While various studies show that around the world the rich keep getting richer, the recently released BRW Rich 200 list gives some insight into what’s happening to the fortunes of Australia’s uber rich, which can be summarised as follows:
Property is hot and mining is not.
There are always interesting lessons to learned by following the fortunes (and misfortunes) of others so…
What can we learn from Australia’s wealthiest individuals?
1. PROPERTY IS A POTENT WEALTH BUILDER
Property remains the single biggest source of wealth for Australia’s rich, with more than a quarter (53) of the country’s richest people making most of their money in the real estate sector.
And many of those who didn’t make their fortunes in real estate are piling into property faster than ever to store their wealth.
Of course this should come as no surprise. Looking back over the years no matter how the Australian economy changes, the Rich 200 has always been dominated by the property entrepreneurs.
This year property developer Harry Triguboff had the biggest rise in wealth, up $4.73 billion bringing his total wealth to $10.23 billion helped along by our hot real estate markets.
Fourth on the list is Frank Lowy (of Westfield) who has grown his wealth by $700 million bringing his total wealth is $7.84 billion.
Hui Wing Mau, a Hong-Kong based billionaire, is fifth. Hui has Australian citizenship and went to the University of South Australia in the early 1990s. His Shimao Property Holdings has extensive projects in China and also holds Sydney CBD office property.
2. ANYONE CAN BECOME RICH IN AUSTRALIA.
While several inherited some of their fortune, many on the Rich List were self-made successes, some coming from working class backgrounds.
Attending a private school or having an elite education is clearly not a prerequisite to joining Australia’s wealthy.
While some forged important networks at school, many went to public schools and others didn’t even finish high school. In fact many did not have tertiary qualifications.
There were 19 new names on the list this year and 10 new billionaires.
While men dominated the list, Gina Reinhardt, whose wealth fell by $5.99 billion to a measly $14.02 billion, once again topped the list. Sixteen other women made the 2015 BRW 200 rich list, which included five female billionaires.
3. MAKE YOUR MILLIONS AND THEN REINVEST IT – DON’T SPEND IT.
This is really just using the power of compounding to grow your asset base before you start spending up big.
4. TAKE RISKS EARLY ON, BUT NOT ONCE YOU ARE ESTABLISHED.
While many entrepreneurs took big risks to get their enterprises going, successful investors then preserved their wealth by cautiously investing rather than taking further risks.
5. HAVE ONE GOOD IDEA AND REPEAT IT.
One core trait that successful entrepreneurs share is the ability to take a good idea and repeat it over and over again. Look through the list and you’ll see so many entrepreneurs stick to the same concept for years and just expand in different locations.
6. START A BUSINESS
The majority of the names on the Rich 200 are there because they started and led a business to national and global success.
Looking back over the years many of the Rich Listers made their fortunes in technology or retail.
7. PICK THE TRENDS.
While this year property is hot, in previous years this was mining, before that retail and before that I remember how technology pioneers dominated the Rich List.
8. GO FOR GROWTH.
Sure, cash flow is important but to become really rich you need a large asset base.
While the average Australian tries to increase their cash flow, the wealthy are obsessed with building their asset base.
Much the same as those on the BRW Rich 200 list who concentrate on building their balance sheets even more than they do on their profit and loss accounts.
9. SURROUND YOURSELF WITH A GOOD TEAM.
While it may seem like they do it alone, having a strong management team or a solid business partnership has been a key ingredient in the success of many of the entrepreneurs on this year’s Rich List.
As I’ve often said – “if you are the smartest person in your team you are in trouble.”
10. TAKE ACTION.
All the people who made it onto this year’s BRW Rich 200 list started with a dream and then took action.
11. YOU’RE NEVER TOO YOUNG AND YOU’RE NEVER TOO OLD.
The youngest Rich lister is 35-year-old Mike Cannon-Brookes who cofounded business software company Atlassian in 2002. He has net wealth of $1.1 billion.
At the other end of the age spectrum jumping up to third place is 82-year-old property developer Harry Triguboff who almost doubled his wealth to $10.23 billion
SO YOU DIDN’T MAKE IT ON THE LIST THIS YEAR…
Well remember, there’s nothing wrong with seeing what other successful people do and applying those principles to your own life.
Michael Yardney is a director of Metropole Property Strategists, which creates wealth for its clients through independent, unbiased property advice and advocacy. He is a best-selling author, one of Australia’s leading experts in wealth creation through property. Subscribe to his Property Update blog.
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