FINAL WORDS
There are three main reasons why rental property is an essential ingredient to an authentically diverse retirement plan. As a refresher, to be diverse means to be different in as many ways as possible, not merely diverse across different risk-tolerance levels within the same vehicle.
First and foremost, rental property operates on a different time scale from typical retirement accounts. Instead of building up a fixed—and exhaustible—pool of funds over your lifetime (the “nest egg”), rental property operates on a monthly income scale, similar to a paycheck or a pension . . . or even a chicken. By definition, it is unending. It makes unnecessary the ever-vexing question with which we all grapple: “How will I know when I’ve saved up enough to retire?”
Second, rental property offers diversification because it operates on a different earnings premise than the stock market. Most stocks and mutual funds operate on the premise of buying at one price, waiting for appreciation, and selling at a higher price. While you can, and often do, make money in real estate from capital-gains, as long as appreciation works in your favor, the strategic approach of buy-and-hold rental property is based on building a safe and secure financial future through rental income.
Finally, rental property offers actual, practical diversification in this modern, computer-oriented world of virtually—and even internationally—accessible bank accounts and retirement accounts. The tangible, physical quality of real estate offers solid protection in a world of increasingly common risks related to identity theft, cyberwarfare, technology glitches, and other computer-related errors. With real estate, your account balance can’t simply vanish into thin air in an instant.
By now, I bet you’ve identified your Level I, II, or III Primary Goal and you’re ready to get started. You know whether one property will be enough for your situation or whether you feel more ambitious, preferring the additional financial comfort or even complete financial self-sufficiency of the Level II or III Goal. However, if you are like most, you will simply start out with the Level I Goal of acquiring and managing just one rental property. You’ll test-drive the experience for at least a year, and then, if the experience is positive, you will consider taking it to the next level.
In addition to your Goal, you probably now have a feeling for which moves are best suited to your circumstances and interests. You’ve found a strategy for achieving your goal that is appropriate to where you are in life in terms of your age and your resources of time, money, and energy.
It’s now time to take action. At this point, I enthusiastically urge you to turn to the R.O.R.E. Blueprint for Success: A Step-by-Step Companion Guide, available on my website at www.GetaChicken.com. Like a real-world workbook, this guide will walk you, step by step, through every technique shared in this book and more. It reveals how to find, inspect, and evaluate potential rental property, including the critical aspect of calculating and understanding property financials, with the goal of landing the perfect income-producing rental property for your retirement portfolio. It shows you how to conduct your own high-quality tenant screenings and also how to find a trustworthy and competent property manager, if that is your preference. I also offer Online Appendix C, “Recommended Reading and Other Resources,” for further information on some of the subjects covered in this book and resources that I have found to be particularly useful.
It is up to you to decide what to do with the information presented in this book. It is my hope that you will at least go for and—with the goal-attainment strategies presented in chapter 6—accomplish the very attainable Level I Goal of acquiring just one cash-flowing rental property. This one move alone will diversify your retirement portfolio by creating one everlasting stream of income to support you in your post-working days. Taking action in this one way will be a significant step toward both protecting your financial future, as well as having an appreciable asset to pass on to the next generation.
People often avoid making decisions out of fear of making a mistake. Actually the failure to make decisions is one of life’s biggest mistakes.
RABBI NOAH WEINBERG
The Ultimate Goal is to pay off your mortgage(s) in full so that you can fully realize the earning potential and other opportunities made possible by your asset(s). Once you’ve achieved the Ultimate Goal, you will have greater income pouring into your bank account month after month for life. One rental property will provide a level of diversification that simply would not otherwise be there. Additional properties will get you to the place of additional financial comfort or complete self-sufficiency in retirement. And now, as we peer into that crystal ball, looking ten, twenty, or thirty or more years into the future, I am confident that you will feel both grateful and relieved that you took the bold and brilliant move of acquiring your first rental property back in the day. And yes, the future’s “back in the day” is actually today. It is right now.
Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness that most frightens us. We ask ourselves, Who am I to be brilliant, gorgeous, talented, fabulous? Actually who are you not to be? You are a child of God. Your playing small does not serve the world. There is nothing enlightened about shrinking so that other people won’t feel insecure around you. We are all meant to shine, as children do. We were born to make manifest the glory of God that is within us. It’s not just in some of us; it’s in everyone. And as we let our own light shine, we unconsciously give other people permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.
MARIANNE WILLIAMSON
American spiritual teacher, peace advocate, and author of A Return to Love