eCentral Business Show^©

What will be your legacy with Chris Wren from Highland Financial

Wed 10:00am 22 Nov 2017
Podcast Audio


What will be your legacy is an interesting question to be answered by a Financial Planner, but Chris Wren believes it is an important question to develop a source and drive of your financial and life plan.

In this video we also talk about the importance of categorising cashflow for different purposes to ensure that business people can correctly provision funds for business expenses, GST, payroll tax, etc.


Video Transcript: what will be your legacy that's what we're talking about today on the east central business show and I'm joined by Chris Wren from Highland Financial thanks for coming in Chris now we've got to do the disclaimer before we kick off suit because you're a financial planner financial planner which means anything we talk about today is general in nature I don't know you personally don't know your personal situation which means I can't give you any advice and that goes for the people on YouTube okay great now let's jump in because we're not necessarily talking about financial planner today we've started talking about legacy there was legacy important well legacy means different things to different people and they can have the well you know when I'm gone and it could be in the context we're going to talk about today what you're building as a legacy okay so one of the questions I like to ask people is look what do you want to be remembered for yeah so what is your mark gonna be as a consequence of your time on this planet that small period of time hmm and then who did you affect how was that how is that being passed on to children how they're going to be passed on to their children and on the run that goes yeah so you have that conversation with people as a financial planner though it's at the place to start all you know the conversation well given the option of coming to talk to a financial planner what do you want to be remembered for would be very much something I'm focusing on about you hmm if I'm talking about superannuation or some other boring thing like that they don't wants to know about mmm how's that adding any value so I think it's a much better conversation to have okay well I guess the thing is if it is a financial outcome or some sort of other legacy if that's properly funded that's gonna be you know something that lives on in degeneration some of the party and grandchildren children and beyond that absolutely and look advice to ask you a question assuming you had children would you want to be able to pass something on to your children besides money mm-hm so the legacy can actually go way beyond money but money just has to help too yeah of course it does okay now we've got the four slot piggy bag behind us here we're gonna get onto that a bit later yeah but I wanted to contrast with you because something we talked about off cameras that you're passionate and small business now there's a guy running around at the moment the barefoot investor a lot of fundamentally good things but he's working with PAYG people in a job Jo B yes and so they've got a fixed income now you'll bid a bit more like you'd like to work with small business though why is that well a small business that there's there's an energy behind small business there's people that are I'm passionate about something people that wanted to actually get out and have a go yes well they weren't happy just to get paid whatever they were getting paid every month mm-hmm and one of the things about being PAYG which is pay-as-you-go your tax meaning the government just wanted to keep taking money from here thing about PAYG is that basically you're a slave to someone else hmm okay and what people don't realize is that your career you could give them like 15 years 20 years of loyal service and that could all end in one hour they had nothing to do with you mm-hm where is that or maybe did but if you are in business you're basically doing on your terms hmm you're helping you're contributing but you're also doing it on different terms which means I'll be doing it your way and it's a indirect proportion as to how hard you work mm how smart you work as to how successful you'll be yeah so for me getting up in the morning being a small business owner having an entrepreneurial spirit it doesn't get any better mmm because I know I can work with people I can make a difference with businesses and I can tap into that energy and they can tap into my energy and the world changes because of small business yeah no that's a while I work with and network with a lot of small businesses so and that's the reason actually I do want you to come in to talk about today because the entrepreneurial spirit is something I really really enjoy it's something we find that there's an impassioned sort of camaraderie around entrepreneurship and small business you know we're here to get ahead and help each other out so it's it's a really good thing but then to link that back so in the piggy bank and a legacy element like what's the even the barefoot investor what's the linkage between all these things you know I'm how does a small business save in all these different slots in the piggy bank so one thing about being in business you've got us a question why are you in business and there'll be a whole bunch of reasons as to I'm Bo serving people you're providing product services and all the rest of it but a successful business does one thing maybe it fundamentally generates cash flow yeah and people will come and buy your things you know whether it be a service or a product or whatever it is you're selling it's that then cash it's a movement off that cash and that flow of money that actually makes everything happen that's right I know the feeling yeah yeah but you take out one step further you've got people working with you they're all working for you you're paying them cash flow pays are their wages yeah okay and then their lives and their dreams and their ambitions basically are dependent on their cash flow so as a business owner there's a lot of responsibility goes with that and people think oh you know there's stress and worry and obligation well yeah you gotta pay the wages every week hmm so what are you doing in your business to make sure that that cash flow comes in hmm so I'm passionate about cash flow cash flow where does the money flow right yeah yeah and that then comes to the pig and this is something that we do with I kids I'm something that I introduced to clients to actually pass on to their kids which then starts building that building block for the legacy okay and then where is all your life's works effort gotta go to mmm what was the point why were you here what was it all for hmm well we got to pass it on to our kids and then impart onto our grandkids and then they had all these choices they got to do cool stuff they got to go skiing they got to get a jet ski they got to do all that stuff but they got to enjoy life yeah they had choices on there turnips and you know it's a question that's what the legacy is all about what are you building to make sure that you're setting them all up yeah okay I get that because in this that's over you know a pointer thing you read my business and that's where I like people are hanging around with it the weekend is PAYG they've got a J OB and on the base that the barefoot investor works easily fun because they get just a portion you know parts of their income and just a shit for later and play money now play money later I think but how does the small business do that I mean I've got a lumpy income too you know my invoices vary in a month in month out basis have you got some any fundamental voice about doing that you just got to make sure you put away the four hundred bucks a month or something like so there's a number of things around that okay so firstly you're saying job pair why do you know can I just interpret what job maids go just over broke okay yeah okay so and you're always struggling your boys just like is there enough money we've got to pay the mortgage you're gonna pay this we're gonna pay that what's left no will say what's left there's nothing left oh my goodness yeah so how do you get ahead with that hmm whereas if you're in a business you've got a lot more control yes you can go come out the new services you can come up a new office offers you can do more for people and then people actually pay you more so it's come entering for the effort that you put in yeah so your question I think it you said to the Bell I'm penis yeah and how much that income can be lumpy so there's things that are always going to come up that you always have to take care of in the business so yeah the taxpayer must be paid okay you've access to be paid yes okay the wages have to be paid supers got to be paid the expenses are going to be paid alright so there the stuff that constantly goes up so when those lumps come in I'm a really really good idea is to basically take that and then just start putting it into a few different places okay and I'll call these buckets yeah okay so you have a GST bucket you have a PAYG bucket you have a super bucket yeah and then the money's then there when you need it okay so then when it does get a bit quiet or when they turn over gets a bit leaner the money's already in the bucket to pay when it needs to be paid hmm and that's cash flow management yeah and exactly what it is pretty simple when you spell it out like that first however it is made to sound complex and people make it sound complex hmm I'm not sure why they make it sound so complex maybe they're trying to say any porn or something yeah um but you just have to make sure the money is there when you need it and that's where the force law piggy bank comes into the analogy yeah absolutely so if I can share why we have to pick in yeah you do me your children tell me a bit about that so as you say there's four slots for the pig okay so there's saving spending investing and legacy and what my wife and I do is that we for money that my kids invest or money that they give mm-hmm and we actually match that yeah so it started off with pot money they got for 50 cent coins they got to put in one slide age so you imagine this that you know you've got a four year old five year olds six year old whatever putting these noisy things into the pig okay so they'd love to rattle it anyway okay yeah but what happened was that with investing and with the giving we match it so what we're doing is we're rewarding good behavior okay and what you're doing here is that you actually teaching your kids a fundamental investment understanding of asset allocation then if you have it in different areas hmm and you spread it around into different areas it can then work where every time so forgiving what we do is once a year we sit down with the kids we work out how much is actually in there they're giving and we've matched it and then we make it decision as a family what are we gonna do with that money Wow and last year we actually made the decision to I'm sponsor a kid in Vietnam okay like a kid who couldn't afford to go to school Wow we actually had to give the kids a pay rise because with the giving matching that we're doing it was enough to sponsor them hmm but what was really cool about that was that we went to Vietnam September last year and we went to the orphanage where we sponsor the kid know he can be goose fast Kristen and what was even cooler about going to the orphanage was that they got to see where their money was going Wow I was wearing a company thing all these children like it 80 11 and 12 and what an experience something else that we did was I said look we're going to go to Vietnam do you think we could take some stuff over there for them and they said well you may not say well what would be really cool but they can't get here and look we've got a case and we just stuffed it full of all this stuff of drawing materials and soccer balls and sports stuff and all that hmm maybe and we went out to lunch with a the company thing that we're doing and we got on a bass then I got on the bus with this case and the guy said you leaving us already I said no they said well why do you have the case I said it's complicated that work so we finished lunch we took the case to the refuge and where these kids were and we just said look can you show us around hmm this facility now this is Vietnam so you got tall buildings they necessarily have lives and we've got sort of got to the third storey and we went into a room when these kids were learning English and we walked in there the kids and they could see it our kids were bright-eyed bushy-tailed and I'm sort of looking and they said look do you think you can help us I said what with what and they said um could you help the kids with some English so this Vietnamese kids speak English so I could see a whiteboard there and I said to my older sis him I just can't grab a whiteboard mark and start drawing on the board see if it helped and then after about like five or ten minutes they actually I should my wife and I wait and see we're okay you come back later and we went to see the rest of the is only where they were and we can't date like an hour and a bit later we walked in that room and you've got like seven kids in there rolling around laughing pictures all over the board animals all the stuff okay so there was a lesson for the kids hmm you put money aside it goes to a good cause you're making a difference you've now met the people where the money's going mmm how passionate do you think they are about this like giving now yeah okay really important life lesson and and something that's they'd seen coming back to the small business type thing is we tend to be a bit focused on the tools we're got our nose down and bum up in the air and just and this sort of make ends meet but just a little bit of that that's and this is what happens you you just to have a business because you want to make a difference you want to do it different when you have more choices hmm and then something happens you get busy you get stressed is that worrying about all this stuff and that passion it's like a meat oh just thought it just starts fading mmm fading fading fading and one of the reasons it fades is because you just like getting caught in it you're right exactly what you're saying before you you're on the tools you're doing the work and one of the things that you have to absolutely have to do is you have to learn how to step away mmm and just be able to look from the outside yeah sure and just say look what being here hmm what's working really well hmm and then when you want to change staff it's all about time that look get yourself in a good place before you do that before you start making changes in your business hmm and then involve other people because they help you with that energy yeah sure sure you feel great about coming to work you feel great about changing people's finances feel great about change in the world from a financial point of view that's a good feeling you've got to enlist your staff to do the same thing sure and on the by set you get a broad effect I'll end up with a legacy gotcha absolutely you're building a legacy but think about it's just that ripple effect yeah half hours ain't going hmm so the pig when clients can come talk to us in the in the business at Highland and when they got young kids I'll give him a pig no okay and they get different colors you know you can get pink I think you were able to get a pig blood and the children gets a life oh I get it then but what I did see it's doing is it's giving the parents an opportunity and also talk to the kids mmm to explain them all that why 34 different sections and if you then match those behaviors as to what's a good behavior mmm that helps the kids another thing you can do that works amazingly take your kid shopping yeah mm-hmm go into Cole's or Woolworths and buy them before you go into Cole's or Woolworths buy them some shares of all wars or buy them some shaysing coals and then ask them where they want to shop because when you stand get the check out you just say you know what you're a part owner of this place well I hit this proud as punch is gonna turn around I got water shares we don't shop at Kohl's baby okay well anyway whether it's wrap this thing up around the legacy question thing for business but so what we've got some fundamental things we've talked about here today you know in terms of like quantum you know dividing up what's coming into the informational you're saving for the rainy days there's a really important thing no alligator you do alligator the buckets is your immaculate right and the the legacy part if you do access them and think about that legacy it's gonna motivate you to work smarter and work forward on those sorts of things I think we're bad legacy think about the business as a thing you know the business is another thing it's going to contribute to your future well-being and it's gonna basically fund you when you decide you don't want to work anymore mmm okay think about your business it's an asset man mmm it's an asset that's actually growing for your family for your wealth for your prosperity that's actually going to take care of you when you don't want to work anymore so is it worth putting a bit of time and effort into and try to sit up straight when you think about that absolutely is it worth the focus and then get off the tools mmm and then stop doing everything yourself and that's a whole different conversation I'm sure yeah yeah but make sure it's working for you and make sure it's fun yeah make sure you're having fun with it fantastic Chris okay thank you very much for coming in today now how do people get holding what's the best way for them to find you oh they can go to our website it's hi and financial.com dot au you can find me on LinkedIn yes you and or you can send us an email that advice at Highland financial condo that you and look I would just love to talk to you hmm if you are on a journey and you are ready to do something different yeah no I'll get it no really powerful stuff around legacy today certainly food for thought there and the stuff you do in Vietnam or you have done in Vietnam was wonderful also wonderful legacy oh well that's it so if you want to enter what question or that question for yourself is what will be your legacy and how's that linked to your business then obviously some food for thought there that's enough for today I'm John Nayler from eCentral