I hear so many people ask me, “Is it better to invest in stocks compared to Real Estate”? Don’t we have to pick one or the other? Which one gives me the most return for my money? Well I’ll give you the short and easy answer to those questions for those who really want to improve financially in their life like it’s done for me… Both. Not only SHOULD you invest in both but as time flies by and the more knowledge you gain in each, the easier it gets. With that being said, here I go back to the “nay-sayers” who tell me… “But if I save my money and invest in stocks then I won’t be able to have money for real estate, there’s no way I can do both”. Now I’m not going to say money doesn’t play a factor because money plays a factor in every investment you make, regardless if it’s stocks or real estate, but there are ways to work around where you can literally invest in both using the same amount of money, same set of dollars, at the exact same time.

The case for Real Estate….

Now let’s start with everyone’s favorite… Real Estate (at least for most it seems like) Real estate is one of the most powerful & successful ways to reach financial independence and retire early (also known as F.I.R.E) then any other strategy out there, regardless if you choose to be a house flipper, wholesaler, landlord, or invest in R.E.I.T’s. It ALL works (has for me). The beauty of real estate is there are SEVERAL different strategies you can use when investing, and once you learn it once, it’s like clockwork you can repeat the same process over and over again… until one day you’re looking at your bank account or outside your new vacation spot and say “Wow, this really did work!”

For me in particular I want to talk about the landlord side and investing in rental properties. I invested in my 1st rental home back in 2015, which happened to be a mobile (wanted to start out small). Since then, at the time of this post I have added 3 duplexes, a townhome, and a condo to my rental portfolio with each and everyone of them rented out, providing me residual and passive income month after month after month. How did I do that you ask? Now of course you can’t wake up one day and say “I wanna buy 6 houses today”. Not that easy. But thanks to sites like Vairt, networking, and making smart financial choices it has allowed me to meet the right people to walk me through my investments. It has allowed me to save money for that next down payment. It has introduced me to the same realtor (and lender by the way) that helped put 3 duplexes under my belt. All of this is available to each and every one of you as long as you have the drive, passions, and will to make smarter choices. When people tell you “Oh it takes thousands and thousands of dollars just to get started”. Don’t listen to that nonsense. There are some lenders out there, depending on the type of house and whether it’s your primary residence or not, that offer down payments as little a 3% or even better… NO down payment at all. All it takes is for you to actually pick up the phone, start calling these lenders, ask questions, and get all the information you need. You are going to make mistakes and have things not go the way you planned, but you know something that I learned.

The best knowledge and future gains I’ve made in my real estate venture was because I did simply that, I made mistakes. I had to face failure. Failing is a good thing, if not a great thing because that is where you learn the most and truly understand the things you need to do better. The key is to push through those disappointments and continue to move forward.

The case for Stocks….

I see far more people who only Invest in Real Estate compared to stocks, which I believe is something that needs to change because most don’t understand the power of what stocks/bonds/ETF’s can do for you and your financial future. But what is a stock? A stock is a publicly traded company listed on a stock exchange for a certain price. Examples of some companies include Amazon, Apple, Facebook to name a few. Investing your money in successful companies like these have proven to make people thousands to millions of dollars throughout the course of their lifetime (just ask Warren Buffet).

When you buy a stock, essentially you are owning a chunk of that particular company, watching your investment go up or down, depending on the success of that particular company. Now how well that particular company performs or is projected to perform requires research and strategies on which way to go, but that’s another post (blog) for another day. The fact is that it is not hard, just takes someone who actually wants to read and learn about what it is they’re investing in. I’m also here to tell you that even if you don’t know which company to invest in… You don’t even have to. Like what most of the top investors suggest, you can put your money to work in a simple ETF (exchange traded fund) that virtually allows you to mirror the success of multiple companies, not forcing you to choose just one happy stock. The smart choice, which is something that I have my money invested in, is purchasing an ETF that follows the movement of one major stock exchange, such as the S&P 500, which basically you can look at as a big basket holding all of the major companies just like the ones I mentioned above. Now that is the smart thing to do, but if you just absolutely love your new iPhone and MUST put all your hard-earned money into Apple stock, then by all means go right ahead. There is even a high chance that you come out on top since Apple is a very successful company, just understand that by doing that you are putting yourself at a higher risk.

The main point that I want you to get from this is that historically, since the life of it’s existence, the stock market has ALWAYS trended higher (check the stats), and the more time and patience you let your money ride the waves, the better off your future will be both now and in retirement. SIDE NOTE: For more information, articles, and just everything you need to know about stocks, bonds, and retirement accounts. I strongly recommend you visit TheMotleyFool online. The amount of knowledge and information they provide has absolutely led me on the right path towards success.

What about the Risks….

Now I will tell you there are going to be risks with BOTH Real Estate and Stocks no matter how you look at it. Exactly how much risk for each we will dive in that in a moment. I will say in the immediate short term, investing in Real Estate is far less risky then investing in the stock market. The reason for that is when you decide to put money in the stock market, you’re dealing with an extremely volatile, and unpredictable investment. One thing people don’t know about stocks is that it has major swings in the very short term (unless you get lucky). This means that one week you can be up a whopping 100 bucks, and the next week you can be down a lousy 50 bucks. This is because the stock market is made to be a marathon, not a sprint. It is something that is made to benefit you years and years from now, not in the next few months, thus making stocks a far riskier investment compared to real estate where once you get up and running, can start making you residual income now, and years and years into retirement. That’s not saying real estate does not come with any risks. In fact some of the risks involved with real estate can have the biggest impact on your investments. Whether people want to admit it or not, Real Estate is a business. It takes time, knowledge, and steady improvement. Now there are ways to prevent risk, but no one wants to hear about a sloppy tenant ruining your rental property forcing you to begin the eviction process, having to spend hundreds or thousands having to replace a new roof and/or water heater, hiring a crappy remodel company to do poor, unfinished work on your renovations (I know from experience).

Bottom line: There are risks involved with both Real Estate and Stocks, that’s why you need to do everything in your power to avoid those risks of disappointment. And trust me there are steps you can take to help offset those risks in each, but it takes experience and learning from your mistakes and the mistakes of others…

In conclusion….

There you have it. I hope that after reading this article you understand the capabilities both stocks and Real Estate can have on your financial success regardless of what decision you make. Because I’ve decided to dive into both, it has allowed me the ability to quit that 9–5, stop living paycheck to paycheck, escape the rat race, spend more time with family and friends, travel the world, and do the things that actually matter to me in life. Knowledge is key. If anything I hope you learn that the more you learn, the greater your passion becomes, and the more successful you will become no matter what route you decide to take. The decision is yours.

Will you come join us?