09 | The Monster In Me
Have you ever said “I’m not good enough”, “I don’t have time” or “I don’t have money”? These examples are part of a negative system we all have unfortunately. This contributes to our story every day, to who we are and who we become. Tony Robbins call it Limiting Beliefs. I like to call it Grim because it’s like the Grim Reaper in my life. It’s a monster.
When do you kill the monster? When it’s little right? You cannot do it when it becomes a massive beast or Godzilla! So, over my last decade without even knowing I was trying to catch the pattern as early as I could, knocked it out and replaced it. Sometimes I succeeded and sometimes I learnt.
I’ve been trying to smash Grim for a while to have more clarity. Because clarity is power. In other words, there is a great version of all of us hoping to come out sooner than later. I call it Wizard.
Do I want to be Grim or Wizard? The difference between both requires just a “small” adjustment and it’s between our eyeballs. It’s our mind.
Have a great week and enjoy the content below!
📸 Issue's Cover
Thinking in Berlin
📝 This Week's Blog Post
As a former student who did a full online certification during the pandemic, Harvard Business School (HBS) reached out to help them prepare 3 mock cases for the upcoming HBS students in an unprecedented virtual mode. Of course, I was more than happy to do so.
Read more: Preparing Harvard Business School Mock Cases
💸 Financial Freedom
In previous issues we talked about alternative investments such as gold, luxury watches and fine wine. Additionally, we talked about traditional investments such as bonds, stocks and funds. Let’s talk about Real Estate. I want to highlight 3 common types of property.
The First Home Dream. We all dreamt of that amazing first home and thought it was a good “investment”. The truth is that it’s not an investment just because it has the potential to appreciate over time. The first home serves a primary purpose (shelter), typically is overpriced playing by the market timing, you might not plan to sell it for very long time, carrying costs are high and more importantly it doesn’t generate any cash flow. Yes, it appreciates a bit more than inflation in the long run but how much more? I heard folks naively saying in London “Yes, he bought a house in the 70s for only £100,000 and today it’s about £1,500,000. He was genius!”. Well, if you apply the cumulative inflation rate for 50 years, you’ll get close to that number.
Buy To Let. Owning your first property will hopefully give you some good lessons in terms of what you need to know about real estate investing. It prepares the scene for your next property (the investment where you’ll generate cash flow). This time you won’t be making the payments, it will be the tenant. This is where you need to leave the emotions behind. Your best friends are the numbers. It’s key to research, at least:
internal rate of return IRR (a profitability measure)
cap rate CR (annual net operating income / property value)
gross operating income GOI (potential losses in tenancies vacancies)
net operating income NOI (like before but minus expenses)
cash-on-cash return CCR (the famous cash yield which is the annual before tax cash flow / total cash invested)
loan to value ratio LTV (this is how lenders assess the risk when you take a mortgage and it’s simply loan amount / property value)
operating expense ratio OER (how much it costs you to operate it, so operating expenses / potential rental income)
gross rent multiplier GRM (useful to narrow down the market as it’s market value / potential gross income)
REITS. If you don’t have enough cash, then there’s an easier way: Real Estate Investment Trusts (REITS). These are investment funds that purely invest in property so you’re paid returns based on how those investments are doing and on the return income generated by those properties under the trust structure. The entry point is low.
As I always mention, never put your money anywhere you don’t understand and always seek professional advice as investments can go up and down.
🛠️ Work Smarter (Not Harder!)
When I started 2020, one of my 10 objectives was to read one new book per month. I’ve just finished my 11th book of the year, so I’m on track. The truth is that I’m reading even more than that as I have extra books I only read on Audible. For example, when taking the train, driving, flying or doing other activities, I play a book if I don’t feel like reading on my Kindle. Sometimes I listen at 1.5x speed because the narrator is slow or just because I’m not completely interested but still want to listen and finish.
If you find yourself procrastinating too much, then I’d strongly recommend audio books as you can keep doing whatever you’re doing and have a book on the background. It’s like asking our brain to extract information quicker and comprehend at a faster pace.
I used to consume a lot of news in the past but since the pandemic started, I lost interest.
You don’t need to follow the daily news. True breaking news will find you, and the rest isn’t urgent or just doesn’t matter.
🧳 Lifestyle Design
We’re now in November and we’re getting closer to year end. Those moments where we look at what we achieved and our areas of improvement. It’s been a memorable year due to our wedding and honeymoon. On the other hand, I must confess that in 2020 I’ve experimented many new things in my life and one of those being meditation. I’ve done 304 days of meditation this year. Almost 15 minutes every day. Just missed 2 days but still on streak.
My meditation. Breath awareness meditation. It helps ease stress and anxiety, and calm the mind. It’s perfect when feeling anxious, tense, restless or overwhelmed.
The technique. It’s called “4-6” because it’s 4 seconds inhale and 6 seconds exhale.
The goal. To focus only on breathing and ignore anything else. Build a wall to any thoughts entering the mind.
The science. Slow, steady breathing with a lengthened exhale triggers the parasympathetic nervous system’s relaxation response, which calms the body and mind: slowing the heartbeat, decreasing blood pressure, relaxing the muscles and evoking a sense of peacefulness.
The app I use. It’s called Calm. You can try for free and explore breathing exercises, there are some guided/unguided meditation options and nature sounds too. Honestly, I’ve been using it for free for at least 6 months and there’s absolutely no need to pay. However, worth noting there’s a premium version and costs £29.99 ($39.99) per year. It’s only worth if you want guided meditations covering sleep, anxiety, stress, gratitude and other stuff. They also have a library with more than 100 sleep stories and some masterclasses.