Learn how real estate pays you up to five ways simultaneously.

Should you be playing offense or defense as an investor now?

Learn how a return of less than 20 to 25% is disappointing.

We’ll add up all five ways you’re paid and see what your Year One return is from: Appreciation, Cash Flow, Return On Amortization, Tax Benefits, Inflation-Profiting.

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What does late rapper Notorious B.I.G. have to do with real estate investing? You’ll see today. Kind of.

**Complete episode transcript below. Read along as you listen.**

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Welcome to Get Rich Education. I’m your host, Keith Weinhold. There are seasons in your investor life where you either play offense or defense. What should you be doing now? … as we refresh the “Up To 5 Ways That Real Estate Simultaneously Pays You.”



Anything less than a 20 to 25% rate of return in buy-and-hold real estate investing is disappointing. How can that be? Today, on Get Rich Education.

______________________



Welcome to GRE! From Asmara, (Air-UH-tree-UH) Eritrea to Ashtabula, OH and across 188 nations worldwide. I’m Keith Weinhold. This is Get Rich Education.



Thanks for being here, but you’re not here for me. You’re here for you.



In your investor life, are you playing offense? Or are you playing defense right now?



Or, in general, longer-term, are you a more offensively-oriented investor, which correlates with more risk-taking for higher returns.



Or are you more defensively-minded - where you’d rather have less risk and lower return?



Are your mindset and actions aligned toward offense or defense?



Well, I’ve got an answer for you here, and you’re going to have a really valuable takeaway.



Anything less than a 20 to 25% annual rate of return in real estate is really … actually … disappointing.



“What choo talkin’ ‘about, Willis?”



What I’m talking about … Will - is ...



Really, this all comes back to how - when you buy income property the right way - you are paid up to five ways simultaneously.



A stock typically only pays you one way, perhaps two.



I think that the easiest way for you to understand the five ways you’re paid - and even celebrate these five ways you’re paid - because … this ... is ... pretty compelling - is to use an example.



I’ve discussed this before. So if you’re a longtime listener, I’m going to put “The 5 Ways” through a new filter for you.



And if you’re a newer listener, say in the last year, this could completely change your investing thought paradigm for the rest of your entire life.



In fact, compound interest is lame and rarely, if ever builds real wealth in real life. I’ll tell ya what does here.



And yes, I know that this is abject heresy. It is replete blasphemy to criticize “compound interest” in the finance world.



I am surely guilty of committing financial profanity right there.



This is really fundamental stuff I’m about to share with you here - and yet the real paradox is that most real estate investors don’t even understand this.



This is pretty fun to do. We’re going to add up the five ways you’re paid and determine your total rate of return here.



Let’s say that you purchase a $100,000 property - $100K. And, no worries, if that’s too “small time for you”, this is all based on ratios, so it scales up to a $1M or $10M property.



(Ha!) And sometimes I wonder how much longer a $100K property will even be a feasible example as inflation makes $100K properties less common all the time.



But with your newly-bought $100K rental single-family home, you buy it with a tenant already residing there, where the monthly rent income exceeds the monthly expenses - that’s a big part of “buying right”.



With your 20% down payment, you have $20K out of pocket then, and an $80K loan.



The first of five ways you’re often paid is ...

1 - Appreciation...