Don’t Be Fooled Thinking That Quick-Turning Deals Will Quickly Make You A Millionaire

The One Thing the Gurus Never Tell You Is, Wealth Is Created Over Time, Not Over-Night.

I recently had a conversation with one of my students who made a statement to me that I found very disturbing. This person asked me why I continue to try to buy houses with seller financing terms when money is so easy to get today. He asked me; why not take the fast and easy road to success instead of thinking only about long-term investments. Believe me there are many reasons.

The minute those words came out of his mouth, I knew he was an inexperienced investor who apparently had been to a seminar recently and apparently believed the rhetoric the speaker was saying about doing deals with the latest way to get rich quickly.

I have personally lived through seven different economic cycles over my 36 year real estate career. Over that period of time I have seen with my own eyes, when the economy changed every few years the methods we were using at those times drastically changed, and not always for the better. Depending on what was being done at that time, every niche method of buying eventually changed and then someone else came up with another fool-proof way to get rich quickly. This is a never-ending fact of life that will always be occurring for eternity.

Because of these facts, I always ask all of my students, if the economy changes tomorrow and all of the money sources were to dry up, how would you continue to buy real estate if you had no access to money? This is a valid question you must ask yourself.

I can hear some of you laughing and thinking that will never happen, the money will never dry up. Does anyone remember 2008 when many lenders simply disappeared? Besides, those who always borrow money to pay for real estate and then quickly resell those properties, are paying the highest rate of taxes of any type of income from the profits they are making. Paying more high taxes than necessary definitely IS NOT the fastest path to prosperity. I agree that while the easy money lasts, continue to use it but remember, building wealth will be more difficult and take much longer to achieve when you are forced to give Uncle Sam a huge portion of the money you thought you were making.

If You Are New To The Real Estate Investing Business, May I Suggest, Learning How To Be More Diversified While The Easy Money Is Still Flowing Strongly, I recommend learning how to do seller financing deals that don’t require any type of bank loan or institutional financing to pay for the houses you buy. Banks will limit you to only 3 or 4 loans but there is no limit to how many seller financing deals you can do.

I believe it is a good idea for every investor to buy several income properties with seller financing terms that a tenant can pay for from the rent they pay you each month. This is a long-term plan to create wealth, and it is how most of the successful investors have made their millions. Not by instantly giving up a large portion of the money they make to taxes. Besides, rental income is the lowest taxable income of any kind and has many other benefits. So why not buy several rental properties with seller financing terms and let the tenants pay for those properties over time so when you reach your golden years you will have a steady income for your retirement. That is what I believe is the easiest way to create wealth with real estate.

You must always be aware that paying more taxes than you need to pay is not a good and prudent wealth building plan. Any time you are buying and selling property short-term, such as wholesaling deals, it may generate an income stream for you to survive financially, but when you give up much of the money you make to taxes you will never create wealth. It will just give you income to survive.

Why not think about buying several income properties? Even if you don’t want to be a landlord, you can always hire property management, but why not let the tenants start paying for those properties and start building your wealth today and have a monthly cash-flow to live on at the same time. Start planting those seeds today.

Until next month, good luck and happy investing!

Larry