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Get Real Estate

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Last time, we talked about how to get started in your own business or franchise. Today we want to discuss how to jump start your passive income by investing in rental property.

You may ask why you should think about investing in real estate now. The daily news is ripe with horror stories of houses in foreclosure, people getting slammed by increases in their adjustable-rate mortgages, and others struggling to sell their houses in this down market.

Believe it or not, that’s why we think now is a great time to buy! Relative to historical norms, things are not as bad now as they were good a little while ago. We’re comparing now to one of the most lucrative markets for sellers in history! Take time to note the word “sellers” in the prior sentence.

There’s less competition for property today. It’s a buyer’s market.
That’s why we think you should buy now.

We’ll assume you’re convinced – where should you start?

Start by buying your own home.
In the past, financial planners often recommended renting and investing in other assets, such as stocks. Historically, stocks have outperformed real estate. The problem – the investing part was voluntary.

Buying a home is a commitment. It forces you to save. And if you’re like most of us, you need that “forced” part. So as you pay your mortgage, month after month, you’re reducing your outstanding debt. That’s why, on average …

… homeowners are significantly wealthier than renters.

So owning your own home is the foundation for creating wealth. Now you’re almost ready for the next big step. Remember our discussion of 38 getting aggressively passive]? You’ve found money from watching your spending and paying off debt. Keep piling that money up to prepare for your next move.

Buy your first investment property.
Your next real estate purchase may be your first rental property. Or it may be your next home. Consider moving up to a nicer place and renting out your first one.

Either way, be sure you have more money coming in than going out. Hook up with a good realtor who can help you determine what your rent should be. Now, estimate your bills – property taxes, insurance, mortgage payment, and all the others. If you don’t project having money left over, don’t buy that property – find another one!

Don’t start without a cash stash.
Owning real estate comes with its risks. For example, what if your property suddenly requires major repairs? As with any business, don’t invest in real estate unless you have a cash stash. If you don’t have one, find a partner who does. Otherwise, you may lose everything.

Our quote today comes from the Australian author, Noel Whittaker.

“Becoming wealthy is like playing Monopoly …
… the person who can accumulate the most assets wins the game.”

So roll the dice, take a chance, pass GO, and collect more than $200! It’s not just play money!

Next time, we’ll look at some of the things that can go wrong – lessons from a bankrupt business owner, who happened to be a real estate speculator. Until then, here’s to your bigg success!

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Start a Franchise or Business to Create Passive Income

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Today we want to look at two ways you can jump start your passive income by starting your own business.

Let’s not kid ourselves. Starting a business can be risky. You’ve worked hard to build a nest egg. You have bills to pay. Kids to put through college. A retirement to fund. You don’t want to lose what you’ve worked so hard to gain.

If we can talk you out of starting your own business – so you avoid the financial and emotional turmoil that comes with it – we’ve done a good deed. Alternatively, if after reading this, you’re more determined than ever to go for it – you’ve got a big knot in the pit of your stomach – we’ve served you well. Either way, we want to get you off the fence.

Owning a business is not for everyone. You have to be willing and able to take risk. Numerous studies show that wealthy people accept more risk than the average person. You either have to accept some risk or accept a lower net worth.

Let’s look at two scenarios that allow you to start your own franchise or business, yet minimize your risk:

  • You have the money, but no time.

    • You have a job you love. You want to keep it. That doesn’t mean you can’t enjoy the benefits of passive income from business ownership. Find someone with talent to manage the business for you. But you want to be sure they are careful with your money. How do you do that? Structure your deal so they have more to lose than you do. Keep them up at night, so you can sleep. By aligning their interest with yours, you’ll be likely to develop that passive income you want..

  • You have the time, but no money.

    • You have that burning desire to own your own franchise or business, but you’re missing one key piece – money. Find a partner with money. But beware – you’ll be the one staying up at night! If you can replace your current salary and share in some of the profit, you’ll be jump starting your net worth.

Accepting risk is one thing. Learning to manage it is another. Successful business owners are good at controlling their risk. You need to develop this ability before you start out on your own, no matter which scenario you choose.

We encourage you to sign up for our free newsletter, “Bigg Success Weekly.” It’s published every Friday. This coming Friday, in our Home Office article, you’ll learn about a solopreneur who has built a business worth over $3 million in sales. Check it out!

Our quote today is by Dale Carnegie.

“The person who gets the furthest is generally the one who is willing
to do and dare. The sure-thing boat never gets far from shore.”

Next time, we’ll look at how to build a passive income through income-producing real estate. Until then, here’s to your bigg success!

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Getting Aggressively Passive: Creating A Passive Income That Sets You Free

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Last time, we offered some tips for networking your way through your upcoming holiday parties. Today, we want to talk about one of the most important gifts you can give yourself – a passive income.

Not along ago, we asked you to visualize your dream life – a life where time and money were not an issue. You may think that’s just for fun. It’s not! We’re serious. You can spend your time the way you want. You can be free!

You’re free when your passive income equals the costs of your desired lifestyle.

For the sake of clarity, we define passive income as your money making you money. If you have enough passive income, you can spend your time however you want. You don’t have to work at all, if you don’t want. Or, you can work on your passion.

So, let’s look at the four steps you can take to get aggressively passive and create a passive income that sets you free. The key is to constantly keep your goals in mind so you make the best choices each and every day. For example, if you want to be free sooner, rather than later, you may choose to spend your money differently. Now you have a reason to do so – that dream life you visualize.

Step 1: Purchase with purpose
What if buying that awesome plasma television that you just saw advertised on sale in today’s paper means you have to postpone your new life by a year? That status car may not mean as much as getting to spend your time how you want.

Step 2: Look at the cumulative effect of your decisions
Review your daily routine. $5 here, $5 there soon adds up to a lot of money. Do you eat out every day? Buy a cup of coffee? In his excellent book The Automatic Millionaire, David Bach calls this your “Latte Factor”.  Find one thing that you’re willing to give up now to get to the future you want sooner.

 Step 3: Pay off debt
The reason for the first two steps is to get the money to pay off your debt. Pick one account – ideally it’s your debt on which you’re paying the highest interest rate. Take the money you’re no longer spending from Steps 1 and 2 and use it to pay off your debt.

Don’t stop now … take the money you were using to pay off your first debt, plus the extra money you have from Steps 1 and 2, and use it to pay off your next debt. Repeat until all your debt is paid off.

Step 4: Jump start your passive income
Historically, the two best ways to do this are through owning your own business and investing in income-producing real estate. We’ll look at each of this, respectively, in our next two blogs.

Our quote today is by Groucho Marx.

“It frees you from doing things you dislike.
Since I dislike doing nearly everything, money is handy.”

Next time, we’ll look at how to build a passive income through your own business. Until then, here’s to your bigg success!