I got this question from an unknown reader:

how much is a high net worth individual? I remember Paul when you said that part of the reason that you went bust during the last property boom was that you should of upgraded your advisors. When should one go to a guy like Batten or his equivalent in other professions?

A high net worth to me means $1 million in investable assets. In Sydney, Australia, if you’ve owned a house in the eastern suburbs for 10 year you could have $500K but zero investable assets. The question of definition is not as relevant as the second part of the question.

I went broke in the recession we had to have (after the boom) when interest rates hit 18% for first mortgages. My bridging finance with penalties hit 33%.

I should have upgraded my advisors sooner. They may have suggested alternatives or been stronger against the banks. Who knows? But I would have had a discretionary trust in place and would not have had cross-collateralised loans.

Advisors like Chris Batten are experts whom your advisors consult. So talk to your advisor about this.

Get the best advice you can afford from people who either do it themselves or are recommended to you by someone more successful than you. Good advisers will tell you if your asset base is insufficient to justify their fees. That’s why referrals are so important. And that’s why I have a more experienced friend or mentor to chat to.

Property investors who intend to build a large portfolio should have accountants and lawyers who specialise in these areas. They will offer brilliant due diligence assistance because they have greater deal-flow across their desk.