Real estate is a fantastic long term investment which makes it suitable to include as part of your family legacy. Have you ever considered what you would like to pass along to the next generation?
In my case, Old MacDonald had a farm and it has been passed along from generation to generation. Passing along income property is a great way to leave a legacy and keep wealth within the family.
Long Term Wealth
Long ago Old MacDonald purchased a farm and started to work that farm – it was the family business. Over the years, the mortgage was paid, and eventually that farm was owned free and clear. Years later it has been passed from one generation to the next. Now, not having the burden of a mortgage makes running the family farm a whole lot easier.
This is a real life example of the long term power of real estate. The property was an investment, one that made the family business possible. While this is a little different than the traditional buy and hold real estate, the end result is the same – the property is owned free and clear. Buy a property today, pay the mortgage for 25-35 years, and at the end of the day you’ll own the entire thing outright. If you can find positive cash flow properties, your tenants essentially buy the property for you over the amortization period of your loan. To me, this is the real beauty of real estate investing.
Taking It Slow
Even if you don’t want to be a full time real estate investor, it is within anyone’s ability to buy rental property. What if your parents or grandparents had bought just 3 rental properties in their lifetime? What if they purchased one every 10 years of their working lives and later passed that portfolio on to your generation. Even with a slow and steady stream of just 3 investments, that small portfolio would create a nice legacy and base of wealth for the family.
If those 3 properties were paid off, they would provide great cash flow to support a retiree, or offer substantial equity for a cash-out refinance to start another business or buy more property.
Passing It Along
Even a little real estate can go a long way in building a family legacy. As a sustainable long term asset, it makes a great base for building generational wealth. So, what will you add to the family purse for the next generation?