Did anyone watch the Kansas City playoff game over the weekend? The Miami Dolphins lost the game before kickoff. They wanted no part of -30 degree temperatures. You could tell in the first 15 minutes of the game they were ready to pack their bags and head home.
Similar to the Dolphins, we find ourselves completely unequipped for actual winter weather since moving this year from Arizona!
One thing our kids are absolutely looking forward to is the snowballs. We love a good snowball fight…Until someone inevitably gets hit in the face and runs inside crying. The fights never last longer than 5 minutes with our crew.
Speaking of snowballs…If you have not read the memoir on Warren Buffett’s life, I highly recommend it. The title is aptly named “Snowball.”
In this book, they discuss Warren’s fascination with discovering compound interest.
One story to illustrate this example, His wife at the time when they were newlyweds and were living WELL BELOW their means for the kind of money he was making, one day opened the mail that was piling up on his desk only to find a dividend check for $5,000. As she looked at his desk she realized that he had multiple envelopes similar to this scattered on his desk and as she opened them up one by one she had the realization that they were not just doing ok financially. They were millionaires!
You can imagine how upset this made her realize how much Warren would chastise her for spending any money on well…anything.
Warren knew that for every dollar he invested, he would create 3-4 more…Not to mention the compounding effect money has as you leave it there to grow.
Looking back at my investment career, my greatest regret is not holding onto more real estate.
Every time you sell an income property, it’s like killing the dairy cow. You have to go find another one and start milking it each day. If you take care of it, it can take care of you and your family for a decade or more.
Let me just give you a real-life example of how powerful real estate investing is with our featured property this week.
4057 Arbor Pl Ln, Chattanooga TN – Duplex
Let’s say you buy this duplex for $285,000 this month with $60,000 dollars you have saved up.
- You just leveraged a $285,000 asset for only $60,000 of your money.
- You will have the tenants pay for your mortgage each month.
- On top of that, you will pocket about $460 each month after all expenses are factored in.
- Year 1 you will see a 7.8% overall return on this investment.
BORING, right?
Well, let’s just look at year 5 now. 3% appreciation each year in income & appreciation. You still have tenants paying off your debt for you but now look at your return: 10.3% & $613 a month free and clear each month in your pocket.
That property is now worth $315,000
How about year 10:
13.77% return & $817 a month in your pocket.
$347,000 property value
I did not even mention anything about the tax savings and depreciation over that period of time which adds up to tens of thousands of dollars in savings.
Now imagine you were disciplined like Warren Buffett, and you purchased 1 of these properties every single year for the next 10 years.
If you feel you are behind in preparing for retirement and you think it might be too late…real estate can be your ticket to financial freedom. And it can happen quickly with focus and discipline.
If you have wanted to get into real estate investing, but you are not sure where to start, we are ready to help you out on your journey to financial freedom through the greatest investment on earth.
Real Estate.
