Why DEBT can make you WEALTHYApr 26, 2021
Imagine for a second if when you bought your first house you also bought the one across the street and just rented it out?
Conventional wisdom would dictate that this is a horrible idea... I mean WHY sign up for TWICE as much debt??
Yet if you had done just that you would have (at a minimum) doubled your NET WORTH today.
Now... here's the interesting part. Has your house appreciated in value OR has the impact of INFLATION over the last 10-30 years just increased the amount of dollars it takes to BUY that same house?
- 30 years of 1-2% compounded annual inflation has EASILY doubled the cost of any house.
- Inflation increases the COST of something but not the DEBT used to acquire it.
- Low interest rates have made it EASIER then ever to access RECORD levels of DEBT.
Now with prices hitting record highs in many markets the question people ask me quite often now is whether it's too LATE to create WEALTH using real estate.
It's never too late to start creating wealth through real estate. The question is more along the lines of "what are the best options depending on your age & goals?"
If you're older you may choose to be more passive rather than someone in their 20s or 30s who is more willing to roll up their sleeves and take an active role in buying & managing properties.
One thing is certain though. Many wealthy people have become so using DEBT (mortgage) to acquire properties, rent them out & generate outsized returns.
Being able to do this requires a particular mindset and understanding of what kind of properties (& where) to buy.
To Your Success,
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