Would you like to know my two least favourite words?
These are the words said only after making a terrible decision and having to pay the “stupid” tax.
Maybe you have said them also…
If only I had checked that.
If only I had spoken to that person before.
If only I weren’t in such a rush, I would have noticed that.
Here are a couple of personal examples:
(I’m a little embarrassed to share these.)
– I once hired someone because they played League of Legends (a video game).
No reference checks, no resume, and no body of work were checked.
Wonder why that hire didn’t work out.
– I bought a website for $40,000 in pursuit of passive income.
Only to find out later that all the traffic was coming from a click farm.
Despite having the skills to check the traffic source…
The appeal of making a 20% yield was so strong!
It would have been more efficient (and entertaining) to just light the $40,000 on fire.
– I bought a house that had an illegal renovation done on it.
Then went through the incredibly painful process of getting council approval to have it fixed.
FOMO had kicked in hard.
Compromising on due diligence in fear someone would buy it before me.
The “stupid” tax bill on just these events is well over $100,000.
After each of these experiences, I have felt dumb and embarrassed.
Often knowing better and yet not doing better.
And it’s not just losing money, or the time it takes to fix these mistakes.
The worst part is having to tell Bianca.
To look her in the eyes and admit to paying the “stupid” tax… again.
She doesn’t rub it in, but the look in her eyes just crushes me.
Is this how someone who is supposed to provide for her should be behaving?
After buying the house with some illegal renovations, it was time to update my due diligence process.
The stupid tax bill was only getting bigger as the years went on…
When updating my process, some things stood out.
(That might be helpful for you.)
Here they are:
– When my emotions run hot in the heat of the moment, I’m particularly vulnerable to the stupid tax.
– When someone I respect does something, I assume it’s safe for me.
Things do not get checked as deeply or in the same way.
EG: If Elon buys crypto, it must be okay, right? LoL.
Having a stronger process has been the key to overcoming these vulnerabilities.
In the last three years of following this process, the amount of stupid tax I have saved has been incredible.
Bianca was particularly happy when we avoided buying another house with illegal renovation work done to it.
BTW – What is it with people doing illegal renovations to their house before they sell it?
In this week’s episode of the podcast, I want to take you through parts of the updated process.
Specifically, the areas of due diligence that are critical to bringing down your stupid tax.
The areas to put extra effort and pay particular attention to.
This episode is for you if you want to pay less stupid tax and level up your own due diligence process.
All information we share is NOT financial or investment advice and is purely intended for entertainment and educational purposes only. Always seek professional advice before acting on any financial decision.
00:00 Welcome to Business and Investing
02:03 Why you shouldn’t skip doing due diligence
08:42 Being specific with your goals
17:05 How to know if your purchase is the right fit for you
21:43 Consulting people who have experience
28:13 Checking the financials of a business
39:41 Utilising the Internet for due diligence
48:04 Is the business successful enough in the industry?
53:30 External validation
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