Property Hub - Investment Insights & Inspiration - Get Invested: Part 2 - Steve McKnight on becoming a money magnet

Starting point is 00:00:00 I felt called to write a book that tried to help people understand how to make, manage and multiply their money. So in many ways, Money Magnet is a prequel to 0 to 130. 0 to 130 is a book about buying a property portfolio that will set you up for financial freedom. And Money Magnet is a book about the mindset and mechanics to attract money in the first place that you can multiply, but also a really important conversation, I feel, about how to make your money count, i.e. how to make your money matter, rather than just amassing it for a bigger bank balance's sake. Well, the key message throughout the whole book is that becoming a money magnet, i.e. attracting more money, is a learned skill. It's not an inherited skill. And it doesn't matter how poor you feel you may be right now in knowledge or finances. If you have a heart and a desire to want to improve, then help is at hand in the form of this book.

Starting point is 00:01:06 welcome to get invested the leading weekly podcast to help you unlock your full potential and enjoy your version of sustainable success that lies at the intersection of your three elves yourself your health and your wealth i'm your host and guide bushy martin and each week we go deep sharing great conversations with proven experts in all walks of life including the best investors property experts, analysts, leaders, founders, sports stars, and health gurus to uncover their secret know-how on where they invest their time, their skills, and their money, and the benefits that this creates. To help you find out what it takes to break free from the grind and discover your flavor of freedom, to create your freedom formula. You see, the truth is that everyone

Starting point is 00:01:57 invests. Every second of every minute of every day, we're investing our time, our skills, our energy, and our money in something. Some of us are investing consciously, some unconsciously, sometimes for good, sometimes for bad, and sometimes for no impact. Get Invested will help you start living by design, not by default. I'm going to help you to make it happen, not let it happen. You'll hear the top tips on how you can live with conscious intent so that you can live more, work less, and live your legacy by investing now. You'll enjoy the stories and secrets of high performers who invest for success in every aspect of their lives and discover the top tips on how to get started, how to make the

Starting point is 00:02:40 most of your investment journey, and ultimately, to be living your dream, not someone else's. As you engage in each episode, you'll glean the information, inspiration, and implementation that you need to get empowered and get invested in imagining and actioning the life that you've always dreamed about. and get invested is proudly part of property hub your home for property investment insights and inspiration make sure you subscribe now on your favorite podcast player to get every episode of get invested and realty talk which is australia's leading and longest running online property show that's full of red hot property investment news and insights direct from all

Starting point is 00:03:22 of the industry leaders and influencers you can also connect with me personally and join the get invested community of fellow Freedom Fighters at bushymartin.com.au or on knowhowproperty.com.au. Now, let's get invested. Hi, Freedom Fighters. Do you want to make, manage and multiply your money to become financially empowered and then make your money count by using it to create a living legacy to make the world a better place for yourself, your family and others? Well, if you are, then you're in the right place. So welcome back to part two of our great conversation with living legend, Steve McKnight. And if you haven't had to listen to part one, then make sure you do so.

Starting point is 00:04:05 Now, as I mentioned last week, not only is Steve a successful investor in his own right, but he continues to share his words of wisdom to help everyday investors like you and I through his bestselling books. His first book, From Nought to 130 Properties in 3.5 Years, has sold more than 200,000 copies. and its sequel from naught to 260 plus properties in seven years was also a number one bestseller he's also published a million dollars in property in one year from naught to financial freedom and millionaire so if you hadn't read these yet then make sure you add them to your must read list and to add to this he's now just published his next bestseller money magnet how to attract and

Starting point is 00:04:48 keep a fortune that counts which shares all of the important lessons and insights gleaned from his decades at the front line of personal wealth creation. From the things he's witnessed as a chartered account advising clients spanning mums and dads, through to multi-million dollar business owners, along with his personal experience building a family fortune, buying and selling hundreds of properties. Along with his experience in professional funds management, where he's looked after more than $100 million of other people's money. Now, I could go on for hours about your achievement, Steve, but I'm keen to get stuck into Money Magnet, which I've had the absolute pleasure to read, and it's another cracker. So welcome back to bestselling author,

Starting point is 00:05:29 self-made multimillionaire, and generous philanthropist, Steve McKnight. So let's continue getting invested, Steve. G'day, Bushy. Hello, listeners. Mate, it is another cracking book, and I have had the pleasure to go through it from woe to go and i guess the first and most obvious question right from the outside looking in with with so many best-selling books why write another one wow good question and one that i asked myself quite a number of times while i was in the process of writing it really unlike naught to 130 which started off by louise bedford who writes books about shares recommended me to the publisher and said, oh, I reckon maybe Steve can write a book and that gave birth to Noughts

Starting point is 00:06:17 130 and Noughts 260. This one stems from a dream that I had that I talk about in the book that occurred in 2006. And in that dream, it almost sounds a bit contrite to try and explain it, but it's an encounter I feel I had with God. And during that dream, I felt called to write a book that tried to help people understand how to make, manage, and multiply their money. So in many ways, Money Magnet is a prequel to 0 to 130. 0 to 130 is a book about buying a property portfolio that will set you up for financial freedom. Money Magnet is a book about the mindset and mechanics to attract money in the first place that you can multiply, but also a really important conversation I feel

Starting point is 00:07:13 about how to make your money count, i.e., how to make your money matter, rather than just amassing it for a bigger bank balance's sake. Yeah, I love it, mate. And that making the money matter piece is the significant differentiator, I think, between Money Magnet and just about every other book there is around investing and in property.

Starting point is 00:07:35 that sort of well bushy what if i could interject and sorry i what i would say that's different about this book is that it's written by someone who's not theorizing about what life might be like once you've climbed the mountain it's it's a here's what the view's like from the top from someone who's climbed the mountain and then as i say in the book hey after you've climbed the first big mountain which is survival you may not be able to see it from the bottom but there's actually another mountain behind it called significance and some people will choose just to climb the survival mountain but if you can journey up survival and then if you've got the courage to venture into significance then i think that's where you'll become someone who'll be able to

Starting point is 00:08:22 leave a profound legacy which is more than financial yeah 100% man it comes back to that fulfillment piece rather than the happiness piece and i think there's a chasm between the two of those given that exercise and and we'll drill into the details a lot more as we we continue the conversation today mate but if you were to summarize the the key messages and who's it best suited for what would you say well the key message throughout the whole book is that becoming a money magnet i.e attracting more money is a learned skill it's not an inherited skill and it doesn't matter how poor you feel you may be right now in knowledge or finances, if you have a heart and a desire to want to improve,

Starting point is 00:09:07 then help is at hand in the form of this book. Certainly not a book I've written to make money. I'll be giving away all the royalties, 100% that I receive from the book. It is an awareness piece and almost a legacy piece for me for generations of young McKnight's to come. what what did rich uncle steve know about money that if rich uncle steve isn't around anymore to tell us he's captured uh into perpetuity via this book yeah yeah i love that mate well let's let's set the scene at the the bottom of the mountain then uh because it sort of go through

Starting point is 00:09:45 this in quite a bit of detail and shed some great info on this well why do you think so many hard-working aussies are pre-programmed to fail financially pre-programmed to fail because the dna the financial dna they've inherited is the best that their parents knew how to do but wasn't necessarily the playbook for success i don't think there'd be very many parents out there who would deliberately set up their children to fail financially but you can only pass on what you know and because what was handed down to them from their parents and so on and so forth there's There's a very interesting exercise in the book called Your Financial Family Tree, where I ask you to trace effectively the financial pedigree of your parents and your grandparents back through time to try and give you the realisation that where you are right now, what you know, isn't a fluke, but it's probably hobbling your chances to become financially successful. and that if you want to improve your capability,

Starting point is 00:10:47 you first need to improve your competence. And while it might sound like a challenge, anyone can do that because it's not hard. Yeah, and that's the key piece here is that anyone can do it if they apply themselves, get the right knowledge and surround themselves with the right people. I often say the same thing myself for someone like me who's a bit of a scrubber from the country,

Starting point is 00:11:10 who had a pretty challenging, life-changing moment when I ended up, unfortunately, divorced because I was a workaholic and starting from ground zero, and I mean less than zero at that point in time, and then following the signposts and the guidance that you provided to me and so many other Aussies, I can confidently stand here and say that it is a learned skill. You've just got to apply yourself and stick to it. But that stickability exercise is the thing I find really interesting, Steve, and it's something, there's a part of the book that you talk about, this question, where why are so many hardworking Aussies interested in proving themselves, but so few stick to it and don't end up achieving their full wealth potential?

Starting point is 00:12:01 Why is that, do you think? a friend and mentor of mine brendan nichols i think said it best when he said the enemy of a great life is a good life and i think what ends up costing people is good and and being comfortable they don't realize that the cost of comfort is financial security later in life when they're not earning the money they're earning at the moment and the inability of people to forecast their financial situation and their over estimation of how much time they'll have when they get around to actually making a goal that precludes people from from being a success later in life i mean bushy our whole financial system is geared seemingly the government propagates this by

Starting point is 00:12:50 the policies that it sets banks lending huge sums of money is to end up owning your own home the so-called great australian dream well the consequence of the great australian dream is a dirty great big house but too poor to be able to feed yourself living in it as a pensioner the the best advice i can give someone about their financial trajectory that they're on is to look at what happened to their parents because that will be your programming without you even knowing it you will have watched the way your parents or guardians or people that raised you thought and acted around money and you would have taken on those skills as your own and without an intervention the highest level of success you're likely to get is what they've achieved you may very well get

Starting point is 00:13:34 less than that and time is of the essence the the formula for getting rich only has three components it's not complicated those components are investing capital which is a subset of being able to save money so the capital you've got available to deploy the rate of return and time and when you understand the equation it's not a secret equation it's actually an equation that's taught in high school but it's not in my opinion taught the way it should be if you can understand the way that that financial equation works time is the most important of the three but what happens is we leave it too late the 20s is a era where we go and explore the world and our 30s is settling down and starting a family and our 40s is paying for the kids education and i don't know how you feel

Starting point is 00:14:28 but you wake up one day in your 50s you think geez where's life gone but now with eyesight that's starting to fail and hearing that's starting to fail and vigor that is not as vigorous as it once was you've you've left the hard yards till too late and because of that you then need to take greater risks to get the bigger of the return and then that leads you to possibly getting into ventures which aren't particularly sound and then you think oh it's too late for me i've missed my boat and therefore i'll probably end up on the pension which remember and a lot of people don't know this remember the pension was never designed as anything other than a subsistence payment to people that couldn't look after themselves in australia we have a very entitlement dominated

Starting point is 00:15:19 attitude i'm entitled to a pension because damn it i've paid my taxes my whole life and now the government owes me something back the pension is not a superannuation fund the government does not owe you anything it is there by the government's gratuity and not something that you should rely upon as something that you can count on because with more and more people aging and fewer and fewer taxpayers available to pay the pension the only way the government's going to be able to afford it is to borrow more money and that will be a tipping point so it seems to me that the way that we're middle class welfare feeding through the family allowances into the pension is not sustainable

Starting point is 00:16:03 and it's a giant wake-up call for everyone listening to this that don't expect the government to have your back. It's up to you. It's always been up to you. The pension is barely above the poverty line and any plan that will see you getting the pension must surely be a poor plan and one you want to do better. Yeah, 100% agree.

Starting point is 00:16:28 I don't know about you, Steve, but the biggest challenge that we've had in trying to motivate people is around this whole concept of delayed gratification because, you know, we live in an instant everything world and the real challenge is people will hear it and say, yeah, yeah, that's all good, Bushy, but I don't have time right now. And I always say, well, time is a key ingredient. You've got to take the time now to use the time you've got to be able to get your time back. But there always seems to be some excuse why something else is more urgent or perceived as more important. What are your thoughts on how to assist people to overcome that and see the benefit of starting to invest in early and using the time to really make their future life a lot easier and more comfortable? In Greek mythology, Cassandra was a person who would always prophecy correctly, but no one would believe her. And it seems to me that you don't have to be an award-winning economist to figure out that the way that we're running the economy at the moment, heavily into debt, and the structure of not enough taxpayers, not enough tax being collected, and sort of project or forecast that forward to see that we're going to be in a difficult position. now there'll be some people listening to this will be like well it's too big a problem for me

Starting point is 00:17:59 to solve and i'm too old to do anything about it anyway and i'd say you're only too old if you think you're too old then there'll be younger people listening to this they think oh i've got time but time is you is your friend until it's your enemy i would say to people the world is geared for you to fail. Because the method today that marketers use to entice you to spend money you haven't yet earned and therefore fall into a debt trap, which is the beginning of financial disempowerment, is you deserve it now. Even if you can't afford it, you still deserve it. We've thrown out the rule book of our grandparents, which was save and then buy. And now We've embraced this concept of buy it now, pay it tomorrow.

Starting point is 00:18:51 Buy now, pay later. And this is a phenomenon that will leave today and tomorrow's generations financially impoverished later in life. And it will really be a curse and a scourge because the – I feel like an evangelist here, pardon me, because, you know, it's a bit like saying to the young people don't have fun you know like i'm the fun place well i'm not i'm not the fun place but i can see the writing on the wall right now that if you if you get into the habit almost out of the cot of buy now pay later and i do talk about this in the book then

Starting point is 00:19:29 it sets you up with a financial habit that you feel you can have something before you've worked for it and if you embrace the buy now pay later attitude then you'll become a financial slave because you will owe money the rest of your life and be working to pay it off yeah absolutely spot on so yeah i totally agree and in in the context of of anyone uh can turn things around i'd love to get your thoughts on how we can actually attract more wealth by changing the way we think and acting around money can you put some flesh around that yeah sure if there's only two types of people people who are money attractive and money repellent i asked this of the listener which are you and i said i don't know no one's ever asked me if i'm money attractive or money

Starting point is 00:20:17 repellent well let me ask you one further question do you use debt and if the answer is yes then you are by nature money repellent but hang on steve surely if i invest in real estate for instance and i borrow money well isn't isn't that good debt and in the book i make the point there is no such thing as good debt and bad debt there's only bad debt and worse debt how many times have you seen in the superhero comics debt man or debt woman come to the rescue of anyone they don't exist debt is a villain now you may choose to use debt on a frenemy relationship, which means that you'll coexist, but only while it suits you and with the purpose of getting out of debt. Now, whether it's consumer debt or investing debt

Starting point is 00:21:14 or any kind of debt, I would say to the listener, tread very carefully. If you get into debt, get into debt with the express purpose of getting out of debt. Don't get into debt with the view of staying in debt you'll never go broke if you don't own money and if you don't own money you won't care what's going on in financial markets interest rates can go to oblivion and you won't care because it won't affect you you won't be a forced seller in a down market because you won't have interest to pay the best way you can inoculate yourself against recession and high interest rates is to be low and ideally no debt yeah really well said for those that are sitting here going yeah that that's all really good for you steve because you're through the other end of the exercise

Starting point is 00:22:05 here we are we're looking at how we can start to leverage into assets that are eventually going to look after us so what do you say to them get into debt to get out of debt and make sure you've got backup plans that if your primary way of repaying that money falls through, you've got something else. For instance, if you plan to use your salary to make your mortgage payments and you lose your job, what are you going to do? You never want to be a forced seller in a down market. So I'm not here to give you financial advice. Of course, this isn't financial advice, but I would be strongly encouraging you to go and have a chat to someone about income protection insurance so that if you did lose your job then at least you wouldn't be a forced seller in a down market remember bushy

Starting point is 00:22:54 that investing is all about assumptions and your investment is only as good as the assumptions that underpin it a lot of people never stop to think about what are the assumptions behind my investment being successful and they certainly don't do the due diligence on how robust those assumptions are They tend to hope for the best and really be ignorant or ambivalent towards the worst. And the consequence of that is carrying a lot of unnecessary risk in your investment portfolio. It doesn't need to be that way, but you need to upskill. The antidote to risk is skill. If you don't have that antidote, then you must, by default, be risky.

Starting point is 00:23:35 And risk is the antithesis of safe investing. yeah that's beautifully said uh the uh sort of surrounding that then uh because i again you touch on this uh really well in the book uh talk to us about our financial iq and our financial eq and and how they affect us in relation to all of this so you're programmed to think and act around money you may not think you're programmed i've never been programmed steve wrong you have been programmed you just haven't known you've been programmed you've been programmed from birth by watching your parents your mates other people tv shows listening to this podcast listening to me the great bushman bushy he's got he's he's imparting knowledge to you that's programming you

Starting point is 00:24:27 uh gently uh but still programming you and this programming is shaping the way you think and act Now, sometimes the programming is good and sometimes the programming is the financial equivalent of malware. And we need to know whether our programming is leading us to a good outcome or a poor outcome. And the best way of determining that is to look at your financial situation right now. Look at your income statement. Look at your balance sheet. If you don't know these concepts, read Robert Kiyosaki's book, Rich Dad, Poor Dad, and then understand the relationship between the money you earn and spend and the assets you accumulate and the liabilities that you incur. And if you look at your situation right now, the best guide to where you'll be tomorrow is where you are now.

Starting point is 00:25:16 Because the more you do of what you've done, the more you get of what you've got. And you'll just add time. and if what you've got now is effectively little to nothing then that is a reflection of your programming and it means that by continuing to act and think around money your financial iq think and act your financial eq your feelings and emotions around money unless there's an intervention and a reprogramming event that you submit yourself to you will get more of the same now if that's truckloads of money and a happy life well you're on the right path high five and keep going. But if it's not, if you're not happy where you are, then it's up to you to do something

Starting point is 00:25:56 about it. No one's going to come and knock on your door and drag you to a financial gym, force you to do push-ups and sit there counting sets and reps. You need to do that. And this comes back to what we spoke about before, Bushy, about delayed gratification. Delayed gratification will only ever happen if you've got a reason to put off self-gratification or instant gratification. So you need a reason which is stronger to delay than to consume. If you don't have that reason, it's human nature to consume right now, to not delay gratification, but to gratify yourself. Now, whether you want a carrot or whether you need a stick, whether you need the revelation that the pension won't be enough to support you in a comfortable lifestyle when you need it most

Starting point is 00:26:46 later on in life or whether you want the reward of retiring earlier financial independence retire early it seems to be the catchphrase du jour if that if that's what you want i mean i retired at 32 it's possible if you get started early enough but whether it's the stick or the carrot you need to find a a thing that's going to leverage you out of your current comfort otherwise i'm afraid to say the statistics are that you're likely to end up on the pension three quarters of people play the game of life according to the programming they inherited and end up on the pension something's manifestly wrong we need to reprogram and sooner rather than later yeah I think the biggest challenge is the momentum and the bad habits that we develop over time.

Starting point is 00:27:43 And because most other people are also experiencing the same habits, actually breaking through that and finding the time and the commitment to do something different is the challenge. How can the money magnet help them with that? before i answer that question bushy have you seen the movie the matrix i certainly have and it's a bit cliche because i think the movie did it so well but you know the red pill and the blue pill moment do you do you really want to know what's going on or do you want to live in financial oblivion like you have the ability to take the pill and wake up but by doing so you're saying no to some of the comforts that your family and friends will enjoy what's a practical example Julie and I lived in some pretty substandard accommodation earlier on and invested every dollar that we earned into real estate.

Starting point is 00:28:38 I'm not saying you have to slum rent it, but I'm saying that our friends all went and bought houses, and we would go around to their house and feel like second-class citizens being renters rather than owners. Yeah. But when we bought our first home for cash and all our mates had big mortgages, we didn't feel like second-class citizens anymore. And the ability to delay gratification comes from the expectation of, I always say sacrifice equals, I mean, the cost equals sacrifice plus delay gratification. What you never get is the sacrifice portion.

Starting point is 00:29:19 the delay gratification part tends to be you'll gratify yourself later on and in bigger ways if you can hold off for it now as for how can money magnet help people it's a playbook for how to become a financial success it is what i've learned over the past 20 or so years as a professional investor as a chartered accountant and of course through the money management that I've done, the people I've met at seminars, the stories that I've heard, what I've witnessed, all rolled into a book that teaches you the three-step make, manage, and multiply your money, and then talks to you about the encore, which is very important around, right, now that you are a success, here's what's waiting for you over the horizon, a tremendously financially empowered

Starting point is 00:30:10 life where you can use your money to build a legacy that touches moves and inspires other people so that when you're gone you'll be fondly remembered and greatly missed yeah that's uh inspiring me right right there right now with with those words mate and uh i just hope that everyone that's tuning into this is taking that on board because it is revelational and it is life-changing but you need to do the work and uh and you need to swim against the tide because uh the very few people that are going to actually uh exhibit the persistence dedication resilience to see this through but uh i can tell you firsthand from following your guidance over the years steve it's been life-changing in that capacity and

Starting point is 00:31:02 Bushy, we could sit you and I around a campfire singing Kumbaya for 24 hours with the expectation of a giant sack of money is going to fall on our head. And I can tell you that's very unlikely to happen. So frankly, listeners reading the book, I mean, it'll be an interesting read. There's no doubt about it, but the real benefit will be starting to apply the book. And I kind of force you to do it as you read along by getting you to do various exercises and gradually try and lead you into a process of self-awareness that yes you need to change here's where I am at the moment well holy heck if I don't do something here's where I'm going to be in the future and then we start a conversation around okay what's a framework for managing my money

Starting point is 00:31:51 what's a framework for multiplying my money and understanding risk and being able to invest in high return low risk investments the way that Steve would and then towards the end of the book we start talking about legacy and about this concept of significance and as I mentioned before about how I mean Jesus said to whom much is given much is required the notion that at the end of the day while for some the amount of money that they accumulate is about ego and power I've always found that money won't hug you back, although a lot of people try and hug money. Unfortunately, money, as again,

Starting point is 00:32:31 to quote from my friend and mentor, Brendan Nichols, exists to get a life and give a life. And you may have a certain amount of satisfaction looking at a bigger bank account, but do you want to be known as someone that died rich or do you want to be known as someone who used their money to change the world? I do use the example in the book of Alfred Nobel, who was mistakenly thought of dying and there was an obituary in a French newspaper which called him, I think, the Prince of Death.

Starting point is 00:33:01 And he read that and apparently was so shocked that that's how the world would remember him that he went and used his wealth to set up the Nobel Peace Prize. Interesting that he invested in positive cash flow investments to create a legacy into perpetuity so that the Nobel Peace Prize can be funded forever. But that is a little story that a lot of people may not know about how someone got the chance to read their obituary, didn't like what they heard, and changed their life to cast a legacy which they wanted and fulfilled. Yeah, it's a great example of exactly that. and putting yourself and your future self squarely in the frame. In the book, again, I just love the way you're able to boil what's often perceived as fairly complex concepts into really easy-to-understand approaches.

Starting point is 00:33:59 And one of those, which coincidentally we have a process that we help people with called the Freedom Numbers, which is very similar to what you talk about in the book around calculating how much wealth you need to achieve financial freedom over what sort of a timeframe. Can you briefly share that with us? Yeah. In North to 130, I talked about the 11 second solution to give you an idea of how much you should buy a property for weekly rent divided by two times a thousand. And people often said that was a really handy tool for them to gauge how positive cashflow or not a property would be compare that to the rate of finance and that'll give you a good idea so in this book i've

Starting point is 00:34:41 i've gone back to a concept that i've talked about over many years which is how much is enough and a lot of people don't know a lot of people sort of go oh i don't know i haven't really thought about it well what i say is start at the end and end of the start nominate an amount of money that you would like to earn from your investments every year as an income, Simon? Most people will say $100,000 because it sounds like a large amount of money. I can tell you that if you think or set $100,000 compared to what people retire with, you would be in the top 1% of retirees if you had an investment portfolio giving you $100,000 per annum. But let's shoot for the stars. Step one, what is your desired annual income?

Starting point is 00:35:27 Step two is divide that by your expected annual return. Now, I used to say to people 10% is a nice, easy number, keeps the math simple, but these days with returns going lower, probably needs to be around 8%. That will then give you the amount of required capital you need, 100,000 divided by 8% is 1.25 mil. If you had $1.25 million of investment capital deployed deployed at 8% per annum, you would achieve your goal. You would have $100,000 of income for the

Starting point is 00:35:58 rest of your life without having to lift a finger and work for it. Your investments would do the work. From your required capital, you then need to add or subtract any other adjustments. Maybe you want a house, maybe you've got money already. Some people listening to this, they will be financially free without knowing it. They just need to redeploy their money away from growth assets into cash flow assets and boom game one and at the end of the day as outlined in the book step by step that will leave you with whether you've got a surplus situation or a shortfall situation and then we start asking the question what do we do about it yeah exactly so that that sets the goalpost pretty much and then we add in the uh the exercise of time because how much time

Starting point is 00:36:45 you've got to make that happen can also shape what and how you need to invest. And again, there's a great conversation in the book around the difference between slow and steady versus fast and furious when it comes to wealth building approaches. Can you put some colour around that for us? Yeah, of course. I mean, you can get wealthy with a slow and steady approach if you've got time on your side. Sometimes people don't have time on their side or sometimes people want to accelerate their progress so they get done in a few years what might otherwise take many years or decades and then i retired as i said in my early 30s rather than working until i was 65 i had to cram in effectively 30 years of work into seven years of investing and a lot of hard

Starting point is 00:37:31 work and and a lot of time a lot of late nights barely had a weekend off over that period but it's up to you to decide whether you want to be slow and steady maybe you've got a lower risk tolerance maybe you've got a lower skill base and you invest in growth assets for time or if you're someone who wants to be a bit more fast and furious then you can choose your own adventure but first you need to skill up because if you don't skill up you'll end up taking what i call naked risks which means that you're only one wrong move away from financial oblivion and that's that's not sensible in any way shape or form it really comes back to how much time money skill and risk tolerance you have available as to which of those approaches is better for you yeah yeah and that

Starting point is 00:38:26 that timeline is a is a key component because it can either be a a nice slow walk in the park or it can be a little bit like abseiling depending on how late you leave it towards when you want to be in a position where you don't have to work as hard or as much so and and the book sort of really does i love the way you build that up in in terms of offering the the various approaches and options that you can take in that regard but let's now sort of uh flick to the other end of the equation uh in terms of you know once you've built a nest egg and there'll be listeners that are you know well and truly on the road and and potentially as you just said may already be there but aren't aware of it yet uh once you're in that position the biggest challenge is that you've touched on

Starting point is 00:39:12 in relation to that comfort exercise is how do you stay motivated uh once you get comfortable with financial freedom to to make that shift from what i call success and you call survival into the significance component why don't we talk about something that's not in the book i'll give you a i'll give you a scoop i i almost wrote this for the book but it didn't quite make it in i was on the list of things to talk about but with a word limit not everything could go in and no that doesn't mean there's going to be another book next month or anything else like that it takes a lot of effort to write a book it's not ghost written i tapped it out on the keyboard uh stroke by stroke imagine there's there's um four squares so two columns two rows

Starting point is 00:40:00 And in the top left-hand column, it might help to grab a bit of paper and draw this if you're listening and have the ability to do that. I'm doing it as we speak, mate, yeah. In the top left-hand corner, what we're going to be doing is we're going to be charting the level that we're comfortable. So I want you to write comfortably comfortable in the top left-hand corner. And then directly below it, in the square below it,

Starting point is 00:40:29 So row two, column one, I want you to write comfortably uncomfortable. Then across to the right of that, so row two, column two, uncomfortably uncomfortable. And then above that, comfortably uncomfortable. Now, where we start usually for most people is in comfortably comfortable. i'm just happy oh i rock the boat i'm happy in my job it's not perfect i got enough money kids are going great why bother and i say when you're in this position you won't hunt if you're not hungry and so comfortably comfortable is cruise control in life the problem is you'll

Starting point is 00:41:21 get to a point later on in life as sure as eggs that you won't be in the position where you'll be comfortably comfortable anymore and you will have lost your ability to earn an income because you would have retired and then you'll be forced to shift and there's not much you can do about it so what you need to do is you need to move from comfortably comfortable into comfortably into uncomfortably comfortable yeah now what does that mean that means and this is where i was when i started my investing journey you're sitting there and you're thinking i'm not happy i don't have to do something but i am i'm still comfortable but i'm uncomfortably comfortable it's like i'm i've got a stone in my shoe i can still walk but something's not good i've got to

Starting point is 00:42:09 get that stone out that is the beginning of change so to go from comfortably comfortable to uncomfortably comfortable you've got to find a reason that jolts you out of your comfort zone now you need to invent that otherwise or alternatively life can do it for you i was very comfortably comfortable not long ago and then i went to get a mole frozen off my neck and the doctor said i can't quite do it today i haven't got the stuff why don't i just refer to your local dermatologist i went to the local dermatologist the dermatologist froze the mole off and said oh why are you here might have to have a look at you he goes oh that's an interesting spot on your face look it's probably nothing why don't we take a biopsy boom melanoma out

Starting point is 00:42:56 there's a wake-up call there's the m word for you now luckily they got it very very early and the the prognosis is is very very good but i i wasn't very good looking to start off with and now i've got a pirate now i've got a pirate scar to remind me to be sun smart for the rest of my life on my face well that's what you would call a wake-up call now whether you want to create a wake-up call for yourself or whether you want life to give you a wake-up call by ignoring the obvious it's up to you but if you want to change the first step is to going to uncomfortably comfortable then if you really want to turn on this turn on the gas you've got to go to uncomfortably uncomfortable and that is outside of your comfort zone where the magic happens this is stretching yourself

Starting point is 00:43:47 buying 130 properties in three and a half years was not a comfortably comfortable experience going through the process of setting up a managed fund buying property in the united states stretched me the idea of starting up a new australian managed fund which is something i'm contemplating at the moment and jumping over all the regulatory hurdles and everything else is uncomfortably uncomfortable it's doing the things you don't want to do when you don't want to do them and then after a while and you get successful because no one really i mean you think about the things in life that have been major success moments for you and i'm willing to bet you were in an uncomfortably uncomfortable position 100 my ground zero moment when like

Starting point is 00:44:35 life happened to me yeah mind you i did it myself but i just didn't realize at the time in relation to my early life crisis at the tender age of 33 where my workaholism landed me in financial ground zero was a massive wake-up call for me and and i was absolutely determined not to make the same mistakes again and and hence the the journey i've gone on but unfortunately a lot of aussies don't work that out until they're at or nearing so-called retirement age and then it's like holy moly they have you know what i'd like to refer to as a o-s-h-i-t super moment which is uh it ain't gonna be enough uh and then they've got 10 to 20 years ahead of them to even have a chance of of getting there and it's much more difficult at that point in time yeah regret uh is is bitter

Starting point is 00:45:26 at the best of times once you once you are in that uncomfortably uncomfortable situation you start to fix it you'll then move into comfortably uncomfortable so what was uncomfortable is no longer quite as uncomfortable and then when you solve the problem guess where you'll be back at comfortably comfortable again and so this is a cycle top left bottom left bottom right top right and if you want to go from good to great you need to work your way through the cycle and say to yourself where am i comfortably comfortable and what do i how do i improve it well you have to move through the through those steps that we've been through right now and if you do that you're choosing to forsake comfort for discomfort in order to build

Starting point is 00:46:20 resilience, skill, and ultimately strength. If you go to the gym and you lift weights that aren't a challenge for you, you won't build muscle. You might tone, but you won't build muscle. You need to build muscle to be a bigger financial success. But like I say in the book, you turn up to gym and you try and lift a weight that's too heavy without the right technique, you'll only hurt yourself. The same is true financially. You need to learn the technique before you try and lift the weight. Otherwise, you're just going to end up with a sore back. Yeah, and this is where the manual, the money magnet comes into play

Starting point is 00:47:01 because it actually gives you a pathway and frameworks to start putting that together. And if we sort of shift back into that significant zone, then, again, you're great at coming up with easy-to-remember analogies and acronyms, et cetera, you talk about the three Cs. Can you break down how you define significance and how the three Cs fit into that? Yeah, well, a lot of people say,

Starting point is 00:47:30 I'm not really passionate about anything. And that's because they've been so focused on survival, so passionate about survival, that there's no room for anything else. I'm here to tell you with all the conviction that I have in my bones and blood, that god has put a a cause on your heart it's probably different to the cause on my heart because we're each embedded with something that is something that makes our blood boil when we

Starting point is 00:47:59 see it or is something that we're interested in it could be saving the whales it could be environmental it could be social justice could be anything and because the the need is so many or so big uh there is there's a big vacuum of people out there who are financial resources resources so the three c's are cause find out something uh that is a cause that you're interested in and then the second is a care you know try and find someone who cares about what it is because you don't have to do it yourself. Odds on there's an organization out there that is doing good work in the space already. You need to partner with it. I would love to get a phone call from you saying, hey, I've been financially successful. I would like

Starting point is 00:48:58 to partner with you financially to be someone that helps you do good work in this area. You don't have to do the good work i mean i often say i don't know why i can't sing i can't dance and i can't juggle but god has given me the ability to make money god has given me the ability to make money so that i can resource causes that are important to me to build his kingdom in that way which leads us to the last c which is context based on the causes you support and the cares you care about your money will take on a context beyond dollars and cents it will gain meaning and the meaning that it gains will add significance to your life yeah it's really well said and i've you know it sort of comes back to that concept of of fulfillment uh you know freedom is part of it

Starting point is 00:49:55 but fulfillment uh as i've learned from my good mother who did this all of her life and took me long time to understand it is you know for me is giving freely to others without ever expecting anything in return and without them even knowing you're doing it uh and you don't experience a fulfillment until you start doing that so the real benefit of i think financial freedom is being able to achieve that fulfillment by freely giving to others uh and and there's just no better feeling it's like having your own child you know when you when you see people have babies and it's not your own it's like oh grief i can't imagine myself doing that but when you have your own baby you're sort of doing toyota jumps with a permanent smile on your face for months well it's exactly

Starting point is 00:50:41 the same when it comes to fulfillment what are your thoughts around that steve can i read you something uh bushy i've just called it up while you're talking there because i wasn't planning on talking about it but i've been able to find it pretty quickly off a presentation i did a little while ago my wife and i and our kids had the amazing experience of living in america for a year 2016 2017 half a year in each year and we were fortunate to as i've indicated earlier make a substantial sum of money from our investments in the united states so we decided to to give some money back and the church that we were going to we're getting this thing called a dream center up and running where they were going to take an old supermarket

Starting point is 00:51:25 in a disadvantaged area and turn it into a school outreach childcare area and partner with a local police station so that they'd put a police station there to ensure that youth gangs and drugs didn't get a foothold in a really good project. Yeah. And so we gave a gift to this Dream Centre getting off the ground. And without asking for it, I received the following note handwritten back to

Starting point is 00:51:55 us. Steve and Julie, I wanted to thank you for your generous gift of $50,000 to the Fort Myers Dream Centre. Wow. I know that your generosity will result in so many lives of young people and mothers and kids and men being eternally changed. Thank you. Only time and eternity will tell the stories of what a difference you have made for the generational legacies to come. Thank you and God bless you continually. Wow.

Starting point is 00:52:33 That would certainly warm the cockles of the heart, mate. You just can't put a price on that. what do you say then and you sort of touched on this earlier but what do you say when you hear others say that yeah that's all very good I'll start working on significance after I've got my own money and my own survival sorted out the old you know once this then then that exercise what do you say you need another s word scale so give according to what you have not what you don't have i'll give more tomorrow there's this parable in the bible i'm not sure if you know it it's the parable of the rich young fool and uh it goes like this the

Starting point is 00:53:18 ground of a certain man yielded an abundant harvest he thought to himself what shall i do i have no place to store my crops then he said this is what i'll do i'll tear down my barns and build bigger ones and there I will store my surplus grain and I'll say to myself you have plenty of grain laid up for many years take life easy eat drink and be merry but God said to him you fool this very night your life will be demanded from you then who will get what you have prepared for yourself the lesson we all need to learn from this is don't put off to tomorrow what you can do today you need to build giving into your financial plan and the book explains how to do that in a way where you'll never miss a single cent out of what you give but what you give

Starting point is 00:54:08 will help add significance there and then to spur you on to keep making the sacrifices and delayed gratification needed to do more i can't explain how it works but the principle of sowing and reaping is 100% law of nature if you expect to receive first you must sow if you expect to receive without sowing you'll only get a harvest of nothing this principle in the book that I talk about in order to attract more you need to be more attractive means that you need to embrace this concept of significance and survival not significance or survival mate uh just yeah you've got away with words there's absolutely no doubt about that mate and uh i feel like we could talk for hours mate we've only just started to scratch the surface so that

Starting point is 00:55:04 gives me an excuse to get get you back on at some stage in the future steve but mate i i want to sort of pivot now into the old ambush fast forward but the but i affectionately referred to as the bushfire lightning round where we ask the the questions where we glean your words of wisdom on on the stuff that people want to get their teeth into so first of those mate and you've given us a bunch of these already today but what's your favorite quote and why and you can give us a stevism because i i noticed in the book that you didn't end up putting in your own others quotes because of the challenges around that you and you put some awesome ones in there share a couple of with us it might have seemed a bit indulgent to quote myself i had all these killer quotes

Starting point is 00:55:47 from people who i've read that made a difference to my life that i wanted to put in the book and start each chapter with one of them i thought it'd be fantastic epigraphs they're called and when i when i gave it to the publishers as a first draft manuscript they said oh no steve we need permissions if the people are still alive and they're hard to get and just too hard and i'm I'm like, well, what do I do then? And they're like, I don't know. And I'm like, well, I can – my mate Rainer Hanel said he's been to a lot of my seminars.

Starting point is 00:56:21 His wife, Alina, and I used to work together in accounting before I'd even bought a single property. She came to the Kiyosaki seminars in the early days with me. They've been following me a long time, and they say these things that I say as Steve-ism. So, hence, that's why they're in the book. But this one, it is a Steve-ism, but I don't think it's in the book, which is a bit of a problem.

Starting point is 00:56:41 Why wouldn't you have put your favourite one not in the book? But they don't always fit in. Here it is. Better to have it and not need it than need it and not have it. Love it. Love it. Yeah, that's pretty self-explanatory, that one. Boy Scouts 101.

Starting point is 00:56:58 If we swing back into the literary field for a minute, in addition and over and above your own books of gold, what's the top book that you'd recommend that we read and why? Oh, look, it's cliche. I really would encourage everyone to take a read of the Bible and to study it. There's a fantastic organisation worldwide, non-denominational, free resource called Bible Study Fellowship.

Starting point is 00:57:27 I've been a part of it for the better part of two decades and can highly recommend it. No ulterior motive there. But as a book to read, a book that I read or listened to recently, which I think was fantastic, atomic habits by james clear yeah yeah that's absolutely gold and in creating those those habits uh around that and that's a a nice switch into uh the next question actually yeah i'd love for you to share a personal happy habit rewarding ritual or daily discipline that you employ that's

Starting point is 00:57:59 contributed most to your sustainable success over the years i think you touched on it earlier the ability to see consequences so in order to do that to create the space to stop and think to carve out of busyness a period of time wherever possible to stop and and contemplate to think what does this mean ask why and then ask what does it mean to me interest rates go up why what does it mean to me that's that's the process that i work through yeah that's no that's we allow business to get in the road of that and and you know unfortunately time out and reflection is way underrated in the context of being able to to really allow those insights to come in yeah I mean, we allow busyness to crowd our space, but the question is why?

Starting point is 00:59:01 And the answer is because we're terrified of silence. We make ourselves busy because when we stop, we're afraid of something. I wonder what that might be. The person looking in the mirror, I think, might be the answer to that one, mate. But swinging finally back into the investment space, what's both the worst and the best piece of investment advice that you've ever received? Well, the worst piece of investment advice I ever gave anyone

Starting point is 00:59:31 was don't buy houses in the country. They'll never go up in value. And I gave that to Alina before I'd bought a single property. And to my eternal shame, I'm the one that then ended up buying a fair chunk of Ballarat. at uh that was very bad advice that i gave her the best investment advice i've ever got well i'm not sure what that'd be mate there's been so much good advice that i've got from the seminars that i've been at over the years

Starting point is 01:00:00 stuck it oh i'm trying to think just quickly perhaps along the lines of uh you'll never get rich on the sidelines the the notion that you've kind of got to be in the game to shoot the winning goal there's lots of people who are in the bleachers and on the sub bench when it comes to making money and they're either watching the game or they're part of the game but not in the game investing is an in the game experience you've got to be in the game to get the result and so i would say to someone who's in the bleachers get on the sub bench if you're in the sub bench get in the gain yeah so it's doing where it all happens there's no doubt about it absolutely agree yeah if we had sort of summarized our awesome conversation today steve and with a focus

Starting point is 01:00:51 on the money magnet obviously what are your key takeaways and immediate actions for aspiring existing investors that are listening in can always invent a reason to do nothing and with the noise going on in the market at any point in time around interest rates unemployment wars obviously pandemics we can get scared and we can sort of hide our money under our bed if you like and and not really put it to good use money is there as a servant if you deploy it it will it will return it will grow but left alone it can't multiply it can't mate by itself it needs to be put to use to mate so therefore i would i would say to someone there's never been a better time than right now to invest yesterday is a memory and tomorrow is a promise

Starting point is 01:01:43 figure out what you can do to gain the scaffolding support and accountability of course the skill needed to take action now don't be afraid of what might happen in down times opportunity is in abundance there's just not a lot of abundant investors taking advantage of it in fact i would rather invest in a down time than a good time because asset prices inflate and idiots are everywhere during good times but i've made the most money in the quickest time for the least risk and the lowest aggravation in down markets yeah a true contrarian and i'd certainly subscribe to exactly the same exercise i'm pretty excited right now for that reason given the crisis of confidence that the mainstream media is hell-bent on scaring us with but uh what what's new and next

Starting point is 01:02:40 for you then planting trees i've got 1500 acres of moonscape that i am trying to turn back into a native forest i've got to plant trees i've got a new fund that's in the early stages of being uh being born and is in gestation uh that that may come to pass and then of course i've got a lot of work to do to promote this book and have more conversations with people about how to help them with their money and i look forward to doing that to a certain extent i i say that a little bit laissez-faire because i really love talking to people who'll do something with it yep i i get a bit ho-hum talking to people that want to listen but don't ever want to do anything but then again everyone has their own time in their own place and so I'm willing to chat to people in an effort

Starting point is 01:03:38 to be an agent of change and I hope that's what this book does. Yeah I have no doubt it will and as I've well people way brighter than I keep telling me that you've got to hear something seven times before you take action on it so repetition is the first key to success so We'll make sure that we keep reinforcing that message. And while we're talking about the money magnet, for those that have really resonated with what we talked about and inspired to actually start making changes and breaking out of the ho-hum that's been dragging them

Starting point is 01:04:13 down for a long time, where can they get their hands on a copy, mate? Well, these days online booksellers, Booktopia, Amazon, and they regularly have offers where I think they'll discount it, maybe even send it to you for free if you buy a few other books. Or alternatively, as I like to say, in all bad bookstores, you'll be able to get a copy. I love that.

Starting point is 01:04:35 Well, let's finish with a bit of a challenge that you and I briefly spoke about before because what I'm really interested in is, like you, is people taking action. So here's the challenge. Go out and grab yourself a copy of The Money Magnet and then And email us with a very simple exercise. What is the living legacy that you're going to create as a result of reading the book?

Starting point is 01:05:06 And just email me at bushey at knowhowproperty.com.au. That's bushey at knowhowproperty.com.au. We'll leave the notes in the show notes as far as that goes. But reach out. I'll share that with Steve. And then the best response and the best answer, Steve's very generously agreed to provide a signed copy thereof of the money magnet.

Starting point is 01:05:28 Any further comments on that, mate? Let's upscale it. Let's not only do money magnet, let's do a signed copy of all the books I've ever written with the possible exception of nought to a million because there's not very many of them left in print. But I think we put a deadline on it so that if people happen to listen to this in 2042, they don't get in touch with us.

Starting point is 01:05:50 good point well this is this is going live in in early uh november why don't we say by the end of november bushy yeah done done brilliant mate uh i'm going enjoy seeing my uh inbox flooded with uh responses to that steve and frankly listeners if that's too hard because you're not quite there yet just read the book something that you read in the book that will be the the The point of change for you, and more importantly, as Bushy said, because you're an action taker, what you're going to do that's different as a result of reading the book, because the journey of a thousand miles starts with a single step, right? So you're probably not going to become rich in a month, but little things done consistently over long periods of time will lead to a profound change. Yeah, couldn't have said it better, mate. But, look, as I said at the start, this has been an absolute

Starting point is 01:06:50 bucket list exercise for me, mate. I've been a very serious follower and an action taker as a result of your inspiration and information over the years. I feel like we've only just scratched the surface, so I really want to thank you for your very generous time on the show and I look forward to keeping the conversation going, Steve. Thanks for having me, Bushy, and God bless listeners. I hope that you are able to achieve for yourselves.

Starting point is 01:07:14 all the financial dreams that you aspire to. Brilliantly said, mate. Thanks, mate. We'll talk soon. Cheers. Thanks for getting invested. Now, here's three easy ways you can take action to start making it happen,

Starting point is 01:07:31 to ensure you build momentum and start living by design, not default, so that you're following your freedom formula. Firstly, subscribe to this podcast, if you haven't already, and keep the weekly inspiration coming. Secondly, get a copy of my book, Get Invested, for free and find out what it takes for you to invest in living more and working less. Just visit bushymartin.com.au forward slash books

Starting point is 01:07:56 or knowhowproperty.com.au or click on the links in the show notes. And thirdly, join me and the Get Invested community. Each month I send a free and exclusive email full of practical self-help and wealth wisdom that our current Freedom Fighter subscribers can't wait to get. Just visit bushimartin.com.au, scroll to the bottom of the page and sign up. And there you have it. In three easy steps, you're on your way to dusting off your forgotten dreams and making them a reality. Get Invested is proudly part of the Property Hub, your home for property investment insights

Starting point is 01:08:32 and inspiration. When you subscribe to the show, you get all of your Get Invested episodes along with Realty Talk, Australia's longest running and leading online property show for red-hot property investing news and insights, direct from all of the industry leaders and influencers. And finally, feel free to connect with me on Twitter, Facebook, and LinkedIn, as I'd love to hear your feedback, your inspiration, your ideas, and your questions and queries anytime. Thanks for listening.

Starting point is 01:09:04 Hear you next week. and as always, dream as if you'll live forever and live as if the days you'll last.

Property Hub - Investment Insights & Inspiration - Get Invested: Part 2 - Steve McKnight on becoming a money magnet

There aren't comments yet for this episode. Click on any sentence in the transcript to leave a comment.