The Complete Guide To Personal Finance

Free: The complete guide to Personal finance

Personal finance gives you the ability to invest in property and real estate.

We teach you for free how to sort your finances out so you can obtain good debt to grow your property and real estate wealth.

Introduction

This is a VERY detailed guide to personal finance.  The aim of the property development course is to help empower people to get involved in property including personal finance.

We want you to sort your personal finances out so you are in a position to obtain good debt to invest in real estate.

Society is currently failing to build hundreds of thousands of badly needed new houses each year so there is plenty of room for everyone to build property and grow their wealth.

This guide is MEATY and will only get more detailed. If you want a taster of this guide go here for a less than 5 minutes summary of this guide which is designed to give you a quick overview.

If you want to change your personal finances and grow your wealth using property and real estate then start here.

No one will do this for you. This information is free and if followed will make you rich and then wealthy.

What is Personal finance ?

If you want to build your net worth and benefit your local community through property and real estate you need to be able obtain good debt.

And you will not be able to find good debt if you do not reach the minimum requirements.

We show you how to build your personal finances so that you can obtain the good debt you need to implement your property development and/or property investment portfolio.

Even if you are a billionaire with 500 million of lovely bank notes in the bank we would still advise you to borrow money to invest in property development and property investment.

This is because, even for the super rich, good debt is the best way to invest to maximise your returns.

What is good debt ?

Good debt is any debt that you take on whose possible monthly repayments (including possible interest rate rises) are much less than the minimum monthly returns.

So if you borrow £10 million to buy an apartment block this will cost you £100,000 a month in finance repayments for twenty years.

Your monthly income will be a minimum of £200,000 (lets say you are renting the property to the local authority for social housing for a minimum guaranteed fee).

This means every year you take in £2,400,000 and spend £1,200,000. This means your cash-flow is nicely positive.

Your total yield over the full length of the investment is 10%  (£2,400,000/£24,000,000).

So this is an example of good debt.

Yes, you are taking on a huge debt of £10 million but you are making a lot of money and it is virtually risk free.

The risk is that interest rates will rise but you should have more than enough to pay the bank each month.

Why use good debt to invest in property and real estate?

Well, its simple really when you think about it.

If you have one hundred million in the bank and do not use good debt you can only invest 100 million.

If you use good debt you can invest a multiple of that amount so maybe 300 million.

Using good debt to ‘leverage’ your existing finance situation can make you much richer much faster.

And yes, leverage has a risk. But all investment involves a certain amount of risk. In the property development course we teach people to reduce the risk down to acceptable levels and to anticipate any possible scenarios.

Who is this guide for?

This guide is for people who want to clean up their finances, and start saving money for a first mortgage. It is perfect for people who have low incomes or who are currently overspending.

Symptoms are low savings, medium to high credit card or overdraft debts, personal loans etc. If this sounds like you then read on now – start changing your life for free today.

These people will learn how to organise their existing finances before creating a wealth plan that will include getting debt free, obtaining their first mortgage, and buying their first investment property.

Then you will be ready to move onto taking on good debt for property investment and property development.

This guide is suitable for:

  • Teenagers
  • University students
  • University graduates
  • Employees with no property
  • Employees with property
  • Self employed with no property
  • Self employed with property
  • Unemployed
  • People with poor credit
  • People who own a property or more but struggle with cash flow

The only people it is not suitable for is people who are Billionaires already and have got this personal finance down.

In this guide we are going to talk about:

  • Setting up a bank account
  • Obtaining an overdraft facility and not using it
  • Obtaining a Credit Card and only using it for purchases you would make anyway like groceries
  • Credit ratings – how to get the highest rating
  • Personal loans – how to avoid loans for things you simply do not need
  • Money earning – how to earn more money
  • Money saving – how to save more money
  • Leverage (positive or good debt) – we introduce the concept to you

We are not going to talk about property development or property investment. They are dealt with in separate parts of the website.

Again, this part of the website is all about putting your finances into the best possible shape so you can obtain good debt for property development and Personal finance.

What will you learn to do ?

This guide will help you:

  • identify bad money habits
  • stop spending money
  • make more money
  • save more money
  • clear existing bad debts
  • improve your credit rating
  • save for a mortgage deposit

Once you have have completed this section you can move onto property investment and property development. However if are not financially ready for obtaining a mortgage or good debt then you need to keep repeating the steps in the Personal finance section.

Lets begin with setting up a bank account

We are starting with the very basics of personal finance — setting up a Bank account. This should be done ASAP. Get a bank account as soon as you can even if you are under eighteen.

Once you are eighteen get the bank account upgraded to a current account with an overdraft and build towards obtaining a credit card.

(it is important to note we are only promoting you get an overdraft and credit card so you can NOT use it irresponsibly – this proves to your bank you are responsible financially and helps build your credit rating).

Anyone can get a bank account. Sometimes if you have been declared bankrupt previously a bank will deny you a bank account but there are many banks that will still provide you with a cash account ( a cash account allows you to deposit money but not to take on an overdraft or loans. They will not pay you interest).

Walk into any high street bank and open an account.

You will need a copy of your ID, proof of address etc.

Typically, you will receive a bank card and the login details to manage your account online.

Go to the full guide for setting up a bank account

Overdrafts

An overdraft is simply a facility that the bank sets-up which allows your bank account to slip into negative.

It is useful if you have a bill coming out on direct debit and there is no money in your bank account. It prevents the bill not being paid.

But the bank do not provide you with an overdraft for fun -they make serious money on overdrafts.

They are meant to be a very short-term loan, if you are constantly using overdrafts you will be massively overspending compared to a longer term personal loan.

You will need to be with your bank for several months before you become eligible for an overdraft.

We recommend you obtain an overdraft but do not use it.

By having an overdraft facility you are proving that you can be given credit without going crazy and spending it.

please remember we want you to have the overdraft facility set up but do not use it, prove to the bank and other possible lenders that you can handle your money

Credit Cards

You will need to be with your bank for at least seven months before you become eligible for a credit card.

To obtain a credit card simply apply for one on your banks website.

How to get a credit card limit increase ?

It is important to use your credit card to increase the credit available to you. The trick here is not to use it to buy things you do not need but use it when you are spending money you would already have used anyway -so pay for your weekly groceries, electricity bill, gas bill, phone bill etc. As you spend more on the card and pay it back every month the bank will trust you more and more. They will give you bigger and bigger credit limits.

again, use the credit card only for purchases that you would have made anyway like groceries etc. Do not use your credit card to make purchases for things you do not need. 

Credit ratings

Before you apply for an overdraft, credit card, car loan, personal loan, mortgage etc your bank will check your credit rating.

If you have a bad credit rating you will most likely be denied finance.

Learn more about credit ratings here:

What is a credit rating ?

How to improve my credit rating ?

Money earning

It sounds simple but the basics of personal finance is that you need to earn more money.

If you are an employee you need to increase your wage.

If you are self employed you need to win more Clients and increase your profits.

There are other ways of making money including:

Money saving

Again this sounds obvious but the next basic of personal finance is that you need to save more money. There is no point earning a high salary if you just spend it all, you might as well be unemployed in terms of your wealth growth month to month).

Saving money is easy if you just commit to stop spending money on non essential items such as cigarettes, coffees, drugs, chocolates, sweets etc etc. If you are reading this and saying ‘O but they ARE essential lol’ then chances you are broke and sorry to say, fat.

What is saving for ?

Leverage (positive or good debt)

The whole point of this Personal finance section is to whip you into shape so that you are very attractive to banks to lend to.

We believe in taking on good debt to invest in property investment and property development.

Then you can borrow from the banks to rent out properties or to flip them. This is good debt because you are borrowing money so you can make money- not borrowing money so you can spend on something with no financial return.

How to make your banks love you

Investment

This website is about property development and property investment as a means of growing your wealth.

There are other ways of growing wealth including

Protection of your money

If you have large amounts of cash you need to be aware that only a certain threshold is safe in the bank.

So if the bank goes bust the Government will only refund you so much of your savings.

How much of your money is safe in the bank?

It is important to protect your personal finances from the breakdown of a relationship — we recommend you sign a pre-nuptial agreement with your partner before entering into a marriage contract. If you don’t like the sound of that think of Paul Mc McCartney, Jeff Bezos, Liam Gallagher, David James, Thierry Henry, John Cleese, Rupert Murdoch, Bernie Ecclestone, Steve Wynn, Michael Jordon, Tiger Woods and so on who all lost a substantial amount of their fortunes in the divorce courts.

Pre-nuptial agreements

Renting a property as a tenant

Once you start a job or university you will most likely be renting a place.

In a perfect world you could start a job straight out of high school, stay in your parents house for a few years while you save cash and then get a mortgage for your own property.

But most people want to move out straight away so they can have their independence or because they are going to University.

Anyway, we feel its important that you know how to rent a property so you do not get taken advantage of by more experienced people.

Here is our ultimate guide to renting a property

Next step

How do you know when you have sorted your finances to a point where property development and investment suits you?

You are ready when you have completed the following:

  • Opened a bank account
  • Achieved a maximum overdraft – so the bank trusts you to give you their maximum overdraft figure please remember we want you to have the overdraft facility set up but do not use it, prove to the bank and other possible lenders that you can handle your money
  • Obtained a credit card and have a high credit limit again, use the credit card only for purchases that you would have made anyway like groceries etc. Do not use your credit card to make purchases for things you do not need. 
  • You have a high credit rating
  • Every month you receive a regular, consistent income
  • Each month you save a regular, consistent amount (plus more some months, but hopefully never less)
  • You have a large deposit saved ready for a mortgage
  • You have somewhere to live, either by renting your own place or staying with family

Once you have got to this point your bank will be contacting regarding ‘would you like to try for a mortgage with us?’ Getting a mortgage is so simply once you have got your finances sorted and a mortgage deposit saved up.

We recommend you move into property investment now. Here is a free guide to property investment. We advise people to buy their first house first with the idea being to improve it over a year or two so that you have built equity in it. Then you can apply for a buy to let mortgage for a second property and then a third…fourth…fifth….. And then you can move into property development if you like.

You could of course move in property development first but we recommend building up a reasonable property portfolio first.

Books for Personal finance

We have a list of books related to personal finance here. 

We have a free guide to property development here