the debate continues...


Ever been stuck in a discussion with your partner about your desire to move your family's wealth forward?

Then these typical questions will inevitably arise…

Do we utilize the equity in our home to invest?
Do we continue to save to pay off our mortgage?
Do we wait before investing?
Do we continue to pay the standard mortgage installments and begin purchasing new investments immediately?
Should we sell our home, rent and focus all our efforts on investing?

These are good questions, and the list goes on…

Between the two of you, one will be prepared to take a risk; the other will be more risk averse.

One will have a deeper desire for abundance than the other.

Opinions will differ on this subject and we can’t consider all the possible scenarios right now.

What I will say is this.

The fact that you are coming from two different places due to your core values and beliefs will make getting to an agreed position difficult at best.

Some compromise will be required from both parties.

I can only assume that by reading this that your pursuit of abundance may be stronger than your partner. You will be successful at edging your way to your goals WITH your partner if you do it gradually and with a great deal of communication. Having some small wins in your investing activities along the way will help to re-inforce the value of your desire for abundance to your family.

That still leaves the issue of your family home.

In most countries, buying or owning your own home is a given fact.

Why would you do it any other way?

Let me pose a few questions…

Will you be wealthy one day if you earn a wage, pay tax and then spend, including your mortgage? Unlikely.
Will you become wealthy and gain freedom for your family if you wait and pay off your home before you start investing? Unlikely.
If you buy your family home and then a vacation shack, will you be wealthy sometime soon? Unlikely.

In time, good things come to those that use their God-given talents and brain power – create a plan and have joy in achieving it together.

The wealthy have a few basic tenets that make them who they are – free, sovereign individuals.

They structure their lives so that they pay themselves first, spend on primarily tax deductible debts, pay a little tax and invest the balance.

Simple right. Well infact, it is simple when you know the rules and live them.

So when it comes to the family home, what do the wealthy do?

They purchase an economical home – nothing too impressive – they buy something really special when they can afford to splash out.
They re-finance every year or two and keep mortgage payments to a similar % of their income but use the equity in their home to purchase investments – real estate, stocks, mutual funds, etc..
The wealthy will attempt to structure in such a way that their mortgage repayments are tax deductible as well.

They will budget so that they always have savings that they are investing to create wealth and residual income. As they invest they keep their money earning more money – using the power of compounding to amass a fortune. (See the compounding graphs with lesson 5 on http://www.the-richest-man-in-babylon.com/lesson5.htm) Not until they have significant wealth will the wealthy buy vacation shacks, or expensive cars or the like.

Don't sit on your capital and leave it in your home. Make it work for you and claim tax deductions on using the equity to invest.

Yours in abundance!

John M. Murphy
The Richest Man