When my wife and I acquired property number eight, we hit a wall; one that many investors eventually encounter, but few talk about openly.
It wasn’t about finding our next property. It wasn’t about strategy, structure, or timing the market. It was about income.
At that point, we weren’t struggling financially at all. We both had good careers, the mortgage was being paid, and we essentially had everything we needed. Yet, despite doing all the right things, we couldn’t move ahead.
After purchasing two properties in Melbourne, our borrowing capacity was effectively exhausted. We had the experience, the strategy, and even the deposit for another purchase.
What we didn’t have was enough income.
To keep progressing, we needed to increase our combined household income by approximately $40,000 per year.
That became our next challenge and although it took about 18 months, we got there. That income growth ultimately unlocked our ability to purchase property our eighth property, this time in in Adelaide, and continue building our portfolio.
Looking back, this experience taught me an important lesson about wealth creation.
Most people focus heavily on reducing expenses, and that’s certainly important. We’ve always been conscious of our spending and avoided that so-called lifestyle inflation wherever possible.
However, there comes a point where there is only so much you can cut. You can refinance your mortgage, negotiate bills, and trim unnecessary spending, but eventually those savings reach a ceiling.
Income, on the other hand, has far more room to grow.
That’s a distinction I didn’t fully appreciate when I started investing. Saving money helped us build the foundation of our portfolio, but if I’m honest, saving money got us to property seven. Growing our income got us to property eight.
For me, income growth has always been closely linked to continuous learning. I’ve long believed that education shouldn’t stop when you leave school or university.
Throughout my career, I’ve consistently invested time in reading books focused on communication, personal development, business, and professional growth. The objective was never simply to accumulate knowledge. It was to become more valuable.
When you become more valuable, opportunities tend to follow. That might be a promotion, a pay rise, a better role, a successful side business, or simply becoming exceptionally good at what you already do.
My wife is an even better example. After qualifying as a dietitian, she made the decision to return to study and complete a PhD. It required a significant investment of time and effort, but it materially increased her earning capacity and created opportunities that otherwise wouldn’t have existed.
At a critical stage in our investing journey, that additional income made a meaningful difference.
Now, I appreciate that not everyone wants to own 10 properties, and not everyone wants to complete a PhD.
But that’s not really the point, is it?
The principle is much broader than property investing. Growing your income doesn’t necessarily mean returning to university. Sometimes it’s learning a new skill, negotiating a pay rise, changing employers, taking on additional responsibility, or starting a side hustle.
The common thread is finding ways to become more valuable than you were yesterday.
Looking back, property number eight wasn’t really about property.
It was about creating more options for our family. More financial security. More flexibility. More future freedom.
Without growing our income, property eight doesn’t happen. And if property eight doesn’t happen, there’s a very good chance properties nine and 10 don’t either.
Whether your goal is an investment property, a larger family home, helping your children enjoy financial freedom, or creating more choices later in life, the principle remains the same:
The more you invest in yourself, the more options you create for your family.
In my experience, more options are what wealth is about.
If you’re keen on finding out more about wealth-building strategies that work, book a free 15 minute strategy call HERE.
