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How to pay off your mortgage in 10 years
Investors looking to get out of debt sooner and start creating wealth for themselves have been advised they can pay off their home loan in 10 years through smart property strategies.
How to pay off your mortgage in 10 years
Investors looking to get out of debt sooner and start creating wealth for themselves have been advised they can pay off their home loan in 10 years through smart property strategies.
During an OpenCorp wealth creation workshop, OpenCorp director Michael Beresford explained how through the magic of compounding returns on properties a mortgage holder can get out of debt in a third of the time.
“There are two ways you can do that in 10 years and not 30. The first way is to throw a bucket load of cash flow and sacrifice your lifestyle to pay off the mortgage as quickly as possible,” Mr Beresford said.
“Understanding compound growth is a much smarter way to pay the mortgage off.”
He explained that investors who are looking to get ahead can use the equity in the family home to purchase two investment properties.
With the rules of compound interest, growth on the property would see it likely double within a 12-year period.
“What we do is we hold the two investment [properties] for a 10-year period. It might be nine, it might be 12 years, but the properties will double,” Mr Beresford said.
Using the example of all three properties being worth $500,000, the property investor explains that once the investment properties have doubled to a combined value of $2,000,000, an investor can simply sell, pay the capital gains tax and use the remaining money to pay off all debts.
“If having your own home paid off is one of your goals, this a far more effective way to do it in a much shorter time frame,” Mr Beresford said.
“Acquiring low cost to hold investment properties to give us compound growth over time. All we are doing is real wealth creation through compound growth.”
The property adviser explained that investors do not need a large portfolio to be successful at wealth creation, instead they simply need to hold for a longer period of time.
“It’s not getting rich quick, it’s not bitcoin, it’s everyone jumping on board something, it’s not how we get success,” Mr Beresford said.
“What people don’t understand with compound growth, regardless of where you sell it, you make the same amount in the next unit of time as what you made since the start. Buy and hold long term.”
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