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Are your investments working harder for you than you’re working for your investments?
This past weekend I was at a party and someone I know asked me about the Toronto real estate market. I was then asked by a woman I’d never met, “If you had $3,000,000 to invest right now would you invest it in real estate or Index Funds?”
My answer: “I’d put it in real estate without hesitation because I can get double digit returns annually and not have to worry about the stock market.”
Her response: “How can you do that?’
My answer: “I have access.”
“I need your business card!” she said. Turns out she’s a Fund Manager and a successful one at that. What she understood immediately was that I had a decent enough understanding of the Toronto economy and a connection to making money that she did not. Our conversation continued for quite some time.
Here’s the thing: There are only two ways to make money: 1) people at work and, 2) money at work.
What if your money could work even harder for you? What if it could far outpace average market returns? What if you could plan (and understand) your return on investment and achieve greater wealth than you knew possible? Seriously, who doesn’t want to make a profit and feel knowlegeable doing so?
In 2007 Warren Buffett bet Wallstreet that if he parked his money in Index Funds and let it ride that his money would grow faster than what Fund Managers could create. As of right now, his Index Funds are outpacing. Are You in Index Funds? Mutual Funds? What are you earning?
Here are two quick math equations for you based on $100,000 investment (because it’s a more realistic number for most of us to consider).
Scenario 1: Invest $100,000 in Mutual Funds
The average Fund Manager MER (management expense ratio) fee is 2.87% or $3,000 per year
The stock market goes up on average 8.614% per year.
In 25 years: your $100,000 =$786,000 if you were not paying fees (except you’re likely paying those 2.87% fees).
So, let’s break it down and see who is really making the money:
Your return: $385,000 – $100,000 initial fee = $285,000
Bank Fees: $401,000 pure profit
For the full breakdown of the math above you’ll want to meet Craig Dunkerley of BG Wealth Group. He’s a tax expert that I work with and he can save you thousands in taxes and investment fees every year. His day courses is free if you use my name “Jennifer”.
Scenario 2: $Invest $100,000 in the Toronto real estate market
$100,000/year invested in real estate becomes $1,000,000 in 10 years if you have access.
You can invest in the Toronto real estate market with 1) a pure cash investment as a joint venture (investment) or 2) with the purchase of an income property (asset). The leverage is different in the real estate market than in the stock market. And, there’s no question you want to be diversified between investments and assets.
Want to believe creating wealth is complicated? It isn’t if you have access and systems.
There are no get rich quick schemes but there is getting rich. You need a blueprint and professionals who can help you build that wealth. If you’d like to learn more, let’s connect.