Cash is Trash; Cash Flow is King

If you’ve followed Robert Kiyosaki, author of Rich Dad, Poor Dad, you’ve probably heard him say “cash is trash”. What he’s referring to is this: in periods of high inflation, savers are losers. If the return someone is getting by keeping their money in cash (typically in low-yield bank products) is lower than the rate of inflation, they’re actually losing money every year.

A new article shows that we’re heading into a period of high inflation now. Here’s the article:

http://www.cnbc.com/id/101018843

Here’s the pull-quote:

The practical impact of that level (of inflation) will mean a 30 percent increase in consumer prices over the next 10 years.

Notice that works out to an average of 3% per year. If banks are paying 1% (most are paying much less), then an individual parking their money at the bank is losing 2% per year! I don’t know about you, but it’s never ok to lose money.

One of the solutions to this environment is to purchase real estate with positive cash flow. Typically, this means that after purchasing costs and rehab costs, the gross annual return is 15-20%. The net annual ROI should be 10-12%. On a monthly basis, their should be a net profit (income minus expenses). Once you have one (or a hundred or a thousand!) of these properties, you are well-positioned to stay ahead of inflation because rent normally rises along with other costs in the economy. There are many other benefits to owning real estate as well, but this one is directly related to inflation.

Inflation is coming . . . make sure you’re positioned to profit!

Free Training: http://www.youtube.com/user/4FrontEnterprises

Wholesale Listings: http://forefrontenterprisesllc.com/homepage.html