Did you know that most of the wealthiest people in the world got to where they are by investing in real estate? It’s actually been referred to as the #1 Millionaire-Maker.

By having an understanding of how money works and making smart, responsible choices, you can build a secure financial future for your family.

So let’s talk about the 6 ways that you can create wealth by investing in Real Estate.

1. Benefit from inflation – Inflation is only bad if you don’t own an asset that’s gaining value. If property values rise and rents rise, so do your profits.
2. Generate cash flow – Have you ever heard the phrase “make your money work for you”? Smart investing will make your mortgage payments for you. Once your mortgage is reduced or paid off, all this extra cash can be invested for retirement.
3. Reduce your taxes – The expenses of operating a revenue property are tax deductible. Bonus!
4. Asymmetric risk and reward – This is a fancy way of saying that you put down a small sum of your own money, borrow the rest, then, as the property increases in value, your equity position rises substantially. The bank takes most of the risk, while you enjoy most of the reward.
5. Asset appreciation – You may initially take on a lot of debt when you buy a revenue property, and that can feel a bit intimidating – but this is what is considered “good debt” that will generate investment-grade returns over time. It’s not like a car that begins to depreciate as soon as you buy it, real estate almost always increases in value.
6. Inexpensive source of funds – Once you’ve built some equity, you can access it at inexpensive mortgage rates to fund new investments and keep the ball rolling.

Of course, it goes without saying that you must be prepared and responsible, because if you aren’t you could get in over your head. However, the stability of investing in Real Estate has been proven to be the safest way to build your wealth.

Sincerely,
Kim

If you’re anything like me, keeping records of income and expenses–and convincing your spouse to do the same–can be a real challenge. I started this challenge for myself by first saving every receipt from every purchase I made for a month, then I divided everything into categories to see how much I was spending and where. Finally, I decided which changes were going to have the most impact.

Here are 4 simple tips you can try that you might find helpful…

#1: Budget Envelopes. This may seem a bit old-fashioned, but it’s a great solution for visual people. When you get paid, take out the cash you need for the month and divide it into envelopes labeled as groceries, dining out, movies, clothes, vacation fund, miscellaneous, etc. This obviously is going to work best for things that aren’t automatic withdrawals – you must be sure enough money is left in your bank account to cover these bills. Once an envelope is empty, it stays empty until next month. No excuses.

#2: Set Limits. Set a limit for all non-essential expenses. If something comes up, for example you want a new sofa or cell phone, discuss with your partner and plan to save up in the miscellaneous envelope or better yet, create a new envelope for that expense and decide how much you can put into that envelope each month to save up for it. If it is something you want sooner rather than later, you may need to cut back in another category to speed things up.

#3: Annual Projections. In addition to keeping track of each expense, figure out how much each one costs per year. When you see that your $4 daily coffee actually costs over $900 a year, you may consider making coffee at home. Do the same with lottery tickets, alcohol, snack foods, impulse spending on clothes, new electronics, and so on. Keep all your receipts and record them in a spreadsheet to keep track of how much you actually spend.

#4: Reverse Budgeting. This means that when you get paid, you pay all of your bills and essentials first, then, whatever is left – if anything – can be used for non-essentials. It isn’t as structured as my first 3 ideas and doesn’t help you to build your savings though.

I hope you found this helpful. When it comes to changing our spending habits, discipline can be tough – but it does become easier with practice. A wise person once told me that if you work hard and sacrifice now, life becomes simpler later, but if you keep life simple now, you will work hard and sacrifice for much longer.

Sincerely,
Kim

Today I want to talk about debt and more importantly, how to get out of it! No one sets out to get into loads of debt, it just seems to happen to some and not to others.

Here are 7 traits of debt-free people that sets them apart from everyone else…

1. They are repulsed by debt – it’s not just a preference, it’s a passion. Some people simple hate the feeling of being in debt, so they avoid it like the plague.
2. Debt-free people are willing to sacrifice – if need be, they’re willing to give up eating out or wearing the latest fashion. They know that these sacrifices are temporary and will lead to better things like future prosperity!
3. They are goal-driven – Not only do they set a goal, they made detailed plans and take the necessary steps to make sure they get there.
4. These are patient people – Impulsive and impatient people tend to get into debt more quickly, but debt-free folks are content to wait until they have the extra cash flow to buy what they want.
5. They have more confidence – they don’t care that they may be dressed out of style, drive a beaten up car or still use a flip phone. Debt free people are more concerned with reaching their goals than what people think.
6. Debt-free people are responsible – taking responsibility for their actions – knowing that if they want something, they are going to have to pay for it TODAY, not next year, along with the interest.
7. Finally, debt-free people are not materialistic – they aren’t impressed by big shiny cars, or big houses. Their MO is to build long-term financial security, which will benefit them far more than fancy toys.

So, are you ready to change some of your goals and values to become debt-free? Giving up some of the things that bring you joy, can be really difficult, but the long term gains and peace of mind are worth every sacrifice!

Sincerely,
Kim