Many people believe that to build wealth one must invest in the stock market. The underlying concept is straightforward enough: You purchase stock in a company and they in turn work to increase their profits, which increases the value of your stock. If you’re lucky, they may even send you a dividend, but it’s not likely. If they do, it won’t be much. For serious investors, what’s missing from this process is control. The truth is that those who invest in stocks are at the mercy of the companies they’ve invested in to generate profits and increase stock value.
For those who prefer a more active, hands-on approach, real estate has proven to be a lucrative alternative. Many are choosing investment properties with great cash flow with the help of an expert agent experienced in real estate for investment. Once they have acquired a property, these investors have control over a variety of elements affecting the size of their returns, including property condition, rent charged and tenant screening. These decisions have a direct impact on creating a steady stream of cash flow while building equity, both of which will work to build wealth over time.
But it’s not just control that makes real estate investing attractive. One of the biggest benefits of real estate investing is the fact that you can purchase so much more with your money. The reason? You can use the same available cash you would have used to purchase shares of stock or a mutual fund, and use it as a down payment for a property that is ultimately worth much more than the cash you had available. It’s called “leverage” and it’s a powerful tool when used properly.
Certainly, investment properties will have expenses associated with them, such as insurance and maintenance; however, working with a knowledgeable agent to find the right property and do the math ahead of time can help mitigate risk and help ensure cash flow. Partnering with a Certified Investor Agent Specialist (CIAS) is essential in identifying and negotiating your purchases to ensure a great investment from the outset.
In the long run, there are many great options available to help you plan for your retirement. The point isn’t to take one option over the other and ignore all the others. In fact, opening up to the entire spectrum of investment options could end up providing you access to options that you didn’t know you had.