Too many times real estate investors only care about how they are going to become a millionaire in this business.
But quite honestly, it is so much more important to focus on how you are going to make your private-money partner a millionaire first. If you make your private-money partner a millionaire, it is inevitable that you will also become a millionaire.
How to Purchase Real Estate With No (or Low) Money!
One of the biggest struggles that many new investors have is in coming up with the money to purchase their first real estate properties. Well, BiggerPockets can help with that too. The Book on Investing in Real Estate with No (and Low) Money Down can give you the tools you need to get started in real estate, even if you don’t have tons of cash lying around.
So How Do You Make Your Private Money Partner a Millionaire?
Answer: Compound interest (what Albert Einstein called the 8th wonder of the world).
In simple terms, compound interest is the action of taking the interest you earn on an investment and rolling it back into that investment. This is known as earning interest on your interest. Compounded interest will grow an investment exponentially—and even more so when the investor is not paying taxes each time they take an interest payment.
Einstein discovered a rule around compounding interest, called the Rule of 72. It goes like this: If you take an investment which is compounded annually and divide the interest rate into the number 72, the result you will get is how many years it will take that money to double.
Compound interest is a very powerful concept that will help you make your private money partners millionaires (and even multi-millionaires!)
Let’s get some discussion going!
How have you been able to help your private money partners increase their wealth by compound interest?