Speaker 1: Exactly how I'm going to achieve my financial goals and
Speaker 1: dreams for two thousand and twenty five, breaking down my
Speaker 1: game plan, the things that I'm going to do or
Speaker 1: have actually already begun to help make sure that twenty
Speaker 1: twenty five is my best year yet. Welcome to Sugar
Speaker 1: Mama's Fireplay. Good morning, everyone, and welcome back to another
Speaker 1: episode of Sugar Mama's Fireplay. Today, I am really excited
Speaker 1: to share with you the game plan, the strategy, how
Speaker 1: I'm going to be managing my money, my income, my
Speaker 1: cash flow, and hopefully ticking off all the goals that
Speaker 1: I have set down for two thousand and twenty five. Now,
Speaker 1: before I begin, a quick reminder as to my general
Speaker 1: advice warning and my financial planning license details.
Speaker 2: Obviously, the things I'll be.
Speaker 1: Talking about in today episode are exciting and you might think, oh,
Speaker 1: is this right for me? Maybe I should be doing
Speaker 1: this myself. And yes, whilst these things are great and
Speaker 1: could most definitely help you, you never know if there's
Speaker 1: actually something else that may be even more powerful, which
Speaker 1: is why you should always go and talk to a
Speaker 1: financial planner and ask them for personal advice. Now, to
Speaker 1: anyone who's listening to this going, Yes, I know this.
Speaker 1: Can I know the warning, I understand it, But I
Speaker 1: can't afford a financial planner right now, or I don't
Speaker 1: want to see a financial planner right now? Can I
Speaker 1: remind you as to my book Mindful Money. In Mindful Money,
Speaker 1: I explain absolutely everything you need to know and understand
Speaker 1: about setting yourself up for financial independence, from managing your
Speaker 1: cash flow to picking the right superannuation account, from building
Speaker 1: your investment portfolio of whatever assets.
Speaker 2: You may desire.
Speaker 1: So there are some great resources out there to rely
Speaker 1: on until you are ready to use, until you are
Speaker 1: ready to go and see a financial planner. All right,
Speaker 1: let's talk about my financial game plan, and of course
Speaker 1: you are welcome to ask me any questions through Instagram now.
Speaker 1: In last week's episode, I shared with you some of
Speaker 1: my financial goals, which I will admit I was a
Speaker 1: little bit nervous about doing, wondering what you might think.
Speaker 1: But I'm sure that's just my own insecurity because no
Speaker 1: one here really judges each other. We're here to hold
Speaker 1: each other's hand, pull each other up if we're down,
Speaker 1: and of course keep cheering all the way as we
Speaker 1: go from strength to strength, even when it comes to
Speaker 1: pushing through those setbacks and challenges. Now, the reason why
Speaker 1: I want to share with you my game plan is
Speaker 1: to help you realize how important it is for you
Speaker 1: to have your own game plan for your own goals.
Speaker 1: Of course financial goals, but also all those other goals.
Speaker 1: As I said previously, if you have goals without a plan,
Speaker 1: there's just simply as a wish floating around not really
Speaker 1: actually doing things. By having a game plan, you start
Speaker 1: setting down a strategy, and these are the key benefits.
Speaker 1: And for me, when I look at my game plan,
Speaker 1: it helps ensure that these goals are achieved. So for me,
Speaker 1: having a game plan is really important. I think you'll
Speaker 1: get a lot of value yourself from doing your own
Speaker 1: game plan for your goals. I know myself when I
Speaker 1: have done a game plan and I've folded it to
Speaker 1: the best of my ability, even if I do fall
Speaker 1: short at the end of the year, I know that
Speaker 1: I will still feel proud about how hard I've worked,
Speaker 1: the effort that I put in, the determination, the commitment,
Speaker 1: and the passion that I have gained along the way
Speaker 1: from my own personal growth and development. So here are
Speaker 1: some additional benefits for you to think about when you
Speaker 1: design your own game plan for your financial strategy of
Speaker 1: course your own personal growth throughout twenty twenty five.
Speaker 2: Now, the reason why I'm going to.
Speaker 1: Quickly touch on these benefits is to help motivate you
Speaker 1: to really do a really robust, detailed game plan, but
Speaker 1: also understand that it can be flexible and fluid and
Speaker 1: work with you as your year of goals and things
Speaker 1: happen and don't happen, and there are setbacks, but allows
Speaker 1: you to get back on the bandwagon again. And then
Speaker 1: I promise, the moment i've shared with you these key
Speaker 1: benefits of a game plan, I will share with you
Speaker 1: my game plan. But this is important, so please bear
Speaker 1: with me. Number One, having a game plan stops you
Speaker 1: from wasting time. When I look at my game plan,
Speaker 1: I can see that there is a lot to be done.
Speaker 1: I've got a busy twenty twenty five, and the longer
Speaker 1: I wait, the longer I delay stuff around, I'm just
Speaker 1: going to end up adding more stress and pressure to
Speaker 1: my shoulders, which I don't really need or want any more.
Speaker 1: So why would I want to make life so much
Speaker 1: harder for myself? This is the value of having a
Speaker 1: game plan. The second benefit of having a game plan
Speaker 1: is it allows me to allocate my time and see
Speaker 1: the priorities. When I look at my goals and I
Speaker 1: look at the strategy for each goal to help make
Speaker 1: sure that it's going to happen, I can actually see
Speaker 1: with a great sense of clarity as to what I
Speaker 1: need to tackle first and also what is the smartest
Speaker 1: thing to actually tackle first. Whilst I would love to
Speaker 1: jump in and focus purely on renovating our kitchen, I
Speaker 1: know that it is far more efficient and more important
Speaker 1: to actually focus on building up our financial float and
Speaker 1: some of our emergency money funds. So having game plan
Speaker 1: really helps give you that bird's eye view on your
Speaker 1: own financial situation and what really needs to be fixed
Speaker 1: as a pressing priority, and you know to put that
Speaker 1: at the top of your list as a priority. So
Speaker 1: it allows you to allocate your time and also you
Speaker 1: can use as a motivation to push through those responsible
Speaker 1: goals that you can quickly then move on to those
Speaker 1: fun goals like holidays and special purchases. Number three, game
Speaker 1: plan will curb your distractions.
Speaker 2: I am just like you. I love fashion.
Speaker 1: I love captural wardrobe fashion, I love beautiful handbags and shoes.
Speaker 1: I love holidays and going out for dinner and spending
Speaker 1: time with friends, and I love the occasional glass of champagne.
Speaker 1: But I also know that I've got a lot of
Speaker 1: things to achieve.
Speaker 2: I've got a big year ahead of me.
Speaker 1: But when I go back to my game plan and
Speaker 1: I look at all the exciting things that are ahead
Speaker 1: of me and all the things that I can potentially
Speaker 1: achieve for myself and for my family, suddenly this point
Speaker 1: of comparison between buying a new pair of pants, shoes,
Speaker 1: or address versus having a brand new kitchen, a kitchen
Speaker 1: of my tastes and styles and one that's not going
Speaker 1: to fall apart. And when I open up a cuver door,
Speaker 1: suddenly that point of comparison helps dissipate those sort of
Speaker 1: instant gratification, almost materialistic desires, and it recalibrates my sense
Speaker 1: of focus and what is important and what is the
Speaker 1: bigger picture here for twenty twenty five. So that is
Speaker 1: a really great value of having your own game plan.
Speaker 2: Number four. A game plan allows flexibility.
Speaker 1: A lot of people think that a financial strategy, or
Speaker 1: in this case, a financial game plan, is set in stone, and.
Speaker 2: It's very rigid strict you must follow it to the tea.
Speaker 2: That couldn't be further from the truth.
Speaker 1: A game plan is fluid, it's free flowing, and it's flexible.
Speaker 1: I shared in last week's episode that if something pops up,
Speaker 1: for example, whilst I'm saving up some emergency money. For example,
Speaker 1: I shared last week that one of my biggest priorities
Speaker 1: is to quickly rebuild our emergency money at the level
Speaker 1: that it really should be, as well as our financial float.
Speaker 1: But at the same time, one of my fun financial
Speaker 1: goals is to renovate our kitchen. Now, I know that
Speaker 1: if a special sale comes up, for example, appliances, and
Speaker 1: I'm able to buy the dishwasher and the cook top
Speaker 1: and the fridge, all those things come up with an
Speaker 1: amazing sale, it would be sensible to capitalize on those opportunities.
Speaker 1: And I've given myself permission to have some flexibility there now.
Speaker 1: By having this game plan and having that flexibility, because
Speaker 1: I've agreed with myself that there will be some give
Speaker 1: and take and some allowed tweaks and changes along the way,
Speaker 1: I know that I can safely jump on those opportunities
Speaker 1: to actually help save money and jump on some great bargains,
Speaker 1: but I know the moment I've ticked that box and
Speaker 1: made the most of those opportunities, I can then return
Speaker 1: back with clarity direction as to which goal is next,
Speaker 1: which is my case, returning back to those emergencies, save
Speaker 1: if I haven't built them up sufficiently yet or not.
Speaker 1: So that flexibility can allow you to safely deviate if
Speaker 1: you like, but then it directs you straight back to
Speaker 1: what you need to focus on as a priority. And
Speaker 1: number five peace of mind. Having a financial game plan
Speaker 1: is like having instructions cooking instructions. You see, my game
Speaker 1: plan has been really carefully mapped out. I have not
Speaker 1: rushed this at all. I have written it down, I've reviewed,
Speaker 1: I've changed it, I've reviewed it again, I've adjusted it,
Speaker 1: I've reviewed it again. I've then expanded it, I've reviewed
Speaker 1: it again. I've then tweaked and changed it, and then
Speaker 1: I've reviewed it and then I've improved it. So by
Speaker 1: having these really clear instructions and this list of priorities
Speaker 1: and this understanding of time and deadlines, I have this
Speaker 1: incredible sense of purpose and a direction to follow that's
Speaker 1: going to help me, to the best of my ability
Speaker 1: achieve those goals. And I know that I'm not going
Speaker 1: to be wayting time. And what this has given me
Speaker 1: is a great sense of confidence and empowerment, and I
Speaker 1: actually feel really excited about achieving these goals and following
Speaker 1: these instructions. As I said, it's like cooking instructions being
Speaker 1: given a new dish to try that's a little bit
Speaker 1: out of our skill set, a little bit complicated, but
Speaker 1: then the instructions are clearly detailed in front of us
Speaker 1: with steps. Having a game plan is exactly the same thing.
Speaker 1: It gives you instructions to follow, and particularly the beginning
Speaker 1: of the year or throughout the year, when there are
Speaker 1: natural setbacks and challenges, coming back to those instructions can
Speaker 1: really help boost your confidence and actually allow you to
Speaker 1: see that you might quite possibly be able to do this,
Speaker 1: that is, achieve all of those goals and dreams that
Speaker 1: you set for yourself. This is the power of a
Speaker 1: game plan. All right, now you understand why you need
Speaker 1: to have a game plan, and you now feel excited
Speaker 1: about working on your game plan. Let me share with
Speaker 1: you my game plan to achieve my goals, because I'm
Speaker 1: sure some of you will have very similar goals to me,
Speaker 1: and maybe some of the ideas.
Speaker 2: That I share with you to help achieve my goals,
Speaker 2: you can.
Speaker 1: Maybe apply if appropriate few obviously with the guidance of
Speaker 1: a financial planner, and help improve your own financial situation.
Speaker 1: So one of my goals is to help rebuild our
Speaker 1: financial float and emergency money. Now, when I did the
Speaker 1: Sugar Mama ten Day Financial Reset Challenge, I realized that
Speaker 1: our emergency money is not really where it really should
Speaker 1: be at this point in time, and our financial float
Speaker 1: got a bit of a hammering during Christmas and obviously
Speaker 1: all the ongoing expenses that come with school holidays. So
Speaker 1: I now know what I need to do, and my
Speaker 1: game plan to rebuild those is to go back to
Speaker 1: our budget and look at tweaks and changes that we
Speaker 1: can make to help shift more money as a priority
Speaker 1: into our financial float. And just so you understand, if
Speaker 1: you've done my budgeting and cash flow course, a financial
Speaker 1: floats is designed to help prepare for all those ad
Speaker 1: hoc expenses like birthday presents, Valentine Day, any sort of
Speaker 1: religious festivities that you choose to celebrate such as Christmas,
Speaker 1: and it's for all those kind of irregular bills that
Speaker 1: kind of throw us off guard. Like you know, when
Speaker 1: the retro comes through, all the car insurance, the CTP,
Speaker 1: that's what that financial float is designed to help you
Speaker 1: get through. So I need to go back to the budget,
Speaker 1: which I've already done, make some tweaks and changes, and
Speaker 1: I'm also going to be including one month the weekend
Speaker 1: where we have a no spend weekend, so it can
Speaker 1: really help us boost additional money that can be shifted
Speaker 1: across in rebuilding that float and of course rebuilding our
Speaker 1: emergency money. The second goal that I have shared with
Speaker 1: you is our goal to have a holiday, a family
Speaker 1: holiday skiing in Queenstown, New Zealand. Now I'm excited to
Speaker 1: share with you. Already in the process of doing this,
Speaker 1: so we're booking all of our flights on Frequent Flyer points.
Speaker 1: We are also issues a little bit controversial, but we're
Speaker 1: going to be pulling the kids out of school now
Speaker 1: by traveling outside of school holidays, the cost of accommodation
Speaker 1: and the amount of points that we need to book
Speaker 1: those flights is significantly cheaper, like twenty percent up to
Speaker 1: thirty percent cheaper. I'm also going to be looking at
Speaker 1: buying package deals, especially when it comes to our lift
Speaker 1: passes and skier gear rental. There are some great offers
Speaker 1: going at the moment. I'm going to make sure I
Speaker 1: lock those in before those prices start to adjust and
Speaker 1: change as we get closer. So the key points are
Speaker 1: obviously using frequent fly points. Tom and I pretty much
Speaker 1: fly religiously with one particular airline that we both love,
Speaker 1: and we both cross share our points to help maximize
Speaker 1: booking as many tickets as possible for free. And because
Speaker 1: Tom flies so much at work, he's got a great
Speaker 1: status with one of the airlines, which means it gets
Speaker 1: the opportunity to book flights with less stress less drama.
Speaker 1: It also means we potentially get upgrades along the way.
Speaker 1: But the most important point that I also want to
Speaker 1: share here with you is a holiday savings I always
Speaker 1: recommend that everyone have a lifestyle goal account, and this
Speaker 1: is something I go into detail and explain who the
Speaker 1: Sugar Mamma Budget and cash Flow Academy. So this is
Speaker 1: a separate online savings account that you contribute to every
Speaker 1: time you get paid, In fact, the moment you get paid.
Speaker 2: It's a preage.
Speaker 1: Determined a great amount flat amount that you put into
Speaker 1: that account every single month or every single foot night
Speaker 1: or wherever often you get paid and this can build
Speaker 1: up over time. So when it comes to wanting to
Speaker 1: go on holiday, on booking those flights, booking that accommodation,
Speaker 1: there is sufficient money. They're ready to go. And it
Speaker 1: means that you have not only money paid for the
Speaker 1: accommodation and the airfare and all those spending money things
Speaker 1: like food and activities entertainment whilst on holidays, it means
Speaker 1: that you then come home without the stress and drama
Speaker 1: and guilt and embarrassment and shame of having debt. I
Speaker 1: have never gone on a holiday and come back to debt.
Speaker 1: It would actually ruin all the benefits and blessings and
Speaker 1: pleasure that comes from traveling and taking yourself away from
Speaker 1: groundhole day. So we be using those approaches to make
Speaker 1: sure our holiday is booked in, it's paid for upfront,
Speaker 1: and we come home with absolutely no debt whatsoever. And
Speaker 1: again this is a non negotiable. And anyone's interested in
Speaker 1: doing the Sugar Mamma Budget and cash Flow Academy, which
Speaker 1: does include a one on one session of me, I've
Speaker 1: popped the enrollment details in the podcast notes for you.
Speaker 1: Goal number three and that is renovating our kitchen. Now
Speaker 1: I'm going to share something with you, and I do
Speaker 1: have a bit of an I guess an unfair advantage
Speaker 1: you could save from this particular goal. But one of
Speaker 1: my goals from last year was actually to save up
Speaker 1: money for this goal, and we got so close to
Speaker 1: achieving this goal by regular savings, Tom and I both
Speaker 1: taking on additional ad hoc work to help boost the
Speaker 1: funds that went into this savings account. But something really
Speaker 1: frustrating happened at the end of twenty twenty four. Kitchen
Speaker 1: renovation savings took a massive nose dive. We had some
Speaker 1: unexpected expenses that were not our fault, completely out of
Speaker 1: our hands, and we weren't told about them, and literally
Speaker 1: got sent a huge bill with ten days to quickly
Speaker 1: pay it. And it was a small business behind this
Speaker 1: that had actually helped us, and we just went, Okay,
Speaker 1: it's Christmas time, everyone's suffering with cash show, we need
Speaker 1: to make sure we paid this as a priority. So
Speaker 1: as heartbreaking as it was and frustrating it was, we
Speaker 1: just took the money out of our kitchen innovation funds
Speaker 1: and paid it. It was a bitter taste in my mouth.
Speaker 1: I won't lie, but I share this with you to
Speaker 1: let you see that I am human just like you.
Speaker 1: This was so disappointing. I was so upset and disheartened
Speaker 1: because it did come out of the blue and there
Speaker 1: was nothing we could do about it. And it's just
Speaker 1: part of life's rich tapestry. You know, nothing is ever
Speaker 1: smooth sailing onward and upwards. It's top twitsts and turns
Speaker 1: backwards then you might leapfrog again. So anyway, we had
Speaker 1: a bit of a we have a bit of an advantage,
Speaker 1: you could say, because we are returning back to the
Speaker 1: remaining savings that are still in that account, even though
Speaker 1: they've obviously been eaten away substantially, And we're already hitting
Speaker 1: the ground running with taking on some extra work that
Speaker 1: Tom and I both can do as we juggle family
Speaker 1: and friends and some sort of sense of normalcy and
Speaker 1: balance in life. So we are slowly and steadily building
Speaker 1: this up, and we plan to hopefully be able to
Speaker 1: have enough money by July so that we can get
Speaker 1: the whole kitchen paid for upfront without taking on any debt. Now,
Speaker 1: I know some people were thinking, why wouldn't you just
Speaker 1: like redraw off your home loan, like, there's surely extra
Speaker 1: money sitting in your redrawer facility. Well, no, I know
Speaker 1: a lot. It's really tempting to do that, and trust
Speaker 1: me across my mind plenty of times, but our home
Speaker 1: is non deductible debt. The more I can focus on
Speaker 1: paying the home down by also taking a mindful flow
Speaker 1: around money and making sure that we add value to
Speaker 1: the home and increase the equity in our home by
Speaker 1: a new kitchen will hopefully add value to the price
Speaker 1: of the home.
Speaker 2: I really want our.
Speaker 1: Mortgage to be coming down. I want to see it
Speaker 1: coming down at a faster rate than what it is.
Speaker 1: So no, I don't want to take a step backwards
Speaker 1: by using extra funds that we've paid onto the mortgage
Speaker 1: to pay for the kitchen. I really want to pay
Speaker 1: for it separately and know that we are still on
Speaker 1: top of our game plan to eventually pay off our
Speaker 1: home and own it outright in full, so that when
Speaker 1: we enter retirement, we enter retirement being debt free, or
Speaker 1: at least mortgage free. So that's a really strict boundary
Speaker 1: that I've set in place, and that one is certainly
Speaker 1: definitely not flexible. I'm saving up for this kitchen and
Speaker 1: nothing is going to stop me. And hopefully I have
Speaker 1: no more setbacks along my way. But here you can see,
Speaker 1: hopefully how normal I am, just like you in working
Speaker 1: on your goals. I have setbacks, I have things that
Speaker 1: just happen, and I feel the same frustration that you
Speaker 1: feel when these things do happen to you, as they
Speaker 1: do to everyone else. No one is immune from this
Speaker 1: goal number four and this is the big one again
Speaker 1: to remind you of that. You know advice of going
Speaker 1: to see a financial planner, and this is not a
Speaker 1: strategy I recommend for everyone. It's a higher strategy and
Speaker 1: that is my goal to invest one hundred thousand dollars
Speaker 1: into the thousand dollar project portfolio. Now, the way I'm
Speaker 1: going to be doing this is by debt recycling. That is,
Speaker 1: taking out a separate investment loan secured against our family
Speaker 1: home to go and buy more shares for the thousand
Speaker 1: dollars project. Now, as I said, this is a high
Speaker 1: risk investment strategy. It is powerful though for the right
Speaker 1: people that use it at the right time and for
Speaker 1: the right reasons. I would only ever recommend someone do
Speaker 1: this after seeing a mortgage broker that can specialize in
Speaker 1: this area that has a huge amount of experience in
Speaker 1: setting this up the right way the first time and
Speaker 1: under the guidance of a quality financial planner that actually
Speaker 1: specializes in wealth creation strategies like this. And if you
Speaker 1: need a recommendation to either a good mortage broker or
Speaker 1: for a good financial planner that does this, send me
Speaker 1: an email or sorry, send me a pre dm is
Speaker 1: what's best on Instagram and I will happily pass some
Speaker 1: contacts over to you for you to have a chat
Speaker 1: with them and get some personal advice. But this is
Speaker 1: my game plan as to how I'm doing it to
Speaker 1: help manage it in a smart, intelligent, wise way. So
Speaker 1: the first thing is I'm actually going to leave this
Speaker 1: towards the end of the year. I have a lot
Speaker 1: of goals to achieve. My number one priority is rebuilding
Speaker 1: our float, rebuilding our emergency money, obviously, going on that
Speaker 1: family holiday which will ideally do as frugally as possible,
Speaker 1: and of course retivating our kitchen. So I really want
Speaker 1: to get those things ticked off first. I will then
Speaker 1: come back and see what the cash flow is actually
Speaker 1: looking like after we've done the kitchen. Now, assuming I
Speaker 1: am able to save up enough money by July to
Speaker 1: do our kitchen. All that money that I was then
Speaker 1: saving up and redirecting towards the kitchen or even the
Speaker 1: emergency money, can now go towards building up some savings.
Speaker 1: Because what I plan to do again, this is not
Speaker 1: personal advice whatsoever or strategic advice. I want to do
Speaker 1: this in a really sensible way. So when it comes
Speaker 1: to applying for this investment loan, hopefully seeing the kitchen
Speaker 1: being renovated, and we do a bank valuation, hopefully the
Speaker 1: value of our home will be higher because they can
Speaker 1: see there's a brand new, shiny kitchen and some few
Speaker 1: other things we've done around the house to help.
Speaker 2: Improve the value.
Speaker 1: So it will mean that my LVR, which is my
Speaker 1: loan to value ratio, will be even better. I will
Speaker 1: only be borrowing a maximum of one hundred thousand dollars.
Speaker 1: I will also be pre paying the interest on this
Speaker 1: investment loan. Now, by doing this it means for them
Speaker 1: twelve months, I don't need to stress and worry about
Speaker 1: my cash flow. I know that I have fixed and
Speaker 1: paid for that interest upfront and advance and six month
Speaker 1: montes later that will obviously go as a tax deduction.
Speaker 1: I will be using this one hundred thousand dollars to
Speaker 1: add value to the thousand dollars share portfolio, which is
Speaker 1: a three hundred dollars diversified investment portfolio. So by adding
Speaker 1: another one hundred thousand dollars, I'll make sure that I'm
Speaker 1: going to include new investments in this share portfolio, which
Speaker 1: is going to add the diversification, which means it helps
Speaker 1: reduce my investment risk. I'm also going to make sure
Speaker 1: that this investment loan that I'll be used setting up
Speaker 1: with my mortgage broker, Adam mcabe, and making sure it's
Speaker 1: set on principle and interest. Now this is not normally advisable,
Speaker 1: but because of me and the way that I look
Speaker 1: at money, and my focus is very much about building
Speaker 1: long term, growing passive income. For me, I prefer to
Speaker 1: see that debt slowly and steadily coming down, even if
Speaker 1: it is a little bit of a cost to reducing
Speaker 1: our mortgage our cash flow, and I may even have
Speaker 1: to pay a little bit more, maybe on interest, especially
Speaker 1: as I might be potentially fixing it.
Speaker 2: But for me, I.
Speaker 1: Want my investments to be cash flow positive or at
Speaker 1: least cash flow neutral, So I will then have complete
Speaker 1: control and flexibility in making, perhaps if I want, when appropriate,
Speaker 1: ad hoc repayments beyond prepaying the interest on that loan.
Speaker 1: So I have complete control. That means I'm in a
Speaker 1: really safe boundary when it comes to a high risk
Speaker 1: investment strategy like this of debt recycling. Another thing that
Speaker 1: I will be doing is with the dividends earned from
Speaker 1: that one hundred thousand dollars invested, and we'll use a
Speaker 1: very simple formula here of a five percent yield, which
Speaker 1: is not too dissimilar from the average yield of most
Speaker 1: Australian industrial shares. I'm actually reinvesting those dividends. That extra
Speaker 1: dollars per year doesn't really help me that much in
Speaker 1: paying off our mortgage. I'd rather use our cash flow instead.
Speaker 1: I would much prefer to reinvest the dividends with all
Speaker 1: the other dividends that are being reinvested in this investment
Speaker 1: portfolio for further compounding growth opportunities. So what I'm trying
Speaker 1: to explain is by reinvesting those dividends again, I'm increasing
Speaker 1: the loan to value rape. So I'm decreasing the loan
Speaker 1: to value ratio because the share portfolio is growing, but
Speaker 1: at the same time, the investment loan attached to that
Speaker 1: portfolio is reducing. So again, as time goes by, with
Speaker 1: dividends being reinvested and me chipping away at that underlying
Speaker 1: loan principle one hundred thousand dollars, my financial strategy is
Speaker 1: getting safer and safer and more robust, and I'm really
Speaker 1: focusing on building that long term growing passive income. But again,
Speaker 1: to come back to that concept of flexibility and keeping
Speaker 1: it fluid, nothing is set in stone. If our cash
Speaker 1: flow is looking scared or looking maybe not as consistent
Speaker 1: and stable as I would like, I understand that it
Speaker 1: is okay to park this idea for some time, and
Speaker 1: whether that be one month, three months, or even a
Speaker 1: year so bit. However, by having this in my game plan,
Speaker 1: it means I keep a very close eye over this
Speaker 1: particular goal and of course over this strategy, and it
Speaker 1: may not necessarily mean that I do invest that full
Speaker 1: one hundred thousand dollars. If it's not quite right, or
Speaker 1: it's the loan is not necessarily approved, I can perhaps
Speaker 1: look at doing fifty thousand dollars or twenty thousand dollars. Again,
Speaker 1: the game plan helps keep me focused and helps give
Speaker 1: It keeps me thinking about how I can achieve my
Speaker 1: goals with what I've got going on in my life
Speaker 1: at that point in time. And then finally the fifth goal,
Speaker 1: which I don't think I mentioned in too much detail
Speaker 1: in last week's episode, and that is our mortgage.
Speaker 2: We have a mortgage.
Speaker 1: We decided to upgrade our home about three years ago,
Speaker 1: and we went from a really really small mortgage to
Speaker 1: a much bigger mortgage, probably bigger than I would have
Speaker 1: really liked, and we had some huge expenses along the
Speaker 1: way that we're again with things that are out of
Speaker 1: our hands like water damage. And if you know about
Speaker 1: our experience with special strata.
Speaker 2: Levees, significant six.
Speaker 1: Figure and I say high six figure special strata levees.
Speaker 1: So our mortgage has taken a bit of a battering,
Speaker 1: and I really want to get back on top of that,
Speaker 1: or we're already on top of it, but I just
Speaker 1: want to see some faster debt reduction when it comes
Speaker 1: to our non deductible debt. So the moment July is
Speaker 1: done and hopefully we've paid for that kitchen outright, it's
Speaker 1: being done. We're ripping kitchens out and putting in new,
Speaker 1: a new shiny kitchen. That cash flow after I've saved
Speaker 1: up the six and a half thousand dollars to help
Speaker 1: prepay that one hundred thousand dollars investment loan, the cash
Speaker 1: flow can now be redirected to making extra mortgage repayments
Speaker 1: on our home. So you can see with our cash
Speaker 1: flow in helping achieve our goals. This game plan is
Speaker 1: also almost making me feel like and look like a
Speaker 1: traffic control director. I'm directing the surplus cash at the
Speaker 1: moment towards rebuilding our financial float and emergency money. I've
Speaker 1: also got at the same time ticking around nicely in
Speaker 1: the background or cooking in the background our holiday savings fund.
Speaker 1: I'm also obviously aggressively trying to get money into our
Speaker 1: kitchen renovation savings fun, but of course not before making
Speaker 1: sure that financial float and emergency money is addressed as
Speaker 1: a priority. And then I'm obviously stockpiling with my goal
Speaker 1: to have six and a half thousand dollars up front
Speaker 1: ready to prepay interest on a new one hundred thousand
Speaker 1: dollars in debt recycling investment loan, so beyond, as soon
Speaker 1: as I've ticked all those things off. All that extra
Speaker 1: surplus can then actually be freed up and go purely
Speaker 1: to pay off our home sooner and making those extra
Speaker 1: payments on a consistent basis as well as those ad
Speaker 1: hoc savings that we can do picking and choosing with
Speaker 1: les pressure because we've got so many of our other
Speaker 1: goals hopefully sorted, that we can decide okay, well, actually
Speaker 1: there's an opportunity for me to do some extra work.
Speaker 1: I could actually focus on getting this done over the weekend,
Speaker 1: and there's be some an extra thousand dollars or two
Speaker 1: thousand dollars for example, to go onto the homemone. We
Speaker 1: have a lot more space and flexibility and that fluidity
Speaker 1: to then work on that goal. Now, a great hack
Speaker 1: I would love to share with you on that I
Speaker 1: love using all the time and is actually something I've
Speaker 1: built myself is a special calculator on the sugar mom
Speaker 1: ol website. It is called an extra lump sum repayment calculator. Now,
Speaker 1: this is not your normal extra lump sum calculator. It'll
Speaker 1: actually allows you to show you the power of making
Speaker 1: extra repayments on a consistent basis as well as those
Speaker 1: ad hoc repayments so you can see the power of
Speaker 1: those two debt reduction strategies and how powerful they work
Speaker 1: in combination with each other, really saving you huge amounts
Speaker 1: of money and a huge amounts of valuable time. In fact,
Speaker 1: the other day, Tom was talking to me about the
Speaker 1: idea of taking some money out of our rede or facility,
Speaker 1: and I quickly shut that idea down because I jumped
Speaker 1: onto my calculator, plugged in our mortgage details, the interest rate,
Speaker 1: how far are we into our term, and what is
Speaker 1: sitting in our red or facility, and I showed him
Speaker 1: the impact of taking that money out, and it actually
Speaker 1: was going to cost us a year on our mortgage
Speaker 1: if we did that, and almost ninety thousand dollars in interest.
Speaker 1: So when I was able to see this in the
Speaker 1: calculator because it shows you in a visual way through
Speaker 1: a graph, I took a screenshot of it emailed it
Speaker 1: to Tom, and then Tom agreed, you know what, we
Speaker 1: don't want to do that that is detrimental to our finances.
Speaker 1: It's an undoing all the harpwer work we've done so far,
Speaker 1: and no, we're not going to do that. So this
Speaker 1: is a really great tool to help explain things to
Speaker 1: your partner, your loved ones or even a friend as
Speaker 1: to what you're doing, but also as a great tool
Speaker 1: to help keep you motivated, to help keep you focused,
Speaker 1: but also help you create your own individual game plan
Speaker 1: for your financial goals and dreams. And of course in
Speaker 1: the Sugar Mamba calculators, there are so many of the
Speaker 1: brilliant calculators like my superannuation sweet Spot calculator, as well
Speaker 1: as the dividend investing calculator, where you can see the
Speaker 1: power of investing say, for example, ten thousand dollars with
Speaker 1: an average yield of say five percent, and an average
Speaker 1: dividend growth rate of say five percent, and you can
Speaker 1: put in the capital growth as well, and you can
Speaker 1: see how those dividends, when reinvested in compounding over time,
Speaker 1: can actually really help contribute towards your financial freedom goals
Speaker 1: such as building up passive income. So please use all
Speaker 1: of those free resources, and again to remind you, everything
Speaker 1: I've just spoken about is general advice only and for
Speaker 1: educational purposes. But me sharing with you my game plan,
Speaker 1: obviously I'm making myself a little bit accountable here.
Speaker 2: You're my accountability buddy.
Speaker 1: But also you can see some ideas or some inspiration
Speaker 1: to help you think about your game plan. Revisit your goals,
Speaker 1: make sure they're written down, make sure you're reading them
Speaker 1: every single day. Make sure you have a detail world
Speaker 1: cooking instructions to follow, the recipe, the ingredients, everything you
Speaker 1: need to make sure that what you cook up in
Speaker 1: twenty twenty five is financially delicious, financially fulfilling, and leaves
Speaker 1: you feeling financially fabulous, so that you can take a
Speaker 1: break in December, switch off, relax, reward yourself along the way,
Speaker 1: and of course you have all the great hacks, habits, insights,
Speaker 1: strategies from your previous successful game plan that you can
Speaker 1: then apply for twenty twenty six for even greater financial
Speaker 1: success or at Everyone. It has been an absolute honor
Speaker 1: to be able to chat with you and connect with
Speaker 1: you this morning. I wish you a fabulous week and
Speaker 1: as always, I would greatly appreciate it if you could
Speaker 1: make me a rating and review, and please feel free
Speaker 1: to send this episode to any of your family and
Speaker 1: friends that needs some financial assistance.
Speaker 2: It would benefit from hearing.
Speaker 1: This financial game plan for their own follows or at Everyone,
Speaker 1: have a great challenger sto