Help! Is anyone else have difficulty with friends/relatives who are reacting against their property investing in a negative way?
My husband and I both have well-paid secure jobs and are about to purchase our 5th property. Each of our properties have been bought well below market value and we have carried out extensive rennovations to create further equity. As a result our properties have good, positive returns and we have a comfortable lifestyle, plus we really enjoy our renovating and breathing new life back into these derelict houses. The problem is that my in-laws believe that I’m totally mad and am leading my husband astray and that interest rates will go back up the the 17% rates seen in the 80’s and that we will “lose everything” though our being so greedy! They are desparate to make us see the light.
Whenever we meet up this subject arises and they claim they are sick with worry about our situation!! We have reassured them that, not only do we have 20% equity in our portfolio and our rates are fixed for another 2 years, but we also have a line of credit for use in case of strife. However, this does not seem to reassure them and we are dreading telling them about our latest investment (an absolutely great positive-cash flow of 2 properties sharing a one-acre block just on the edge of a town). We’ve got to the point where we’re avoiding them! Please help!AmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549
Sounds familiar. Have you had the “I was so worried I couldn’t sleep” routine yet ? Or perhaps “Why are you doing this when you’ll have all this (arms spread) one day”.
It’s their way of saying they are worried but care. Your parents were brought up in a different generation where debt was seen as bad.
Don’t worry you’re not the only one’s who have hid telling their folks of the latest purchase !!
I have found that getting my Dad invloved with the reno helps and that way they feel they have contributed.
Somehow I think they will always see me as “their little girl”.
“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”XeniaMember@xeniaJoin Date: 2002Post Count: 1,231
you have just described my life and relationship with my in laws too. [biggrin]
After having survived “such a large mortgage” for over 7 years, since I’ve been with my husband, they have come to accept that we are not about to go bankrupt tomorow! My brother in law is even now looking for an investment property, negative geared off course and he sourts the advice of the experts in the field…. real estate agents! but hey, its a start!!!!!
The problem is that these are poor people with a poor persons mentality, remember being rich is a state of mind and has nothing to do with money, rich person that has gone broke is still rich and a poor person that has won a $10 million lottery ticket, will always be poor unless there has been a shift in perception and thinking.
You are coming from a different mindset and you are unlikely to succeed in explaining what you are doing to people with a poor mindset. Just love them for who they are and talk about things that interest them, it’s the best that you can do!
Discuss investing matters with only investors!
Thanks for that Amanda and Dr X. I’m soo glad there are others out there facing a similar situation. What makes it worse for me though is that I’m seen as the baddie leading their son astray! I totally agree Dr X that they are of totally different mindsets and that we will never see eye-to-eye as in their view, such “huge risks” just aren’t worth taking. However, we do try not to talk about our investing, but it’s difficult when we arrive covered in paint, dust etc after having been happily renovating all weekend and we have to find another subject to talk about for fear of another argument!MillyMember@millyJoin Date: 2004Post Count: 288
hehehe yes this sounds familiar. My folks were forever teh doomsdayers. Tis probably best just not to mention the latest purchase.
But remember THEY are the ones with the problem. They have chosen to worry about these things. Seems to me if it wasnt IPs it would be something else. Don’t make it YOUR problem.
goodluckmapleleafMember@mapleleafJoin Date: 2005Post Count: 51
We had some really good advice along the way…Keep things quiet when it comes to your investing.
We tend to keep things to ourselves for the most part to avoid the negative reactions of others. We understand what we are doing and why we are doing it…We have our goals and stick to a plan that will help us achieve them….We keep positive and focussed and excited about our investing. And that is all that matters!
Sometimes people do not understand (and have no intention of every understanding) what we are doing….So we only give them the amount of information we are comfortable with and we share our successes with the positive supportive people in our lives.
It is VERY [weird] irritating to be given unsolicited advice about your investment plans from people with little knowledge in the area…but just remember that there are heaps of people here on the forum that commend you for your efforts and love hearing about your journey along the way!
Achieve the Dream!DazzlingMember@dazzlingJoin Date: 2005Post Count: 1,150a poor person that has won a $10 lottery ticket, will always be poor
Excellent point Dr X….that $ 10 would hardly buy a packet of cigarettes and a beer to celebrate. [biggrin]DerekMember@derekJoin Date: 2004Post Count: 3,544Originally posted by Housemender:
The problem is that my in-laws believe that I’m totally mad and am leading my husband astray and that interest rates will go back up the the 17% rates seen in the 80’s and that we will “lose everything” though our being so greedy! They are desparate to make us see the light.
I would suggest you look at their ‘balance sheet’ to determine whether or not their comments have credibility.
You will be surprised how many people ‘out there’ have a negative viewpoint. Forums such as this are the exception to the rule and should be milked for all they are worth.
I would also add that a lot of negativity comes from supposed ‘qualified people’
Enjoy the ride, have faith in your decision making process and congratulations on your achievements.kessudMember@kessudJoin Date: 2006Post Count: 9
Why is there so much negativity surrounding property investing,theres another topic altogether. I agree with AmandaBS and try to get them involved in some way, it may enable them to see what you are tying to achieve. My parents help with all my reno work and enjoy getting involved, not to mention the free labour can be a big help.
kessudXeniaMember@xeniaJoin Date: 2002Post Count: 1,231Stuart MilneMember@stuart-milneJoin Date: 2006Post Count: 196
Maybe Dazz did know but he’ll never admit it and I got a great laugh from it…
I’m in a hard place – My parents invest and so do I. My partners parents don’t and never will because it’s risky and they might lose everything. Much like we will apparently. I ignore it. My partner though is the one getting the third degree and always when I’m not there. Apparently our investment decisions are going to cause us to lose the lot one day.
Well I am fairly confident I could sell between now and then, or refi into a LOC and use the equity to self fund the hard patch. But then again I’ve always looked for creative solutions to work through the trials in life, as it’s always more fun that way…
In a nutshell – if they don’t play the game they have no right to comment on it or attempt to make the rules for you. Like voting – If you don’t do it shut up and leave the whinging to those of us who do!!!!!
What more can I say?DazzlingMember@dazzlingJoin Date: 2005Post Count: 1,150Maybe Dazz did know but he’ll never admit it and I got a great laugh from it…
OK, fair enough, I’m sprung…..I knew what you meant….good to throw a bit of comic relief into the fray….
From our side, we found total support from both sets of parents whilst we were investing in residential stuff, with conversations and plenty of to-ing and fro-ing…..generally a good thing all round. We shared stories and strategies and successes….life was good.
When we started doing our filthy industrial stuff…..well that all stopped dead in it’s tracks. Not understanding what the hell we were getting into, the negativity started immediately and uninformed comments and suggestions came thick and fast.
People are funny aren’t they…..if something is outside their frame of reference or sphere of influence…..then it must be bad and is inherently dangerous. It’s only when we are prepared to step out into a brand new area and gather knowledge and experience that the fears melt away and it becomes “comfortable again”…..your frame of reference grows and start to look for new horizons.
It’s when someone puts a peg in the sand and says “this is as far as I’m going and are comfortable with”….that the tensions arise.
Some of the stuff you do Xenia scares the beejesus out of us and we’d probably be negative and wary of it, yet you are quite at home and comfortable with the whole process…..and…..on the other hand we probably tackle stuff that alot of people would find most unpleasant and we’ve had enormous negativity about it…..until they see the figures.
We find the person that needs the most education and talking to is our Banker…..after all it’s his money…..if they are negative about it you’ve got alot of homework to do.
Cheers everyone.redwingParticipant@redwingJoin Date: 2003Post Count: 2,733
No we’ve had the opposite reaction (But then again the Market is racing here).
The wife’s Brother was keen on what we were doing and is now up to property number two from nothing two years ago when he was at Uni and working part time.
The in-laws were a bit wary of the debt levels at first but remember they come from a time where “any” debt was considered BAD and today many investors know more than some accountants and many of the numerous bank managers..the bank manager is no longer the pillar of the Community as well -where you had to dress up to the teeth and go and beg for a loan..now..they’ll come to you[wink2]
Many friends say to us that they should talk to us about thier situation, we always say “sure, anytime”..but thats as far as they take it (apart from the bro-in-law..funnily enough he now works for a group that also owns a MortgageBroking company, so he has access to these guys a few offices down nowadays)
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorAgaveParticipant@agaveJoin Date: 2006Post Count: 22
I can totally relate to what you are saying.
My inlaws belive in getting a good secure job and wasting the next 20 years working for a boss who doesnt appreciate you. My father-in-law got a gold watch on retirement and a lifetime of regret.
That is how they lived thier life and they don’t understand anyone living thier life differently. They are kind and caring, though so full of negativity that they would squash my dreams in a second if I told them what I am up to with investing. (They are just scared for us.)
So I don’t tell them. They look at me as if I know nothing anyway. Yes it gets frustrating not including them in some parts of my life’s journey. I would love nothing better than to have thier confidence and joy that I am following my dream, and to discuss some of the details with them.
Ah.. but I can’t you see. What I am doing is outside thier comfort zone and they don’t have the confidence in me to know that I know what I am doing. So my choice is to keep away from negative people or away from conversations re investing / real estate, so I don’t get pulled down by it. (lead balloons can’t fly)
You know why they do it don’t you? They love and care for you, and don’t want to lose you, so they try to pull you into thier life raft (we’ll call mediocracy) where they belive you will be safe. Only the buggers don’t realise that you know how to swim and you are safe in the fulfilling waters of investing life. And that scares the crap out of them. They have to learn how to deal with it or shut up.
Like religon, investing is a very personal matter. Sometimes you can comfortably converse with a person from an opposing belief system and enjoy each others differing view, sometimes you gotta get out of the china shop beforre the bull runs you over.
I avoid the subject and will continue to do so until I belive they are ready. You may consider doing the same and if they don’t take the hint, maybe you can kindly say that you would prefer not to talk about it, and promptly change the subject.
I bet there are a lot of us out there who are also trading in silence.
Thanks for the advice everyone – Agave I agree with you that it’s sad they don’t understand or trust our abilities and judgements. As a result I’ve concluded that it’s best we don’t tell them about our latest acquisition. This is sad as it means we’ll have to hide a lot from them but I think their negativity would be more damaging in the long run – especially as I think they’re starting to get to my husband – despite all our calculations, careful planning etc etc he said to me last night “maybe my parents have got a point..” Ahhhhhh!michaela_alvares5728Participant@michaela_alvares5728Join Date: 2003Post Count: 12
Yep, know all about others negativity. I recently bought an IP and did not tell my partner about it and dont intend to in the near future cos if i did I would be woken up at 2am by him worrying and stressing me out. Its not like I was using his money (we tend to keep our finances seperate) or his property as security. I have a tough time keeping up with what I am doing and intend to do without having him constantly nagging. I have been keeping things to myself. I however can tell my mum and stepdad but again dont go into too much detail. I just keep them informed and listen to what they have to say. I take the good and ignore the bad.
I have a teeling my partner will find out when I tell him I am retiring but by that time it wouldnt matter cos I know he would love that.
Somepeople dont want to do the hard work but want the rewards.
Good luck to all of us.
MichaeladucksterParticipant@ducksterJoin Date: 2004Post Count: 1,674
No one ever gets financial freedom from being negative
However you will be considered as “Lucky” when you reach financial freedom rather than as someone who worked hard and did something to create wealth.
The problem is that Wealth building takes time and a long term planning outlook.
. I am always amazed at how people can owe $20,000 to $30,000 on a credit card or buy a $30,000 car that will be worth $1000 in ten years time but see it as risky to invest by putting down a $30,000 deposit into property or shares.
Ask your relatives how long they will survive if they lost their JOB (just over broke).
I have to say that your strategy does have an element of risk in the statement of well secure jobs. As I haven’t worked in 5 years I am aware of how hard it is to get finance and how long I can sustain a negative loss without a wage.
However you may need to consider if a possibility
-what happens if you decide to start a family in the future as one wage will be lost and you may need to look at reducing your debt. This is the situation I am in as I am a stay home dad and my wife works. A positively geared portfolio of properties would fund a few negative geared properties.
Also if you consider applying for centrelink payments they consider negative gearing losses as income and reduce your payments accordingly.
I am not being negative here I just think you need to consider what actions you may need to take if starting a family is a possible future occurance. You may need to sell a property or two to reduce your debt level so you can afford the loss of one wage. The selling of a property is considered as income also by centrelink so careful planning is required with regards to timing of financial years.
what you should do housemender is regularly look at the current debt level of your portfolio compared with the current market value of your portfolio. This will keep you and hubby steering in the right direction and reinforce what is known as your financial position. It is easy to lose track of how well your financial position is growing and you may be shocked to learn that your portfolio has grown. The council rates is how I learnt I had made $70000 while not working for 4 years while doing University. This is what made me take notice of how easy it is to build wealth through property investing.
I also do not tell others what I do investment wise as they do not understand because they don’t think as an investor like me but rather as an employee living each day relying on the steady stream of a JOB (just over broke) wage.
This is why they are negative because it is so foreign to their perspective and you take your skills for granted and also you get so excited when you make money that you want to tell your relatives / friends in the vain hope that you can change their thinking and help them from being trapped with wage dependancy.ducksterParticipant@ducksterJoin Date: 2004Post Count: 1,674
I just remembered a funny situation Nov 1998
I was so excited about the original Telstra float that I asked the Service station operator if he was going to purchase Telstra shares in the float.
He answered with no it is too risky.
That particular float opened at $3.30 Nov 1998 and went to a high of over $9.15 in Feb 1999 that is a profit of 172% over 14 months but I guess it was too risky an investment for him.
I am glad I didn’t let that negative advice influence my investing styleNewMoneyMember@newmoneyJoin Date: 2006Post Count: 39
We’ve all come across our fair share of negative nelly’s in our time, whether it be friends or family, and I think some of the driving emotions behind these reactions are envy, fear, self doubt and disappointment. Notice how only one is actually linked to their feelings for you….. coincidence???
If you are happy with the research you have done, confident you can make this work for everyone involved and the numbers stack up, that’s all that matters!!!!
If your friends or family cannot accept this, simply dont talk to them about it. Eventually they will ask how it is going – naturally to see if you have failed for self validation – only to be served a big dish of humble pie…..
If this happens enough, no doubt they will begin to appreciate he choices you have made along with those that you will make.
You have done more that the majority of Australians by giving it a shot, don’t let negative people ruin this for you.
All the best,
Mark.AgaveParticipant@agaveJoin Date: 2006Post Count: 22
It is sad, I agree, but if you don’t steer clear of the investing subject with negative people, than you will steer of course. Then in years to come you may become negative and resentful of them.
You go girl!!! Think things through, do the research, then trust yourself. Have you heard the song that goes something like….”I get knocked down, but I get up again, you never going to keep me down”? [strum] Its a goodie to live life by I think.