The 3 Bucket Method

The first thing that I had to do is to get my mind set right. I had to move away from what everyone else were saying about how risky investing is, if we were meant to be rich we would be already and all that "You need to be lucky!" or I'm happy how I am (i.e. afraid to get out of their comfort zone).  Remember that 95% of the people at the age of 65 years of age will be either dead or dead broke, lets call them the Pensioner Minded (Lets make the government look after us).  So there is some thing wrong with the way our society thinks and acts.  Without getting into specifics, obviously 5% (the minority) will retire (4%) financially independent and (1%) what some may call rich, (Lets call these people self funded).  So if the minority will be financially independent, it stands to reason that we should not think or do what everyone else is doing.  Basically we need to see what the financially secure do, how they invest and copy or better in better words “Model” what they do.  In school we were told not to copy, but professionals and teachers like myself have been told by higher department officials that we cannot copy or plagiarise but they give it a new name “Modelling” , a new word and its now OK. 

One thing I was taught was there were basically 3 buckets the first bucket is where you generate your cash flow.  This is where income is generated using Options.  Options allow you to make money when the market is going up or down.  You just make sure you NEVER buy against trend. 

The second bucket is where your park you money you have accumulated from your option trading.  Here your look for undervalued stocks with low debt and good cash flow.  These tend to be the Blue Chip shares with good strong business sense and have generally been around for a long time and have seen many share market falls. 

It is important though to have a Good Full Service Broker to help you especially when you are starting out.  I have found Kinetics Securities as an excellent Company to deal with.  They hold your hand every step of the way and are fully aware of the Jules Dawson Wealth Creation strategy.

The third bucket is where you park your money for the long term.  This is property.  Not just any property but, property in areas which will be next to boom and have historical good capital growth and rental yields.  

All these three financial buckets are explained in detail with Jules Dawson’s Educational DVD's and courses.  He has simply condensed there in rules to follow which he has named “Parents”.  These Parents need to be followed and the risk of investing is greatly reduced.  So there is no need to chase mate’s hot tips or listen to financial advisors who are primarily concerned to sell you products so they get paid commissions.  Not even worrying about what real-estate agents say which area is about to boom next.  Of course their area is next because they are local and want to sell their properties. 

All is clearly explained and with the DVD’s there are exercises to hone in certain skill such as reading charts and determining which stock will trend up or down. 

With property, discovering where to find the data that tells you the median house price for a suburb, the last 10 year average capital growth, as well as the average rental return for the past year or last 10 years.  All this data is used to find a property which will hold its value when properties are slowing down and as soon the market turns around, they are the first to bolt out the gate.