The only money target we should have is that of cashflow. Cashflow is what buys freedom.
Here are some goals that may be helpful:
- Owning an essential business that cash flows more than $2,000 a month with minimal time, so as the owner you can either A: keep a high paying day job or B: pay yourself a small salary in the business and still cashflow.
- Owning real estate that both cashflows and has tenants paying the loan. As a bonus maybe win in the appreciation game (this is less predictable than rental income.) DONT COUNT ON APPRECIATION
- Buying several cashflowing businesses and “rolling them up” to A: Cashflow today and B: win from the capital gains on the sale of these assets several years out. (Baby boomers will be selling their businesses at an extremely alarming rate starting 2021 for another 3-5 years.)
For more reading and tips on this checkout Robert Kiyosaki Cashflow Quadrant book or Dan Pena YouTube videos.
Save money today, so you can buy assets tomorrow. Spend on luxuries from cashflow instead of earned income.
2 thoughts on “Cashflow is the answer”
Question about baby boomers selling in 2021… Do you think that will be accurate? Isn’t it more likely that they leave it or sell it to a family member? Or is it because of the current economic crisis we are about to face?
Ps in your opinion what kind of business ventures would you consider have the possibility of thriving the next few years?
Thanks for your help, as always appreciate the guidance!
They will be selling. The kids have no interest in their parents businesses. Plumbing, HVAC, construction, etc all the trades no longer have the spark (in the kids eyes) like they did years ago. So they will be for sale. I’m sure there are many reasons why it will happen, just know it will.
So those businesses are what to buy. It will be a buyers market, meaning the buyer will options. Earnings will be cheap to buy.
For ex someone can buy a HVAC biz doing 200K CASHFLOW for 400-500K with only 10% down.
Do that multiple times (buy many HVACs) and the multiple to sell goes up. Meaning instead of buying at 2.2-2.6 earning one can sell at 4-5 times earning once purchasing 10-20+ over 5 years or more. Really depends on how fast one can acquire.
THIS IS MY OPINION I suggest anyone do their own research
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