Creating Wealth Real Estate Investing with Jason Hartman CW 507 FBF – Defending Investments Against the Demons of Risk and Inflation with Doug Utberg
Jason Hartman starts this episode with an update on and new fixed-rate mortgage financing program for IRA investors and foreign nationals. In addition, you’ll hear about a change the RSS feed for this podcast in hopes that the change will be seamless and you won’t even notice it; however, you know how technology goes sometimes. You’ll get an overview of a few properties, a few thoughts on the greater Atlanta, Georgia real estate market and an update on Jason’s “Meet The Masters of Income Property Investing” event slated for October at The Hyatt Regency in Irvine, California visit: http://www.jasonhartman.com/meet-the-masters-of-income-property-investing/for complete details.
The main focus of this episode of The Creating Wealth Show will be: Defending Against The Demons of Investing.
The world of investing involves many considerations. Chief among these are the two “Demons” of investing that must both be defeated in order to realize success. The first demon is risk, and the second is inflation. Risk comes from the fact that future returns are uncertain, and it is not possible to foresee all future events. Investments that seem ‘safe’ may turn out to have hidden dangers that we did not notice. Risk can never be eliminated, it can only be managed. The best way to do this is by properly diversifying your investments so that they are not all subject to the same market shocks. The second demon of investing is inflation. Inflation is especially difficult because it erodes the value of your dollars. Defeating the demon of inflation requires investment in multi-dimensional assets that are optimized to defeat inflation. Income properties meet this criteria well because the property itself holds real value by nature of the replacement cost of the structure, the loan allows you to have a fixed cost of capital for three decades, and the cash flow is pushed up by inflation while you cost structure remains flat because of the fixed-rate financing.