Are You Ready for Financial Freedom?
Financial freedom is something we all want, but very few of us actually achieve it. Instead, we spend our lives indebted to others and toiling away to pay off those debts, and inevitably rack up more I.O.U.s along the way. It’s a vicious cycle that millions of Americans are trapped in.
But what if I told you that financial freedom wasn’t just a pipe dream? That it was actually an achievable goal? It’s not easy, and you’ll have to work hard and make sacrifices along the way. But if you’re committed to this plan and making the dream of being debt-free a reality, you can do it.
My method for achieving financial freedom is sort of hybrid of other experts’ plans. I took a little bit of Dave Ramsey, a dash of Suze Orman, and a big helping of advice from investors I know and trust, and from there I formed a plan that also incorporates my favorite type of investment: turnkey real estate. Here’s how it works:
Step 1 - Get your finances in order
Before you can buy a turnkey property, you’ve got to have your financial situation under control. Whether you plan on buying property with cash or taking out a mortgage, the plan is the same: reduce or eliminate debt and then start saving. Take control of your finances, stop blowing your money on unnecessary crap, and start focusing on the big picture: getting that property, adding to your portfolio with more properties down the road, and ultimately becoming debt-free. No more excuses, people.
Step 2 - Start researching
Ignorance will not serve you well in this business. Educating yourself as much as possible before you start investing is one of the keys to your success. Get online and start reading up about real estate markets, what makes a great rental property, who to put on your investment team, and anything else you can think of. There are tons of excellent resources online, like BiggerPockets, that are chock full of information and advice. You should also start looking into local turnkey providers once you’ve decided on a market to invest in. Ask about their experience, get references, and find out what services they offer. It can take time to find the right company, but this is time well-spent. You want to be 100% sure you’re partnering with an experienced and reputable company who has your best interests at heart.
Step 3 - Buy your first turnkey rental
Once you’ve settled on a turnkey provider, it’s time to choose a cashflowing property and buy it. The turnkey company will have an inventory of rehabbed, tenanted properties to select from, so all you really need to do is figure out what neighborhood you want and what sort of property you want to own. Your turnkey provider will be able to provide you with numbers illustrating the property’s financial performance, but it’s important that you run your own calculations as well. Use your knowledge of the market to get real-time data, as well as projections for the future. If the numbers all look good and point to a cashflowing property, buy it.
Step 4 - Snowball your cashflow
Let the dust settle for a little while after you purchase, just so you can be sure that your finances weren’t thrown out of whack and that your property is continuing to produce positive cashflow. Once you feel stabilized, you can start snowballing some of the income your property is producing along with your regular savings. Doing this will bolster your savings account, enabling you to move into Step 5 more quickly.
Step 5 - Add to your portfolio
Owning just one turnkey property probably won’t get you to total financial freedom. For that, you need to own several cashflowing properties that will provide you with income from multiple sources. As soon as it’s feasible, start looking for a new property with your turnkey provider, and repeat Steps 4 and 5 until financial freedom is yours!