These last few years have shown us that the only constant is change and this is very true in the world of finances and investments. It can feel like you are riding a rollercoaster with no seatbelt or handrail to grab onto as the markets go up and down and in circles.
I know for years, our "investment strategy" was to do what the banks told us to do and we "invested" in what they sold to us. (Hint, mutual funds and RRSP's were profitable for the bank, not so profitable for us.) I knew this wasn't a good answer for building a solid retirement plan or to build sustainable generational wealth, however I didn't know what to do or what the answer was and had no time to figure it out. Many people I talk to feel the same way and do nothing or ignore their investments out of sheer confusion, or they do what the bank tells them to do as it feels "safe". If this is you, you are not alone. I encourage you to pull out your bank investment statements and really look at them to determine what your actual return on your investment is. There is a reason banks are so profitable.
So how do you know what investment will secure your financial future and help you live a life without the stress of money? The stock market fluctuates every day. I'm sure you know someone whose retirement got derailed as the stock market decided to drop substantially right when they retired. There are a few people who time it right and are successful in the stock market, however for most people, you can’t really depend on the stock market. Likewise, bonds and even mutual funds tend to be unstable, as they shift with the external market forces that move the economy. You want a more stable investment, one you can count on and one where you have a good degree of control. Something that is consistent, reliable and over time has proven to be a very successful investment strategy. That’s where real estate comes in. An overwhelmingly majority of wealthy people have either made their money in real estate or hold their money in real estate. I remember reading the book about McDonalds and the founder knowing he wasn't in the hamburger business, he was in the real estate business.
Real estate is a smart investment for a lot of reasons. Chief among these is the steadiness of it. Where other types of investment can lose vast amounts of value at a moment’s notice, real estate has a great consistency in value. In my life time, I have seen the real estate market go up and go down, and each time it eventually goes back up and surpasses where it previously was. Investing in real estate is not a get rich quick scheme it is a get rich over time strategy.
Yes, the value of a property can change however it doesn’t drop like a cement block, the way the value of stocks can. When property prices change, they do it much more slowly and gradually. That’s because, unlike luxuries such as gold and diamonds, housing is a necessity and a consistent market. Everyone needs a place to live, and that isn’t going to change whether the economy is humming along, or slowing down. So with that in mind, it only makes sense that your properties would remain valuable no matter what the economy gets up to. It is the basic economics of supply and demand.
Real estate is real - it is physical and you can touch it! This kind of investment is reliable because it’s based on actual, tangible things - people will always need a roof over their heads. Real estate is not based on abstract concepts and invisible forces, it is the real deal. Plus, there are multiple strategies and investment types within real estate investing, so you can always find one that fits your life and goals. If you’re looking for an investment that is stable and consistent with good returns, investing in property is the way to go.
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