Friday, January 30, 2009

Product Newsletter 1 February 2009

an investment property is a money tree (right), not a house


You will appreciate that I am biased, and while I always maintain that “the time to invest is whenever you can afford the weekly contribution” circumstances right now are really exceptional.

When you put it all together, the reasons to be “quietly confident” and proactive are obvious: ·

Minimal out-of-pocket costs

Undersupply of housing

Record population forecasts

Rising rents

Low interest rates and further reductions in the pipeline

Tax minimization

Long term capital growth

Security of ‘bricks & mortar’

Tax deductible insurance against involuntary loss of income

In addition, property values have been increasing ever since records began.

We’ve had world wars, depressions, interest rates at 22% - and you know what - after every pause, values have continued upwards. Remember that speculators rely on timing, investors rely on time.

The time to invest is now, because in 7-10 years time when according to statistics (and I can’t see the long term trend line altering) each your investments are likely to have doubled in value.

In ten years time, what happened in 2008 will be of little significance.

All you have to do is contact me – Bernard Kelly – and I’ll help you explore your options.


I have been running spreadsheet numbers recently on the basis of interest at 6.5%

For a “average” couple earning $60,000 plus $25,000, it would cost them $110 per week in the first year to have their names on the paperwork for a house and land package priced at $380,000.

Of course, in the real world, with increasing rent, that couple would only ever have to contribute half of that – say $55 per week, and probably only for four years.

So it’s theirs for just $11,440 plus the $1000 deposit i.e. $12,440.

Yes – you read it correctly. $12,440 over four years.

And the funding advisors that I am in contact with say even 6.5% is perhaps 0.5% over what most transactions have been done at over the last few months.

Be that as it may, I prefer to be conservative.

However, image what the investment contribution for this average couple becomes if rates fall another 1%.

When I now run the numbers for this couple at 5.5% - I’m not going to be tempted to use 5.0% - their contribution would only be $57 in the first year, so their contribution would be $28.50 time 52 times 2 years i.e. just $2,964 plus the $1000 deposit.

Yes – you read it correctly. $3,964 over two years.

And then they will sit back, and in ten years time -if history repeats itself as it has since records began - they’ll be saying “back then in 2009, we really should have bought TWO”

If you want me to run the spreadsheet numbers for your income, feel free to contact me – Bernard Kelly - anytime.


First time clients often say – how do we know it will work?

My response is that investors only need to reflect on what they paid for their own home – and what their children might have to pay in the years ahead – to recognize that residential property is expected to continue to increase in value.

What I bring to the table is wisdom, experience, research, logic, and efficiency.

My concept of professional investing is “least in, most out” with 105% funding from local Australian banks (depending of course on their valuations).

You only need a $1000 deposit to start. I show you (and your family) how to invest with maximum efficiency.

We have developed a clinical and scientific approach to property investment and we were delighted early in 2007 when we received a testimonial (from America): “You are the only rational source of information in your market”.

Our method totally ignores emotion, and has its focus solely on the expected financial return.

My practice is based on long term relationships, repeat business and personal referrals.

And none of that happens if clients are not totally at peace with the first investment that I share with them.

And I’m happy to share with you.

Phone me anytime 0414 778 518


Most of us will not have enough for 20-25 years of dignified retirement, but I have come to realize that many a micro-business has started from a household hobby.

And many profitable hobbies can be continued into retirement, providing extra income.

To learn more, go to

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Wednesday, January 28, 2009


Deferring the drawdown of retirement assets by just four years increases a person’s eventual monthly income – for life – by 33 percent, says Steven Sass, coauthor of Working Longer: The Solution to the Retirement Income Challenge (Brookings Institution Press, 2008).

And an eight year delay can produce a 75 percent monthly bonus, he says.

Many people actually want to work longer than their parents did, and even longer than they expected, for the continued social engagement and connection as well as the continued income.

Even more promising, a slew of surveys show that as many as half of all baby boomers want to “give back” in their encore careers, in schools, community organizations, environmental efforts, and troubled spots at home and abroad.

These major structural changes in working lives have been building for decades; the economic crisis, which has wrecked many retirement plans, is accelerating this shift and increasing its urgency.


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