Here’s a great, actionable 5-year blueprint for you to build durable wealth. This is what I do for people! Let’s go!

Here’s how you can turn your $100K into $300K in five years, and create passive monthly income along the way.

If you desire, you can even turn your $100K into a cash-flowing million-dollar apartment building in just five years:

1. Invest $100K by making five 20% down payments on five $100K turnkey cash-flowing single family properties. If you don’t know where or how, go to GREturnkey.com. You’ll end up with specific addresses. Do your due diligence.

2. Real estate has a historic appreciation rate of 6%. Compounded, each of your $100K properties is worth $134K within five years. That’s $34K of appreciation in each of your five properties.

NOTES: Equity is the difference between what a property is worth and how much is owed on that property’s loan. Equity can also be thought of as your “skin in the game.”

Cash flow is your passive income. It’s your monthly rent income minus mortgage, property tax, property insurance, maintenance, professional management, and a factor for vacancy.

3. So now for each property: you have $20K of original equity as the down payment, plus the $34K in equity from appreciation. That’s $54K in equity.

4. And see, your tenant is also paying down your loan for you every month for five years. At today’s interest rates, that another $6K to add to your $54K. That’s a grand total of $60K of equity for each property over five years!

5. You now have $300K of total equity over your five properties, just five years after you began with $100K.

What? Wow! How did that happen? Is this real? It’s the magic of financial leverage at work. You achieved the rate of appreciation on both your down payment and the money that you borrowed from the bank.

Compound interest is slow, lame, and doesn’t create wealth on it’s own. Wealth is created when compound interest is leveraged this way.

After five years’ time, you can keep holding your five properties or go sell them and cash in.

Let’s say that you decide to sell your five properties. You won’t get $300K in equity cashed out. When you pay agent commissions and property make-ready costs, it might get whittled to $250K.

With your $250K, you typically do not have to pay any tax (yes, zero tax) on your capital gain if you use it as a down payment for another property (follow the generous tax-deferred exchange rules).

This means that you can put a 25% down payment on a one-million dollar apartment building, and enjoy all of its monthly income production!

Yes, now you’ve created financial leverage on an even larger property and continue to amplify your wealth in the same way!

Excited? You should be. I’ve been doing this for almost fifteen years. This experience also means that I understand some risks and limits. The above example is surely simplified.

What are some risks and limits?

  • Well, we didn’t include any mortgage loan closing costs when you bought the five $100K properties. Often, you can ask the seller to pay some of these for you in exchange for your full-price offer.
  • The 6% appreciation rate could be lower (or higher). Let’s say it’s lower. Let’s say that the properties even lost value. In this case, you’re not sunk as long as your property stays rented and cash-flowing. That’s why we carefully pick markets and cities that hedge against downturns (stable-price, job growth markets) at GREturnkey.com.
  • Some things surely will go wrong. You’ll have bumps over the five years. The month you have to replace a garage door or section of fence won’t feel so great. Think long-term.
  • This whole thing still might not work out. There are simply no guarantees in investing.

Remember, real estate pays you five ways at the same time. In growing $100K to $300K in five years, we’ve only discussed two of just five ways you’re paid with residential, cash-flowing real estate! Those two are appreciation and loan paydown made by others. There’s also cash flow, tax benefits, and inflation-hedging.

Note that with a turnkey investment property, someone else manages the property for you. Your time is worth too much to replace flooring, fix faucets, or collect rents yourself. Be an investor, not a landlord.

This is not a “zero-money-down-get-rich-quick” plan. This is about smartly investing your money over time to leverage other people’s money to build durable, lasting wealth for you and your future.

I implore you to not just say “that’s interesting” and move along to the next thing. Knowledge is not power. Knowledge plus action is power. Take action. Visit GREturnkey.com. Smartly leverage your way to financial freedom.

Here’s to your wealth and success!

Thought getting your money to work for you creates wealth? It doesn’t! That’s a myth. My one-hour investing video course is now 100% free: Real Estate Pays 5 Ways. For a limited time, you can learn how wealth is really created, here.

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