Turnkey Wealth Building 101

Real Estate Investing on Autopilot

According to the Federal Reserve, families’ median net worth has fallen dramatically.  This resulted from unemployment, unstable stock market, etc.  What can you do about increasing your income and net worth this year?

Chances are that your goals for this year include getting rid of debt, increasing your income and preparing for your future.

“There has never been a better day than today to your future,” Guy Indelicato.

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What strategies can you use to achieve your financial goals and build wealth this year?

 

1.    Roll into a Self-directed IRA and add rocket fuel to your retirement

Are you ready to take control of your own retirement future?  Are you ready to begin to diversify your investments beyond the traditional stocks, bonds and mutual funds?  If you answered yes to these qualification questions then you are a prime candidate to add rocket fuel to your retirement by utilizing a self-directed IRA.  Now is the perfect time to diversify and become free the chains created by being forced to invest only in stocks, bonds and mutual funds.   It is estimated that only two percent of the total assets in IRA’s are held in a self-directed IRA.

“The self-directed IRA is one of the best kept retirement secrets in America.”  Guy Indelicato

The Self-directed IRA is perfect for the investor who is prepared to make their own investments outside the arena of stocks, bonds, CD’s and mutual funds.  With a self-directed IRA you can invest in real estate assets, notes, deeds of trust and mortgages as well as other investment classifications such as foreign currency, oil, gas, gold, silver and tax lien certificates.  The bottom line is that you are not limited to just the traditional stocks, bonds, mutual funds and Certificates of Deposits.

Want more info on self directed IRAs? Follow this link: Investing with a self directed IRA

 

2. Invest in rental property

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Prices of houses are cheap and rents are up!  These market conditions make it an outstanding time to buy and hold real estate rentals.  There are a variety of investment possibilities when buying rentals including commercial, multi-family and single family homes.

Warren Buffett “If I had a way of buying a couple hundred thousand single-family homes… I would load up on them.” He went on to make more remarks concerning low interest rates, low prices and valid points regarding why he likes single family homes. For all these remarks I do applaud Mr. Buffett. He has an accurate picture of the housing market as an overall investment platform. He also remarked that, “single family homes are cheap now.” Check out his video.

I will agree with Warren Buffett that today’s real estate market is the best market opportunity of our generation.  History will soon reveal that more real estate wealth will be made now than anytime in recent history.

More info on buying rental property: Investing in real estate rental property

What is holding you back from investing in rental property?  If you said, tenants, then this 3rd wealth building opportunity is perfect for you.

 

3.    Wealth building without tenants, toilets or time

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If you are a true investor and have the funds to invest but just want to be passive and allow your money to work for you, then you are the perfect candidate for joint venture real estate investing.  Your investment funds can joint venture with an experienced real estate entrepreneur and you can create great returns and cash flow.

Discounted Real Estate

In today’s real estate market a good Entrepreneur should be able to find and acquire houses at a 35-40% discount price point. What that means is that the purchase price and all the necessary repairs together will not exceed sixty-five percent of the value of the house.

Wealth building case study using real estate

Purchase price of house: $65,000 Necessary repairs to house: $15,000 Value of house after repairs: $130,000

The total investment is $80,000 and the house is worth $130,000 which equates to a 37.5 percent discount on the overall value. Looking at it the other way, the $80,000 investment has $50,000 of built in equity upon purchase of this property.

Monthly Income Stream

In my market here in Southern New Hampshire and Northern Massachusetts, a house like this one will be a typical 3 bedroom, 2 bath house in a county suburb working class neighborhood. This house will rent for $1400 per month creating a nice Monthly Income Stream for the joint venture investment. The primary on-going expenses associated with holding real estate – are taxes and insurance. In the Merrimack Valley, the taxes and insurance combined will be about $300 per month for the house in this example, which leaves $1100 net for the on-going monthly income stream for the joint venture.

The $80,000 investment has now been used to pick up $50,000 of gross equity and a $1100 monthly income stream. I hope you are wondering how this gets applied back to the members of the joint venture because the answer is that the Investor and Real Estate Entrepreneur come to terms. For the sake of simplicity, let’s assume that the two joint venture members agree to a 50/50 split in this venture.

With a 50/50 split, the $1100 monthly income stream is split so that both members receive $550 each month; along with this monthly dividend style income stream both members will also share the upside equity at some point in the future.

Overall Earnings

Let’s make one last assumption to show how the ultimate return can be easily calculated for both members of this joint venture. Let’s assume that both members hold onto this investment property for five years and then sell it for $130,000, which is today’s value of the house. What are the earnings on this joint venture?

Investor Earnings $550 per month for 60 months: $22,500 Upside equity split of the total $50,000: $33,000 Total return over the five years: $55,500 Total investment made: $80,000 Annualized return on investment: 13.87%

This is an example of a win-win transaction for an Investor that can joint venture with a sharp real estate Entrepreneur.  The Investor invested $80,000 and received earnings of $55,500, which is an annualized return of 13.87%.

The key is to joint venture with the right Entrepreneur who can do all of the work while keeping your investment safe, returns high and the investor does not have to deal with tenants, toilets or commit any of his personal time.

More info on joint venture real estate investing: Joint venture real estate investing

 

What is holding you back from creating or rebuilding your wealth using these 3 tops strategies? Leave comments or questions and we will be happy to respond.