We've referenced one of our favorite lenders, Michael Leland with Mortgage Trust, in past writings and today, we wanted to pass along an awesome tidbit he wrote about building wealth recently.
House Hacking.
Have you heard the term? Well, here is a quick story of a client he recently helped that will summarize it for you:
“We just helped a client buy his first home… a triplex. He's going to live in one of the units and rent the other two out. His plan is to live in this triplex for a year or so, then rent out his unit, and go buy another 3-4-unit property. He intends to do this 4-5 times. So, within 5 years, he'll have 15-20 “doors owned”.
Even with today's high interest rates, his low down payment (5%), and the lower-than-market rents on the other two units, his total net house payments will be under $3,000/month. After factoring in the enormous income tax advantage, he'll be paying closer to $2,000/month. Once he's able to raise the rents to fair market value and/or refinance the mortgage into a lower mortgage rate, he'll be in even better shape.
To be fair, this guy is single and doesn't have kids, so house hacking is going to be much easier for him than for folks with a family. So it's understandable if this particular method doesn't work for you."
Dismal Savings Rates.
If this house hacking strategy doesn't apply to your family plan but are interested in growing your wealth, Michael also offers to help any one of our contacts build a personal strategy plan. Here is another article he wrote on US savings rates and a confident pitch to help you build your way to be a millionaire.
"Are you saving enough? The savings rate in the US has fluctuated greatly over time. It's averaged 8.45% over the past 65 years. It reached a peak in April 2020 (hello, Covid) of 32%. The last reported reading (August 2024) was down to 4.8%. Yikes!
USA Today shared results of a recent survey they did around our country's financial and retirement health. One of the questions they asked was: “How much have you saved for retirement?” Here are the responses:
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Haven't saved anything: 1%
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Less than $10k: 3%
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$10-50k: 27%
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$50-100k: 24%
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$100-200k: 24%
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$200k-$500k: 14%
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$500k-$1 million: 5%
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More than $1 million: 2%
If you own a home and don't have $1 million or more saved for retirement, let's talk. I can put you on a path to become a millionaire sooner than later."
To set up this wealth building strategy meeting and get connected with Michael, just reply and let us know. And if you're inspired and would like to start receiving triplex listings that come on the market, we'd be more than happy to get that going for you.
