How to achieve your ideal passive income through property!
For some people, retirement can’t come soon enough. After so many years of working, they can’t wait to spend more time with their family and doing the things that they love.
For others, however, they dread the idea of retiring.
Why?
Because retiring from work means losing their active income. This idea is uncomfortable to think about, especially if they haven’t built up a great deal of savings over their working years to fund their retirement.
Fortunately, when it comes to wealth building, if you plan early and execute properly, you can enjoy your retirement phase comfortably, while earning a passive income at the same time.
I get asked a lot about how to effectively replace a 9-5 income with passive income through real estate investments. So, in this blog, I’m going to share with you some of my general tips to help you start building an income for your retirement.
First off, what is passive income?
Passive income is a regular flow of income that requires only minimal effort to earn and maintain. In simple terms, you earn money while you sleep by letting your assets work for you.
Having a passive income is important if you want to gain more financial freedom, allowing you to enjoy your retirement and do things like take that dream holiday with your loved ones. However, most passive income sources often require a lot of time, effort and financial commitment.
While there are many sources for passive income available, one of the best options around is property investment, which can provide you with stable assets and healthy capital growth – assuming you select the right real estate, in the right location.
5 tips to generate passive income through property investment
Real estate is a great investment to help you build a passive income, especially as property values and rental incomes typically increase with the rate of inflation, meaning your money doesn’t lose value.
Here, I’ve listed 5 simple steps to help you secure your future and achieve your ideal passive income through real estate investments:
1. Focus on paying off your primary residence.
One of the great advantages of paying off your primary residence as early as possible is that it will leave you with a large amount of equity.
Equity is the difference between the current value of your property and the amount left owing on your mortgage. When set up correctly, equity can be used to finance the purchase of additional properties.
For more information, read: 5 strategies to help pay off your home loan faster
2. Build your property portfolio.
In order to achieve your ideal passive income through real estate investments, I recommend purchasing at least 5 properties over a period of 10 or more years.
You can start building your property portfolio by using your equity to purchase properties and rent them out to cover their costs.
For more information, read: How to use equity to buy an investment property
3. Set up an offset account.
An offset account is a transaction account linked to your home loan. Depositing funds into your offset account over a period of time can reduce the amount of interest charged on your mortgage.
For example: Mrs. Greene has a home loan of $300,000 and $40,000 in her offset account.
She will only be charged interest on a loan balance of $260,000.
4. Grow the value of your assets.
While the value of each property will increase as time goes on, undertaking cosmetic renovations and adding new features to your properties like a remodelled kitchen or updating a bathroom can add more value to your assets in a shorter time frame.
5. Time to sell your properties.
If you time it well, you can sell 3 of the 5 properties you’ve acquired and use the revenue to pay off your loan balances and any additional costs, leaving you with extra funds on hand to add to your savings.
Then you can leave your two remaining properties as rental properties, earning you a passive income of at least $2,000 per week.
Are you ready to create a passive income for life?
Achieving financial stability to help you through your retirement days is a calculated and well-planned strategy – and it should start as soon as possible.
While it can be a long journey as a property investor, achieving your perfect lifestyle, along with financial freedom will make it all worth it.
Just remember that the above is just general information. Don’t forget to consult your financial professional to get more personalised advice about your particular circumstances.
However, if you’re interested in learning more about how to select the right property, at the right time, location and price, then reach out for a chat.
I can help you to find the right property to start earning you a passive income
My team and I at Worth Property Investing are passionate about helping you make well-informed property purchases that will contribute to your financial freedom.
Think of us as your property buying partner, here to support you in making the ideal decisions for your future. As your trusted, licensed Buyer’s Agents, we do everything from searching, connecting, researching, bidding, negotiating and securing the best properties for you.
Speak to us today!
Start by taking the Investor Readiness Quiz now.
By answering 35 quick questions, we’ll provide you with a free, detailed report to help you be more confident about your investment decisions.
No worries! This is free of charge and takes less than 5 minutes to accomplish. You’ll also get a free copy of our property investment eBook as a bonus!
TAKE THE TEST NOW
[INSERT_ELEMENTOR id=”18847″]
