The Reality of Property Investing
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Property investment is one of the best ways of creating wealth and securing financial stability for the future.
Even during the current economic climate property is still an excellent investment, yet it’s also important that new investors understand the reality of the business and any potential disadvantages. And this is where anyone hoping to invest in property needs expert advice.
Firstly property could be termed an “illiquid asset.” What that means is that if you want to release cash quickly, it can take some time before you get your hands on it. However if you have some equity in the property some mortgage companies will allow you to borrow more funds and will release the money fairly quickly.
Secondly you need to commit the time and money to maintain the property. Renting the property to tenants means probably dealing with a letting agent, ensuring your tenants pay on time, being able to cope in the event that the property is empty for a month or two, or you may need to carry out repair work. There’s also buildings insurance to pay and some countries require that landlords adhere to certain regulations such as schemes to protect security deposits or energy efficiency inspections, which all cost money. Make sure you find out about all the rules and regulations for landlords and your tenants.
Finally if you compare property to other types of investment such as a pension fund or savings, there is a time commitment. You have to spend time making sure your properties are well managed and in good working order.
Pensions and savings on the other hand are something you really don’t need to think about on a regular basis and they manage themselves. Someone else is looking after your money and all you have to do is make any monthly contributions... and just hope you have enough to retire on!
Therein lays the biggest problem. Far too many of us put too much faith in other people for ensuring we have enough money to retire. But who’s going to bail you out if you have a pension shortfall? Not the government... state pensions are declining year on year.
Investing in property allows you to take control of your financial destiny and as long as you buy the right property in the right location by doing some research, and have planned for any risks in advance, the advantages far outweigh the disadvantages:
- You are rewarded with a much bigger asset than your initial capital investment
- Tenants pay the mortgage for you
- You can control any equity built up and decide whether to reinvest in more property or withdraw it to live off the interest and retire
Best Wishes
Clayton J.Moore
WANT TO USE THIS ARTICLE IN YOUR EZINE OR WEB SITE? You can, as long as you include this complete blurb with it:
Author, Financial Coach and Entrepreneur Clayton Moore has written ‘Your Money Puzzle’ and publishes the ‘Think Tomorrow Today' weekly ezine to help people gain control over their future financial security. If you're ready to jump-start your finances, make more money, and have more fun in your creating the life you desire, get your FREE tips now at www.claytonjmoore.com. Also visit my daily blog at http://www.claytonjmoore.com/blog for some great content.
Article author
About the Author
Hello. I’m really grateful for you taking the time to look at my article and how I could help you plan a brighter financial future.
To introduce myself to you I thought it would be best to tell you a little bit about where I started out and why I do what I do today.
I started working for a major UK bank in 1995 and soon discovered that I absolutely loved helping people to make more of their money. This passion led me to set a goal of becoming a Financial Planner within the bank – something that I achieved within a few months. For a few years I loved my job and loved helping people realize that they could do more with their money and create more financially secure futures.
However, after a number of years it dawned on me that the choices I had as far as advising people to create more financial security were very limited within my role as financial planner. I could also see that most of the traditional financial products were quite frankly not working for most people in the way that people thought they would. I realized that the financial products I had been trained to sell by the bank were not creating financial security for people.
I also realized that my very own financial security was at risk long term. Even though I was a member of my company’s pension scheme I had realized that the whole notion of having to work for this company for 40 years in order to receive only two thirds of my basic salary (I was earning as much again in bonuses but these were not eligible towards my pension) for the rest of my life in retirement was just absurd. This just didn’t make sense as a long term financial plan for my life.
Worse than my own financial security being at risk I could also see that there were many people who didn’t even have the so called security of a company pension plan and that for these people they needed to take responsibility for their own financial future. However, most people I came across were either not saving anything at all for their future or, if they were saving, were not putting aside anything like the amount they required to build up even a basic financial security later in life.
My passion for helping people understand the issues surrounding financial security was lit and I decided that I was going to leave my restricted job as a financial planner and start my own business to help as many people as I possibly could create more financial security in their lives.
I also realized that it was now up to me to build up my own resources in order to become financially secure when I retire and so I decided that rather than hand my hard earned money over to financial institutions to save for my retirement I was going to invest myself in assets that would grow long term and create the financial security I desired.
So, my life had turned and I was now a business owner, an investor and financial coach rather than an employee and so-called financial planner.
I have created ‘Your Money Puzzle’ and ‘Mastering Financial Success’, as a way to share my understanding of personal finance and enrich the lives of millions of people by guiding them to create their ideal lives.
I hope I can be of service to you and feel free to contact me at anytime if you need assistance. You can reach me at clayton@claytonjmoore.com
Good luck and best wishes
Clayton J. Moore
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