[tomzestatlu]

I know there are many threads about getting money. I am not asking for some "instant money" advice. I am just often thinking about how rich people became rich. I am not dreaming of Dan Bilzerian lifestyle, I am looking for way how to secure life to my future family in these days.
I recently started doing my first real job paid by government after getting the degree. I must say the salary is really good. I have maybe 100% more than some of my friends (who are even older than me) and it´s high over average sallary in my country. A lot of young people live with their parents or they are secured by them. I stood on my own foot, pay my own flat in different city. And I am not one of those lucky who have chance to inherit something.
As I said, the sallary is good, but I spend a lot on living (rent, coming to work). I can make some savings, but that´s the point. Even though I can try work and save as much as possible, it won´t bring me any different life. Saved money I will spend on some things (vacation, older car?), but won´t get me out of the from-month-to-month surviving circle.
I would consider myself being rich, if I had own flat/house. It´s the security, even if you lost job and have no income, you still have ground for changing life to better. But what to do with mortgage if I lost income for longer period?
I am 24 and I don´t want to be paid by the government forever. Being paid by some corporation seems to be even worse for me. In the future (when I will be 30 or a little bit over it) I would like to do something different. I will be experienced, but still young to learn new skills. Plus I will have some savings (which must be somehow multiplicated, otherwise they are not very useful). Getting some slave-job won´t probably be that what I am looking for. And it probably won´t bring me as big sallary as I have now.

There are some good oportunities to earn good money. But the problem is, that it can be done only by those, who are already rich and have capital to spend. In these days, rich become richer and poor become even more poor, in my country... middle class is disappearing and I don´t want to end on the bottom of it (I don´t live in the US, but middle Europe).

I know there are some succesful people here on this forum, so some good advices could be found here. My advantage is that I am not waiting for things to happen, but I am going for them. And now I have those 6-10 years to figure out, what to do and prepare as much as possible.

[christpuncher]

"And now I have those 6-10 years to figure out, what to do and prepare as much as possible."

I think having such a mindset is a big part of the problem. There's always some high reaching 5-10 year goal for "making it big" so that you can gear your lifestyle towards being a carefree, minimal work, location independent seasoned player who travels the world with a respectable wallet.

So many young manosphere guys have this dream, myself included in the past.

Problem is, it's a very ego-centered, results-needed goal, with a low chance of success. It's the dark side of delayed gratification, so much so that happiness in the present is willingly sacrificed for a doubtful future. Goals are set on the years-decades level instead of weeks-months, and getting out of your head and living in the now becomes very challenging.

It's great to have a dream/goal, but don't base you happiness and judge your success as a man on pipedreams. Having a lifestyle of freedom from drudgery and responsibility is a lofty goal, especially when one wants to accomplish this by age 30 or 40. The vast majority of smart, hard working men, 90+%, will work from age 25 to 60 at a job they enjoy less than 25% of the time, hopefully save some money and not make unwise investments, and eek out a somewhat comfortable retirement.

It beehooves any man to align his temperament to be able to allow himself to feel happy and not regretful within this all-but-certain reality. And IF life works out even better than that for you, all the better!

[ElFlaco]

(09-19-2016 12:25 PM)tomzestatlu Wrote:  

I know there are many threads about getting money. I am not asking for some "instant money" advice.

If you're interested in business, here's a forum thread started by our old friend cardguy:

Is making money in business easier than people imagine?
thread-36220.html

Also, there's a 'Making Money' tag in the Lifestyle subforum. Not everything there is advice for 'instant money'.

[WeekendCasanova]

Compound interest.

[TheFinalEpic]

Start a business. Don't exchange time for money.

[chakalaka]

Invest in real estate. You have a secure job so you can easily get a loan. Check if there´s a gap between your mortgage monthly payment and the rent you can get. And calculate a 5% interest increase and see if the rent can pay it. Also check the average price and look for something with 30-40% lower. Buy in the center and if possible capitals. If it needs to be fixed work on it in weekends. Or hire somebody to do it for you. Every month you will receive a check.

Everyday check the MLS listings. Every fucking day. Forget about agents giving you non listed bargains. They will not give it to you. Don´t waste too much time on the due diligence. Don´t hire a lawyer. Unless it´s overseas. The bank to grant you the loan will probably check everything for you. And reserve the house ASAP. A good house is like a hot girl in a club. If you take too much time another guy will approach her.

When you decide to rent. Remember all documents the bank asked you to deliver in order to grant the loan. Ask the same docs to the tenants. If you hire a real estate agency to rent. Don´t take the tenant they want. Take the one you want.

If the property value increases above 50% sell it. And repeat. You can do this repeatedly and become a millionaire.

You can even be more greedy and go for BNB´s. It´s more active. More work. 16-18% yeld.

After you have a nice bank account. Think about higher projects.

[Seadog]

Is multiplicate a word? That aside, there are basically 3 facets. 1) spend less, 2) make more, 3) invest the difference.

#1 is by far the easiest. Older car + vacation wont get you out of it? That's the wrong attitude. Bike to work, eat subsistence food, live like a true minimalist.

#2 is trickier, but if you want to fast track toward freedom, forget about the cushy government job. Think trades, industry, 100 hour work weeks in Siberia.

#3 is simply what you do with what's left over. Other posters recommended real estate. I don't. It's hardly hands off, can be hard to liquidate in a bad market, and a single bad roof/foundation/tenant can literally wipe away two years of profits. I'm a big fan of ETFs which basically take all the stocks and put them together, to lower volatility. Hands off, easy to liquidate. If you do like RE, REITs are the way to go.

While I'm not quite at his level, I found myself pretty close by doing more or less the same thing as him, without knowing it, which is basically what I outlined here. http://www.mrmoneymustache.com/

One of the key takeways however is that unless you have the next facebook idea, it can't be done without sacrifice.

[chakalaka]

When you go into real estate. You must consider it a business. Not a part-time or past time. In a business you don´t buy the market price. Buying bellow market price is what a business does to survive and thrive. And the same principle should be applied to real estate. Buying a house bellow market price is not a great deal. It´s what you do as a business. To succeed as a business you will always have to buy houses with good discounts.

Problems with the house. It´s the same problems as any other business. Any investment has risks associated with it. But there´s a reason why banks loan money to buy houses. And it´s more difficult to receive a loan for stocks. Buying a house is less risky. The rent yeld must pay all expenses. If they don´t. You didn´t buy the right house with a sufficient discount which would give a nice rent yeld.

I don´t think stocks are much more liquid than real estate. A house just like a stock can be sold really fast. It´s just a matter of the discount you want to give it and losses. If you hire a good broker he will sell you the house. In a downturn you might sell bellow what you bought. But you can always sell a house fast. The only question is how much discount you will have to give. A stock might be more liquid. But what´s the advantage of being liquid if you need to sell when the quotation is low. It´s liquid. But if you don´t want to take losses you will need to wait for the quotation to go up.

But for me the biggest advantage of real estate is leverage. You cannot get the leverage in stocks you get in real estate. Unless you´re Buffett. At least from my knowledge. And I´ve been researching this subject for a while now. If it would possible to get a loan to buy stocks and repay it with dividends. It would compete with real estate. A stock just like a house should pay themselves.

One example bought a house in 2009, which was 100% financed by the bank. Sold it last month with 100k gains. The house was always rented. The cost of maintenance was low. Did spend 5k in renovating it for selling though. Besides the transaction taxes. There wasn´t one cent of sweat money in this investment. And even transaction taxes I could have avoided with a company. But I like to deal minimum with accountants.

One thing I tell my tenants when they see the house. They should imagine the house is theirs. I will not fix or take care of anything. A toilet gets broken. Electric problems, etc. It´s up to them to take care of it. If I wanted to take care of those things I would rent rooms not a house. Unless it´s something structural don´t bother to call me. Never rent to lawyers/judges or anyone related to law. Also avoid businesses. Rent to normal people. Young couples. Foreign students (from north of Europe, anglos, etc).

When you offer to buy. You must be ashamed of your offer. If you don´t feel uncomfortable with your offer for how low it is. Don´t make it. It´s a business. You´re supposed to buy with a discount. A house can be bought at 40% of it´s value or less. Even in a hot market. Again I can´t do this with stocks. If a stock of Apple is worth 113$, I cannot offer 60$. Unless you´re a hedge fund.

In my opinion stocks are more advantageous for high net worth. When leverage becomes more irrelevant. Or simply put to accumulate wealth. Not create. A lot of private/investment banks ask for a minimum 5M account opening for a reason. Bellow this value it´s not worth it for them. Capital markets are higher projects. And something I´m looking into.

[jj90]

(09-20-2016 04:42 AM)chakalaka Wrote:  

I don´t think stocks are much more liquid than real estate. A house just like a stock can be sold really fast. It´s just a matter of the discount you want to give it and losses. If you hire a good broker he will sell you the house. In a downturn you might sell bellow what you bought. But you can always sell a house fast. The only question is how much discount you will have to give. A stock might be more liquid. But what´s the advantage of being liquid if you need to sell when the quotation is low. It´s liquid. But if you don´t want to take losses you will need to wait for the quotation to go up.

Weak argument. Nobody wants to take losses on an investment. If I have to take a loss of -10% I don't care if it's real estate or stocks. In fact in that case I prefer stocks because I can liquidate most of it fast in case the price goes down more.

You can sell a house in a hot market fast. How bout a down market? You want to discount your RE 50% in order to liquidate? That's not liquidity. That's a panic sale.

(09-20-2016 04:42 AM)chakalaka Wrote:  

If it would possible to get a loan to buy stocks and repay it with dividends. It would compete with real estate. A stock just like a house should pay themselves.

It is possible. I have a REIT portfolio funded with none of my money. I borrow at about ~3% and the portfolio is yielding about ~10%. In a special vehicle that is tax free. That's ~7% net with no up front capital.

(09-20-2016 04:42 AM)chakalaka Wrote:  

Again I can´t do this with stocks. If a stock of Apple is worth 113$, I cannot offer 60$.

What if Apple is worth $213 actually, and it is now worth only $113?


To specifically answer the OPs question and concern: Yes, the middle class is disappearing throughout the western world. Other posters have outlined great points to create wealth. The key point here is while you do that, how do you not end up in the bottom half?

Or rephrased, how do you keep yourself in the top half? Be in high demand. Get the necessary skills, experience, contacts, whatever to better yourself and command a higher compensation while you build out the wealth creation methods. If that means going back to school, switching careers, whatever, do it. There's a very strong correlation over time between the class you stay in and your level of wealth. Set yourself up and buy yourself the time needed for success to hit.

[WeekendCasanova]

(09-20-2016 04:42 AM)chakalaka Wrote:  

In my opinion stocks are more advantageous for high net worth. When leverage becomes more irrelevant. Or simply put to accumulate wealth. Not create. A lot of private/investment banks ask for a minimum 5M account opening for a reason. Bellow this value it´s not worth it for them. Capital markets are higher projects. And something I´m looking into.

It has nothing to do with stocks being more advantageous for the HNW/UHNW. It's about bank revenue.

The reason we seek clients with certain capital requirements, is because we don't want to waste our resources on clients who don't contribute as much to our income. Additionally, dealing with a lot of clients is a hassle, and typically the clients with less money, tend to complain more.

It's just business.

I'd also like to add that HNW clients are some of the most leveraged investors out there. They can afford to service the debt.

[Peregrine]

FYI chakalaka, definition of liquidity is how fast you can sell an asset without booking a loss.

[TheFinalEpic]

"I don't think stocks are much more liquid than real estate"... What are you talking about man.

If you want to control your destiny, starting a business and leveraging your skills to eventually create a passive income stream is the way to go.

The markets being a multiplier of this wealth that is created via your business channel(s).

Think of it as your business brings in the money, then you get that money to make you more money.

[chakalaka]

From OP post:

"There are some good oportunities to earn good money. But the problem is, that it can be done only by those, who are already rich and have capital to spend. In these days, rich become richer and poor become even more poor, in my country... middle class is disappearing and I don´t want to end on the bottom of it (I don´t live in the US, but middle Europe)."

You are talking about realities which are nowhere near attainable for a layman. The OP is a public servant. And he´s asking advice about how to start making money. My answer took this into account. I made a simple blueprint which worked for me. To start from scratch real estate is better than stocks. You can give me the examples you want. But I´m pretty solid about this. If your a market professional. Stocks might be easier. But if the OP was a money manager he wouldn´t have started this thread.

How much would the startup cost of a REIT would be? How is the REIT structured? Don´t you need more than one shareholder? I read about REIT´s and it´s not a straightforward process. Capital markets are more reputational than real estate. And entry barriers are higher. The bank might loan to you. But do you think a common person without a solid track record can get the same loan conditions you received? Of course not. I´m suggesting the OP to start walking. Your telling him to run a marathon. Still might not for anyone but I thank you for your input. Creating a REIT is something I want to do. Capital markets will be my next step. My experience so far with stock loans was banks only loaned for you to acquire their stocks. And it´s nowhere near the same maturity conditions of a house loan. Europe is more complex also. Luxembourg, London and Malta. Are the easier and still it´s complicated as hell.

My idea of capital markets it´s basically a tool for you to reach a much higher number of people. It´s pulverized. But it´s complex. And if you don´t work in the industry how will doors open? You can pay a lawyer. But you don´t have experience if he´s overcharging you. And you are a sucker paying 3 for something which is worth 1. Also you need experience. You can buy a house without experience. You cannot create a REIT without experience. There will be exceptions. People sarting an bank at 25 etc.

I thought iquidity meant how fast you can turn an asset into cash. And of course stocks can be sold faster than a house. This is not what I was pointing out. A stock will crash faster than house prices. For a common person. If you have 100k in stocks and and houses.

But if it´s the ability to sell a asset in market without taking a loss. How come a house is more instable in the price than a stock? If a market goes downturn. Won´t the price of the stock fall faster than a house? Isn´t it more sensible? If I work everyday in a 9-5 job. Unless I keep refreshing my browser it will be better to own real estate than stocks.

A house in Hongkong can be sold in 3/4 hours. In fact houses can be sold and bought in less time than this. You can sell a house with a visa swipe. If it´s common? no. There will be exceptions to any statement you make.

Most of the HNW I know avoid debt like plague. They use very litle money to start a business and are mostly reliant in others people money (investors). They don´t take debt or litle. But investors money. This as been my experience so far. But you seem to have more experience than me and your sample is larger.

Capital markets are for higher flights.

[Off The Reservation]

Zero need for a new thread for this. Find other threafs and ask specific questions.

[jj90]

@chakalaka: Look, we know you know RE. That's what you've done and had success. By your own admission you don't know other things. It would behoove you to learn from others here instead of getting defensive. We can turn this thread into a total shitshow but that doesn't benefit anyone.

1)No one previously is talking about starting a REIT. If you do, good for you. I'm talking about buying shares of a REIT.

2)European banks might be tighter on the lending standards, but really a loan is a loan is a loan. Only difference is if it's secured or unsecured. If you've never borrowed to invest specifically in equities walk down to your bank 1 day and start a conversation. You might learn something and be surprised.

3)You make valid points about experience, then tell the OP to buy a house when he has no experience. Come on bro.

4)A stock can crash faster than a house? Sure, that's the flip side of liquidity. The real question is, how levered is a person to an asset whose price falls? Take 10 people you know with houses, how many of them bought in cash? A mortgage = debt = leverage. You put a 10% down payment and borrow 90%, you don't need house prices to fall 50% to be wiped out. Food for thought.

5)I'm picking on you here but: A house can be sold in HK in 3-4 hours? Pics or it didn't happen bro. Come on with the hyperbole.

6)OPM is debt. Doesn't matter if you owe someone money, cars, blowjobs, debt takes many forms. If you take something from someone and are obligated to pay them back, that's debt.

There's nothing really wrong with what you've said, however there are many ways to do things. Don't assume your way is the only right way.

What we would appreciate from yourself is a datasheet on owning physical RE.

[chakalaka]

A joke we say is Chinese don´t count cash they weigh it. If you have contacts in HK they will confirm a house is listed in the morning and sold in the afternoon. And also don´t want to disclose more personnel info here. Not here to win the title of the RVF arrogant prick.My purpose is to help. Everything said worked for me and it´s tested. It´s not theory. If I sound arrogant it´s not what I mean. My purpose is to make money. Don´t care for moral wins. Care for the number of zeroes in my bank account. If I can help RVF users to replicate better. But there are more than one way to make money. Life is like a video game. I´ve already killed the real estate Bowser. Equities will be the next level for me. Until I kill the boss of this level also.

Used to invest in cash cows. Now looking into tourist places in Europe. But waiting for the downturn. Which will come eventually. My plan is instead of just having a house which give me 10-15%. Want to buy in tourist places rent it out on BNB and use it when I decide. Even if the return is lower.

Looking into places in South of France. With the terrorist attacks a lot of people probably got scared and are selling with a discount. There´s a thing called viager a terme libre. Recently made an offer of a house in Sainte Maxime. Basically you make a downpayment and pay the rest to the owner as rent. My plan is to stay there July and August and rent it out the rest of the year. Currently negotiating with the real estate agency the price. Want the bouquet to be lower and the extension of the loan higher. Will see. Don´t mind walking away if don´t get the right terms. I´m married and more and less retired from game. Real estate is the closer to game I´ve got. It brings me joy. If can make an extra buck the better.

Paribasinternationalbuyer makes loans to foreigners who are looking to buy in France.

Have a draft of investing in real estate in many countries. Websites. Taxes. Banks to open account. And will post it when I´m sure of everything written there and have time to organize it coherently.

Brazil is also good now. I would wait more 3-6months. If you want to check houses in Brazil:

http://www.zapimoveis.com.br/

Brazil real estate financing drops almost 50% in 7 months

http://www.bnamericas.com/en/news/bankin...7-months/?

Interest rates in Brazil are really high. So it would probably have to be a cash buy. Looking into Rio (Leblon) and Floripa (jurere).

The real dropped but price of square meter not. This also has to drop. Lula will go on trial. So a lot of political instability in the near future. Also looked into Venezuela. Isla Margarita. But fuck it. I´m not that agressive. And despise anything communist/fascist related. Why haven´t the Venezuelan stock market tanked?

There´s one big advantage of equities. Everything you do in real estate is recorded in public records. This means the state knows your life. You can create a company in Malta or Portugal 100% owned by an offshore. But it´s not the same as equities. You buy a 1M house the deed is registered in public records. Buy 1M on equities I think there´s no public record.

There was some discussion if the 1M Trump´s father gave him was better invested in equities or real estate. You had conclusions for all tastes. If he had more fun doing real estate developments than coumponding. Let him have it.

Another thing when you buy a house. Buy it like if it would be yourself. The same mindset. If you couldn´t see yourself living in the house. Don´t buy it. It´s not hard to make money in real estate. Just like every asset. Buy when everybody is selling. Sell when everybody is buying.

[chakalaka]

When negotiating a house price. People generally want round numbers. A house is sold for 235k. They want minimum 200k. Offer 150k. See what happens. If they want 200k. And you offer 150k. If they are motivated to sell. Meet them in the middle. 175k. When there´s a broker involved you already know a comission of 5% will be paid to him. So take this into consideration.

Meeting in the middle will close most of negotiations. It´s more and less a negotiation rule. When you offer and counter offer know the principle is meeting in middle. It doesn´t have to be the first middle. You can continuously meet in the middle of the middle of the middle. Let say a owner is selling for 75k. You offer 50k. He counters with 62,5k. But continue pushing. Offer 56,25k. He might accept it. Or get angry and tell you to fuck off.

When it´s a inheritance. Ask the broker how many heirs there are. And give them a round number for each. If a house is sold for 300k. And there´s 3 heirs. Each will receive 100k. It will be easy for them to take away 5-10k each. if it´s three. Each can probably accept 90k *3=270. But push it. Offer them 70k*3=210.

Bought a small building in 2014. Was checking this building for some time. It was first listed at 500k. After a month 435k. After two months 350k. I offered 245k. And told the broker. I know exactly the minimum your clients want. 250k. But guess what I will just offer 245k. They accepted. The building is now under contract for 440k. And had a yeld of 11% of rents. Partially financed. When I called the banker to cancel the mortgage. He was like I´m sorry to hear that. You know where available for any business project you might have in the future. Always consult us first. Bankers will lend you an umbrella when it´s sunny and ask it back when it starts raining. And it starts raining when the interest rates go up.

Top real estate brokers have the best oportunities. Don´t hire them to sell. Buy from them. They are extremely agressive on the price. They work in bulk and don´t want to loose much time in each house. For them it´s all about time. How much time each house takes them to sell. It´s not about if the price is fair for the owner. He just wants to sell it fast, get a comission to move on to the other one. To sell best is a middle level broker.

[chakalaka]

http://en.people.cn/n3/2016/0926/c90000-9119558.html?

"Surveillance camera caught the shocking moment a new real estate in east China's Hangzhou city open for sale on September 24. The spree was prompted by the new restrictions on Monday which prevent people born outside Hangzhou from buying more than one property.
The said real estate was sold out in a mere couple of hours, according to reports from local media.
Hangzhou is the latest in a series of Chinese cities to introduce property curbs in a bid to deter speculators and cool the market, which has reported rapid price increases in recent months. "

https://www.youtube.com/watch?v=3CPCtlxOgUY