Having a 401k plan for your retirement is good but you have no control of it so, I got the thinking I say having two rental properties is a saver bet. You have control of your property not like your 401k where you just hope everything goes well your rental properties pays you and it goes up in value and when your done paying it off it still pays you and you can sell it for more than you have in your 401k. #retirement #401k #rental#properties…(read more)
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How Two Rental Properties Are Better For Your Retirement Than A 401k plan
When it comes to planning for retirement, most people automatically think of contributing to a 401k plan. While a 401k plan is undoubtedly a popular choice, there is another investment avenue that can potentially provide even greater returns – rental properties.
Investing in rental properties offers several advantages over a traditional retirement plan. Here are two key reasons why two rental properties are a smart investment for your retirement:
1. Cash Flow and Passive Income:
One of the main advantages of rental properties is the ability to generate passive income. When you invest in rental properties, you have the opportunity to earn steady rental income each month. Depending on the location and demand, rental properties can generate a substantial amount of cash flow. This passive income can serve as a consistent revenue stream during retirement, ensuring financial stability.
In contrast, a 401k plan relies on the performance of the stock market. While a 401k can provide strong returns over time, there is no guarantee. Market volatility can significantly impact the value of your retirement savings, potentially leaving you with less than anticipated. With rental properties, you have greater control over your investment, and the income is derived from tangible assets rather than the fluctuations of the market.
2. Appreciation and Equity Growth:
Rental properties offer the potential for appreciation over time. Historically, real estate has proven to be a reliable investment, with properties generally increasing in value over the long term. This means that your rental properties can appreciate significantly, allowing you to sell them for a profit.
Additionally, rental properties allow you to build equity. As you make mortgage payments, each month brings you closer to owning the property outright. This equity can serve as a valuable asset during retirement. Whether you decide to sell the property or use it as collateral for other investments, having equity provides financial flexibility.
In contrast, a 401k plan relies solely on the performance of the stock market for growth. While the market often performs well in the long run, there will always be fluctuations and risks involved. With rental properties, you have the potential for long-term appreciation and equity growth, allowing you to build wealth more consistently and securely.
Of course, investing in rental properties also comes with its own set of challenges. Being a landlord requires time, effort, and knowledge of the real estate market. Property management, maintenance, and dealing with tenants can be demanding. However, many investors choose to hire property management companies, reducing the burden and ensuring a smooth rental experience.
While a 401k plan remains a viable retirement savings option, it is worth considering the benefits of diversifying your investments. Two rental properties can provide a reliable and consistent source of cash flow, as well as the potential for significant appreciation and equity growth. By investing in tangible assets, you have more control over your retirement savings. Ultimately, the decision to invest in rental properties or rely solely on a 401k plan depends on your risk tolerance, financial goals, and long-term plans.
I’m grateful for this video. My mind is set on a minimum of two rental properties. And that’s the minimum. I’ll refer to this video in the future when I achieve that goal. Thanks brother.
41 years old never had a 401k, don’t plan on ever having one. Have two single family rentals with 400k in equity, probably would have taken 20-30 years to accumulate with a 401k. But cash flowing the equivalent of 30k a year job. I’ll be in the position to buy one a year in two years, then hopefully two a year in five years, plan on snowballing my portfolio for the next 30 years. Not letting wallstreet dictate me and my family’s future. Great vid
Thank you for your videos. I bought my house in 2010 in oakland ca for 125k now its worth 600k. 4 years ago i turned my garage into a jr adu with only $6000 dollars, me doing most of the work. I charge $1300 a month. With that rent money i build another adu in my back yard. So now i collect 2 rents. $1300 and $1500. Thats $2800 a month 33k a year. I did all this with $6000 dollars out of my pocket. The second adu was built with my tenats rent money. Ive safe that rent money for 2 years thats almost 70k in my pocket. Im ready to get another rental property hopefully house prices drop soon. Rents never go down. Im 34 my goal is to get more rentals and retire in my early 40s.
Great Topic!… my goal, acquire 2 rental properties within the next 6 months and other REI investments planned. I need that equity, boss lady making boss moves!
My first home will be a multi family! In the process of fixing my credit now. The knowledge you’re sharing is helpful af!
Hey what is that rotating silver thing on the table called ?
Bro I got the same mentality
Keep up the great content Bro. That timepiece is the truth, what brand of watch is that?
Thats all facts but the stock market especially if you remove your money out the generic way your employer invest in the 401k which they use a standard target date fund like vanguard 2055 which us conservative…. If you drop your whole 401k into fxiax or vtsax of fzrox etc yes market may have a down turn however the stock market always recovers and have a average return of 8-12%, no matter what happens you are guaranteed to fall in that range… rental properties are good but its no real guarantees you may lose money too… and your profit may not give you such a return it might but i think its all the same risk… its no safer one…
Good info King Appreciate it