Friday, February 27, 2015

Credit History

Importance of Creating and Keeping a Good Credit History

I have had a change of heart! In my previous posts I told you how I hate credit cards. However having given great thought to my vision and strategy, a good credit history will be essential for my accent.

There are people I never lend money and the reasons are simple.....either they do not pay back or simply because I dont know enough about them to trust them with my money. The same thing applies to banks. They will give loans or mortgages to people who have shown in their credit histrory that they can repay their dues.

I have a vision to go into properties. By the way I stay in London and the property market here is not bad at all. The great thing about properties is that you can get a mortgage from a bank and a 5% (if it is your first home purchase) or 10% deposit. This means that if you want to buy a 100,000 home you will need only 5,000 down. Sorry my medieval laptop does not have a pound sign lol. Dont forget that with that 5,000 you will also need a good credit history since the bank will do what is called a credit check on you. The best way to create a credit history is to take a credit card.

How to create a good credit history

I was so eager to create a credit history that I hopped onto the first credit card provider I saw. This was an Argos Card which provides credit through Vanquis Bank. I quickly filled in all the details on the application form and SEND! I waited paitently for my credit card but got a regret letter. I was so disappointed. Damn! They told me that "at this moment having reviewed your circumstances we regret to inform you that you have not been successful in your credit card application bla bla...." and some other technical jargon. The reason they could not give me credit in my opinion was not based on my ability to repay but on my lack of records. I have literally zero debt! So their system screamed "ERROR".

So I set out to find out how I could get a credit card with no record at all and started googling how to get a credit card with a "poor credit history". I do not have a poor credit history I have no history....anyway you get the point. So I came across a credit card called Aqua. This card gives credit to novitiates at higher interests of about 35.9% APR. Their rate however goes down 5% every year for 3 years if you dont default on your payments. So I applied and got this card. I am using it to buy my groceries every week and pay them off every month. My groceries are about 20 pounds a week and simple math gives ermmm (counting fingers and toes....) yes.....80 pounds lol. That's very humble. Wish it could go lower but hey I dont wanna starve.

In about 1 year the big wig credit cards will want to roll with me. When that happens I will take out a loan and invest in my various high yield vehicles and do what is known as interest arbitrage. Getting money at 4% and investing it at 10-25% back in Zimbabwe. I just love the developing world. Gives you a chance at making super profits.

So I want to build my investment portfolio first before I do leveraged property portfolios. This means that I will be using debt to fund my property purchases. This is why I am creating a credit history and changing my value of despising credit cards. They are now a means to an end. There are other ways of creating a good credit history out there but today I've just talked about what I did. I like the pragmatic way of seeing and doing things because when someone has done it, so can you!


Million Dollar Club

Thursday, February 26, 2015

Millionaire Pledge

Millionaire Pledge

Last year I set about on a challenge to become a millionaire in 10 years time and the following is a template or strategy of how roughly I am going to achieve this.
Phase 1
Geographic spread of Investments
-          80-100% of investments in Zimbabwe
-          0-20% of investments in cash UK (emergency fund)

Type of Business
-           Micro Lending
-          Order Financing

Dollar range

-          0-£10,000

Phase 2
Geographic spread

-          70-100% of investments in Zimbabwe
-          0-20% in UK
-          0-10% in USA

Asset Type

-          Order financing
-          ZSE (Individual stocks)
-          UK Funds

Dollar Range

-          10-£100,000

Phase 3
Geographic Spread

-          Maximum investments (ZIM) not more than 50%
-          25% in UK
-          25% in USA (Global funds)

 Asset Type

-          Equities
-          Properties
-          Funds
-          Order Financing

Dollar Range

-          100,000- £1,000,000
-          From 500,000 max zim investment must have gone down to 50% or below

 Million Dollar Club

Net Worth Update

Net Worth Update

When I wrote my first blog page last year I got so busy working I forgot to come back day after day to keep you posted.

However I do not expect many people to be following just yet since what I have done so far is not yet follow-worthy. However it will become soon.

Just a second lemme open my excel spreadsheet with my exact figures so I can update you on my current net worth since I posted last year.

Still remember me telling you about a small business I have back in Zimbabwe? If not then go to my last post. This humble business has done a lot for me. I managed to invest and withdraw $4000 for my wedding and honeymoon in August 2014. So im happily married now woohoo!!!

Net Worth

After my wedding and honeymoon I started working and saving again. I have managed to achieve the following to date.

Investments in Zimbabwe: $4,247.28
Savings in UK: $1,456
Investments in UK: $2,250
Total: $7,953

My net worth is $7,953 since I have 0 debt. LOL I miss debt....! Anyways I have had things that ate at my net worth. I had a car impounded for lack of insurance.....silly mistake on my part to not to check expiry dates. That needed 240 pounds to be released. Ouch!!

Family Finances

Our family finances at the moment are as follows:

I earn $3,000 a month
My wife earns $1,200
Simple maths $4,200 (Total)

All our expenses total $1500
Total monthly savings $2700

Amounts are shown in USD for comparability with Zimbabwean investments

Personal Development

My wife is doing her degree in social work and cannot work as much as I do. She has had to change a lot of things about her spending. At first she put up a fight against the saving culture saying shed end up without a life but she slowly got in the trend. She had so many dresses in her closet that she had not worn yet and by saving she began to wear them. I still get her dresses here and there but she does not fuss about a dress a week anymore. As for me I can do with my current clothes till December.

I am thinking of doing a masters starting this year. This would raise my salary to the 30-40 thousand pounds a year range. Together with my wife after she finishes her degree we can earn 60-80 thousand pounds collectively and still use 12 thousand pounds a year for expenses. ;) I promise!!! Well if not 12 then max 14 or lets say 15 thousand lol. Married people you should understand me. Its midnight and I must go to bed thanks for reading and see you at the top.


Million Dollar Club

Million Dollar Club