Every week, I answer questions on my YouTube channel on property investment. If you have a question about property, leave a comment on this week’s Q&A Sunday video and I'll do my best to answer it next week.
If something has been holding you back; you're struggling on a deal; you need a little bit of support, or maybe you are stuck on what something means; or you need some help with structuring a deal or understanding lease options, rent2rent or anything else – I want to hear from you!
Last week, I got an excellent question about what to do with £10k of savings. Here is the question and my answer.
Charles Royal said….
If I have 10 grand spare, how should I spend it?
Well first thing is, you shouldn't spend it! If you've got 10 grand don't spend it, you should invest it. There is a big difference between investing money and spending money. So how should you invest it?
Well I would probably say if you've got 10 grand, let's face it 10 grand isn't enough to buy a house. What's the cheapest house in the country? 30-35 grand? But you won't get a mortgage on a house that cheap. So if it's a 40-50 grand property, you are going to need more than 10 grand, especially with your stamp duty and legals.
So, 10 grand won't even get you the cheapest house. You just can't buy a house for 10 grand, even if you could, even if you had 20 grand, it might be just enough to buy a house which is then going to make you £200 a month profit. It's hardly life-changing!
My advice? If you've got 10 grand, rather than investing into a property, I would invest it into your property business. I would put it into setting up a rent to rent business or a deal sourcing business.
I'd put some of it into your education; I'd put some of it into getting your website drawn up, down payments on a Rent2Rent, etc.
I would be using that 10 grand to get yourself an up and running cash flowing, cash producing, business. Then your business is going to start making you cash flow. I would take that cash flow and I would then start investing it into something that's going to give you a passive income.
As a property investor, you can either invest money or you can be a property entrepreneur and you can make money with property. I think you should do both. So I'd put that 10 grand into a property cash producing business. Then with that money, invest it, and slowly build up passive income over time as well as active income.
If you would like to see the rest of this week’s questions you can check out the video here.
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Here is a link to book on the house! Come and meet me, let's train you up, let's see you getting some results. I'll see you on the next training program real soon!