Dear valued existing investors and future investors,
Once again, welcome to this week’s CPI Capital’s news briefing. Our regular, weekly newsletter contains a mixture of updates, commentary and informative related articles about the lucrative world of passive real estate investment.
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It’s long been accepted that health and wealth are two intertwined concepts which together have a significant impact on an individual’s overall well-being. It is widely believed that a healthy lifestyle can contribute to wealth and, conversely, financial stability can enhance one’s health.
Furthermore, there is research suggesting that wealth is positively correlated with life expectancy, indicating that people with higher income levels tend to live longer than those with lower incomes.
As we all know, real estate investing is one way in which individuals can build wealth and improve their overall financial well-being so, this week, we will explore the relationship between health and wealth, and how real estate investing can contribute to building wealth.
Correlation between wealth and health
Studies have shown that there is a significant correlation between wealth and health. People with higher income levels tend to have better access to healthcare and a healthier lifestyle. For instance, wealthy individuals can afford better quality food, exercise equipment as well as things such as gym memberships, which can lead to a healthier lifestyle. They are also more likely to have health insurance, which means that they have better access to medical care when they need it.
On the other hand, people with lower income levels often struggle to make ends meet and may have to prioritise their expenses, which can make it challenging to maintain a healthy lifestyle. They may not be able to afford nutritious food or gym memberships, and may not have access to regular healthcare. This can lead to chronic health conditions which can impact their quality of life and life expectancy.
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Over time, research has consistently shown that wealth is also positively correlated with life expectancy. A study conducted by the University of Michigan found that life expectancy increased by 2.5 years for men and 2.8 years for women for every $50,000 increase in income. Additionally, research conducted by the Centres for Disease Control and Prevention (CDC) found that people in the lowest income bracket are twice as likely to die before age 75, compared to those in the highest income bracket.
Investing in real estate and wealth building
Real estate investing is one well-known way in which individuals can build wealth and improve their financial well-being. Such investing involves buying, owning and managing property with the goal of generating income or securing capital appreciation. It is a long-term investment that can provide a steady stream of passive income and where the asset appreciates in value over time.
Real estate investing may provide a significant return on investment (ROI) over the long term thereby building wealth. This can be in the form of rental income, capital appreciation, or a combination of both. Furthermore, real estate investing involves acquiring a tangible asset(s) that can provide a sense of security and stability.
There are various ways to invest in real estate, including buying rental properties, buying and selling (flipping) houses and investing in multifamily and/or BTR syndicated investments or funds such as real estate investment trusts (REITs). Each of these options has its own set of risks and rewards and, of course, investors should carefully consider their investment objectives, risk tolerance and financial situation before deciding which option to pursue.
Real estate investing and health
As mentioned, real estate investing can also have a positive impact on health.
One of the most significant benefits of real estate investing is the passive income it generates. Passive income is money earned without having to actively work for it. Rental properties generate monthly rental income that can be used to cover mortgage payments, property taxes and other expenses. Once the investment property is paid off, the rental income becomes pure profit, providing a steady stream of income. This is an excellent way to supplement income and build long-term wealth whilst maintaining good health.
This can also reduce financial stress and improve overall well-being, providing a sense of security and stability, which can contribute to better mental health.
Furthermore, owning a property can provide a platform for living a healthy lifestyle. For example, an investor who owns a rental property with a gym or pool can use these amenities for personal use. This can lead to a healthier lifestyle and can contribute to better overall health.
Furthermore, real estate investing can provide a platform for living a more sustainable lifestyle. As an example, an investor who owns a rental property can install solar panels, energy-efficient appliances and use other green technologies. This can not only reduce the carbon footprint of the property but can also reduce utility bills, leading to cost savings and, accordingly, improved financial well-being.
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Real estate also provides excellent opportunities for capital appreciation. Property values tend to increase over time and real estate investors can benefit from this appreciation by owning their properties for an extended period. This appreciation can be a significant source of wealth over the long term, allowing investors to achieve financial freedom and retire comfortably.
Another benefit of real estate investing in, for example, multifamily syndications is the tax benefits it provides. Real estate investors can deduct many expenses related to their rental properties, such as mortgage interest, property taxes, repairs, and maintenance costs. These deductions can significantly reduce the amount of taxes owed each year, allowing investors to keep more of their rental income and build wealth faster.
Finally, real estate investing provides investors with the ability to leverage debt to acquire more properties. This means that the rental income from one property can be used to purchase another, effectively multiplying investment returns. This can be an excellent strategy for building wealth over the long term, as each new property acquired provides additional rental income and appreciation potential.
CPI Capital agrees that real estate investing is an excellent way to achieve financial freedom and build long-term wealth. The passive income generated by rental properties, capital appreciation, tax benefits and leverage all contribute to making real estate investing one of the most effective wealth-building strategies available.
As we all know, good health is essential for enjoying life to the fullest and financial well-being is an integral part of that. By investing in multifamily and/or BTR syndicated real estate with CPI Capital, it’s possible to ensure that both the aspects of health and living your best life can be taken care of!
CIO, Co-Founder CPI Capital