Investing for cash flow rather than capital growth | Common Investor Mistakes [Video]

The more you know about the most common mistakes that investors make, the better your likelihood of building lasting wealth. 

Each week in this series of short videos, we discuss the common mistakes we’ve seen investors make.

Today we discuss the choice between investing for Cash Flow vs. Capital Growth.

Which way is right?

Points we discuss:

  • Most investors think they need cash flow but residential real estate is a high growth relatively low yield investment Money 2696228 1920
  • You can’t save your way to wealth
  • Cash flow keeps you in the game, but capital growth gets you out of the rat race
  • You need to build a substantial asset base – to give you choices.
  • Most of your assets on retirement will be the tax free capital growth of your property portfolio, not the rent you receive or the money you save
  • You need to build assets first then transition to the cash flow stage
  • While many investors buy properties for cash flow, I buy properties to allow me to buy more properties. You need the capital growth to pay for your next deposit and the rising rents will help pay for your mortgage for your next property purchase

NOW WATCH: PROPERTIES DOUBLE IN VALUE EVERY 7 TO 10 YEARS|COMMON INVESTOR MISTAKES [VIDEO]

Now is the time to take action and set yourself for the opportunities that will present themselves as the market moves on

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Michael Yardney

About

Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media. Visit Metropole.com.au


'Investing for cash flow rather than capital growth | Common Investor Mistakes [Video]' have 2 comments

    Avatar

    September 20, 2018 Murray L Raimona

    Well to me it would be cashflow first in order to build a asset base .Otherwise you cant move on . Quantity first before Quality because then only then you can weed out the not so well perform assets

    Reply

      Michael Yardney

      September 20, 2018 Michael Yardney

      Murray – I’m sorry I didn’t get my point across well. It’s really the other way around – sure you need cashflow to pay your mortgages, but you must have capital growth to build your asset base

      Reply


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