Are you happy with 1% - 2% on your Savings? I hope Not!!!
Having a nest egg, an emergency fund or the security of a pile of cash in the bank is all well and good but please don’t tell me you are happy with the interest you are earning!!! The rate is terrible and it should be flat out unacceptable for a lot of you.
First some general thoughts on this topic:
First if the bank pays you 2% and inflation is 4% what are you really earning?
Answer your purchasing power is actually going down. Let me say it even more simply. Your savings is losing value every month.
Second is security found in a pile of cash or line on a your balance sheet that say cash OR is it in controlling an income stream that appears every month on your income statement (Think Mailbox Money)?
Income and especially income that you don’t work for is what makes life easier.
Even if you only get an extra $300-$500 in income a month without working that is a lot better than just sitting on a small pile of cash that is losing value. Think about how you can create income to cover your monthly expenses. Life gets a lot better when your monthly expenses are covered with or without working.
Creating passive income is not easy because if it were everyone would do it?
Regardless of which avenue you take earning passive income will take work and management to insure returns and downside protection.
There are lots of ways to turn cash, equity lines, IRA’s, etc into income streams but given my experience I am only comfortable referring to two of them.
First you can put in the work to find a real estate market or real estate deals that offer investors 15%+ return on their investment capital.
The other option is to identify a proven real estate investor that is offering private investors secured returns with plenty of down side protection.
Please review the Article titled Which is Best for you – Active Real Estate Investing or Private Money Investing as it will highlight the work, the risks and the rewards.
I think both options are outstanding choices given the depressed real estate market and low interest rates on savings. As other articles point out both strategies take work, offer risks and decent rewards.
Always do your homework and look for ways to convert cash into future income streams. Whatever you do don’t buy more toys and increase your monthly expenses. That just keeps you in the rat race longer and running faster.
Good Investing and thanks for reading.
