Momentum - Business to Business Online Magazine Summer 2017 Issue | Página 33

As you see so far in our example, the all cash investment
has seemed to be quite a bit better financially for our
investor - for a single property. However, the all cash
investor has had the entire budget locked up for the term,
recovering cash only on a monthly basis and accrued
property increase only from 1 home.
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Our mortgage holder, on the other hand, has realized
positive cash flow, met all their obligations, and from the
start, retained a $150K cash investment pool.
What if they replicated their investment strategy across 3
total investment properties versus only one?
Plan B x 3
$319, 520.00 x 3 = $958,560.00
with $150,000 Cash Investment!
Total 15 year Profit.+ $50K cash reserves
As you see so far in our example, the all cash investment
has seemed to be quite a bit better financially for our
investor - for a single property. However, the all cash
investor has had the entire budget locked up for the term,
recovering cash only on a monthly basis and accrued
property increase only from 1 home.
Our mortgage holder, on the other hand, has realized
positive cash flow, met all their obligations, and from the
start, retained a $150K cash investment pool.
What if they replicated their investment strategy across 3
total investment properties versus only one?
Note that our scenario does not account for rising taxes
and insurance costs: however, at the same time, it also
ignores rising rental rates over time. We all know, taxes
and the rent only go up!
So, with conservative projections, using OPM (other
peoples’ money) can triple the $200K (or less) capital
investment winnings over a 15 year period. Being
ridiculously conservative, it will for sure double them.
There are other benefits not considered here as well, such
as lower annual personal income tax debt because the
mortgaged property yields much more modest annual
income. The taxes we don’t have to pay immediately, as
well as the cash we retain while we invest, offer that many
more opportunities to explore.
So…is a property paid in cash the best way? Or perhaps
a growing portfolio…ultimately, it’s your pick. But the
portfolio sure looks attractive!
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