Now that you have a business that is successful and making lots of money, you need to consider what to do with your profits. The worst thing you can do is to squander your hard earned money on consumer goods or fritter your money away on throwaway items. You need to consider your future and the best way to assure your financial security so that you have the money and time to enjoy your life. You want to have the option to work if you want to, not because you have to.
One strategy that is popular with successful investors over many years is the purchase of real property as an income producing asset. I use the term ‘real property’ here to refer to physical land or other property such as units, in other words, real estate. There are many other investments that you may choose to invest in, such as shares, but the purpose of this phase involves real property as the most appropriate investment for most business owners at this phase of the Business Legal Lifecycle.
All property has benefits and risks. It is not the purpose of this book to go through each type or to give financial advice. While my personal preference is to invest in property given its long-term history of building equity, return and reward, I understand why people like to invest in other types of assets. As your business generates more profits, you should consider investing in property to ensure that you can build an investment portfolio of passive investments (although property is not strictly a passive investment, it is generally considered to be so) that can pay you an income without your active involvement. You should treat your investments as a separate business which is funded by your successful primary business.
This phase is located on the upward trend of the Business Legal Lifecycle as it is all about protecting your future as a business owner. However, I have observed that when a business reaches this phase, you need to consider investing in property now otherwise you will never do so or worse still will not do so properly, which could have a dramatic effect on your ability to set yourself up for the future phases in the Business Legal Lifecycle.
In this section I will discuss the considerations for buying residential, commercial and industrial property, the general process of buying a property, important factors that may impact the buying decision, questions to ask the real estate agent and strategies for selling property.
Investing in property is a very important phase in the Business Legal Lifecycle. This phase is all about setting you up for the future by ensuring that your business feeds into the other aspects of your life. This will give you security going into the future and through the final phases of the Business Legal Lifecycle. It is imperative that any person, including business owners, obtain appropriate advice before embarking on investing in property.
Not doing so can have disastrous consequences and can end up costing you a lot of money in the future to get right or fix. I have found that business owners who follow these steps feel that they are comfortable about the future and ready to tackle whatever comes next. It also creates, in the business owner, a sense of relief that they are setting themselves and their families up for the future.
Once you have the right advice from your various consultants, you will find that you are in a great place to be able to successfully navigate your way through this phase of the Business Legal Lifecycle. You will then be ready to move onto the next phase, Litigation, knowing that you are starting to be financially secure.
What are your investment goals?
Where will these investments take you in the next 20 to 30 years?
What type of property do you want to invest in?
Do you understand the process?
Are you willing to take investment risks that may result in losing some
of your savings?
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