“Darin, if you are going to invest your money make sure your investment is working as hard as it can, every day. Our time is limited, so, the investment needs to have more than one component working simultaneously to build your wealth”
-Manson Houmes, Retired Real Estate Investor, 74 Years Young
The above is some of the best investment advice I had ever received. If you think about it, it does make sense.
I will admit it did take me a little time to figure out what Mr. Houmes was telling me. But, after some thought and more of watching what he was doing, I finally figured it out.
And that is what I want to do in this article. I want to figure this out with you. I want to make sure you also understand what Mr. Houmes was telling me. I owe it to you. You need to know this. Your wealth and lifestyle may very well depend on this.
What Mr. Houmes was saying is that we all have choices on how to invest our money. The very act of what you choose is key. Here is what he meant:
(Investment…Number of Investments Working For You and What They Are)
CD's…1 Investment: Appreciation
Stocks…2 Investments: Dividends and Capital Gains
Bonds…1 Investment: Appreciation
Mutual Funds…2 Investments: Dividends and Capital Gains
Tax Lien Certificates…2 Investments: Appreciation, Cash Flow
Apartments and Commercial Real Estate…4 Investments: Appreciation, Equity Build Up, Tax Savings, Cash Flow
You see, inside each of the above investments there are literally other investments or what I would call “sub investments” working for you. The more of these sub investments that you have working for you, the better off you will be. In other words the more of these sub investments you have the more money you will make and the faster your wealth will build. Isn't this great?
Once I caught on I started using the same strategies right away. We only have so much time on this planet so we may as well have as many of these investments and their “sub investments” working for us at the same time.
You can look at it this way. In order to cross the river you can either swim or take the bridge. Both ways will get you to the other side. One way is slower, harder, unpredictable and messy. One way is faster, clean and predictable.
Mr. Houmes was a smart guy huh?