It takes time and patience to generate wealth. At some point in time, you’ve probably wondered how the rich have managed to be successful in accumulating wealth. What are the things that they are doing right? How have they managed to build a property investment portfolio? Here are some lessons on property investment that we can learn from the rich.
Understand how the rich think
The rich did not get to where they are today without a system of beliefs. They have very different views about money, and they think and act differently than, say the middle class. They grasp whatever opportunities that come their way in order to make money. They learn and grow all the time. They take action and they believe that they deserve the success that comes their way. Having that positive mindset in the first place that they are destined to success puts them on track to take action to generate wealth.
Paying themselves first and investing in assets
One common thread that the rich share is that they tend to “pay themselves first”. For most people, the first thing they do when they receive their monthly salary is to pay off their monthly credit card bills or even splurge a little on discretionary entertainment or shopping. But these are immediate needs. For the rich, they flip this around. They always first set aside money to invest in assets be it stocks, property, mutual funds or insurance. This practice forces them to be financially prudent and prioritises long-term financial wealth rather than meeting short-term wants.
Let property assets generate cash flow through rental income
Getting on the property ladder is an important step for the rich. But you have to be in it for the long haul. Once they’ve accumulated enough wealth to invest in that first property, with the right strategies, diligence and leverage, it is only a matter of time before the rich are able to steadily build a property investment portfolio to generate rental income. By diversifying and scaling up property portfolio for example, by investing across various asset classes such as residential property, industrial property and co-living assets, the rich are able to start collecting stable and continuous passive income. Why is property such a popular asset investment class? Well, people will always need a place to live and there is an opportunity to generate consistent returns through rental income and capital gains over time.
Earn back your time
When the rich are able to earn multiple streams of passive income through their property investment portfolio, financial freedom is within grasp. This affords them the time to travel, spend time with children or significant other, and pursue their hobbies or passions.