What is Generational Wealth?
Generational Wealth is any financial assets/wealth that you accumulate and pass down from you, to your children, to their children etc. (basically wealth that is passed on from generation to generation).
What assets can provide Generational Wealth?
- Property/Real Estate
- Money
- Bonds
- Stocks and Shares
- Family Business
Basically, anything with a monetary value.
Why is it so important?
Imagine generating enough wealth that could provide you and your family with a better standard of life; you wouldn’t need to rely on a 9-5 job, you could have the freedom to enjoy your life, you could contribute to good causes that are close to your heart etc. Now imagine that you have enough wealth that can be passed down to your children. This could be a game changer for them and could have such a positive impact on their lives. You would be leaving them with a mammoth legacy that has the potential to provide them, their children, and their children’s children with a better standard of life, which is such a powerful thing.
Why is Generational Wealth difficult to maintain?
When people inherit wealth, it does not come with a manual on how to grow their assets. So, they spend the money, which diminishes over time. There might be enough money to pass on to their children but without the knowledge of how to make their money grow and work for them then the likelihood is that after a few generations, there will be no money left. It is not just good enough to leave your wealth to your family, you need to provide them with the tools to maintain and grow their wealth.
How can investing in property create generational wealth?
If you have read my post “Investing in Property for the Long Term”, you will know that this type of investing is not a get rich scheme but overtime, and if managed properly, you will see your investments grow and you can accumulate assets that can be passed down.
It is possible to create a property portfolio that will provide you with some of the following benefits:
- Cash flow – a passive income through rental, which can typically give a yield of 6 – 7%.
- Market appreciation – although property prices fluctuate throughout the year, historically, the value of properties increase over time.
- Equity – as property prices increase, there will be more equity in the property that can be released.
- Assets – by holding on to your properties, you will have assets that will not only grow in the long term but that can be passed down to your children.
With the potential for high returns on your Knowledge – when you build up your wealth, you need to learn how to obtain money, how to invest your money and how to make your money grow and earn for you. The more you learn the better you will become at getting your money to grow and work for you it. You will surround yourself with people who can help you and some people may even have similar goals to you but the fundamental thing is that they will be building or will have already built their wealth and will share information with you.
We at RP Property & Lettings make it our mission to find properties for our investors that will increase in value and continue to be a sustainable asset. Contact us via the booking link below for a free no obligation consultation, or find us on our socials.
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