The rich only buy or invest in assets that make them money. We already exposed the big secret! But do you know that they also have an Invisible Money Growing $uperpower? 👠
Why Are Assets Important?
Building Wealth is about learning to buy & create assets intelligently:
Get Financially Savvy (you're at the right spot 🤗!)
Buy Income Producing Assets
Build Wealth Through Cashflow
Okay before jumping into the specifics here we strongly advise you to read the secret basics of what assets really are. It’s a quick 3 min read. You know you have to crawl before you can walk or run. Now go!
Even though we obviously, absolutely love RealEstatz by far. We encourage you to truly understand all the implications, benefits & merits of ownership and pay attention to the 3 most known faces of money and all 4 Income Producing Assets!
Please understand that every single one of the Assets has it's own advantages and setbacks! To figure out what the best combination is for you, you'll have to at least have a basic understanding of all 4 of them!
Business
With "Business" we implicitly refer to a business bigger than self-employment, where employees produce the majority of the revenue and where ownership is mostly: leadership. You have to be working at the business not in the business.
The two areas that most affect Businesses: Tax and Leadership
The Top Financial Liability For Everyone Is Tax. The Ability To Keep Most Of Your Earnings Will Determine Your Wealth Growth Potential 💰.
Many countries offer tax structures with advantages & incentives to Business Owners in almost any area. Why? Because they pay for campaigns and they lobby for legislation that favors their interests.
Business is about organizing people and their talents. As a strong leader owning a business allows you to leverage the efforts of other people. Instead of a one girl's shop you now have other people's education, experience, energy, effort, expertise well everything! That's how you see A students working for C students. Imagine the cash flow & growth potential.
Real Estate
Real Estate is so attractive to investors because of it's ability to use debt as leverage to buy into bigger investments than with your initial capital, also known as OPM (Other People's Money).
With Real Estate you have control and the power to increase the value of your properties with (forced) appreciation (follow the make money tread for more on this) and clever TAX-FREE refinance opportunities! (details in keep your money tread).
Commodities
Commodities are those essential things we need in our everyday living like Food, Fuel and Metals. The great thing about Commodities is that they retain their value and are mostly used for Hedging Wealth. In other words to protect your money from inflation!
The Biggest Money Liquidator is Inflation. A fancy word to describe the decreased purchasing power of a currency that results from the loss of its value due to rising prices (inflation) 😵.
Remember Tax limits what you can keep of your earnings. Inflation than chips away from what you are left with after tax through raising prices. So your goal as an investor is to limit your taxes & hedge against inflation. Legally, with asset protection!
Because commodity prices typically rise when inflation is accelerating, they offer protection from the effects of inflation. Few assets benefit from rising inflation, particularly unexpected inflation, but commodities usually do! They can therefore also be seen as a favorable mirror trade market for Paper Asset's.
Mirror Trade Market
Inflation—the rise in the price of goods and services—reduces the purchasing power each unit of currency can buy. When inflation increases, purchasing power declines, and each dollar can buy fewer goods and services.
For investors interested in income-generating stocks, or stocks that pay dividends, the impact of high inflation makes these stocks less attractive than during low inflation, since dividends tend to not keep up with inflation levels. In addition to lowering purchasing power, the taxation on dividends causes a double-negative effect. Rising inflation has an insidious effect: input prices are higher, consumers can purchase fewer goods, revenues and profits decline, and the economy slows for a time. Because commodity prices typically rise when inflation is accelerating, they offer protection from the effects of inflation. When inflation is low the opposite is true.
(source: Investopedia)
Stock Market or Paper Assets
When investing in paper we can choose how we want to get profits:
Capital Gains through selling stocks at higher prices than bought
Cashflow through clever Options Investment. Profit if it goes up, down or sideways offering great scalability opportunities.
The only one big disadvantage if you will to owning Real Estate is Speed of Cash or the lack of Liquidity (the ease with which it can be converted into cash). That's where Paper Assets come in! Stocks have a great exit strategy for cash, they offer high liquidity and are traded in high volumes all over the world. At your fingertips with a touch of your screen, no negotiation or special sales skills needed.
What's Best?
There is no good, bad or best here! A lady 👠 who only invests in Stocks will miss out on many of the TAX-FREE incentives that the Business Owner will enjoy. A Real Estate investor queen 💄 may like the idea of having a portion of her wealth invested in Liquid Assets or Hedge her Capital in Gold or other Commodities during recessions to profit and grow! (read all about making money during bear & bull markets here).
It's all about context and perspective. Acquire only income producing Assets. Now combine the strengths of all 4 Asset Classes to conveniently own all the shapes money can take, maximize your profits, keep your money through tax shelters, hedge against inflation and accelerate your Wealth Growth Potential. Now you know the Big Secret 🤗 and you just gained the Investor's Invisible $uperpower!
Welcome to RealEstatz, start your journey to financial freedom today. Join us! #Free4Real
