One of the biggest fears people have during a time of economic chaos is: What will this mean for my retirement plan?
This fear is understandable, and you’re not alone. Everyone is feeling this right now.
But, if you’ve invested in short term rentals, you don’t need to worry.
No matter what happens with the economy, housing will always be a need.
As long as there are people in the world, those people will need a place to lay their heads at night.
No matter how many industries become obsolete during this global pandemic, the housing market is here to stay.
Especially when it comes to short term rentals.
And there’s no better time to get started than right now.
Today, right this minute, short term rental owners are providing housing for medical personnel and first responders that can’t go home to their families. These people are looking for places to stay, short term, while they are fighting this war. And as short term rental owners are serving this unique market sector, they are ensuring their retirement plans stay fully intact.
None of us saw this coming, but here we are.
So - why are short term rentals your safest bet in terms of building a retirement fund that supports you NOW and in the future?
Here are three reasons to ditch the retirement plan and start investing in short term rentals.
Cashflow now AND funding later.
Traditional retirement accounts require you to take a portion of your current cash flow to invest in your future. You can’t touch those funds without penalty until you actually retire. Those funds are completely dependent on the market, which as we’ve all seen over the past few weeks, can be quite a scary thing.
However with short term rentals, your investment now, leads to cash flow NOW. When you understand how to market and price your short term rental, you are able to easily keep your units running, while collecting cash each and every month.
Just like with traditional real estate, the longer you rent your unit, the more equity you build and the higher the property value becomes.
Not only do short term rentals provide cash flow in the immediate now, they increase in value for the future.
And the future is what so many people are afraid of during these chaotic times. When today is uncertain, and tomorrow is even more uncertain, retirement can seem terrifying, especially if you are looking at your statements right now.
Knowing you have a solid retirement plan can set your mind at ease, even in times like these.
A retirement account is NOT a retirement PLAN.
When I ask people if they have a retirement plan, many of them tell me they do. But, when I investigate further, it becomes clear that what they actually have is a retirement account.
A retirement account and a retirement plan are not the same thing. There’s a big difference between the two.
People with a retirement account just have money saved but no vision for the future.
People with a retirement plan have a destination in mind. If retirement is a destination, it starts with a definition.
The definition of a retirement plan should be: to build, own, or control enough assets that produce income greater than your expenses without you working.
And that’s exactly how short term rentals work for you.
You build those assets—those short term rentals—today, tomorrow, and the day after that. You get cash flow immediately, but you also get to watch those short term rentals increase in value month after month, year after year.
Then, when retirement comes, your assets will earn all the income you need, while you take it easy.
Economic crisis or not, there’s no better time than today to start investing in short term rentals.
Trust me—your retirement self will thank you.
J. Massey is a real estate investor and the owner of Cashflow Diary. While J.’s investment experience includes single-family homes, cell phone towers, apartment buildings and commercial real estate, his most profitable investments have come from his 34 short term rental units in California. He is now offering housing to medical professionals, first responders, and displaced international students in an effort to support the work they are doing during the coronavirus pandemic.