Earning Passive Income Through Real Estate Investing
I recently participated in a career design program, focused on reflecting on the satisfaction with the current professional path and on redesigning a more fulfilling career.
Most people I had the pleasure to meet wanted to improve work life balance without a reduction in income. I noticed that the lack of financial freedom limits people's ability to take risks while considering career changes, as they don't want to change their family's lifestyle in order to pursue a passion.
In this post we will learn how to gain financial freedom by earning passive income through real estate investing.
You can learn about redesigning your life and career according to your purpose on previous posts.
What is passive income and how can you earn it?
In its simplest form, passive income is money you earn without having to actively work for it. It's the opposite of active income, which is when you trade your time and energy for money.
Passive income can come from a variety of sources, including rental properties, stocks, bonds, or business ventures.
Why is passive income important for financial freedom and improving balance in your life?
When most people think of financial freedom, they think of earning a high income and being able to live life without having to worry about money. While this is definitely one way to achieve freedom, it's not the only way. Passive income can play a huge role in achieving financial freedom, and it's something that everyone should strive for.
If you rely on your salary as an employee or entrepreneur as a unique source of income, you may feel that improving your life balance and prioritizing your personal life can limit your potential financial growth, and keep you away from wealth building and financial independence.
ith passive income streams, you let your money work 2x or 3x or 4x for you to reach financial freedom and allow you to make choices to live an extraordinary life.
How can you get started with earning passive income today with real state investing?
When most people think about real estate investing, they think of buying and flipping homes. While this can be a lucrative way to invest in real estate, it's not the only option. In fact, there are several ways to invest in real estate without ever stepping foot inside a home. One such way is through passive income investments, such as rental properties.
I interviewed Axel Meierhoefer, Founder of AH Green Homes LLC and CEO of IdealWealthGrower ™ and we discussed how to become financially independent through real estate investing.
As a retired Air Force officer, Axel started his first company in 2005, focusing on consulting, employee skill development, and program management.
Then Axel began applying profits towards retirement as a business owner, and research indicated that owning tangible assets would be the best way - which led him to develop a residential real estate portfolio worth $1.5 Million.
Through his mentoring program at IdealWealthGrower ™ and as the host of The IDEAL Investor Show podcast, Axel continuously helps professionals and investors to reach their financial freedom point, which would generate wealth for the next generation.
Here is what we discussed:
How can we start a real estate investing journey with as little as $50/month?
According to Axel, we should consider 3 steps to start investing:
1. Understand where in your financials you are and your available funds
2. Define your short term and long term vision to earn financial freedom
3. Develop a mindset of a creative and wealthy business person
Although the journey can be long if the only money saved is $50/month, it's possible to start the path to real estate investing with that amount. An experienced financial advisor would be able to help you to start and grow your investment portfolio and guide you on the path for financial freedom.
Should we focus on saving money to buy our first (dream) home or should we start investing in real estate?
I shared that I am saving money to buy my first home in expensive California and I asked Axel if that was the right approach. Being authentic like a diva, he explained why this is a bad strategy.
In summary, Axel said that in a higher price area you win if you are the tenant of your property, in a lower price area, you win if you are the owner of the property and you rent it to someone else.
Watch the video to better understand his rationale and how making better financial decisions and applying your savings towards assets that can appreciate, help you to build and diversify your investment portfolio and build enough wealth to achieve your life goals and potentially achieve financial independence.
After this interview I will consider starting in real estate in cheaper areas to generate passive income that will help me to be able to acquire my dream home.
How can we get from saving $50/month to a million dollars in real estate investment?
According to Axel, the first part of the journey is to generate excitement and save enough money today to build investments that will generate passive income that can cover your life expenses, so within 10, 15 years you can potentially achieve the financial freedom that will allow you to have a more balanced life.
Axel also suggests that we eliminate unnecessary expenses and use the extra time that we may have due to the decreased commute due to the hybrid work model could be used to generate additional income. More money put into real estate investment can accelerate the growth of your portfolio for your financial freedom.
Final thoughts on the importance of financial freedom and ways to improve balance in your life through earning passive income.
Achieving financial freedom is an important step we can take to improve our lives. When we're not tied to our jobs simply because we need the income, we're able to be more selective with the work we do and spend more time doing the things we love and have more life balance.
I learned a lot on this interview and I am ready to put together strategy to achieve financial freedom in the next few years.
What about you Divas? How are you managing your investments to generate passive income and improve your life balance? Leave your comment on Twitter or Facebook and share this post on your social media!
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