It’s been quite a journey thus far. Starting small with “Making
a Million Dollars from Nothing: part 1” and “Part 2.” We’ve been working our 9
to 5. Blogging our butts off. Side Hustling until coach calls for a water
break. We’ve established a Mutual Fund, and like kids on Christmas Morning, we
eagerly open our monthly earnings report when it arrives in the mail. For some
of us, we have reached Financial Freedom with the help of financial gurus like
Dave Ramsey or even your favorite internet shaman like frugaldad.com
Even if you haven’t, you still have a large chunk of change
and maybe you want to celebrate (atleast do
it Frugally!) or you are ready to take the next step and take a risk!
Now, more than ever before, is an amazing time to invest the
stock market. While I was in New York for the QUINNEPIEC GAME Forum, one of the
Wall Street workers gave an amazing speech but one tid bit I remember him
saying was that market trend analysis shows that it is safer than ever to
invest, yet companies and people are still scared because of the 2008 financial
crisis. With the Eurozone crisis how it is, this fear is undoubtedly grounded
in well-reasoned fear based logic. For others, the logic may not be there but the
fear of the impending December 21, 2012 apocalypse might be just enough to keep
your neighbor from taking the risk. I’d still go with the longer term option of
selecting a few mutual funds for the long term and using whatever you deem as
disposable income into a stock portfolio. (You are keeping atleast a simple excel spreadsheet, right?)
I’m thinking of something even more long term though,
something that could be turned into a business if you so pleased to. But for
now, should be a side-hustle, or atleast a very, very long-term investment.
I’m talking real estate.[url= http://money.cnn.com/2012/11/19/real_estate/existing-home-sales/index.html]
Home prices are starting to rise [/url] and I know you keep hearing that real
estate interest rates are “Lower than Ever!” atleast I did, on the radio ad the
other day. But a quick google search shows that, as of November 29th,
2012, a 15-year fixed rate is 2.84% (Uh… yeah I’d love to have my house paid
off in 15 years at under a 3% interest rate!)
So why not bust out the rusty old Texas Instruments business
calculator you had to use for that college level economics course and run a few
Payment equations [VGC1] to find out if you can afford it?
So what do you do if you can afford it? If you’re willing to
take the risk, I’d say take the plunge, but of course, be frugal and do your
research. This isn’t a get rich quick scheme.
Find a property that is either right for you and your family
(or your future family) or one that could be easily fixed up in a few months
and flipped for a profit, if you are banking on the real estate market to
bounce back. Which it will, it will reach an equilibrium. You’ll turn quite a
tidy-profit. This same strategy can be used in the future too. Higher education
is on the same path as the Tech Bubble and Real Estate bubble took. The key is
studying the past to capitalize on the future.
Or, for the Side Hustle
fanatic, buying a small property near a college town or somewhere nearby your
humble abode and turning it into a rental property is a wonderful way to stay
busy on the weekends while earning a nice chunk of income each month.
Real Estate is never a bad investment, especially if you
finance the correct loan and never exceed 25% of your take home pay for house
payments.
Good luck and stay Frugal!
I would love to hear your feedback about renting properties
and your experiences. Tell me about your good and bad tenants! Or have you ever
owned more than one house? What were they used for? How did you balance the
budget?
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