Invest in real estate or a franchise

3 Replies

I have an opportunity to invest 70k in a franchise that I can scale into a business that would more than replace my salary (low six figures). It's a business that I can scale using the wealth building approach based on some independent discussion with current owners.  It'll be a job but at a business owner level and not doing the technical work. 

OR

I take that 70k and invest in real estate and create a game plan to replace my salary in 8 plus years and build great equity. 

I like the idea of growing my business and building wealth, leaving the current corporate scene faster with a franchise. OR I invest in real estate and be paitent for a longer period of time. 

My other thought is buy the franchise and then use those profits to purchase real estate. 

Any advice will be greatly appreciated!!!

Seems like you have a great opportunity either way. I have never operated a franchise, I did look into it. The thing that kept stick out to me was the face that you will keep answering to someone. That was reaffirmed by the gentleman that  I just purchased my primary residence from. He told me its a job that keeps him busy all the time. He owns a Little Ceasar's. Said it felt like being a middleman, however it is good money. He did tell me that he wishes he would have went into real estate investing after I mentioned I had several rentals. My take away was if can be different for everyone and depends on the person. Also I would say it depends on the franchise. Is it small and regional, or huge and national. 

I have a W2 job and manage my own rentals. I like managing my own rentals better, but it can be slow endeavor. I started with about 30k into a vacation rental, its been close to 10 years, but I'm making it. I do have the luxury of age, I started age 30. If you are a lot older, it might be best to take the opportunity that can propel you to retirement quicker. Good luck!

Originally posted by @Tom S. :

Seems like you have a great opportunity either way. I have never operated a franchise, I did look into it. The thing that kept stick out to me was the face that you will keep answering to someone. That was reaffirmed by the gentleman that  I just purchased my primary residence from. He told me its a job that keeps him busy all the time. He owns a Little Ceasar's. Said it felt like being a middleman, however it is good money. He did tell me that he wishes he would have went into real estate investing after I mentioned I had several rentals. My take away was if can be different for everyone and depends on the person. Also I would say it depends on the franchise. Is it small and regional, or huge and national. 

I have a W2 job and manage my own rentals. I like managing my own rentals better, but it can be slow endeavor. I started with about 30k into a vacation rental, its been close to 10 years, but I'm making it. I do have the luxury of age, I started age 30. If you are a lot older, it might be best to take the opportunity that can propel you to retirement quicker. Good luck!

 I am in my early 30s right now and want to make a move over the next year. The two franchises are nation wide but I would only be operating in my metropolitan area. It's a home services business that some keep it small and do all the work OR grow it with a few employees. Thanks for sharing. 

Gotcha. Both sound like they can be good, but no one has a crystal ball. They could be wildly different for you, depends on what you want to do. Managing employees/workers and managing tenants are two different things. Something else that comes to mind is health insurance. Main part of the reason I'm still with my W2 job, and also the 401k as a backup in case my real estate goes bust.