How to Succeed, Even In a Market Crash
We all want to succeed, and fear of market crash always prevents us from the success we want. If you have not yet heard it, I will share the most important and valid advice that every investor needs to hear:
“It is all about time in the market, not timing the market”
So simple, yet so difficult to follow.
Why? Because of steady headlines like these:
Warren Buffett: This Key Indicator Could Signal a 2021 Market Crash (Motley Fool)
RBC’s “Worst Case” For Canadian Real Estate Is A Price Drop Of Nearly 30% (Better Dwelling)
So how can you not be afraid? The idea of a market crash is all around us. It also happened recently (2008 financial crisis, covid stock market crash earlier this year, etc.).
But as much as a we realize that just hanging in there through out it all leads to success, we still fear these crashes.
So how do we succeed even in a market crash?
For us, our fool proof system has been our rent-to-own system.
What is a rent-to-own system?
Simply put, a rent-to-own system offers a product on a rent-to-own basis. We use a rent-to-own system in real estate.
The basic idea is this:
- Buy a single family home/mobile home
- Market as a rent-to-own
- Request a down payment from the renter
- Charge a rent above market value, where the additional amount goes towards purchase price of the home
- Set a future date and price (inflated from your purchase price) to which you must sell to the renter if they choose to proceed
If you are certain real estate will go up, then do not use this program.
BUT, if you fear a market crash, this program is the way to go.
Why? Well if the market does crash, you just built a safety reserve with the down payment you received and additional rents you collected.
Thus, rent-to-own homes offer the upside of owning real estate but also limit the downside of a market crash.
We actually have never sold a single family home on a rent-to-own basis, but we have used it religiously on our mobile homes (one of our best cashflowing investments).
What people don’t realize is that rent-to-owns are not only for real estate.
In January’s issue of the Canadian Cashflownaire, we share another idea where you can use rent-to-own garages to build your monthly cashflow. All the largest companies do it, and for good reason.
Think about it. A lot of you reading this have probably participated in a rent-to-own yourself. Did you give your car dealer a down payment and pay monthly installments until your car was paid off? Did you do the same for your furniture? Maybe your electronics? Heck, your house is basically a rent-to-own unless you paid cash for it.
Why not turn things around? Stop being the consumer and become the producer.
Rent-to-owns may not be your thing. But if you haven’t taken the time to learn how they work, you are selling yourself short.
As we preach, creating income in your life that is not correlated with your employer is the only way you can really achieve the glorious position of FU. We feel that the rent-to-own could be one major way to build that precious cashflow in your life. It definitely helped us in our journey so far.
Hope this sparks some kind of idea and you take some serious action in 2021.
Vince & Mike
P.S. We offer our Complete Rent-To-Own System as a free gift to all of our Canadian Cashflownaire Members. This guide, developed by Rob Minton, is the same guide that helped us create massive cashflow with mobile homes.
P.P.S. Due to popular demand, we extended our Boxing Day promotion of waiving our $99 initiation fee until Dec. 31st at midnight. Use discount code boxingday2020
P.P.P.S. Become a member today, where you will receive both the December and January issues, before December disappears forever. And in December’s issue, Vince shares what he has learned as a commercial banker and his 5 rules to using leverage.