I have been a fan of the stock market since I was a kid. I remember watching Limitless, Money Never Sleeps, and The Boiler Room as a kid because I was always fascinated with how these people were rich by looking at charts. It was wild to me like a jungle watching a bunch of men screaming words at each other. I could not understand how this way of living granted these men the ability to afford the most expensive items ever. So I set out and actually put money into learning about the stock market from various courses from various traders. I do appreciate the knowledge I have gained via the learning experience but I must say I wish I had at least put 10% of that energy towards real estate.
Real Estate as an investor is like having your Batman to Superman. I mean each by their own allows you the ability to change your life but together they’re even better. I would actually go even further and say they’re like a husband and wife relationship. The reason being is that stocks work great when you have a large amount of capital. This is not to say you should only invest in the stock market when you have a large amount of money but it is a fact that capital preservation is what the stock market is all about for the wealthy. Owning a portfolio of over millions of dollars only really requires a small amount of interest to be earned to live off of plus dividends. But with real estate you get to have another cash flow. Of course the tangiblilty is nice and you can constantly upgrade your property in order for it to appreciate in value. However with real estate there are so many tax benefits and advantages that can be utilized.
Once you set yourself up with an experienced CPA you are able to use real estate as a cash flowing machine. You can use all sort of tax benefits to defer taxes from selling or decrease your W2 taxable income for taxes. Real estate provides options allowing one to create a long term investment along with cash flow. The cash flow can give you the ability to raise capital quicker to invest or first become financially free and have it cover your monthly expenses. Real estate gives you the ability to hedge against inflation as we were seeing when inflation first took off before the interest rates started rising. Real estate has a high entry to play which is why it’s not as sexy to many-beyond the fact of its tangibility. The simplicity of being able to buy and sell on the stock market is very attractive to those that have an understanding of both. But stock market provides cash flow only via dividends. Real estate provides cash flow in various of ways from flipping homes to having a home as a short term to long term rental, essentially a dividend per month.
Remember that it’s not about either one. It’s about using both to your advantage. Collaboration over competition.
