Hello Financially Free Doctors!
The true potential of financial intelligence using compounding to its maximum was brought home to me recently when I stayed with my friend, C.
C is a full time GP. On discussing the current political situation and job pressure in general practice, she said to me "I would stop working tomorrow if I could!"
I couldn't resist getting my calculator out - the effect was amazing! I can suddenly see where this is leading....
C bought her house for £95,000 some years ago.
She has £23,000 remaining to pay on her mortgage.
Meanwhile, a similar house in her road sold in 2005 for £500,000 - which means that, with a further 3 years of appreciation, it may well be worth £572,450 today.
If C took out an interest - only mortgage on 85% of her property, she could borrow £425,000 - debt, admittedly, and it would be even better if she did not have to borrow it, but it is borrowed against an appreciating asset....
She could pay off her original mortgage, put aside 5 years' worth of repayments in a high interest earning savings account, and have £253,250 to play with.
This is where the fun starts!
She could buy one portfolio of buy to lets through progressive or passive (see the buttons to the right), allowing her to accumulate 5 buy to let properties in the South East or Peterborough over 5 years. At a cost of £70,000 or less, she now owns (after 5 years) nearly £700,000 worth of buy to let property. She does not need to worry about agency fees etc over that initial 5 years.
Now she can remortgage one per year (interest only mortgage with the tenant paying the mortgage off) and draw off an untaxed income of £50,000 (at today's prices) per annum.....
Meanwhile she has £183,250 to play with at the start of the 5 years - she could buy 2 more property portfolios, or learn to buy the properties herself if she has time.
She could put £50,000 in the stock market. Even using the low time - input method recommended by my stock market mentor (4 hrs per year or thereabouts) she could make 30% per annum, leading (with the power of compounding) to £185,646 after 5 years....
And - she still has £133,250 left, some of which she could give to charity, some of which she could invest in a buy to let property where her son ends up going to university (with him managing the property, collecting the rents etc, and understanding that his is a serious job...), and still have money to live on for 3 years...
So, you see, she is already financially free! And by the way, she will be a millionaire in 5 years time!
If you are interested, click on the links to get information on stock market trading or buying property passively....
And if you would like me to coach you through the process of realising your assets, and bringing your dreams to reality, get in touch!
NB I do not give financial advice - I am just here to show you options that you and I never dreamed were possible! See the disclaimer below right.
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