
THE EXPERT
David Khalil
DPN’s Director of Finance has 20 years experience in finance and banking. He knows mortgages inside and out with particular interest in systems and processes.
Armed with a 20-year background in finance and banking, DPN’s Director of Finance and Services, David Khalil, offers simple steps towards transforming your financial health.
Become aware of your financial position
How aware are you of what comes in and what goes out? It’s an interesting fact that many people have more money than they think, which only becomes apparent when you stop to take a real look. Therefore, it’s time to take note of your income versus expenses, assets and liabilities, and the need for suitable management plans. Realising where you are and where you need to get to helps you eliminate fear and take control of your future.
Budget, budget, budget
Not many of us like budgeting, but it’s one of the best tools towards financial freedom. Think of a budget like a road map, in that, if you don’t have one it’s hard to know where you’re going. Then, ask yourself if you budget to live, budget to get out of debt or budget to build wealth.
If you’re budgeting to live, it means you’re spending everything you earn and living hand to mouth. It’s important to move away from this towards paying down debts. Use the simple waterfall technique to get started with debt including credit cards and car loans. Pay the minimum debt on each and focus on one debt with extra payments. Once that’s paid off, use the extra payments for the next one.
Attacking debt frees up your cash flow to move onto the next level of budgeting, which is the ability to direct where your money goes. While it’s important to pay off your debts, it's time to prioritise investing money first, along the path to financial recovery.
Understanding assets and liabilities
Next, evaluate your assets and liabilities. Basically, a liability is something that takes money out of your pocket and an asset is something that puts money into your pocket. Most people think of their house as an asset, but is it? Even if you’ve paid it off, it still attracts expenses. Therefore, while it holds value, it's actually a liability. The key is to change your mindset about what an asset is.
When it comes to financial health, you want income-producing assets that pay for your life whether you’re working or not. They allow you to take control of your future by knowing that if you stopped working today, you have true assets to see you through.
Taking control of your financial health
What you do today will impact your tomorrow, so if you’re just making ends meet and not putting money aside to invest, it’s hard to get ahead. The first thing to consider is how to reduce liabilities. For example, when’s the last time you calculated how much you spend on takeaway coffees, Netflix, subscriptions or eating out?
It’s important to enjoy life, but you might just be eating your investment potential. Take a good look at your expenses and eliminate what you can do without, in order to direct the money back into an asset base. When you save money now, you can learn to leverage to invest. For example, you can leverage against existing properties to get into the market. It’s not difficult, it just takes education, time and preparation.
What the rich know

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Money skills are not taught in school. We learn our financial habits from our parents and often these habits don’t include fostering an investment mindset. This means figuring out how you can earn a little bit extra, in order to direct it into income. Paying yourself first is a top technique towards making an income on your wage. Save 10% of what you earn to invest in assets that pay your liabilities.
An investment in financial knowledge is also crucial, but you don’t have to do it all on your own. Surround yourself with an expert team, including an accountant, a mortgage broker, legal professionals and property strategists to guide you.
Protecting and passing on wealth
Make it your mission to create a legacy by implementing a family wealth strategy. This means encouraging a mindset beyond the immediate for yourself and your children. With daily wealth-building habits, like saving or investing pocket money, it’s easy to re-educate your system in a fun, day to day way. Protect your wealth with insurance and instil goals beyond getting out of debt, so the next generation learns to build it and pass it on.
As you take steps towards recovering financially, stay inspired with this Chinese proverb:
The best time to plant a tree was 20 years ago. The second best time is now.
Chinese proverb