Since we are a precious metals investment company, we could come at you and say that you should put your money into gold or silver. It’s not that we don’t believe you should invest in precious metals, but we believe in a portfolio that stretches beyond one avenue of investing. The answer isn’t quite as simple and concrete as you may have hoped. The objective here is to show you the benefits of both and let you decide where to put your money.
Real Estate Investing
There are several benefits of investing in real estate. To give you an idea of why it might be a good idea for you to invest in real estate we thought we would give you a few of those features.
Benefit 1: Cash flow
A major benefit for those interested in real estate is cash flow. This is exhibited in rental properties for the most part. Cash flow is the extra money that is left after all the bills have been paid. It can provide long term monthly income that will allow you to spend time reinvesting, building a business, or even traveling.
Benefit 2: Tax Benefit
The nice part about owning rental properties is that the government rewards property owners. The cash flow received from your rentals is not subject to self-employment tax and the government also offers tax benefits which includes depreciation and significantly lower tax-rates for long-term profit.
Benefit 3: Loan Pay Down
Another great part about rental properties is that if you buy real estate using a mortgage, it is your tenant that is actually paying the mortgage. Because of the loan pay down a rental property is basically a savings account that grows automatically. It works like this, you owe $175,000 on a rental property. By the end of the following year, because your tenant is making the payment for you, you only owe $170,000 and this goes on until the mortgage is paid and you have the option to sell or even continue renting. It’s a pretty great option.
Now that you understand that there are some great benefits to real estate, let’s look at what gold has to offer.
There are also plenty of benefits of investing in gold. Let’s take a look at some of the major benefits that gold produces.
Benefit 1: Inflation Protection
Inflation is when there is an increase in prices but a fall in the purchasing of money. A good way to look at how gold protects against inflation is to look at history. In the 1930s a $20 bill and a $20 gold coin had the same value. But since the dollar is no longer backed by gold only one of the two is worth much more today. A $20 bill is still worth $20, however, a $20 gold coin is worth close to $1200.
Benefit 2: Store of Wealth
For 6,000 years gold has been used as currency and also as a store of wealth. It has been just in the last 100 years that the U.S. government has backed the dollar with something other than gold or silver. Gold has stayed the most effective store of wealth and the dollar is on the decline year by year.
Benefit 3: Protection Against Government Debt
As the U.S. debt ceiling grows and grows the American people lose confidence in our ability to pay it back. The Federal Reserve creates more dollars and lower interest rates and Central Banks throughout the globe hold more dollars than any other currency. When those places need to protect themselves, they buy gold. This also how you can be protected from government debt.
Which Investment is Better?
The question rises again. Which investment is better, real estate or gold? If you are looking to make cash and increase your net worth, we would say real estate. If you are looking to protect your investments from inflation or government debt, then gold is the answer. Whichever you decide, Landmark Capital is here to help. Let us help you set up your financial blueprint and contact us today at 877-448-2646