An Australian investor who owns a $140 million property portfolio reveals his secrets on how to build a fortune that matters.
Steve McKnight, 50, whose tenants range from everyday Australians to former US President Barack Obama, has published a new book titled money magnet. In it, he guides readers on how they can attract wealth themselves.
Steve, a fund manager and global real estate expert, escaped the rat race by replacing his salary with income from his real estate investments.
“I worked as an accountant and suffered from stress related issues which manifested as ulcers in places where you don’t want ulcers,” Steve told news.com.au.
“Doctor told me I needed to change or I was headed for an untimely grave. I looked for ways to replace my accounting salary and came across the idea of cash flow property positive.
The idea would lead to a complete change for the man from Melbourne. In 1999, he and his friend David Bradley bought a three-bedroom house in Ballarat, Victoria, for $44,000.
“I bought my first property in May 1999 and was hooked. [David] and I bought 130 properties in three and a half years. It allowed me to opt out of having to work at 32,” says the 50-year-old.
“I continue to work, but on causes and concepts that interest me, and that add meaning and purpose to my life.”
This includes philanthropic work. Steve has donated 100% of the royalties from his six books – over $1 million – to social environmental causes.
His latest project involves planting native forests on previously cleared land under a program called TreeChange.
Become attractive for wealth in order to attract wealth
“The secret to attracting more wealth is to first become more attractive,” says Steve. “Strangely, people expect to be successful before they learn the skills to do so. That’s like saying I’ll work to be better with money once I have more money to be better with.
“This approach will set you on a path of lifelong financial disempowerment. Becoming more financially attractive only requires two things: doing fewer things that repel wealth and doing more things that attract wealth.”
Steve says being a better money manager is a bit like becoming a better driver; a few lessons from a qualified instructor will be far better than many lessons with a well-meaning parent.
He recommends three areas of work to become a money magnet:
• Spend less than you earn
• invest your savings wisely
• start as soon as possible
“People are programmed to be poor because they have inherited some, or in some cases several, bad financial habits and beliefs from their parents,” Steve says.
“It was unlikely to be deliberate; your parents passed on what they were told, and so on through time.
“Therefore, if you want to retire earlier or desire a better financial future than your parents realized, you need to improve your Financial IQ (the way you act) and your Financial EQ (the way you you feel) by learning from people who have achieved the results you are hoping for.
Steve’s top four tips for financial freedom:
• “The old age pension is not a right or a refund of previous taxes paid. This is an emergency support payment for people who cannot support themselves. Currently, three-quarters of hard-working Australians work their whole lives only to end up needing the old-age pension to survive. Something is wrong. The system people use to earn and manage their money doesn’t work. If you want a different result, you have to follow a different plan for the masses. The sooner you do this, the better off you will be.
• “You might be programmed to be poor without knowing it because some of your financial thoughts and beliefs that you inherited from your parents might be holding you back. It wouldn’t have been deliberate, it’s just that your parents passed on to you what was passed on to them, and so on through time. Without new ideas and strategies, the highest level of financial success you are likely to achieve is what your parents achieved. If you want to aim for something more than that, then you will need to update your programming.
• “You won’t get rich by saving, but you’ll never be rich if you can’t save. Savings are a store of wealth, not a source of wealth. It’s important to multiply your money by investing it, not hoarding it. That said, saving is important because it demonstrates that you can live within your means, and if you can’t, you might attract a fortune, but it won’t stick, causing wealth to appear ( materialism), but not the substance of wealth (happiness).
• “The more money you allocate to touch, move and inspire others, the more your money will matter and the more you will invest in creating and passing on a lasting legacy. You will also attract more opportunities and improve the caliber of people in your circle of influence. Make sure you live the way you want to be remembered.
What prompted Steve to donate 100% of his book royalties to social and environmental causes?
“I didn’t write my books to make money,” he says. “I wrote them to help people who yearned for more than working four or five decades before retiring with financial problems, to introduce generally unknown or misunderstood concepts, and to share surprising strategies that have helped attract and retain wealth that matters.
“Using my money to fund causes I care about adds significance to my wealth and gives my money meaning beyond dollars and cents,” Steve says.
“Take TreeChange.com for example. It’s a movement I founded for people who want to help out mother nature by replanting native forests on land that’s not viable for agriculture. “Our pilot project is a 700 hectare site in northeast Victoria that was cleared in the early 1900s. To date we have planted over 300,000 trees to help establish a new permanent and rich native forest. in biodiversity. We’re helping save the world one tree at a time.
He encourages others to follow in his footsteps, within their means.
“The first step is to give a little of what you have, not a lot of what you don’t have. If it’s money, great. If it’s time, fantastic! What is important is to get involved as much as possible.
“Many hands doing a little work is much more useful than a few hands doing a lot. Think of a cause or issue that you are passionate about. Then find an organization already working in that space.
“Finally, contact them and ask them: ‘How can I help them?’ Sowing the seeds of generosity today will result in a harvest of generosity later tomorrow.