The Passive Wealth Trifecta of Real Estate and How it Works While You Sleep
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The speaker in the YouTube video claims to have made $32,500 in five days while staying in the hospital with his newborn daughter, thanks to his "passive wealth trifecta." This trifecta involves owning $32 million worth of real estate that he bought without using any of his own money. He encourages viewers to invest in real estate and use his success as motivation, even if they do not aim to own $32 million worth of real estate.
The first part of his passive wealth trifecta is appreciation, which is the increase in value of his properties over time. The speaker estimates that his properties appreciate at a conservative rate of 5% per year, which means that his $32 million worth of real estate will go up by $1.6 million this year, or $4,400 per day. He emphasizes that appreciation is tax-free and the biggest chunk of his passive wealth trifecta.
The second part of his trifecta is debt pay down, which involves paying off the mortgages on his rental properties. The speaker has around $19 to $20 million worth of mortgages on his $32 million worth of real estate, but he is not over-leveraged and still has plenty of equity built in.
The third part of his passive wealth trifecta is cash flow, which is the positive net income he receives from his rental properties after all expenses are paid. The positive cash flow after all expenses are paid equates to about $1,100 every single day in positive net cash flow. The speaker explains that he does not have to pay taxes on this cash flow because of depreciation, which allows him to write off a percentage of his cash flow from the rental properties that he owns.
When combined with the appreciation and debt pay down, the speaker makes $6,500 per day in tax-free income from his real estate investments. The speaker emphasizes that real estate is a powerful investment tool that allows you to take advantage of the passive wealth trifecta.
The speaker in the YouTube video claims to have made $32,500 in five days while staying in the hospi