How can you increase your wealth, so you can buy what you want without draining your bank account. You may have heard about buying assets, not liabilities, so that you can afford what you want to afford. But is it really possible to make all the money that you want to spend all over social media? You see wealthy people who have nice, watches, fancy cars or luxurious mansions. Are these luxury items only for the rich? What can we do to take a dream, car, beautiful home or ideal vacation from our wish list to reality? You see all these extravagant possessions that rich people have, but what you might not know is what they did to afford these luxuries their secret is. They were buying assets, not liabilities. If you want to increase your wealth, you must do a critical thing: buy income producing assets the best thing about income generating assets is that they aren’t exclusive to experienced investors with the right research and planning anyone can get started investing today, whether you are fresh out Of college or are approaching retirement, there are opportunities to build wealth, with income generating assets and achieve financial freedom, but first before we proceed, we’ll tackle the two major liabilities that most of us have. The first is your car: no matter if you lease or buy it, many americans own one because of the convenience and the status. But when you sell your car, you will never get back the same amount that you paid for it.
The second major purchase in this list may be a surprise in his book, rich dad, poor, dad robert kiosky explains that an asset is something that you can profit from. It can make you money while you sleep. Many people think that their primary residence is an asset. But this is a common mistake. Your primary home is a liability. Your home will eat away your money. While you sleep each month, you give away money and mortgage payments. People who are drowning in debt have similar financial statements. They have a lot of liabilities and zero assets. For example, the average mortgage debt per borrower in the usa in 2018 was two hundred thousand nine hundred and thirty five dollars. So what can you do to increase your assets and lower your liabilities? Buy income producing assets now that we know what major liabilities to avoid let’s now proceed to the assets that you need in order to get rich and if you’re new to the channel. Please click the like and subscribe button for more informative videos. Number one property investing: this involves investing in physical units of property, usually in a variety of locations chosen based on an investment case. There are a variety of strategies for investing in physical property units. Two popular ones are buy to let standard investment in single units with lettings to a family, couple, etc. House of multiple occupancy hmo, leading to multiple parties in often self contained rooms, property investing has huge appeal because many people feel they understand it.
If you lived in a house before it’s easy to feel like you understand how to buy and let a house out one of the biggest mistakes with property investing is buying at the wrong location. This is often compounded without an investment case for buying and made worse with no idea of how the property actually ties into one’s overall asset allocation. The other big mistake is underestimating the true cost of property. Investing these include taxes, voids maintenance, court fees, agency fees, stamp duty and legal fees. Then, of course, you throw in possible heartache and opportunity cost. The thing is, though, if you take the time to understand how this really works and how to mitigate your risks eg via insurance and outsourcing, then this asset class could be a winner. In fact, if you get it right, you’ll be looking at significant wealth creation over time potentially number two stocks, stocks refer to investments in business equity and allow investors to generate income through several means, not the least of which are dividends. More importantly, dividends are rewarded over time and do not require a significant amount of capital to benefit from. It is important to know the difference between investing in individual stocks and investing in mutual funds. Individual stocks represent the opportunity to buy single shares in a company as a way to test out the industry. On the other hand, investing in mutual funds involves investing in different stocks across several companies, because mutual funds are more diverse than individual stocks.
They provide less risks, however, individual stocks can yield potentially higher results. If you’re interested in investing in stocks be sure to familiarize yourself with the stock market and get a better idea of the types of companies you may want to invest in among the best income producing assets is large cap dividend investing commonly known as the dividend aristocrats. These blue chip companies in the s p 500, are known for their consistent increases in dividend payouts dividend stocks derive from companies that are well past their growth state, meaning they exhibit much more stability than younger growing companies. While dividend investing can be a reliable income producing asset, several tech companies, including internet and biotech commonly do not pay dividends most of their retained. Earnings are reinvested back into their company to maintain further growth number three straight up. Building your own business among the best income generating assets is a very interesting investment idea, opening your own business. This could be whatever you want it to be: a product for sale on etsy, or perhaps your own real estate. Investing business building a business is a great way to increase your cash flow, while also pursuing something you’re interested in. Perhaps the biggest benefit is that you can devote as much or as little time as you want to the project. It could start as a side project to supplement your regular income and one day turn into your main focus. There are numerous business options available that could be of interest to you.
Perhaps some of the most common are opening franchises, whether for restaurants or gyms in your area. As you might expect, these businesses can take a lot of capital time and work before they begin operating successfully. An alternate business idea could be selling any of your skills online. For example, if you have experience in graphic design or copywriting, you could pursue freelance opportunities until you have enough clients to start your own business. Another unique idea could be to buy and sell websites through platforms such as flippa.com building. A business of your own can ultimately turn into an excellent income generating asset. It all depends on how much work you are able to put into it. I recommend researching new ideas, looking for a need in your market and then finding a mentor to help with any questions you may have in the beginning. This route will take time to get started, but it could be a great way to pursue your passion, while also increasing your overall income number four certificates of deposits certificate of deposits. Cds are considered time deposits and can be thought of similarly to savings. Accounts. Investors simply invest a set amount of money earned income through interest accrued over time. The main difference between cds and savings accounts is that cds will require set amounts of time before investors can access the funds without penalty. Due to the required time frame. Cds will often have higher interest rates when compared to savings accounts.
Investors may be able to find a five to seven year, cd with interest rates up to 2.5 percent, while the time frame may be longer than expected. One of the great things about investing in cds is that there are not income minimums to invest. This makes cds one of the more accessible types of assets to invest in number. Five p2p lending peer to peer lending peer to peer lending is older than crowdfunded real estate investing but follows the same principles. You act as a bank lending money to borrowers, but are able to diversify your loans across a variety of different borrowers, with varying levels of risk by funding loans with ten dollars and twenty dollars. You can deploy thousands of dollars across hundreds of borrowers that, hopefully, are not correlated so far. We’Ve talked mostly about investing in equity, related assets of some sort or another, with p2p. What you’re really doing is lending money for a return that money is then invested in various assets, such as property development projects that carry some risk rate setter in the house. Crowd are examples of platforms that allow you to do this straight from your smartphone number. Six royalties, a royalty is a payment made to someone who holds a patent or copyright for use of that patent or copyright. If you want to play a song on the radio, you have to pay the artist a small royalty. If you want to publish a book, you have to pay the author a royalty in the case of some products.
The royalty may be percentage of sales, patents last only 10 to 20 years, but copyrights can last up to 70 years after the death of the creator. Ever wonder why they don’t sing happy birthday in restaurants, it’s, because it was copy written in 1935 and said to be owned by warner. Chappelle music it’s said to have earned approximately 50 million dollars since registration. Remember when sony bought michael jackson’s, music catalog for 750 million dollars, this wasn’t a catalog of michael jackson’s music, the king of pop, had acquired the rights to music by the beatles and bob dylan, amongst others, that’s. How valuable royalties can be if you’re interested in buying an individual royalty there’s a company called royalty exchange that will let you bid on these streams of income? You can go to peer to peer lending marketplaces to facilitate the process. They not only fund original loans, but some will even let you buy and sell loans on a secondary market on their platform before they mature number. Seven websites in the old world websites existed mainly to give basic information about a business. Today, though, websites fulfill a totally different function and are themselves the business for most companies, most of us now make our purchases online as consumers, and this trend won’t change anytime soon, starting a money making blog, for example, has become a major thing. Thanks to low startup costs and ease of technology acquisition, you know something is pretty serious when you can find a readily available market for it.
Websites such as flippa empire, flippers and fe international exist to help you buy or sell a website note that it is not just creating a website that matters. It is really more about the business of the website. The website is merely a vehicle that delivers value. I.E. Does the business in conclusion? No matter where you are in life, you can get started building wealth by investing in income generating assets. There are numerous examples of income generating assets that investors can choose from to yield profitable returns with the right dedication. Many entrepreneurs will find real estate offers attractive returns by minding your due diligence and choosing the right income generating asset.