and Wealth’ wisdom that our current Freedom Fighter subscribers can’t wait to get each month. Just visit bushymartin.com.au, scroll to the bottom of the page and sign up. About Get Invested, a Property Hub show Get Invested is the leading weekly podcast for Australians who want to learn how to unlock their full ‘self, health and wealth’ potential. Hosted by Bushy Martin, an award winning property investor, founder, author and media commentator who is recognised as one of Australia’s most trusted experts in property, investment and lifestyle, Get Invested reveals the secrets of the high performers who invest for success in every aspect of their lives and the world around them. Get Invested is part of the Property Hub podcast channel, your home for property investment insights, inspiration and stories from Australia’s top property experts, investors, leaders and analysts. Subscribe now on Apple Podcasts, Spotify and Google Podcasts to get every Get Invested episode each week for free, and also get full access to RealtyTalk, Australia’s top online property show for red hot property investing news and insights direct from property industry leaders and influencers. Property Hub is a collaboration between Bushy Martin from KnowHow Property, Kevin Turner from Realty, show producer Andrew Montesi from Apiro Marketing and Apiro Media, and Australia’s largest independent podcast network DM Media.  For business enquiries, email [e-mail] omnystudio.com/listener for privacy information.

So in the early days, it was buy a house, you know, then you go through that change of having kids and then it goes through, you know, being able to spend time with the kids. So money changed from having that necessity in just doing what we do all day, every day. And then as time went on, money changed. So, you know, that's where money becomes, well, how can I make money from money? And where am I going to be able to best use my money? Money became more important because I could see what would happen if I invested a dollar, I could get two or three back. So it was always a learning curve of what money meant,

how it changed and how it could benefit you. So now money is, well, to best use my money is to work out how I can make more money off that money to ultimately not have to be involved in the thing that generates it welcome to get invested on the property hub podcast channel the leading weekly show to help you unlock your full self health and wealth potential i'm your host bushy martin and each week i go deep with the best investors experts leaders and founders to find out what it takes to break free from the grind discover freedom and live by design. Subscribe now and join me and get invested in the life you really want. Let's get started.

Hi Freedom Fighters. What does the concept of access versus ownership mean to you? And what about opportunity cost? And what's any of this got to do with investing? Well, you're going to be surprised. Many of us have been brought up to believe that cash is king, that you should pay cash for everything because you should never ever owe anybody anything. But does this approach really stand the test of time? For many this is clearly not the case when it comes to owning your own home. If you waited until you'd saved up enough of your hard-earned cash to buy your home you'd be dead and buried at worst or old and grey at best. So clearly when it comes to our homes early access is more important than ownership because until we pay off our home loans which

normally takes anywhere between 25 to 30 odd years, our homes are actually owned by the bank. But by taking out a home loan, we only need to put down anywhere between a 5 to 20% deposit to control the asset. And for this, we get early access to our home as a precursor to deferred ownership at the cost of the interest we pay on the loan. And this leaves us the remainder of our savings and our earning capacity to be invested in other things, like an investment in property, which is where the concept of opportunity cost comes into play. In simple terms, opportunity cost is the value of the next best alternative when you make a decision. It's what you give up when you take when you make one decision over another. So let's apply this to your

car. You could use your savings to pay cash for a car, or you could finance it with a small deposit and tax deductible monthly repayments if you use it for business, and then invest the remainder of your savings funds into wealth-creating growth assets like shares or property, or you could keep them in a reserve as a rainy day reserve fund. The opportunity cost of paying cash for the car is that you lose the opportunity to invest the rest. And this is where the benefits of access over ownership and opportunity cost actually come together. You have the option to pay less of your hard-earned cash now to get access and control over an asset, while your remaining monies are invested elsewhere. By putting on a pair of investment glasses, you can start to make

your financial decisions differently by asking yourself, how can I control and enjoy access to this asset now at minimal cost, while freeing up my funds to invest in other high growth opportunities? Now clearly, you have to do a proper cost benefit analysis to look at the true cost comparisons of your options, once all costs, including inflation, etc, are all factored in. It's the reason that my partner in all things Sonia and I, rent-fested for many years when we started in property because we could live where we wanted to at a fraction of the cost of buying a property in the area, while our savings and finance capacity were put to better work by investing in rental properties, where the tenant and the tax office hit all of the heavy lifting and carrying the

cost of holding the properties. It was about making our money work harder and smarter. Now, I'm not suggesting that you just go out and buy everything you want now and stick it all on bad debt credit because this is going to restrict your good debt property borrowing capacity as every dollar you've borrowed via a credit card or a personal loan will reduce how much you can borrow on a property by anywhere between four to seven dollars depending on the lender. And certainly don't take out a big car or equipment loan in the year that you're looking to buy to borrow monies for your next property as this is likely to really clip your wings. But for assets like work cars, vehicles and office equipment that can attract tax and cost

advantage incentives financing them cleverly and carefully and free up resources and funds to invest in other business and or wealth building opportunities and like everything done well the devil's always in the detail here which is where today's special guest comes to your rescue because when it comes to asset finance you need an experienced expert specialist not a generalist and because generalists do a little bit of everything and end up knowing actually enough to be dangerous all at your expense. Now, one of the benefits of actively working in the property finance and investment arenas for many years is that I get to rub shoulders with some really great quality people. And I can count on an amputated hand the number of asset finance

brokers who are not only great at what they do, but share my values and are great people to boot. And today's guest is definitely one of them. Michael Johnston is by far the best asset finance broker I've ever had the pleasure of dealing with. I first met Michael just under 20 years ago, would you believe, which when he actually helped Sonia and I with our work vehicles when we owned our property management business. And we were so impressed with how he looked after us that we've been referring others to him for their finance vehicle needs ever since. Because Michael's not just a one hit wonder, fly in, fly out, one crack of an instant success asset finance broker, his genuine care and long-term relationship approach extends to the level that when I bought

my last black beast Bushmobile in Adelaide a few years ago, he went above and beyond to put me in touch with a car dealer in Melbourne, where I was actually able to buy the car for $10,000 less than I was able to get it in good old South Oz. So in an environment that's getting increasingly more complex and overwhelming, Michael's the director of National Direct Finance, who combine their decades of experience across multiple lenders and loan solutions to help you to source, structure, negotiate and deliver the best available result to suit your specific needs. So I'm really excited to unpack his personal journey this week before we deep dive into the nitty gritties of asset finance in next week's episode. So welcome and let's get

invested, Michael. All right, thank you very much. That's a fantastic intro. I think it's probably better than the intro i got at my wedding thank you very much well mate it all comes straight from the heart mate and and i i don't make statements like that uh easily or or otherwise mate and so it's uh all the the absolute truth and in no certain terms but mate i'm really uh privileged to have you on the show today because you and i have been rubbing shoulders uh a fair bit over the years and to actually spread the word of your message to others that have similar needs, very keen to do that. But I guess to kick things off, Michael, in terms of a personal introduction, let's start by getting you to tell us what you do differently and more importantly,

why you do what you do, mate. Yeah, thanks, Bushy. Thanks for the opportunity as well. It's a pleasure to be able to do this. And as you say, we've worked together for a long time and I too, like you i work i've been in the industry for 20 odd years i work with a lot of people um but there's only a few that i've actually truly um invest time and effort into uh because of those um you know similar uh beliefs that we have in the way that we want to look after our our customers and our people within our businesses um and have the opportunity to be able to you know spread what we believe back to back to our people so mate thank you so i guess where my journey is in as far as my business so we're a multifaceted asset finance business so by that or finance

brokerage so by that i mean we look at so not just cars and equipment uh machinery but once upon a time it used to be simply if it had a serial number on it we could finance it and i have to point out we don't do home loans uh so it's not in our wheelhouse it's not what we're good at and all the finance isn't equal. So from that perspective, we stuck to what we know. So my background comes from cars. I left school as a motor mechanic, saw all these guys in suits and dealerships and thought that would be nicer than wearing my overalls

and getting dirty every day. Eventually got into sales through just doing things that I now realise were where my business was heading, what I wanted a future business to look like. So I did things like car shows from the workshop, you know, I'd be in the workshop in the morning, go to the Melbourne car show, for instance, was on for a week in the city and we'd spend that time hassling the sales manager to try and get a chance to have a go

and talk to people. And from there, it just came about relationships and experience and I really got value out of people engaging and accepting the information that i was giving them um so went through a career and don't hold it against me but it went through a career in car sales um and then into running dealerships and and then eventually into my first experience into an online finance brokerage and having had some experience through financing the dealerships um this was kind of a new thing it actually opened up my eyes to the the fact that I didn't have one product to sell anymore.

So if people walk into a dealership, their intent is, the dealership's intent is to sell you the product that they have on the floor and not let you leave until you do. So for all intents and purposes, their product is the best product and no one else out there matters. So they'll tell you why you should buy their car and why theirs is so much better than theirs, better than the others.

And then if you're successful in buying that car, then they'll try and sell you aftermarket. They'll sell you finance. And it's all about selling a car, their car that they have in stock. So getting into a brokerage after that really opened my eyes to the fact that I can actually talk to people about a lot of things and it wasn't one lender, one bank, one product. It meant I had opportunity to actually help people.

So obviously, yes, my role is to sell a product and I don't make money unless I sell the product. it was at that point where i had the ability to choose the products and choose for the benefit of the client and probably in the early days it was a case of what we're learning it's these are the products we've got through the lenders and so we would sell and then as time went on and i was more experienced got to really understand what a broker's role was and then as a broker our job is to broker we're we're not there to sell a product we're there to find the best product that suits the client's needs get the the best result for the client and that may not actually mean it's

the best result for me so by that i mean it might not be the lender that gives you the most commissions it might not be the lender that that gives me the best kickback somewhere down the track but more about making sure that client got what they were expecting to get before they came to us and sometimes it's not a case that the customers know exactly what they're after either So as an education piece, we need to take on that knowledge and confidence for the client to make sure that we understand what they're looking for and give them the confidence that we're helping them make that decision.

So what they came in for might actually be a not quite the right product. And that's a real skill is because people, when it comes to anything like this, you know, as I said in the intro, often know enough to be dangerous. Yeah. And they think they know what they need, but once you open their eyes to the options and the pros

and cons of what's on offer, then suddenly there's a bit of a penny drop moment there that they go, okay, well, now I really understand what I need. So that's a really important part of it. What I'd like to do briefly, Michael, is circle back to when you made the change from selling cars to moving into the finance area. What attracted you to do that?

What was the thing that sort of got you to think, oh, gee, I think I'd have more fun and more satisfaction out of doing that? Can you remember? Yeah, look, I sort of agree. I touched on finance in the dealership and I found that that was the part of the process. We actually got to know the client better, not so much that they were there to buy finance.

They were there to buy a car. Finance was a separate thing. and we got to get closer to the clients in the finance department more so than the sales department. So it kind of taught me a different level of relationship and really trying to identify what people's needs were because we all know when someone comes into a dealership, they need a car, you know, and you've got that ability

to sell what's there in front of you and nine times out of ten, people are coming in there because they've already seen it and liked it and done their research. so from a finance perspective again they didn't really know what they needed we were an add-on to the sale and to a smaller degree we had to fight for that opportunity because they might have had relationships elsewhere but as I say the dealership side of things was again just sell the products that you've got you're rewarded on what you sell there's certain KPIs between all the departments and so I guess once I left that environment I didn't really know when I got

into the finance brokerage world, that that's where I was going to stay. And ultimately, when I left, I went to a brokerage owned by a gentleman that I'd worked for before or worked with before in a previous dealership. And he said, just come and sit in here while you're looking for something to do and, you know, just take your time and if we can help you find what you're looking for, fantastic, but come in here and do this.

And that's where I say that was the eye-opener because all of a sudden I had products. I had the ability to be more open and honest with clients because it wasn't just, oh, my product's the best product. Here's a bunch of lenders. Here's a bunch of options. And here are the differences between those. It might not just be race.

It might not be, you know, the name of the brand of the product. Once you drill in and talk to the customer and understand, you know, what they wanted, how they were going to use the product, what their long-term goals were going to be, you might have been able to then suggest products that best suited that scenario. So you went away from being transactional to actually understanding it and then have a more holistic idea

of what you might be able to do with the client. And I guess the way I'm built is that I'm looking for a long-term relationship. So it wasn't about, hey, I can just sell this product now and never see the client again. It was, okay, if I can sell this product now and I do a good job, the customer appreciates it and we achieve what they were hoping to achieve,

I might get that opportunity again or I might get a referral or, you know, family or, you know, it's more of a holistic idea. And that's something I really appreciated. And so at that point, that's when I thought, okay, finance brokerage is where I want to end up. yeah i know you've had a few ducks and weaves uh sort of taste testing other exercises and ended up back in the breaking space so take us on that journey mate tell us about uh what you

decide why you decided to do something else for a period and then then what's brought you back into into the space that you're so good at yeah look i guess it's like most people we do something for so long you become bored by it you think you've reached as far as you want to go or you just burn out you've just gotten to the point where you think where is my future in this there's less opportunities coming about less opportunity to earn an income or a better income so then you have to start looking either sideways or staying within the industry and doing the same thing but somewhere else and then hopefully at a different level to give you more opportunity again in the future um so i um i'd have did that i uh gfc hit things were pretty tough in in all sectors

i had some friends that were in franchising and um we sort of talked a lot looked at what they were doing how their businesses were affected by gfc um what they did in their businesses and And a lot of it was around relationships, so building relationships with franchisors, building relationships with franchisees, teaching their people how to have relationships with their customers. And so it's really more down my pathway as I was getting a bit tired of where I was and not doing what I wanted to do. So I got into it.

And I always say to people, I got into franchising. And so people are engaged and think, oh, that's great. I've worn a suit all my life up until I was about 30, 32, suit and tie, shiny shoes, cufflinks. And then I said to people, I bought a dog wash franchise. So everyone looked at me madly and a bit puzzled and couldn't quite work out what I was doing. And then we explained.

We actually purchased the Australian New Zealand rights to this franchise model. and our role was to basically bring franchisees in and build a brand, which was already a well-known strong brand in the country, but it was a division of that brand that needed some growth. So from that perspective, it was a bit of a challenge. With two partners, three of us in total,

we thought the three of us could run those or that business while each ran their own other franchise business and I stayed in finance. But we found that it was probably out of our comfort zone. It wasn't, whilst the franchise model was the same that these two guys had grown up in and, in fact, had developed themselves to a large degree, the product itself was somewhat different.

So different people, different style of selling and probably more emotive than what these other businesses that they owned were. So it took us a while, probably took us six months to get our heads around how that had to work, which meant one of us had to leave the jobs that we were doing. And then given that the other two partners owned their own businesses, it wasn't going to be that.

And so this was my first full foray into running my own business. And we did that, or I did that for the fact that I just wanted to, again, just take that next step, wanted to apply all those things that I'd learned through corporate world and try and make that, make something of it with putting my own stamp on it. So I got into that world and loved it. It took me a long time. It took me a long time to understand the industry

and the emotions within that industry. and but ultimately what it came back to was um our style of selling my style of selling was the same no matter what i did and also the way i treated people and and be staff or franchisees or other franchisors um the philosophy around how i sold didn't change yeah so i had to learn the product and understand the product a lot more but I didn't really have to change what I already knew and that was the exciting part was once that penny dropped we were able to teach dog groomers how to run their own business and and how to be profitable and and probably the only other thing that came out about that was people's expectations you know what was success

um you know if if someone was investing their time and money into their business what what i thought was successful uh didn't necessarily mean what they what wasn't their same vision of success yeah um so we had to or i had to learn how to to change with that so we'd have some people that could earn 50 or 60 thousand dollars a year and that was fine in my mind we had models that would allow them to double that income and I couldn't understand why I was getting resistance when I was asking them to try different things to be able to earn more money but once we understood where they wanted to be in life and what was success to them then you know we had better relationships and and more successful people out there yeah it makes sense what what circled your

back then into the asset finance arena? Yeah, so with the franchise, we actually sold it probably five years sooner than we wanted to. I brought one of my partners out. We were looking at expanding the business, looking for either investors or other opportunities to cross-network the business. We looked at some of the big pet suppliers in the country and started having a conversation with them.

But because it was a franchise, that limited their ability to grow the business in the directions they wanted. So one day we spoke to the owner of the franchise brand and he made us an offer to sell the business back to him, which meant we were selling five years earlier. The business wasn't in a position where we thought we would have it at a sale, but we were offered an offer that was good enough to convince us to sell it.

And unlike any other sale of a business, it was done within three or four days. So from the day of offer to the day we had the check was very, very quick. So that prompted that side of it, and it was just a timing thing. It was either invest more money into it and stick around for a while or take this opportunity now and then go and look at other areas. And I guess what brought me back into the finance

was I never quite left it. So whilst we were talking to franchisees and we were looking for funding to get them into their business, my background sort of kept me involved in that side. And there were still customers that I always dealt with that wanted support. So they would come to me before going anywhere else.

So I would still broker the odd business here and there. Yeah. And then I got involved with somebody who I'd worked with in the finance brokerage prior that had gone out on his own and had a business that was going okay, but needed some help. And whilst I was doing my finance, I was referring business back to them. And then the opportunity came up to help them grow their business. And again, that was a short-term idea. and then eventually having gotten involved, having rebranded, having just changed that business the way it ran.

I thought I've invested all this time and effort and money now. I might as well go and do this. So I actually started or joined National Direct Finance and we set up a division in Melbourne. They were a Queensland based. and then our role was to help develop brokers, young brokers coming into the industry to run their own brokerage, which again should have supported my passion

in helping people grow their businesses. But I did it now in a franchise, sorry, in a finance environment and gave me the ability to put the two together. Yeah, brilliant. Brian, I want to circle back now, Michael, if we can. Yeah, now, if you can still hear me there, Michael. Sorry, go again, mate. Sorry, yeah.

I just want to circle back to your childhood, if I can, because often our families have a big impact on how we think, look and act in the world. So how has your upbringing affected who you've become, do you think? Yeah, I think I was lucky. Yeah, different, and it affects different people in different ways as well. So I won't suggest that, you know, my brother had the same experience doing what we did, but it somehow suited me.

But my father was in the services and we travelled a lot. And we would find ourselves, you know, spending some time in Australia and then Southeast Asia, getting to travel a lot out of Southeast Asia, coming back to live in Australia. And Dad really enjoyed Hong Kong, Southeast Asia area, and had done some work in Singapore and Butterworth for a fair bit of time in Hong Kong. And so he would circle back to that.

And I'm probably, you can see now I'm an introvert. I find it hard to talk to people. i uh i um found that i could actually reinvent myself as i went so i wasn't into it i was a shy kid i didn't have trouble making friends but i didn't um once i was in a bubble i would stay there um so each time we changed it gave me that opportunity to reinvent and and again if i look back at it now it was teaching me selling the whole time so it was teaching me or teaching me a relationship so i don't know it's called selling selling it's you know relationship is is selling in in my book we you know we've all done it we've all you know probably had

girlfriends you know got engaged gotten married um that's selling uh because in one way or another we've had to sell yeah um so i think it gave me that that confidence um that that okay that didn't work so now what do i have to do to to be who i want to be uh and so there's a lot of like when we're all young we're always looking to try and work out who we are in life and and i think that just accelerated things because it just gave that opportunity to to do it um and as i just taught you some resilience it taught you that hey not everyone's going to like you not everyone's going to um uh want to be a part of what you do um and and we had two years to deal with it most of the time so it was you had a posting for two years and then you were gone and this was before facebook

and instagram and and all those things and and i wasn't much of a writer so once we left a place the pen pal thing might have worked for a you know a year or a month or two but outside of that you dropped off pretty quickly yeah i'm right there with you i'm very similar and i i think the adaptability that comes out of constantly moving to new locations and travel and having to establish new relationships uh you know i'm you know everything you're talking about it resonates uh with me personally very similar in that regard but i if we look at look back on at that time, Michael, what are the sort of core values and beliefs that emerged from that and how they influenced

your life ongoing? Yeah, look, I think there's three, and they're probably fairly standard things, but it's how you use them, I think, is the important thing. So honesty and integrity are probably the two key ones that I tend to think are the most important. In fact, if I pull it back to those two, you know, I think that's your foundation.

Yeah. And outside of that, sure, we were in a place for a short period of time, and I guess you're treated a bit like Facebook of today. You can get up and you can slam anything out there that makes people think you are what you are when clearly you're not. And to a degree, when you travelled a lot,

you had that same ability, but you were grounded in that same place. So you got found out pretty quickly. um so so they're probably a couple of things that i i hold as a high value um and and they're not negotiables it's it's you know there's honesty in you as a human uh there's honesty in how you operate your business there's you know honesty in the way that you treat you know your family and and within honesty comes integrity so you know you you have to look you have to believe in yourself and what you do and and i think if if that's your core and you stick to it and you

believe it then it's it's not something you work towards you know it's just there and and to me it's that foundation 100 and honesty and integrity uh at terms that are thrown around very loosely sadly it's easy to do yeah yeah but the reality of of that and living that uh and then being happy to have hard conversations and say no and be brutally honest in in times when it's important and i you know but we talk about our business uh we we have a brutal honest policy so you know we we have a a regular keep stop start session with our team where we say i want you to keep doing this i want you to stop doing that and i want you to start doing this uh and and we often say that if you find yourself at home talking to your partner about something uh or someone at work

and you haven't had that conversation then there's an issue uh so you're creating an environment where that that form of uh direct uh honesty is is both respected and appreciated is is really a foundation stone in our self-belief because if we if we believe in that ourselves and that that tends to emanate in every interaction we we have with everyone else so now i love you sharing that mate while we're talking about the family what's a funny story yeah that your family tells about you that you'd love to share with us man um they pick on me a lot but i don't know there's too many funny stories i don't they don't think i'm funny full stop but um there's one that comes up whenever we catch up with a friend of mine that um everyone in the family is is embraced and we

We might have probably added a bit of mayo to it over the years as well. But coming from a service family, you're often mixed with service kids in different areas. So we were in the western suburbs of Melbourne. There was a community of service people that lived in, you know, a block vicinity of each other, being in housing commission homes. and we tend to have the same sort of upbringing. You know, you're here, you're there.

These kids might have been there for six months at the end of their tenure and, you know, you've just arrived. And so they mixed around and we connected with this one family that are from Queensland. We'd just come back in from Hong Kong and primary school, again, we just connected. and it was probably because of the service piece, I'm not sure, but we were probably only one of a couple of kids in the school

that were of service background. So we stuck thick for a while and Melbourne for that period of time and that was in the early 80s was probably a place we stayed for the longest and so we started to build up relationships well with these guys and still very good mates today. But we didn't have a lot of money as kids. Service didn't really pay a hell of a lot. You know, I remember Mum telling us at one point

for some of the Christmas presents, she made them for us. Mum's a great seamstress, can cook, can make clothes. So we, for a long time, Mum used to make our own clothes, stick our labels on them. You know, even to the point where at school, out of those three stripes in the early 80s were the thing to have. You probably had a pair, yeah.

It's not selling out of us, man, mate. Sadly, it's sort of been imprinted on my voice. I think the shoes used to be the Adidas Roams and the tracksuit pants were, you know, the three-stripe. And we couldn't afford the brand, so we couldn't afford the Adidas three-stripes. But mum being as good as she was, if we'd go to Kmart, if it was Kmart at the time,

she'd buy something that looked similar and then she would sell on the third stripe. So I had out of that three stripes. So that being mum's talent, when we got to high school, we went to a tech in Sunshine. And that's where you obviously is, you know, you go from primary school to high school and you break up. You know, some go to one way, some go the other.

So this mate and I went to the tech and his sister was already at the tech. so you know we had some knowledge of people there and other kids and brothers and sisters from from the school but somehow and I don't really know how it came about but mum had convinced my mate's mum or not convinced that they both agreed that it was the right thing to do that we should have a uniform so we were two of the only kids in this pretty hardcore school that wore a uniform and not even this guy's sister had to wear the uniform It'd be like having a target on your back, wouldn't it? It pretty much was.

So he hasn't forgiven me for that. It comes up all of the time and everyone seems to think that that was a funny thing, but we were probably petrified at the time. I imagine you would be. That we were the only two. And other service kids that went didn't have us uniformed, but he didn't know for a long, long time that it was our parents

together and my mum making them that decided that we were going to wear uniforms. I love that. So that's probably as funny as it gets for Mayo. And as I say, when the family tell it, they add a bit of Mayo to it. I can imagine they would. It stuck around for a while. No, it's awesome.

If you were to share something unique or interesting that you've never shared publicly before, Michael, what would it be? Unique or interesting? Look, it's probably a recent journey, which probably entails or ties me back to a little bit of this whole investment piece and what generated my thinking around or accelerated my thinking around investment. But I was diagnosed a few years back with a disease called

polycystic kidney disease, which ultimately means your kidneys will eventually shut down. So you'll go dialysis and then, if you're lucky enough, a transplant. Wow. So not too many people know about that. Those that are close to me obviously do. But, you know, that's something that isn't a problem.

They're the cards you're dealt and, you know, you deal with the environment you've got. But it certainly changed the way I thought and made me learn or relearn or think about certain things that I hadn't done in the past that probably I needed to do when I was putting off. so you know they changed my eating habits my my lifestyle habits exercise regimes all those sorts of things but that's um that uh you know standing in good step um for whatever gets thrown at you and that's physical or mental um but uh yes not too many people until now know know much about that but uh and you know that throws in some other you know passions around you know things that that that you know we push around um transplant and and uh you know people being on the on the organ donor lifts and those sorts of things so that's probably another conversation another

day but um you know that was just something that that uh yeah it's close to me obviously because it's it's what i deal with every day um but um you know from a a a perspective of what you do all the time i kind of find change a lot of that stuff so so i think business has got to be better relationships have got to be better um and uh investments and things like that need to be to be better because you know there's a limited time that you can you can do those things now So you just need to get all your ducks in a row. So, you know, that would have been a thing to say 10 years ago. What I'm trying to do now should have been in place.

But, yeah, so that's whether it's unique or not, but that's something that not too many people are aware of, but it's something that also drives what I do today. So it's got to be an important part. It would certainly change your perspective and add some challenges in relation to how you look at things. And it's funny how these sort of triggers, while they seem bad at the time, are often the switch that gets us to do things differently and better that we were perhaps putting off or never quite getting around to. So, you know, it's often those things that create the biggest opportunity.

And I guess talking about challenges beyond that, which is challenging enough, what challenging event in your life has brought about your greatest learnings and biggest changes beyond that? Yeah, so there's a couple of things. So travelling overseas a lot is a challenge because you need to learn to adapt and deal with change. But probably one thing that was close, my father-in-law

passed away of mnd uh he was only 57 i think 57 when he was diagnosed 59 when he passed away and there was a point in time there that when i was in hospital with him and and we were having a conversation i said i'm about to go back and do this and he just looked at me and said no you're not this is not that's not the person you're you're when you're doing that you're not the person that that um you know you could be or should be and and so that was a point where i sort of sat back and said okay well now i do have to reevaluate so if someone's telling me that that's pure honest and raw um then i need to to look back and then see what am i doing what what decisions am i making are they best for me are they best for those around me um so that was

a bit of a wake-up call because, as I say, I'm not far from that age now. And you sort of think, well, that's a – whilst there's a long – life is long, it can be taken away at any time, but you've got to make the most of the time that you've got and don't wait for things to happen because often the things we wait to happen aren't the things we really want to see. Yeah, absolutely right.

Beautifully said, mate. But let's translate that into the money world then. Yeah. What does money mean to you, Michael? Look, it's changed over time. So money used to be just what you had to survive. And I don't mean we're ever living on the streets, but it was, you know, we did what we had to do.

So in the early days it was buy a house, you know, then you go through that change of having kids and then it goes through, you know, being able to spend time with the kids. So money changed from having that necessity in just doing what we do all day every day. Now, we were in a lucky position that my wife could not go back to work after our second child and she got to spend time

with him where I wasn't. And we figured that if someone had to miss out or the point is if we were in a position where only one of us had to miss out on that, then that's the way it would be. so you know we were financially well enough to be able to do that we we could live comfortably within our means um you know it wasn't holidays it wasn't you know buying flash and fancy things but the value of that investment i guess was to spend time and put back into our kids so we bought them up and someone else didn't um so we were lucky when not everyone gets to do that

and then as time went on money changed so you know that's where money becomes well how can i make money from money and where am i going to be able to best use my money um so that was the business part of it so that's where we decided okay well i'm hitting a ceiling working for people um i'm gonna take a chance you know and it might work and it might not um and it was certainly into a field that I had no understanding of, but, again, the core of it was about me. So I had all of my beliefs tied to it, and so that's where that then changed was now we're investing into something that's got my blood, sweat

and tears into it, and money became – I probably earned less money, but money became more important because I could see what would happen if I invested a dollar. or I could get two or three back, or I could get 50 cents back. So I started to think about how we used the money, and then the intent was to sell the business and make money from the business to put us in a more financially better position. So at that point, the money actually had a value.

And then, again, changing businesses where we were able to actually be probably in a more profitable business and we can actually start then to use the money. So it was always a learning curve of what money meant, how it changed and how it could benefit you. So now money is, well, to best use my money is to work out how I can make more money off that money to ultimately ultimately not have to be involved in the thing that generates it so if that makes sense it makes

absolute sense the old residual passive income exercise where where's investment fitted in into your uh journey and uh can you sort of give us a quick idea of uh what your investment approach has been and how that's evolved and where it's heading to yeah absolutely i guess in the early days again it's you don't have a lot of money so we were always taught buy your house own your own bricks and mortar and then you're successful so that was the first investment was we've got savings we're going to put them into this house that i'm not sure we ever thought it was our forever house but it was a big deal um and and you know it was going to take a big chuck of what we did within sort of seven or eight years of that it was okay so okay now we need to

bro this we need to you know get as much equity in this thing as we can so we can go on to that next investment um and so for an early stage that's what investing was for us was just investing to get that next step up you know get a slightly bigger house more valuable house something that is going to increase in its own value over time um then from there it was now a case of well how we use the equity in the house better um and if i had have had my time again you mentioned it in your intro rent best i had no idea what that was word the word was just strange and didn't make any sense and it probably took me yeah a while to actually get my head around what you know that actually meant and and understand that it that it actually was a good thing um because it was

your story why rent when you can buy you know that's the advertising goes out there and so we're all driven to do that so uh the rent vest is is where i wish i had have started you know it's one of those things that you mentioned you know let the the tax man and and and the the tenant make the payments for you and do the heavy lifting um do that early have the opportunity to to do it and even if you rent and i mentioned earlier that that um we had a group of guys that went away together four guys hadn't seen each other for a long period of time and it's interesting just listening how they did their thing and one said yeah i can't afford or won't be able to afford to buy in town so i'm going to go and buy something out of town

that that i know i'm going to be able to to pay off and i know it's going to grow in investment and this is a great idea uh for the simple fact that okay i'm not going to live in it as my full-time home, but it's something I can afford to do and it's something that's going to appreciate in value and then, again, I can use that value to do what I want to do. If I hadn't done that, I might have just rented and not invested and not have that asset growing in the background. Yeah, it's calm.

Yeah, and that's the thing. A lot of people, you know, there's this debate over the two and the danger is if you go down that road, you spend it on other things rather than put it into stuff. And I'm guilty of that. Well, a home becomes a forced investment strategy in a sense because it's a growing asset that you have to make the repayments on. If you look forward then, is your investment strategy

like to change and what does that look like? Can you sort of unpack that for us? Yeah, so the investment strategy now, and I guess health is probably one of those things that's accelerated our thinking, but it's accelerated too late, but probably said, you know, stop messing around and, you know, almost start doing what you're talking because I have those conversations with customers every day.

But so it has changed that point. We don't need to own something that we buy, you know. So if we buy it today in 10 years' time, if cycles continue as they are or have done, it's doubled its value if you're careful about where you invest. um so come retirement you might not own it but you don't necessarily need to own it so you have that choice at that point in time so do i go into retirement with the property um that that still has an encumbrance on it that still has a mortgage on it that someone is still paying and i may have

to to lean into every now and then or do i sell that use the equity and put that into my super at that point in time but it gives you choices and unless you do it you don't have choices and and what was creating a fear for me was i was going to have this house that's worth a lot of money and and i would own it outright but i would be forced to sell it and move to retire and i get the whole idea of downsizing and the rest of it but you've got to then find a place that you like you've got to you know have something that has all those same same comforts that you've got now and so i didn't want to do that i didn't want to be forced to do that and you know it might still and probably likely it will happen but i want to do it on my terms

and not not be forced to to do that for retirement yeah a lot of hard-working aussies uh out there michael who uh all of their wealth uh sits in in the home uh so they're asset rich but cash poor and uh you know the sadly most people's super levels isn't going to give them a sort of a level of income that's going to allow them to live comfortably uh so making the hard decision uh to invest in things outside the home or as you say be forced to downsize to free up some equity that's going to fund your lifestyle uh that's some of the challenges that a lot of a lot of Aussies are actually yeah faced with whether they are aware of it or not as we currently speak so so talking about investment then if you look back on your journey Michael what's been your

best and your worst investment and what have you learned from each of those yeah look again it's perspective I suppose so my best investment to a degree and not necessarily not necessarily making me the most money but was going out and then starting my own business um because that in then changed my way of thinking um and then it really has been property um so buying property that's given the ability to to see greater growth than money in the bank super you know what's the average super turning around eight or nine percent over the last 10 years um you know if you put property next to that it's it's significantly different um so you're not doing all the hard yards to get the same growth uh my worst um early on very early on was probably one of these pyramid

schemes yeah because my mate said it was a good thing to do and he'd made some money so i thought i'll throw a couple of grand at that and do the same the old amway special is that what we're talking about yeah well yeah amway specials the old uh what were they pilot schemes were they the concord or whatever it was called you know you got money in and and someone below you got money in and then i always said to be the guy that was on the end of the wing falling off not the guy that was flying the plane so um dot com had no idea on shares no clue i just had some mates that were doing it and i thought they were good at it so they said oh you got to invest in this hot orange or whatever it was at the time and i said well that's great if you're doing it i'll do it and

threw money at that without any knowledge without any education with without uh understanding the consequence um and so when you and i'm talking we were young just had a house uh probably you know small child on the way so you needed every dollar you had so you were desperately looking for the quick dollar um and that seemed to be it uh and of course i was always again that last one So I think I put some money into this red hot thing and it had gone up by, you know, $100 or something over the week before. And as soon as I put my money in, it crashed and it closed the market. So I didn't even lose, you know, I mean, I lost everything. I didn't even get to lose a little bit.

But again, that was about poor education. No knowledge. I mean, we grew up without having, you know, people investing. My family rented, because of the jobs that they did, rented until I was, you know, 30, 40 years old. And there weren't many around me that actually invested. So it was a new, you know, it was something we needed to learn. And I really think we need to implement that into schools.

Another topic again, another time maybe, but I think if we want to be a stronger, wealthier country, then we need to teach our kids what money is. So, you know, I'm sure I'm not the only one that's had that journey with money and investment. If I had have learnt that at school, then maybe. Look, I may not have done anything with it, but come the time that someone else started talking about it,

something might have made sense and I may have done it a little bit earlier. But if you don't know about it, then you don't know what you don't know. and if you don't understand it you tend to just turn away from it exactly and you we go with the crowd we go with what everyone else is doing and if the majority of people aren't focused on it they focus on the here and now and and the immediate exercises then the delayed gratification of investing in the future just is not something that never comes under the horizon yeah i've been burnt before and and one of the things i've always learned is no one ever tells you about their losses so you know well yeah i've made lots of money doing this hang on i actually lost all my money

on that yeah um and they've went gone through their their education process so so you know you've got to talk to the experts and lots of them not just one um and and truly try and understand what you're doing so so you can control it a little bit better and i think within our supers that's a that's another thing that we just keep putting money in and not knowing what it's what it's doing or how it works um and given sleep is such an important part of our future our kids future another thing they should be teaching properly at school you know so and not not allowing the governments to continuously change the the the rules after the event because they want to get their sticky hands on that big lolly jar that's growing year on year well we all know

that they've done it for their benefit as well spot on mate now beautifully said and i'd really appreciate you sharing that journey mate there's a lot of people who are going to be nodding their head with everything that you've shared with us on that. I want to now sort of jump into what I affectionately call the bushfire ambush round

sort of running off the old name and there's a couple of quick questions that I'll get your responses on. First of those mate what superpower do you wish you had and why? Again probably ties in and I get picked on this a bit because i talk about it but it's it's wonder woman's last word of truth

because again it just gets everyone to the point straight away you know and and if you could actually give people the confidence to tell you what they're thinking not what they think they should tell you then we can all go you know be in a better position and get a greater result early on and and i suppose if i put that into the business side of things when we're talking to clients they're only telling us what they think they should be telling us which when it gets to the nitty-gritty of what we do that can actually impede what um the result of what they get um and whilst i think they might be doing the right thing it's it's always a case of um just be open and honest and and uh not be afraid to say anything because ultimately we get to know all

about you anyway um and and so let's let's you know cut to the chase and get that right um so The Wonder Woman letter of truth, I wish I had a number of times that I could throw down the phone and get people to actually just be confident enough to open up and tell us exactly what's happening, and that way we can help them better. Yeah, beautifully said. Switching to the literary field for a moment, what would be the title of the book about you

if your worst enemy wrote it, mate? Yeah, what do I think of this one? So this is, like, I asked the question around the place and everyone said, I don't have enemies. So that was going to be difficult. I think it was something along the lines of you don't have to like them to respect them. Yeah.

So if there is an enemy out there, you know, I apologise. But, yeah, it's all done. Everything I do is done with good purpose. No, I like that. You don't have to be liked to be respected is something that a lot of us shy away from because we like to be liked. Yeah. But saying what needs to be said, whether it's taken on board

or other, does create a lot of respect when people are brave enough to look beyond the impact that has on them. So beautifully said. Yeah, and I think that's come about. I've had people that I have learnt so much from that I don't want to be anything like yeah um so you know there's always some positive benefit to come out of the negative totally agree yeah i want to switch into caffeine for a minute mate if you can have a copy with anyone alive or dead uh historical or otherwise uh who would you choose and why

yeah look i there's um there's a couple i talk about that caffeine probably wasn't even around at the time so uh and they might be controversial so i might believe them off to the side but One person that's always fascinated me, and I don't know why because I'm not a political person, but for some reason to sit down with Barack Obama. I don't know. I've always just been impressed with the way he carries himself, just his knowledge, his, you know, and he was reasonably brave

to actually stand up where he was and be honest, and I think I like that about him. yeah um so it'd be really interesting person to sit down with and and see what uh you know how he's learned because he was you know he's never going to be president and in the early days and and through his pathway he's he's you know gone to the top of the tree and and so something like that would be really interesting but look i like history as well so you know sit down with a napoleon or a uh julius julius caesar or something like that and live through their eyes would have been pretty cool as well.

But in modern days, probably Barrett. Yeah, and he is a real statesman. There's no question about it. He's eloquent. He sticks to his guns. Yeah, I would love to have a coffee with him as well. Last one on these, mate. If you won $10 million tomorrow, what would you do with it?

Yeah, $10 million. It doesn't sound like a lot of money nowadays, does it? No. You know, when you see everything being thrown out in, you know, $30 million, $50 million lottos and, you know, businesses being sold for mega millions. But I think, you know, $10 million is huge and it would give you the ability or for me it would be set myself up properly,

make sure I was in a position to have all my debts paid off, support those around me and definitely my kids, get them into a position where maybe not so much give them money and hopefully they do listen to this. So now there's an expectation. But, you know, do something that means that there's something there for them to leverage off, but that's still where to go at and earn, you know, the right to do a lot of things.

But, look, a passion for mine is just being able to go out and help people and give them an opportunity to do, you know, educate people on finances, on, you know, general business stuff. So I'd like to actually set something up where I could help those disadvantaged get into a business for themselves and grow it. So there's not a lot of profit in that. And I've done some non-for-profit work in the past and I've really enjoyed, you know, imparting that sort of information and seeing people accept it and use it. So I'd love to set something up along those ways.

So a bit of money there would actually give me the ability to be able to set something like that up and then leave some sort of legacy down the track. Beautifully said, mate. I know we're going to dive deep into the very overwhelming world of asset finance in the next episode, but for those that are really resonating with your message today, what's the best way for us to get in touch with you, mate? Yeah, look, either off our absolutely newly regenerated Facebook page, National Direct Finance.

Certainly reach out through our website, nationaldirectfinance.com.au. and any of the socials, you're able to find us. But nationaldirectfinance.com.au will get you straight to our page and give them access to me or anyone else in the group. Excellent, mate. Look, I really want to thank you for taking the time to share the ins and outs of your personal journey, mate.

Thank you, mate. If anyone would actually like to ask any further questions or leave your comments and thoughts on this, just jump just join and jump into our newly badged property hub collective interactive facebook community where you can keep the conversation going with other like-minded hard-working aussies and we now look forward to continuing the convo next week's episode where we're going to deep dive into the good bad and ugly of the increasingly complex world of asset and equipment finance as a basis for combining the benefits of access over ownership and opportunity costs so i look

forward to seeing you again stay tuned for part two of this interview next episode thanks for tuning in to get invested on the property hub podcast channel your home for property investment insights and inspiration and don't leave yet until you've taken the next step towards living by design by getting my award-winning book get invested absolutely free when you sign up at knowhow property.com.au or bushimartin.com.au. And finally, make sure you subscribe to Property Hub to get your weekly dose of Get Invested inspiration, along with every episode of Realty Talk, Australia's leading property show for red-hot property investing news and insights, direct from industry leaders and influencers. Remember to always get invested in your knowledge

and I look forward to seeing you next time.