A couple of months ago I was talking to a friend and I said “you know, in the small town I grew up in we all thought the rich folks were the doctors”. My friend agreed that society generally thinks that high income earners such as doctors, lawyer, engineers, etc. make up the rich. However, how many of the folks who made the latest Forbes 400 Richest Americans made the list through practicing medicine?
A doctor certainly earns a high enough income to become wealthy if they save and live a modest lifestyle, but what happens when the doctor stops practicing medicine? They would have to practice medicine for a lot of years and save their money to have a big enough pile to live off of.
What I am trying to point out here, is that the doctor or anyone who works to earn a paycheck must keep working to keep earning. Simply put, they work for money.
The self-made ultra rich or anyone who is in a position to live off of their interest, have figured out how to make money work for them. In other words, they could sit at home and literally do nothing while their money earns them more money. This is the number one reason I am so big on rental real estate.
I can purchase a rental property, hire a property management company to manage it, and then sit back and let my money make me more money. It’s that simple.
If you follow Investucate on Facebook, then you have probably seen the video of me teaching my seven year old son this concept. He doesn’t have the capital yet to buy a rental property on his own, but he does have the money to invest in a vending machine. I hope to teach him this concept through a simple gumball machine.
If you want to be financially free, you have to figure out how to make money while you sleep!