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Linear growth is seen in stock, not geometrical growth. Geometric growth, unlike linear, is not a straight line; it is much faster. Those who take advantage of geometric growth, when it comes to their money, will be rich. This is what separates the rich and the poor. This is the one and only way to become rich, in fact. Anyone can take advantage of it.
The secret power we are talking about is the power of borrowed money, as this is the surest way of them all to get rich. The poor and middle class struggle because they are seeking always to avoid debt, rather than focusing on getting themselves into good debt.
The richest people in the history of the world built their fortunes with often times one-hundred-percent borrowed money. If you would like to take advantage of this power, you can simply jump head first into the world of real estate: the best place in the world for borrowed money.
You will only need twenty-percent of what you buy in this world. Sometimes, you do not need anything. The bank will cover the rest.
Real estate will allow you to buy with only twenty-percent down things that cost hundreds of thousands of dollars. Often, you need put nothing down.
Both investments appreciate by six-percent after some time. The stock, then, has made us one-thousand, two-hundred dollars, while the real estate has made us six-thousand. Naturally, we will need to subtract what we owe the bank before determining what our real profits are. So, we take away the four-thousand, and we end up with eight-hundred more dollars than what our stock returned to us.
Our stock has made us only sixty-percent of what our real estate has. The real estate made us ten percent return on investment, but the stock only made us six. Now, you tell me which the better investment is.
This is just a taste of the real fun of real estate. If the investments made eight percent, then real estate would have earned us four-thousand while stock would have made us one-thousand, six-hundred. This time, stock only earned forty-percent of what the real estate did. Real estate really does earn exponential growth.
If we make another investment after this, assuming an eight percent growth rate, we will have twenty-one-thousand, two-hundred from stock, but we will have twenty-four-thousand from our real estate.
On a second investment that earns eight-percent also, we will end up with much more from real estate yet again. On a third investment with again eight-percent interest, the stock will have earned us only thirty-five-percent of what the real estate did.
The more time goes on, the higher percentage earned on capital invested in real estate. Stock, however, only grows linearly.
Real estate truly allows one to take advantage of the power of borrowed money, the core of capitalism. Other people's money will allow you to become rich.
The secret power we are talking about is the power of borrowed money, as this is the surest way of them all to get rich. The poor and middle class struggle because they are seeking always to avoid debt, rather than focusing on getting themselves into good debt.
The richest people in the history of the world built their fortunes with often times one-hundred-percent borrowed money. If you would like to take advantage of this power, you can simply jump head first into the world of real estate: the best place in the world for borrowed money.
You will only need twenty-percent of what you buy in this world. Sometimes, you do not need anything. The bank will cover the rest.
Real estate will allow you to buy with only twenty-percent down things that cost hundreds of thousands of dollars. Often, you need put nothing down.
Both investments appreciate by six-percent after some time. The stock, then, has made us one-thousand, two-hundred dollars, while the real estate has made us six-thousand. Naturally, we will need to subtract what we owe the bank before determining what our real profits are. So, we take away the four-thousand, and we end up with eight-hundred more dollars than what our stock returned to us.
Our stock has made us only sixty-percent of what our real estate has. The real estate made us ten percent return on investment, but the stock only made us six. Now, you tell me which the better investment is.
This is just a taste of the real fun of real estate. If the investments made eight percent, then real estate would have earned us four-thousand while stock would have made us one-thousand, six-hundred. This time, stock only earned forty-percent of what the real estate did. Real estate really does earn exponential growth.
If we make another investment after this, assuming an eight percent growth rate, we will have twenty-one-thousand, two-hundred from stock, but we will have twenty-four-thousand from our real estate.
On a second investment that earns eight-percent also, we will end up with much more from real estate yet again. On a third investment with again eight-percent interest, the stock will have earned us only thirty-five-percent of what the real estate did.
The more time goes on, the higher percentage earned on capital invested in real estate. Stock, however, only grows linearly.
Real estate truly allows one to take advantage of the power of borrowed money, the core of capitalism. Other people's money will allow you to become rich.
About the Author:
Cody Scholberg, an expert on finance investment, writes for the Investment Properties Guide, the one and only guide to investing and how to pick your first rental property.
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