Unless you’ve had your head buried in a pile of cash for the last forty years, you almost certainly know the Abba song, Money, Money, Money. Ironically, if you read the lyrics, if anybody knew about money and all of its ‘amusing’ possibilities, the Swedish band members did, and still do. The fame, the fans, the accolades, the enormous houses, the fast cars and, of course, the…
…money, money, money…
So what’s it all about, this funny money business?
We get it, we spend it, we invest it to make more of it. Money, supposedly, makes the world go round. But why?
If you care to gen up on a quick bit of social-psychology, Maslow’s hierarchy of needs pretty much sums it up. I challenge you to think about these ‘needs’ and try to find one in which money, at some level, doesn’t play a part.
Difficult isn’t it? It’s almost impossible to reach the higher levels without meeting the more lowly ones first—the ones that need, at almost every level, some sort of cash flow.
Yet with more than enough money, with the sort of money that you might call surplus overflow, you can almost take those lower levels for granted and, instead, turn your focus in life to the things that add value.
At a certain level, money is something that pushes open ‘value doors’ rather than being a thing of value in itself. If you read last month’s newsletterin which we talked about the Zimbabwean trillion dollar note that was practically worthless, it illustrates the point. Put more crudely, money, as in paper, coins, numbers on a screen, can’t be eaten.
So, even though few would bother to take the time to think about it, let alone admit it, money, in and of itself, isn’t actually a goal. It’s merely a doorway through which many of our true goals, those listed by Maslow above, are attained. It’s a tool we can use as leverage to reach higher levels of self-worth.
The acquisition of it feelslike a goal because we all too often think of it, not as a means to an end, but as an end in itself. And that’s a mistake. Money is simply a secondary reinforcer. It’s the thing we get to acquire the primary reinforcers that sustain us—firstly the things we need to survive, and then the things that make us feel good about ourselves. The things that bring us value.
But what value isn’t, is a price tag. Value doesn’t need to exist in the fiscal realm at all. Value can be about something as whimsical as ‘meaning’. Value can be found in scarcity and rarity, summed up as supply and demand, encapsulated in, but not defined by, price. In short, value is whatever you want it to be. It’s personal.
Why is this more important now than ever?
A recent Gallup poll suggests that as many as 85 percent of the UK population gain little pleasure from what they do ‘for a living’. Attached to many of these jobs will be a pension and, at the point of retirement, the promise of a future income from that pension.
But, for many, retirement is sold as a fairytale that turns into a nightmare.
You may have heard me tell the story before, but it’s an important one, so I’ll give you a quick recap here. The reason I got into property investment, in the first place, is partly because I watched my dad slave away in a job his whole life and then…‘retire’.
He anticipated a happy ending. But he didn’t get it. His pension was so bad that he had to go back to work the minute he realised how little moneyhe was getting. It was heartbreaking to see. My dad had so looked forward to spending more time with his family. He was looking forward to no longer having to work for money, and doing more of the things he considered to be ofgreatervalue.
How many of us sacrifice the things we valueso we can earn moneyto satisfy our most basic needs, perhaps only ever climbing two or three rungs up Maslow’s ladder? It was at the point of making this realisation that I vowed to never go down the same road as my dad.
I chose property as my vehicle for making money. Quickly, I learned that I loved the process of investing, leveraging and working with other investors. I found something that I was good at that would provide a substantial living for me and for others, and that would bring value and satisfactionto my life.
Today I have an impressive portfolio of houses and hotels, great clients and customers, and millions of pounds in assets. This isn’t to boast, it’s just to illustrate my point. Which is that if I stop and ask myself, ‘is it all about the money?’, the answer is a resounding ‘no’.
Money is just a part of the puzzle. The other parts of the puzzle being: the interesting and keen-minded people I meet through what I do; the opportunity to travel and see amazing buildings, some of which I end up buying; the opportunity to make great deals that are a win-win-win-win-win for my investors, agents, the vendors I buy from, Shepherd Cox, and me.
And then there are other aspects related to what I do that bring more value to my life, such as the chance to speak at events and teach people about how to invest in property.
Because I chose what many would initially consider being a more difficult route (and yet a route that was barely a choice for me), sure, I’ve made some money. But more importantly, I’ve created value. For myself, my family and friends, and plenty of other people besides. Which makes me proud.
I’m a proud Yorkshireman who loves what he does, and who wants to keep on doing it, and right now that’s investing in hotels.
The thrill of going to lunch with a property agent and discovering the next hotel that I can show to my team and partner-investors makes me feel like it’s worth getting up in the morning. I don’t groan and dread the commute. I check my diary and jump in my car and go and meet the people who can help me with my business and personal growth. And theirs.
So let me put this to you: the next time you have five minutes spare, check out the Abba tune, Money, Money, Money, and think about it in the context of Maslow’s ladder.
The first verse of the lyrics sums up the 85 percent of people I mentioned earlier in the Gallup poll who work, pretty much hate what they do, and dream of a life they’ll never get because every time they try to rise up they hit that invisible income ceiling. This is, to put it bluntly, the antithesis of investing.
And as for Abba, what about them? Well, the ‘money, money, money’ is still pouring in from around the world from thousands of different royalties. Now that’s what I call a great passive income! I’d have a go myself, truly I would. But since I’m north of 40, and can barely sing a note in tune (trust me, I’ve tried), I’ll stick to what I know best, and we already know what that is!
Until next time.
If you’re looking to make a sound, passive business investment in hotels, get in touch with us at Shepherd Cox today, and we’ll show you how.