Where to Invest $50,000
I teach my clients that they should not invest until they have at least $50,000. That’s a fact. Long story short, if you have less than $50,000 you lack income, margin, and discipline. $50,000 is proof that you make enough money, you keep enough of it to save that amount, and you are disciplined enough to be consistent and also not to blow it. Today, I want to talk about what to do with the money when you are at the $50,000 level. There are a few key investments a person can make that I believe are the best bang for the buck. Before I dive into them, I want to talk about what you are looking for in this first investment.
You are looking for the most passive investment possible. Why? Because you are still in increase income mode. If you make 12% on $50,000, you will get $500/mo in income from the investment. That’s awesome, but it isn’t even scratching the surface of what will be required to build wealth. Therefore, if you make $500/mo and it requires time and energy away from the primary source that produced the $50,000 in the first place, that is a bad idea. You want an investment that doesn’t require much time or attention at all so that you can keep doing the things that got you there in the first place. Any other way and your growth will be stunted. That is the baseline and anyone who understands wealth will tell you the same thing. Now that we’ve established this, let’s talk about what to invest in.
1. Merchant Cash Advances. Merchant Cash Advances are a form of privatized lending. This is a great way to secure fixed passive income without investing much time into it at all. Essentially, a small business may need funding for staff, inventory, expansion, etc. and although the business does not have the capital set aside, it does have future payment streams from customers in contract. The small business will typically look for a lender who will advance them a portion of those payment streams in a lump sum and in exchange pay the lender the income streams plus interest. These are not guaranteed, but are secure by payments from customers of the small business that are engaged in a payment contract. It is typical to earn anywhere from 7–12% on shorter term loans with an investment like this. There is no involvement from the investor aside from getting paid each month.
2. Land lease private lending. These are the next step up. This type of investment will provide income produced by land as well as the land itself as security. Most of these are oil, gas, and mineral operations. Company’s will purchase land and lease it to an oil drilling operation. The purchasing company may need financing and they are will to pay interest on the funds borrowed with the promise that if they default, the lender may foreclose on them and seize ownership of the land itself. These are more secure because of that fact. This will typically pay someone 8–10% annually. Again, this is truly passive income. The lender/investor isn’t a landlord, manager, or even a supervisor. He just gets paid every month.
3. Real estate based private lending. This is my favorite personally. Why? Because I love real estate. This type of investment basically makes a person the bank or financing source in a commercial real estate transaction. This could be an HOA, a mobile home park, or multi-family apartments. This gives an entry level investor experience being in real estate without the risks of purchasing a bad property, management responsibilities, or tenant issues. It also provides security that in the event of a default, the lender can foreclose and seize ownership of the real estate and collect the gross income as an equity position. You can learn about the property and use it as a foot in the door until you’re ready to buy your own properties (When you do buy, you need at least $100,000 — $250,000 to invest as a down payment to make it worth your time and attention.)
The bottom line is that if you are not wealthy yet, you want to invest your money in things that will not violate the very things that have been working. Put the money in one of the above investments, let it pay you every month, and go put all of your time and energy back into the activities that caused you to save $50,000 (earning more income). I help people make money, keep it, and multiply it. My clients multiply their money with the exact types of investments I discussed above. If you’d like to learn more about passive income producing assets to help you multiply your money, click here.
Own Your Potential,
Jerry Fetta helps his clients make money, keep it, and multiply it.
He believes everyone should own their potential. He believes you were not created to spend 40+ hours per week serving the 40-year-to-life sentence trading your precious time for money just to live in mediocrity.
However, the truth is that time and money must be exchanged. It just doesn’t need to be you making the exchange.
Jerry helps his clients create wealth that exchanges time and money on their behalf.
His clients see a 30% increase in income, a guaranteed increase in savings rate, and 8–12% fixed annual returns on their assets in the 1st 90 days of working with him.
To get started, go to www.WealthDynamX.com/potential