The simple strategy that helped this couple avoid hitting the ‘serviceability wall’

The simple strategy that helped this couple avoid hitting the ‘serviceability wall’

By Bianca Dabu

Jack Chen has spent a decade in a property investment with his wife, and together they were able to build an impressive nine-property strong portfolio worth around $5.2 million. While their journey was not always smooth-sailing, the couple found success through their partnership.

“It’s me and my wife – she was sold on the whole dream of financial freedom, so shes been part of the journey from day one. So, the Marrickville unit that we purchased, she helped me paint that unit. Then, in 2009, she bought her own property, in her name, claimed the $14 grand first time owners grant. We got married, moved in, painted it, renovated it, moved out. We rentvested for about three years before we moved into our [principal place of residence],” he shared with Smart Property Investment.

Jack added: “We made a lot of sacrifices along the way. In terms of pure investment strategy and manufacturing equity and that sort of thing, I’m a bit late to the party for that aspect, but in terms of taking action, I’m quite proud of what I’ve managed to achieve over the last 10 years.”

Jack and his wife, like all investors, have had to overcome hurdles along the way, including almost hitting the serviceability wall.

Aside from getting assistance from a trusted mortgage broker, the couple has also made their own strategy to continue accumulating income through their investments – by closely monitoring their daily household expenses.

Jack said: “In terms of daily household expenses, we talk about that a lot, almost on a daily basis. Even purchasing groceries, we’ll make sure we’re buying the things that are on special during that week. I’ve been tracking our spends. We spend roughly $40,000 a year in just pure living expenses. So, from that perspective I think were doing quite well.”

“In terms of the investing side, thats more my domain. Im quite lucky that she’s supportive and she will allow me to use her serviceability in my property investing journey. She’s been supportive from day one. She has the confidence in me to make those decisions. She doesn’t care all that much about property, but she does care about financial freedom, financial independence,” he added.

According to Jack, the simple but effective strategy of tracking expenses is inspired by one of his favourite financial blogs whose owner is able to retire in his 30s by keeping control of his spending.

The Smart Property Investment Show’s guest co-host Eric Brown believes that this discipline is one of the most basic and most important rule in property investment, but usually the most forgotten one.

“Hard work and consistency, I guess, [are] the key to progressing it faster than you would normally,” he said.

“Just [know] your numbers – you need to understand what you’re spending if you want to realise you’ve got all of independence in terms of your financial position. You need to know how much money you spend. You got to get back to basics,” Smart Property Investments Phil Tarrant concluded.

Tune in to Jack Chen’s episode in The Smart Property Investment Show to find out how he overcame his debt-adverse mindset to build a nine-property strong portfolio, the sacrifices he’s made to further his wealth creation efforts, and why he believes working with a team of professionals has been critical to achieving his goals.

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The simple strategy that helped this couple avoid hitting the ‘serviceability wall’
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