Should I Invest in Real Estate While Running an Internet
Business?
Copyright 2005 Peter Dobler
Of course you should. I practice this for quite a while and I
never looked back. I think this is the perfect combination. You
get the best of both worlds. Did you know that 90% of all
millionaires made their fortune with real estate and 10% with
the internet or the stock market? Well, this doesn't leave any
room for the paycheck workers, doesn't it?
I once read a small phrase that totally changed my life "Trading
hours for money doesn't bring you any wealth". This powerful
phrase stuck with me ever since. Take a moment and think about
this. We all do it by being employed by an employer we trade
hours for money. How many hours per week can you trade without
completely giving up your life? 60, 70 hours max. This doesn't
leave much room for a family life or having some fun, doesn't it?
Well, enough of this depressing stuff. Let's talk about
something fun. Did you know you can actually make money while
you're sleeping? It is called residual income.
With your internet business you want to achieve residual income
through selling membership subscriptions to any form of service
that charges monthly dues. Typically you will receive your share
of this as monthly installments. You do the work once and you
get paid over and over again.
With real estate you achieve the same effect with rental
properties. Although your involvement in the process is a little
bit bigger, but it is still manageable. You have to collect the
rent and making sure it is paid on time. On the other hand you
have to pay all the bills like mortgage payments, insurance,
taxes and sometimes utility bills. Depending on the type of
lease agreement you have with the tenants.
This takes care of the residual income part. As a rule of thumb
if your residual income covers your living expenses you're on
your way to be successful. Now you can start doing the fun part
with real estate. Not that there's anything wrong with being a
landlord. I personally don't like this part of investing in real
estate.
The fun part for me is to work deals with real estate. It could
be buying an old property way below market, fix it up and sell
it with a profit. Another method in dealing with real estate is
called flipping. In this case I simply control the property
through a contract and then assign the contract to another
buyer. Of course I will collect a fee for my services. I prefer
the second method because the least amount of money and work is
involved. Fixing up properties can turn into a time and money
consuming project.
The point I want to make is that you need to establish some sort
of residual income to cover your basic living expenses in order
to expand your business.
Of course you can do all of the things mentioned and still
working full time. That's what most people are doing. However
you have to decide if the extra income is worth the effort. You
will need a lot of time to do both investing in real estate and
running an internet business.
Visit my home business website and my real estate website to
learn about effective systems to leverage both business models
without completely giving up your life.