confessions of an · 2013-02-15 · the barefoot investor confessions of an inustry outsier take...

the barefoot investor – confessions of an industry outsider

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Confessions of an Industry Outsider

CONTeNTS

The Industry Outsider ........................................ 3

Scott Pape tells journalist Susan Cram about the

day he was ‘killed’ on live radio

The Millionaire Next Door .................................. 5

What a rough-looking bloke in ugg boots

taught a gentleman in a Gucci suit

Dear Barefoot ..................................................... 7

• Help me pay less tax!

• Mortgage, super or shares?

• How much do I need to retire?

How to Increase Your Investment Returns

20-fold ................................................................ 9

This could quite possibly be the most important

article you’ll read in your investing career – grasp

its key concept and you’ll compound your wealth

many times faster than the ‘average’ investor

How to Get Free Cars for Life ......................... 11

New cars lose half their value the day you leave the

showroom floor – here’s a little strategy for getting the

car you want without breaking the bank

Dear Barefoot ................................................... 13

• How do you pick the best stocks?

• Save tens of thousands without extra mortgage

payments? – prove it!

• My parents are being pushed around by

their planner

Why Most Landlords Are Losers ... And

How You Can (Almost) Triple Your Money

in Property ......................................................... 14

Using excruciatingly conservative Barefoot forecasts, I

came to the conclusion that it was possible to almost triple

your money over the next 10 years – in property

Why Old Stubby Fingers the Accountant

Is Ripping You Off ............................................. 17

… Or why most people shouldn’t have a self-managed

super fund (SMSF) … and what they should

have instead

Dear Barefoot ................................................... 20

• Can you get my hubby to join the Compound

Interest Club too?

• Multiple streams of income

• Where can I meet investors like me?

A Politically Incorrect Response to All

Those Who Say We’re Doing It Tough ........... 21

Has it ever struck you that – in Australia at least – the

last 25 years of uninterrupted economic growth have

left us, well, kind of soft?

A Story I’ve Never Told, Until Today ................ 23

Common sense is not so common – if you can use it, you’ll

find yourself on the path to incredible wealth

“The Barefoot Investor rocks!”

Sir Richard Branson


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An independent survey by CoreData Research Australia found that,

“Scott Pape was considered the most knowledgeable regarding financial matters, topping the ratings in the areas of superannuation, investment, taxation, insurance and economics. Pape was also considered the most trustworthy, truthful in how he presents himself and in touch with financial matters that affect everyday Australians.”

SCOTT PaPe TellS jOurNalIST

SuSaN Cram aBOuT The day he

waS ‘kIlled’ ON lIve radIO

Susan: Legend has it that you’re the only financial advisor the ABC has ever had to use the ‘kill switch’ on.

Scott: That’s true – but it wasn’t me dropping the F-bombs. I was doing a talkback segment on the sneaky fees the financial planning industry pockets – and why you’re better off not paying them – and a financial advisor rang up and proceeded to have a brain meltdown live on air.

Susan: But you’re a financial planner yourself!

Scott: Guilty as charged. But I made the decision long ago to get my own financial licence so I could be completely independent and answerable to no-one … and to be free to poke the big boys of the industry who create complicated, high-cost products that make them millions.

There’s so much rubbish out there passing off as ‘financial advice’, it makes me angry. It’s caused me a bit of grief in the past – people have threatened to sue me numerous times for what I’ve written in the papers. But at the end of the day I’m a country boy from Ouyen and I’ve been raised to call a spade a bloody shovel!

Susan: You seem to do a thousand things – columns, radio, TV, keynote speeches. Do you sleep?

Scott: Not much. But my wife and I are about to have a baby, so I’m in training.

Susan: What do you like doing best, then?

Scott: It’s hard to say. I work at both ends of wealth: from helping widows and single mums struggling

The INduSTry OuTSIder


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“ASIC asked me to develop a program for schools, called MoneySmart Teaching. It’s now up and running.

to put food on the table, to advising AFL and NRL footballers on managing their wealth. You’d think these famous footballers on huge salaries would have it all – not a money worry in the world. But they have their problems just like all of us do. For them it’s getting into bad habits, blowing all their cash.

Susan: But what do normal people worry about the most with their money?

Scott: They want to know where to put their money so that it will grow safely. That’s exactly why I created the Barefoot Blueprint, my investment newsletter. I asked the smartest, wealthiest mentors of mine to help out. Our head analyst, Mike, is a retired multi-millionaire (I say he’s the best analyst money can’t buy) who has traded on dealing desks around the world. And in its first year our little newsletter put most highly rated professional fund managers to shame. We outperformed the broader market, and by investing in businesses that most of the pros had never heard of!

Susan: You’ve also been working at the other end of the age scale – teaching school kids?

Scott: This is one of my real passions – financial literacy for young people. ASIC (the Australian Securities and Investments Commission) asked me to develop a program for schools, called MoneySmart Teaching. It’s now up and running.

Susan: How does it work?

Scott: The trick is, finance shouldn’t be taught once a week in a specific class – it needs to be integrated into the curriculum. So MoneySmart is taught as part of English, history, science, maths – that way kids get to learn about finance without really realising it – they just ‘get it’.

But we’ve taken it one step further by educating teachers about money as well. For it to work, teachers need to feel confident about managing their money so they can share it with the kids.

Susan: If this is a very public government program, how can you call yourself an ‘outsider’? After all, the Government employs you to help teach kids in schools, you do tax tips each year for the ATO, and you’ve even helped them explain new credit card laws!

Scott: Well, I’m an outsider to the financial services industry. But at the same time I’m working on the inside – with schools, the media and the Government – to help people see some old-school commonsense truths about money.

Susan: Thanks for your time today, Scott, where can people find more about you?

Scott: I write my nationally syndicated column, the Barefoot Investor, each Saturday in News Limited newspapers, and in Sunday’s newspapers I write a Dear Barefoot column that answers readers’ questions from right across the country. I also work with Eddie McGuire on Triple M, and I do a lot on the telly – the most recent is my own show on CNBC, the largest financial news network in the world.

Hey, in reading back over this interview, I sound like I’m a bit of a wanker (as my old man would say). So let me tell you about a time when I fired myself from a job...

http://www.barefootblueprint.com/wealth-blueprint-90


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whaT a rOugh-lOOkINg BlOke IN ugg BOOTS TaughT a geNTlemaN IN

a guCCI SuIT

What I’m about to tell you is still very sensitive – so I cannot name names.

My nightmare started when I was approached to be the feature money writer for a lifestyle magazine.

Editor: “Our readers are dashing, sophisticated and worldly – they are opinion-makers.”

Barefoot: “George Clooney reads your magazine?”

When I got off the call, the Barefoot team quizzed me: “You’ve never read that magazine, have you?”

I hadn’t. So later that evening, after getting home to the little country town where I live, and feeding my dog Buffett, I headed down to the local IGA supermarket to get my hands on a copy. I stood flicking through the mag in my standard Monday night wardrobe: ugg boots, tracksuit pants and a flannel shirt.

The pages were chock-full of buff models, aftershave (sorry, cologne) and handbags (sorry, compendiums). It spoke to a wealthier, better-looking version of me. And this aspirational tone was exactly what the advertisers wanted.

That night I wrote my first column for the mag – three times.

I finally decided that, given this was an aspirational magazine, what the readers really wanted was to be able to afford the images being sold to them.

So I wrote my article about how the wealthy people I know get rich: working hard, saving money and compounding their wealth.

I compared what a real millionaire does (like buying a decent second-hand car) to what a try-hard does (like leasing a Beamer), and even added a handy little chart so they’d really get the message.

INveSTINg

The mIllIONaIre NexT dOOr

“So I wrote about how the wealthy people I know get rich: working hard, saving money and compounding their wealth.


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BlOOdIed aNd BruISed

My article came back slashed, gaping with red changes:

“You can’t say not to lease a BMW – they are a major sponsor – and so are the high-end fashion labels you mock. Please understand that our reader is, well, a little more sophisticated than you’re used to writing for.”

Truth be told, I know dozens of self-made millionaires – and a quick straw poll I conducted showed that none of them had read this magazine. I reckon that, like most image-based marketing rags, the mag’s real readers were image-conscious wannabes – exactly the people who need to hear my message the most.

But that wasn’t the game, so I politely told the editor I was happy to stick with my unsophisticated, wealthy audience.

Editor: “Let me get this straight – you’re telling me to get stuffed?”

Barefoot: “That’s right.”

The awesome thing about working for News Limited,

Triple M and Channel Ten is that I’ve never been put in the situation where I had to pull a punch or change my content to keep advertisers happy. Not once. It’s something I’ll never do.

And, unlike the magazine editor, I can pick my (Barefoot) readers in 30 seconds flat.

They come in all shapes, sizes, ages and occupations. But they all have one thing in common: they’ve made building wealth a priority. They may not be flashy talkers, but they’re slowly and surely heading towards incredible wealth.

And, as I’ve said before, to become wealthy you need to be around people who are moving in the same direction as you. And you need someone you trust to give you the guidance and select the investments that will compound your money over time.

“... the mag’s real readers were image-conscious wannabes – exactly the people who need to hear my message the most

In this six-week series, set to launch in 2013, I’m going to coach you to:

Safely transition from your current job to a six-figure (plus) career

“kickstart your Career”Coming soon in 2013...

· Help you define – once and for all – what your dream career looks like

· Ensure that it builds on your personal strengths AND passions

· Explain, step-by-step, a strategy for getting in front of key decision makers

Plus, the team and I will:· how to negotiate your salary – and ethically build in pre-set future bonuses

· Show you how to grow your network, help people, and have loads of fun

I’ve built my career by bucking the trend, and in this course, I’m going to explain why the traditional career ladder is dead, and how you can leapfrog your way to a new, highly paid career – even if you don’t have the qualifications, or skills (right now).


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helP me Pay leSS Tax!

Dear Barefoot: My husband works in IT and earns $125,000 per year. I work part time three days a week in a small consulting firm but take the bulk of my income (around $30,000) cash in hand, which allows us to still claim childcare benefits. I’ve been offered another job for $45,000, but would have to pay tax on this. What would you do? (name withheld)

Scott says: You’re a thief.

I really dislike paying my taxes – so much so that I spend good amounts of money doing everything I can to legally minimise the amount I pay out – but I still pay them. And it’s not because I think either side of politics spends it wisely (they don’t). It’s because I can’t buy back my integrity.

You may think you’re winning by cheating and getting some government benefits, but you’re not. Successful people don’t have your situational ethics.

With ongoing national budget problems, middle-class welfare will be on the chopping block – and about time too. The idea that a household on $160,000 should get a government handout is ridiculous. People need to harden up and stop looking to Canberra to solve their problems – they’ve got enough of their own.

hOw muCh dO I Need TO reTIre?

Roger asks: Hi Scott, I’m a dedicated reader of the Barefoot Blueprint. What you write makes sense to me like nothing I’ve ever read before. I’ve had years of financial planners dazzling me with stats and jargon, and where has it got me? You just state it like it is, in terms we can all understand. So could you help me with my problem?

After a lifetime of work, my wife and I have the princely sum of $178,000 in superannuation. That’s combined. I went to a seminar recently and they said that to have a comfortable retirement you need at least $1 million in super. We’ve got no hope of hitting that. We’ll get the pension, but how much do normal people like us need?

Scott says: Hey Roger, you’re not alone – plenty of people feel they haven’t got enough to retire on. The difference is you’re doing something about it by becoming part of my wealth-building community.

In answer to your question, the pension provides a couple with around $30,000 a year, but for a comfortable retirement the latest thinking says you’ll need about double that – which is where the million-dollar-plus lump sum figure comes from.

Many people are unaware that Centrelink doesn’t include the value of your home in its pension calculations – so as a couple you should be entitled to a full pension of around $30,284 (combined), and you can supplement that with both your pension earnings and part-time work.

The real question is: who says you need to retire at 65? In 1909, when the pension was first offered, the retirement age was set at 65 – but most people were dead by then (average life expectancy was 55). Today we’re living on average till we’re 82, but we’re still trying to retire at the same age.

dear BarefOOT



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Either way, to have a decent retirement when you get really old, you’re going to have to keep working and topping up your savings – but that’s not a bad thing. It’s often said that the two most dangerous years of your life are the year you’re born and the year you retire.

Why not work at Bunnings and teach young flatheads like me what a Phillips head is?

mOrTgage, SuPer Or ShareS?

Martin asks: I’m 39 and have one big debt: a home loan of $450,000. I want to pay it off, but I also feel I should start building my long-term wealth – super and shares. I don’t want to miss the boat. So should I put every penny into the mortgage until it’s paid, or should I balance the mortgage with super and shares?

Scott says: Hey Martin, to keep things really simple, I want you to think of your income as falling into three different buckets:

• Blow bucket: Your spending money, your home repayments, and everything else labelled ‘lifestyle’. This bucket has a hole in it – every dollar that goes in leaks away.

• Mojo bucket: Set up a high-interest-paying online savings account and aim to eventually have a sum equal to a quarter of your annual income saved up. (By the way, I don’t advise you keeping

this money in an offset account – even though it’s a more tax-effective way to park your money, for most people there’s too much temptation to blow it.) Don’t think of your Mojo money as a traditional investment – its purpose is to give you the Mojo to live life on your terms. There’s power in giving money a name.

• Grow bucket: This includes your super, your share portfolio and your investment properties. This is the most important bucket because it will compound over time (doubling every seven to ten years). And it will save you a heap of tax: for every dollar you put into super, you’re effectively halving the amount of tax you pay (or more, depending on your marginal tax rate).

I’m a huge fan of getting the banker off your back and owning your home debt free. I’ve seen single teachers who’ve gone on to build million-dollar share portfolios because they’ve managed to slay their mortgage in their 30s. But while I’d certainly make paying down your mortgage a priority, make sure you’re filling all three buckets!

BlOw grOw

BluePrINT BuSINeSSeS

INveSTmeNT OPPOrTuNITIeS

ma

Na

ged

PrO

PerTy

Tru

STSmOjOSavINgS


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ThIS COuld quITe POSSIBly Be The mOST ImPOrTaNT arTICle yOu’ll

rEAD IN your INvEstINg cArEEr – grAsP Its kEy coNcEPt AND you’ll

COmPOuNd yOur wealTh maNy TImeS faSTer ThaN The ‘average’

INveSTOr

Investors become wealthy by buying cheap stocks and selling them at much higher prices, right?

Nope. In fact you’re not even close.

Wealthy investors, those who go on to multiply their wealth over and over, don’t pay a lot of attention to the share price – in the short term at least.

Instead they focus on what Albert Einstein called the eighth wonder of the world – compounding – and specifically on how they can turbocharge their efforts to reach their wealth-building goals. Let me explain …

where The reTurNS really

COme frOm

Good companies earn profits. Great ones retain and reinvest some of those profits back into the business, then, twice a year, share what’s left over (the dividend) with their investors.

Research from Professor Jeremy Siegel, of the prestigious Wharton School at the University of Pennsylvania, shows that 70 per cent of an investor’s return comes from the dividends they receive in the mail – not the share price increasing.

And if you choose to reinvest the dividends you receive into buying more shares, your investment grows – because the dividends also start making money. And with time your investment takes on the appearance of a snowball rolling down a hill, getting bigger and bigger.

hOw TO dOuBle yOur mONey IN

46 yearS

Professor Siegel looked at the returns of share prices, adjusted them for inflation, and found they only went up by about 1.5 per cent a year.

In other words, the average punter makes just 1.5 per cent a year in share price gains (and that’s before we take into account fees and taxes). At that rate you’ll double your money (in today’s dollars) in 46 years.

hOw TO INCreaSe yOur INveSTmeNT reTurNS 20-fOld

“70 per cent of an investor’s return comes from the dividends they receive – not the share price increasing


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hOw TO dOuBle yOur mONey IN

10 yearS

Now let’s see what the wealthy do. Remember all those dividend cheques in the mail? They don’t spend them. They use them to buy more shares.

How?

Well, some companies make the reinvestment of dividends really easy. They offer shareholders the option to sign up to a Dividend Reinvestment Plan (DRP). Not every company does this, but many do.

When a dividend payment falls due, their DRP will issue you with extra shares rather than cash. This not only saves on brokerage fees for you, but as an added benefit they’ll usually offer the new shares at a slight discount to the share market price. Double bonus.

So, using Siegel’s figures, these dividends add another 5.5 per cent to the returns, making a total of around 7 per cent per year (and this is being conservative). With these returns your investment now doubles in 10 years, not 46.

And in the time the average punter has doubled their money (say, turning $10,000 into $20,000 over 46 years), yours will have increased 20-fold (turning $10,000 into $200,000).

COmPOuNd yOur COmPOuNdINg

Want more? The investments that Siegel studied used an average bunch of companies. Which is easily replicated by buying a listed investment company like AFIC and hanging on for the long haul.

But what if you own better-than-average companies?

If you can find wonderfully profitable companies, like Woolies say, you’ll in effect be compounding your compounding. Even if they only squeeze out an extra 1 per cent annual return, your initial investment will go up 35-fold (turning $10,000 into $350,000).

The BarefOOT aPPrOaCh

The most reliable way to create wealth is to build it over time, by buying shares in good companies and using the power of compounding. Not trading.

And if you find great companies (like those we’ve selected for you in the Barefoot Blueprint), you’ll be well on your way to not only becoming a successful investor, but an incredibly wealthy one.

“With these returns your investment now doubles in 10 years, not 46.



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New CarS lOSe half TheIr value The day yOu leave The ShOwrOOm

floor – HErE’s A lIttlE strAtEgy for gEttINg tHE cAr you wANt

wIThOuT BreakINg The BaNk

As a general rule, I try and avoid married women on Facebook. But recently a married woman (who we’ll call Jan) messaged me.

Jan: “I love my husband, but he wants to spend $40,000 on a brand new Commodore, and we don’t have the money – what can I do?”

Barefoot: “Keep your husband away from the dealerships, while I explain how he can have his Commodore and eat it too – it’s a little strategy I call ‘free cars for life’.”

Here’s how it works.

Most people become intoxicated by the aphrodisiac that is the new car smell, and in Jan’s case it was going to cost $39,990 for a brand new Commodore.

To justify such an expense insert quotes from new car salesman here: “You’ll have a family soon and you need a good car, and it makes sense that you don’t buy someone else’s problems”.

Jan’s hubby gets a car loan from the bank with a

five-year loan term that has an interest rate of 11.25 per cent, which works out to be a repayment of $875 a month.

Fast-forward five years and they’ve finally paid off the Commodore – along with an extra $12,478 to the bank in interest.

Over these five years they’ve spent just over $50,000 on the car, yet when they go to sell it they find out that it’s now only worth about $10,000 (according to car industry source Red Book)!

That’s what you call wealth destruction.

Worse, if they’re anything like most new car buyers, they’ll soon get another whiff of the new car cologne and repeat the process – and probably be broke for the best part of their lives because of it.

But there’s a better way. Here’s a nifty little strategy that I learned last time I was in the land of the never-ending car payment from an anti-debt campaigner called Dave Ramsey.

hOw TO geT free CarS fOr lIfe


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After a bit more Facebook ferreting, I noticed that Jan and her husband owned what appeared to be a limited edition Nissan Pulsar.

Legend has it that in the late eighties at a boozy Tokyo lunch a sloshed Nissan executive decided it would be a great idea to join forces with Reebok and manufacture a Reebok-branded Pulsar – which consisted of a Reebok sticker on the bonnet, and an FM sports radio.

The car held its value like a sweaty pair of sandshoes, and today it would be lucky to get $1,500.

Still let’s say that instead of buying the brand new Commodore they tighten up their laces and hold on to the Reebok for another ten months.

Instead of paying the bank a repayment, they put the equivalent amount of money, $875 each month, into a high-interest online savings account.

After ten months they’ve saved up $8,750. They then sell the Reebok Rocket for $1,500, which gives them $10,000 to buy a 2007 Holden Commodore – for cash.

Just six months later, they’re still making those monthly repayments – although to their own savings account, not to the bank – and consequently they’ve saved another $5,250 in the kitty.

They decide to sell the 2007 Commodore (which they get $10,000 for), and combined with their savings are able to buy a 2011 Commodore for $15,000 – not exactly what her hubby wanted, but on hot days when the air conditioner is on it still occasionally lets out a bit of that new car smell.

They decide to keep making their $875 monthly car repayments, but instead of depositing it into a savings account they now choose a low-cost managed share fund that invests in solid, dividend-paying Aussie companies.

At the end of five years, they’ll be in the same

situation that they would be if they’d bought the brand new Commodore – they’d own the car outright.

Yet instead of losing $40,000 by borrowing and buying, they will actually have about $40,000 in their managed share fund (assuming even a below-average rate of return).

That’s what you call wealth construction.

But it gets better. By this stage they understand that the biggest accidents occur on the dealer’s showroom floor – they’re happy to let someone else take the 30 per cent new car haircut.

So they sell their (now six-year-old) Commodore and replace it with a nice, reliable fairly new $15,000 car. Which still leaves them with $25,000 in their managed share fund.

The kicker is that even if they never put in another cent – never make another car repayment – every five years or so through the miracle of compound interest (minus a little tax, but factoring in the trade-in), they’ll have enough money to replace their car with another solid, reliable $15,000 car, for the rest of their life!

The biggest car accidents happen on the dealer’s showroom floor


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hOw dO yOu PICk The BeST STOCkS?

Steve says: I’m a single dad, focusing on raising my daughter & rebuilding my financial plan after the end of my marriage. Being at the top end of middle age I know it’s time to get cracking. The specialist articles in your Barefoot Blueprint each month are great, but I really get the most out of the analysis of your Blueprint Businesses. What I want to know is, in a nutshell, what do you look for in a stock?

Scott says: Steve, your daughter is lucky – not everyone has a parent who cares like you do and who is looking out for their long-term security. When picking stocks with my investment analyst, Mike, I look for long-term security just like you. We pick only good companies with strong earnings, low debt and a good economic ‘moat’ around them (the capacity to withstand competition). Then we look for one more thing: a low price. If we sniff a great company at a bargain price, we recommend it to you in the Blueprint. And remember, we’re investing alongside our subscribers, so we’ve got our own skin in the game.

Save TeNS Of ThOuSaNdS wIThOuT

ExtrA mortgAgE PAymENts? –

PrOve IT!

Col asks: I consider myself a savvy guy. I’ve just gone through the ‘Mortgage Slasher’ special report you sent with the Barefoot Blueprint. ‘Save tens of thousands of dollars on your mortgage without making any extra repayments’. Alarm bells rang. It sounds good but I just can’t help being a bit sceptical – how is it possible?

Scott says: Col, it’s good to be sceptical. But I can assure you that it’s on the level. I got my mortgage guy (who does my personal financing) to put the report together. I paid him $2,000 for his research

time, and gave it away free to Blueprint subscribers. It’s 100 per cent reliable and it 100 per cent works. Less than one out of every hundred people receive truly independent home loan advice in this country – now you can be one of them.

my PareNTS are BeINg PuShed

arOuNd By TheIr PlaNNer

Tillie asks: Earlier this year (when they received an inheritance), my parents had just under $1 million to invest. They went to a financial planner with high hopes ... and came home deflated – Dad was upset, Mum was confused (he tried to sell them on a ‘geared managed fund’). I gently put the latest issue of the Barefoot Blueprint in front of Mum’s nose and she started reading it (she thought it was funny – Dad went straight to your investment returns page). That was it! The next day she and Dad told the planner to go jump. Do you find this is a common story – financial planners who only confuse things?

Scott says: Sadly, yes. A good financial planner is worth their weight in peanuts, but a bad one will end up just giving you a cookie cutter plan that you can find on the back of a Weeties box (and they’ll charge you a hefty fee to do it). In the end, though, it’s up to you to take responsibility, because no-one cares about your money as much as you do.

dear BarefOOT








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uSINg exCruCIaTINgly CONServaTIve BarefOOT fOreCaSTS, I Came TO

The CONCluSION ThaT IT waS POSSIBle TO almOST TrIPle yOur mONey

ovEr tHE NExt 10 yEArs – IN ProPErty

I know what you’re thinking ... have I gone completely nuts?

No more than usual. Though I’ve got to tell you that when my stock analyst, Mike, came to me with the idea of investing in property, my initial reaction was to hurl a scrunched-up piece of paper at his bald noggin.

(I missed.)

However, over the next few hours we pored over one particular property investment, and my attitude changed completely.

Stop! Time out!

I feel like I need to take a cold shower and scrub myself clean after rereading that last line. Those sorts of statements are usually reserved for sleazy property spruikers flogging dodgy investment units.

But let me assure you, I’ve overdosed on Excel, checking and rechecking my figures, and I stand by them: we expect to achieve a 196 per cent

compound gain over the next 10 years from this particular property investment (earning 100 per cent will double your money, and 200 per cent will triple it).

INveSTmeNT PrOPerTIeS? really?

My opinion on traditional Aussie housing hasn’t changed one iota: I still firmly believe that most investment properties bought today are a trap. Their prices are too high, and their returns too low, to justify the dangerous debt burden needed to ‘get in the property game’.

That fact is backed up by Australian Tax Office figures, which show that, despite collecting $28 billion in rents last year, Australia’s landlords still reported a $4.8 billion loss. Less than four in ten property investors made any money.

Smart investors know that, when you boil it down, an investment is really just something that puts money in your pocket – and that’s why most investment properties aren’t really investments.

But this property investment pays you.

And best of all it doesn’t require a costly mortgage, dealing with a burst water pipe at 3am, placating annoying tenants, or putting up with a real estate agent.

wHy most lANDlorDs ArE losErs ... AND How you cAN

(Almost) trIPlE your moNEy IN ProPErty


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BlOOdy BIg greeN ShedS

So what is this property investment?

It’s called the BWP Trust (ASX: BWP) and it trades on the Australian Securities Exchange and has a current market value of $995 million. (A little lingo: trusts call their shares ‘units’ and their dividends ‘distributions’, but for ease of understanding I’ll talk in terms of shares and dividends.)

Now I’m guessing you’ve never heard of BWP, but there’s a good chance you’ve been in one of the properties it owns – Bunnings Warehouse Stores.

Let me be completely clear, this is not an investment in spanners, pots and paints, but rather in the big green sheds and the land that sits underneath them. And while Bunnings’ parent company, Wesfarmers, has a 23 per cent stake in BWP, the rest of the owners are individual investors like you and me.

When you become an investor in BWP, you’re becoming an owner in the real estate of 60 Bunnings Stores – a combined 208 hectares (the equivalent of around 2,000 suburban housing lots) of prime real estate across every capital city in Australia.

a Tale Of TwO laNdlOrdS

BWP is effectively the landlord to its tenant, Bunnings. If you compare that against being a typical residential landlord you’ll see why it’s much, much more profitable.

When my wife and I were renting last year, we signed a standard 12-month lease. In the time we rented, the landlord had to replace the oven, redo the heating and pay council rates, all of which he is required to do under the terms of the tenancy agreement.

When we moved out all we were required to do was steamclean the carpets. But the landlord probably had to give the place a spruce-up – nothing major, just a bit of paint in places and a tidy-up of the kitchen – before he could let it out again. It would have ended up eating thousands out of his hand.

reTurNS TO kIll fOr

Now let’s see why I think my landlord would have been much better off buying shares in BWP.

BWP has ironclad leases with Bunnings for up to 20 years. Written into these leases are pre-set annual rental hikes, and a stipulation that Bunnings must pay all outgoings and upkeep on the buildings.

So not only does the Trust have much longer leases than residential property, it has substantially lower out-of-pockets because the tenant pays for everything throughout the lease. And also usually written into the lease is a requirement to spruce the place up at the end of the tenancy!

That’s all very attractive, but by far and away the best advantage of BWP is that Bunnings pays rental returns that residential property owners could only dream of.

My landlord was earning a 2.4 per cent return per year on the home we rented – and that’s before factoring in his borrowing costs, which would mean he was losing $12,800 a year. This is a typical situation that many Aussie property investors find themselves in.

BWP delivers its owners over three times as much each year – a 7.7 per cent rental return – and that’s after it’s paid its funding costs.

TrIPle yOur mONey IN 10 yearS

While every man and his dog has a view on where Aussie residential property prices are going, commercial property is much easier to value. This is because it’s a numbers game and all the emotion is taken out of it: the value is tied to the rental yield the property delivers.

When the Trust was first set up in 1999 at $1 a share, it paid out a dividend of 7.2 cents to shareholders. In 2011 the Trust paid out 11.98 cents to shareholders and the share price was $1.70.


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That’s why, all things being equal, good-quality property with low overheads and low debt like BWP is relatively easy to forecast into the future. Remember that each lease has an annual 3.5 per cent rental increase. So I’ve factored in a 3.5 per cent growth in the annual dividend, and a corresponding 3.5 per cent growth in the value of the properties, which I believe is both conservative and realistic.

Now I want to run you though my calculations (based on buying 1,000 units in BWP) so that you understand them yourself:

Initial purchase price: 1,000 shares @ $1.90 = $1,900

Initial dividend: 1,000 shares @ 14.6 cents = $146

Extra shares purchased via the Dividend Reinvestment Plan: 77, which is $146 divided by the current share price of $1.90, which means in year 2 we begin with 1,077 shares.

Now what if you’ve got a bit more money to invest, say $10,000? In 10 years’ time your money will have grown to $29,584, and you’ll likely receive a cheque for $2,273 in year 11.

The power of compounding can potentially triple your money in 10 years!

BWP is a winner: it has large holdings in prime real estate right across the country, strong positive cashflows, extremely low debt, and an automatic reinvestment program that makes it easy to compound your money over time.

This is a rare opportunity to invest in Australian property at a fair price. Leave the losses to the landlords, and get paid to invest in property!

---

Disclaimer: This is an excerpt of a much longer report that I wrote for my Barefoot Blueprint subscribers. At the time the share price was $1.90, though it’s much higher now. My research is fiercely independent, and so I received no commissions, kickbacks or payments from the company in question – period. To receive reports like this each and every month, you can subscribe to the Barefoot Blueprint, Australia’s fastest-growing investment newsletter.

“rule your retirement”Coming soon in 2013...

In this brand-new series, set to launch in 2013, I’ll show you:

How a divorced 56-year-old woman on an average income boosted her retirement nest egg by $300,000 (even though she thought she’d left it too late).

· Provide you with a common sense, step-by- step strategy on how you can boost your super – even if you think you’ve left it too late

· Explode the MYTH of investing for income versus investing for growth

Plus, the team and I will:· Arm you with ready-to-use email and verbal scripts that put you in control when dealing with ‘superannuation professionals’.

· Provide you with worksheets, timelines and action steps so you always know what to do and when.




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… Or why mOST PeOPle ShOuldN’T have a Self-maNaged SuPer fuNd

(smsf) … AND wHAt tHEy sHoulD HAvE INstEAD

Lean in close, because I’ve got a deal for you.

I’m going to instantly find you $20,000 to $200,000 that you can use to invest. And, without you doing anything, thousands of dollars will flow into your account to invest in any way you want each quarter.

Pricked your interest?

I’m going to show you how to invest the existing money you have in superannuation directly into stocks without having to set up a costly and complicated SMSF.

And I’ll also show you how to boost your investment returns by 34 per cent – guaranteed!

SlaSh yOur Tax By 50 Per CeNT

Or mOre

Superannuation is the only profitable option for cutting your tax by half or more. It really is the last great (legal) tax dodge – a dollar invested in superannuation slugs you only 15 cents in tax, rather than your marginal income tax rate, which could be as high as 45 cents in the dollar.

And less tax means there’s more money to invest, and to compound.

So even if you don’t chip in any extra money – and just let your employer’s contributions pile up – your super will eventually become the largest item in your net worth calculation.

You can rest assured that this fact hasn’t gone unnoticed by the financial services industry. They’re

busy doing what they do best – turning your hard-earned money into theirs.

The $390-BIllION-dOllar

gravy TraIN

After a long, hard day spending their kids’ inheritance, Baby Boomers across the country pull their Winnebagos into caravan parks, pop open a chardy, and talk to their silver fox friends about what some news reports have labelled the latest ‘must have’ financial fashion accessory – a self-managed super fund (SMSF).

“It’s a sign of financial strength. It shows your peers that you’ve got at least $200,000 in super, and that you’re smart enough to choose your own investments, rather than relying on the woeful returns of retail super funds”, explained an accountant friend of mine.

You know you’re dealing with a sophisticated, well-oiled marketing machine when they make the expensive, compliance-ridden job of administering your own super fund fashionable.

why Old STuBBy fINgerS The aCCOuNTaNT IS rIPPINg yOu Off


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Almost one million Australians now have an SMSF – a figure that has grown 50 per cent in the past five years. Bragging rights aside, I believe there are two main reasons why so many wealth accumulators have set up an SMSF:

(1) They got sick of seeing their super fund ‘going nowhere’ (and being charged for the privilege) and decided to invest the money themselves.

(2) Their accountant told them it was a good idea.

aCCOuNTaNTS are The New

fINaNCIal PlaNNerS

I’ve had some cherished, high-profile dust-ups with the financial planning industry over the years.

For years I’ve called them on their bulldust as they ripped off their clients by trousering shady kickbacks. And I’ve campaigned to end the rorts that have robbed investors of billions of dollars a year of their retirement money.

Yet while this was happening, the industry shifted foot – and this time it’s the turn of the accountants to construct a billion-dollar yearly gravy train from investors’ retirement funds.

Let me show you how it works.

When you run your SMSF, you basically need to jump through the same costly compliance hurdles as the billion-dollar funds. The trustee of an SMSF (that’s you) must:

• Set up the trust deed correctly (which can cost thousands)

• Ensure it’s registered with the ATO

• Set up a separate bank account

• Maintain stringent financial records

• Make sure the investments comply with (ever-changing) superannuation laws

• Have a written investment strategy, and review it each year

• Conduct a yearly audit of both your financial accounts and your fund’s compliance.

Or you can pay an accountant a few grand to set it all up, and a few grand each and every year to take care of it for you – but if you get audited by the ATO, you’re on your own.

Most SMSF investors are unaware that their SMSF could rob them of hundreds of thousands of dollars over time. That’s because it’s not in an accountant’s best interests to tell them there’s a dirt-cheap way to invest their super directly into shares.

hOw TO BOOST yOur INveSTmeNT

rEturNs by 34 PEr cENt –

guaraNTeed!

I promised I’d show that you DO have money to invest, and that you can boost your returns by 34 per cent.

Introducing what I call ‘SMSF Lite’ (though super funds have their own names for it).

Over the past five years traditional retail and industry funds have watched some of their best customers leave them to set up an SMSF.

Now the funds are fighting back.


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There are a number of public offer funds that you can join that allow members to invest their super balance directly into shares – just like a traditional SMSF, but without all the hassles.

And best of all, they’re around 34% cheaper than running a traditional SMSF. And you know what that means? More money for you, and less money for old stubby fingers the accountant.

* Source: A statistical summary of SMSFs – 10 December 2009, Australian Government Review into the Governance, Efficiency, Structure

and Operation of Australia’s Superannuation System

** $180 plus brokerage costs assumed to be 4 trades of $20,000 share parcel ($160 brokerage) for a total of $340 per year on average

balance of $350,000.

*** Based on an 8% return per annum.

so, bArEfoot, you’vE got mE INtErEstED – How Do I Do It?

Take a look at the funds that offer this type of product. When you’ve narrowed your search, go to each fund’s website and investigate further. You’ll want to look out for three things: fees, investment features and insurance options. And, if you’re a little uncertain doing it yourself, please speak to an independent financial advisor, who’ll help you make the best choice.

Many people have said to me they love the idea of becoming an investor but don’t have the ready cash. With an SMSF Lite you’ve now got the ticket to ride.

Not only will you become an investor with a healthy and growing portfolio, you’ll do it 34 per cent cheaper than the so-called wealthy investors with their SMSF bragging rights.

---

Disclaimer: This article is an excerpt from a longer article in the Barefoot Blueprint. There I go into detail about what SMSF Lite funds are available and the tips and tricks to watch out for.

SmSf ‘SmSf lite’

starting capital $200,000 $200,000

set-up fee $2,000 -

average annual fees 1.76%* 0.1%**

Post-tax annual contribution $5,000 $5,000

20-year end balance $853,139*** $1,141,370***

difference fees make to your end balance $288,000 exTra



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CaN yOu geT my huBBy TO jOIN

The COmPOuNd INTereST CluB

TOO?

Rebecca asks: Scott, I got such a kick out of reading your report ‘How to Join the Compound Interest Club’ in the Blueprint. It made such sense and cleared my head about how money can work for me, not against me. I’ve never been much good at investing but you put it so simply even I found it easy to understand. To think I could turn $5,000 into $420,000 in 25 years blew my mind. One problem: my hubby won’t believe me and doesn’t even want to read it. What can I do to get him on board?

Scott says: Rebecca, great work on educating yourself. The cynical side of me says that if your husband can’t get excited about making $420,000 with no effort, then maybe you married the wrong dude! My kinder side says that you can’t force things on people, you need to be patient. Maybe a little down the track (when your dollars start to add up), he’ll get it.

mulTIPle STreamS Of INCOme

Pete asks: Investing has always been on my to-do list, but I haven’t made the leap yet (I’m 27). When do you advise people to start investing – before or after buying a house?

Scott says: I started early. When I was a little kid, instead of paying me pocket money my dad gave me one share in BHP. He sat me on his knee and said, “you’re now a part-owner in one of the biggest companies in the world – and they share their profits with you”. That was a life-changing day for me. Even better was the day when I saw the profits (dividends) hit my account.

You don’t have to wait until you’ve paid off your house – you can get started now. The aim of the game is to create multiple streams of income – other than just relying on your job or your home. You don’t need a lot of money to get started – as little as $1,000. At first it’s like a drop, then a splash, then it turns into streams of money!

where CaN I meeT INveSTOrS lIke me?

Deenah asks: I was never once interested in investing, never great with money. But since I got onto your Blueprint I’ve been learning quickly. I get such a buzz each Friday when it arrives. I like reading about stocks to buy, but you know what I like best? It’s that I feel part of a community. Do you have any events I can get into where I can meet fellow Barefooters?

Scott says: Hey, Deenah. You be amazed how many people feel more confident when they are part of something big. And like you they want to meet other people on the same path. Stay tuned – 2013 is going to be a big year, with plenty of opportunity to be part of the Barefoot community.

dear BarefOOT




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a POlITICally INCOrreCT reSPONSe TO all ThOSe whO Say

we’re dOINg IT TOugh

HAs It EvEr struck you tHAt – IN

AustrAlIA At lEAst – tHE lAst 25 yEArs

Of uNINTerruPTed eCONOmIC grOwTh

have lefT uS, well, kINd Of SOfT?

That’s the only conclusion I can come to after spending some time with my grandparents and other octogenarians, hearing about their life experiences. Unlike us, they lived through genuinely tough times.

I’ve got a huge amount of respect for the dignity with which the so-called ‘silent generation’ lived their lives (financially and otherwise). And with all the navel-gazing negativity going on today, let’s draw on some lessons from their lives in the 1930s and 40s.

1 › They paid their bills One of the nicest things I ever heard said about my grandfather was that he always paid his bills on time. For him it was an integrity issue: you were either a man of your word, or you were a crook. Going bankrupt was not an option.

2 › They paid in cash They didn’t have a choice. Credit cards were yet to be invented, and bankers back then behaved like responsible corporate citizens. More than that, people had an aversion to debt, caused by the borrowing binge that preceded the (not so) Great Depression, which was still fresh in their minds.

3 › They saved money The hard times left them with a healthy respect for risk, and this stayed with them – and ultimately served them – even after the economy picked up post World War Two. Saving wasn’t a diversification strategy – it was a survival strategy. These were the days before mass-market consumer credit, so most people simply couldn’t live beyond their means.

4 › They fixed stuff Things were fixed, not thrown away. Both my grandfathers had sheds where they could get away from the missus, have a crafty beer or a fag, listen to the footy, and ‘tinker’. Things were handed down from eldest to youngest. (Maybe they were the first greenies? Sure, let’s go with that.) Shoes were re-soled, socks were darned, dresses were hemmed.


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5 › They worked hard With five mouths to feed, there was no time to ‘find themselves’ (let alone protest at the inequities of the world). For both my grandfathers this consisted of manual labour, and while both parents worked long and hard, there was only one income. Second and even third jobs were common.

6 › They didn’t expect handouts The dole was something to be ashamed of, or at least it was for my grandparents. You worked hard, paid your taxes and paid your way. Listening to them, it seems like there wasn’t the entitlement attitude that pervades our politics today. Case in point: remember the outcry over families earning $150,000 having their (middle-class welfare) government benefits cut?

7 › They lived in modest homes One of my mate’s grandfathers once told me, “I remember growing up with dirt floors – it was like Christmas when we got carpet – imagine that, being happy with carpet!” They bought what they could afford, then they slowly added ‘mod cons’ like carpet and curtains.

8 › They lived through genuinely tough times I learned this when my grandmother said (out of the blue) that “we skinned rabbits in the old days – whatever it took to make ends meet” (wait – KFC was around even back then?). Still, I understood what she was getting at. There was large-scale unemployment and married women weren’t accepted in the workforce. They simply did what they had to do.

9 › They had a sense of community While Gen Y are the most connected generation in history, it’s commonly cited that they’re also the loneliest. Things seemed to be simpler back then – maybe because there wasn’t a TV piping pipedreams into their homes each night making them feel unworthy. Instead, they lived with dignity, they saved money, and they competed – but on their integrity and their family rather than the ‘stuff’ they had.

10 › They created a real legacy Each generation that has followed the ‘silent generation’ has done everything in its power to reduce the risks of life: credit now enables us not to have to stress about living within our means, superannuation means we don’t have to worry about funding our retirement, and populist politicians claim to be able to fix whatever worries are left over – so long as we vote for them.

But it’s impossible to be fully insulated from risk. And even if you could be, you wouldn’t want to. A bit of pain is life’s way of telling you to stop doing dumb stuff – and it’s essential in sharpening your long-term decision-making skills.

So despite all the doom and gloom in the newspapers and the bleating we hear from Tony et al, we need to remember that – right now at the very least – things are pretty bloody good. After all, we’ve got low unemployment, first-class (and basically free) healthcare and subsidised education.

Or, as an old bloke once said to me: “Life isn’t fair, and if you expect it to be, well, what you need to do is get a bucket, a spade and some concrete and harden up, cupcake.”


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commoN sENsE Is Not so commoN – If you cAN usE It, you’ll fIND

yOurSelf ON The PaTh TO INCredIBle wealTh

“Your stuff is just common sense”, sniggered an older bloke upon being introduced to me.

“You say that like it’s a bad thing”, I retorted.

Truth be told, I’ve long given up caring what people think or say about me. Working in the mass media for over half a dozen years has given me a thick skin.

But the guy did have a point. Barefoot is built on commonsense advice. The problem is that common sense isn’t that common. We’ve got some of the most heavily indebted households in the entire world – so to be normal is to be broke.

And, because I have the privilege of working in the mass media, I tailor my advice to the masses: pay off your credit cards, get some Mojo savings, make sure you’re insured, sort out your superannuation, don’t buy an already overinflated home you can’t afford.

From the thousands and thousands of conversations I’ve had over the years, I estimate 80 per cent of the population never get the basics sorted. (The reason there aren’t as many poor people around is that the debt-fuelled property boom has plastered over their mistakes, and made them look like geniuses – for now.)

But here’s the thing. You’re not normal. If you’re a regular follower of what I do, you’re already actively engaged in achieving your financial goals.

You are the 20 per cent.

Even if you’ve just begun walking down the Barefoot path, if you put in place my honest, commonsense advice, you’ll make it. My most prized asset is the 6,300 personal thank-yous I’ve received over

the years from people I’ve helped (in some way) to become financially free. Sure, they put in place commonsense advice – but that doesn’t diminish the fact that their grandchildren’s lives will be changed for the better because of what they’ve achieved.

So with that, pull up a chair, and let me explain what I’ve done with my money throughout my life.

It’s not the most tax-effective strategy, it favours cash over debt and safety over speculation, and it’s got multiple dollops of common sense. And I believe there are learning lessons that you’ll be able to take and apply to your own situation.

buyINg A HomE (AND A fEw

sHArEs As wEll)

For many years I resisted buying a home, fearing they were overinflated (which they are), and all my research suggested they’d eventually come down in price. A good friend of mine, who has decades of property experience and a multi-million-dollar property portfolio, agreed with me.

“But that shouldn’t stop you from buying a home”, he told me. “Owning a nice home that you can comfortably afford is one of life’s great achievements.”

So I bought my home and, in hindsight, I negotiated an absolute bargain – a unique property in the heart

a STOry I’ve Never TOld, uNTIl TOday

You are the 20 per cent


TAKE THE NEXT STEP

of Melbourne. Yet it was secondary to the pleasure and pride that owning the home has given me (and besides, even though I chose well, I’d still have been better off having my money in shares). But you can’t live in shares.

So when I was left with the dilemma of whether I should pay down my mortgage or continue investing in a portfolio of good-quality shares, I decided to do the following:

1. I drew up a budget and looked at every expense I would have for the year ahead (including car, travel, clothes, Mojo – everything). Then I set up some high-interest online savings accounts, which I call ‘buckets’, and filled those buckets with money each time I got paid. Because I’m not a big spender, that amounted to substantially less than I was earning.

2. I gave myself a buffer on my mortgage, and made repayments a couple of percentage points higher than my variable mortgage. Again, this still left me with money left over.

3. With the (little) remaining money I continued investing in shares.

4. I made a decision that, whatever pay increases I received, I would pay directly off my mortgage (and not into an offset account).

Now it’s true that you could put all your spare cash into paying off your mortgage, and that’s certainly a smart way to make a guaranteed 7 per cent return.

But for me personally it felt like such a humungous goal, like I was eating an elephant one bite at a time. So I decided to put some of my savings into shares. You may be different, and that’s okay. If you’re a little older, investing through your super fund will make a lot more sense. It doesn’t matter – the end goal is to build passive income, and there are many ways to do that.

NO hOT STOCkS

My financial goal has always been to compound my money, as consistently as I can, for as long as I can. That’s how you get rich.

I’ve followed a number of stock market newsletters for a while, more out of business interest than for their tips. Most of them do the same thing: they hype up small speculative stocks. For every ten they recommend, about eight tank and lose money. They are forgotten. Two go up, and they’re the ones you hear about in next month’s edition. Rinse, wash, repeat.

I would never, ever invest that way. Maybe it’s because I’ve been a broker, and I’ve seen too many speculative shares that are rigged by insiders. Put simply, investing in speculative shares is a mug’s way to make money – that’s why most investors fail to beat the market averages, and why others lose their shirts.

Warren Buffett sets out some very commonsense rules when it comes to investing: don’t lose money, become a part owner in wonderful businesses that have a reliable track record of delivering consistent earnings, and, when the price goes down, buy more. Rinse, wash, repeat.

Acclaimed Wharton Professor Bernie Siegel tracked US share market returns from 1802 to 1997 and found that $1 invested in common stocks would now be worth $7.47 million – adjusted for inflation it was $554,945 – while gold over the same period had grown to just $11.17. More importantly his research also found that 70 per cent of an investor’s returns come from the dividends good-quality companies pay, rather than rising share prices.

Growing dividends that are reinvested into buying more shares is the safest way to compound your money. There are ways to speed up the wealth-building process, but it’s not by investing in ‘hot stocks’.


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SPeedINg ThINgS uP

I’m a proud wealth-accumulator. Don’t misunderstand me. I don’t wear designer labels, I drive a very unfashionable ute, and my most expensive accessory is my dog Buffett. What’s important to me is financial security, building up a sufficient level of wealth so I can do what I want, when I want. Money won’t make you happy, but it does give you choices about how (and with whom) you spend that non-renewable asset – your time.

Now my parents gave me a wonderful education and the best upbringing in the world, but when you dig down to it, I’m just a kid from the country. But I learned a few things.

The way I sped up my wealth accumulation was to focus on earning more money. But it wasn’t easy, and to some degree it was risky – I missed out on a lot of social events, and worked harder than my mates.

I chose to invest in my career, first by undergoing a massive amount of training and education, and by spending a huge amount of time developing a network of contacts that I helped and who eventually helped me. The increase in earnings took me from $31,000 a year to well over $200,000 a year.

Then I started my own business.

No, I didn’t become a millionaire overnight. But I worked hard, reinvested my earnings and grew my business. (Even better, I got to do work that I find incredibly fulfilling, and that I’m passionate about.)

The wealthiest people I know follow this pattern. They back themselves in their career, or start their own business – but they invest their money very, very conservatively.

That’s how they stay wealthy. I’m now at another stage of my life, focusing on starting a family and moving to the country. But my approach will stay the same – work hard, pay down debt, invest smart.

You may not agree with the way I’ve done things. The bloke I met who said that what I do is ‘common sense’ was an accountant, and he argued that with my income I should be borrowing to invest. Technically he may have been right. But the fact of the matter is that he was much, much older than me, and after I spoke to him for a few more minutes I realised I was much, much wealthier than him.

What I’ve just told you may be common sense – but as I’ve grown older I’ve come to realise that that’s what makes it so darn powerful.

Money won’t make you happy, but it does give you choices


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SO ThaT’S my STOry, NOw IT’S yOur TurN

Today I’m inviting you to become a member of my Barefoot Blueprint.

Why would you become a member? For the following reasons:

1 › You’ll have access to a professionally selected, continually managed portfolio of value investments. And I invest alongside you – where your money goes, so does mine.

2 › I offer special bonus reports throughout the year – the best home loans on the market, savings accounts, tax strategies and insurance – all provided by me and my group of experts, 100 per cent fiercely independent.

3 › Each week I answer the Blueprint community’s money questions, and am on hand to inspire, motivate and keep you moving towards your wealth goals. All for less than a few hundred bucks a year.

IN addITION, yOu’ll geT a whOle BuNCh Of BONuSeS:

• Investing 101: A Fast-Start Guide to Making Your Very First Successful Investment

• The Business of Being Barefoot: My Five Lessons for Business

• The Mortgage Slasher Strategy

• Join the Compound Interest Club

• My Serviette Strategy for Putting Your Money on Autopilot

• How to Get Started in the Share Market

And an amazing $500 FREE Brokerage with E*TRADE.

Remember: We also have a no-questions-asked 30-day guarantee.

Now you could rip me off. Theoretically you could take the brokerage, read all the reports, and get your money back before the free trial ends.

But I’m not too worried. I truly believe this is the best investment you’ll make in 2013.

So, if 2013 is the year you’ll take the next step, click here.





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LEGAL STUFF

Members of the Blueprint team own shares in Berkshire Hathaway, Thorn Group, Metcash, Collins Foods, Woolworths, AFIC and

BWP.

Please remember that investments can go up and down. Past performance is not necessarily indicative of future returns.

IMPORTANT: This Barefoot Blueprint Newsletter provides general financial product advice only, not personal financial product advice.

It has been prepared without taking into account your objectives, financial situation or needs.

Before acting on our recommendations, you should consider their appropriateness to your specific investment objectives, financial

situation and needs. If you are uncertain as to what your objectives and needs are, you should contact a financial adviser who is

licensed to provide you with personal financial product advice.

Please refer to our Financial Services Guide for more information at www.barefootblueprint.com/fsg or email us at blueprint@

barefootinvestor.com to request a copy.

The Barefoot Blueprint bases recommendations and forecasts on techniques and sources believed to be reliable in the past but

cannot guarantee future accuracy and results. The Barefoot Investor will not be liable for any loss or damages arising from the use of

this information.

The Barefoot Blueprint is published by Barefoot Investor Pty. Ltd. Registered Address: PO Box 16215, Collins St West, Melbourne

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