One of the best ways to make money is to let your money work for you.
Example: rental apartment complex.
For any rental property, you have three key numbers you have to pay attention to:
1. Income
2. Expenses
3. Debt
There are a number of ways you can increase your rental income:
1. Increasing the rent
2. Lowering your vacancies
3. Introduce some new revenue streams (e.g. vending machines or coin-operated laundry)
While you come up with new ideas to add more income to your business, you also need to consider your expenses. For example, you could invest in more energy efficient lighting. Not only will this lower your electric bill immediately, but you’ll reap the benefits for years to come.
The last variable you have control over is debt. pay close attention to the financing terms you’re being offered, like interest rate and length of the loan. It’s better to pay more upfront for something that will give you better terms with more flexibility. With interest rates at all-time lows right now, financing large investments couldn’t be better.
A lot of people are scared of debt. But if you’re leveraging debt to buy income-producing assets, like a rental property, then debt can be good. If you finance things that make you wealthier over the time, like stocks, precious metals, cryptocurrency, and real estate, then debt is good.
Sven Franssen