Monday, 4 August 2014
Home for Living and not for profit taking (10)
Read? Home for Living and not for profit taking (9)
One way to avoid evaluating it too emotionally is to ....
Think of it in term of Mathematics.
Read? Passive Income??? Why must have more of it!
Uncle8888's Wealth Formula:
Wealth = Asset value + Cash flow ------ (1)
Substitute "Asset value" with "Home" ---- (2)
Wealth = Home + Cash flow
Does your Home currently generate any cash flow to supplement your living expenses?
Yes or No?
Don't defend your answer with your emotions.
In our retirement phase with no or little earned income, we will need to have good level of cash flow coming from our current assets to support our living.
Can our Home provide that level of cash flow now?
Our Home is our future Asset that can generate cash flow with some trade off. That trade off is the necessary Evil!
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Rich Assets. Poor Cash flow = No really Good
ReplyDeleteRich Assets. Good Cash flow = Wonderful assets that we have.
Peng yu tio bo?
Poor asset & Poor cashflow = Dog
ReplyDeleteRich Asset & Poor cashflow can be turn around. For example, my friend father in law stay with him and rented the fully paid HDB flat and collect >2K income every month.
Good one
DeleteNo wonder people say how much your net assets doesn't count, it's your cash flow. And if you can't control your cash flow, you may have to sell some of your assets cheaply. In fact with little personal assets but proper leverage (OPM), you may have quite good cash flow.- Rental property is one of them.
ReplyDelete