You Can Have The New Car And The Money

You may have seen my recent Facebook post of me standing beside the latest Porsche 911 and driving a Porsche.

I want to point out that I did not actually buy a new 911 and I don’t actually drive a Porsche at all.

Firstly, I wouldn’t spend £100,000 of my cash on a brand-new Porsche reasons I’ll explain in a moment.

Secondly, I was only in the show room because I was driving a friend to collect the Porsche after service. I was then driving my friend’s Porsche.

The reason I would not spend £100,000 of my cash on a car is that I would prefer to put my money into assets, which puts money into my pocket, rather than liabilities which takes
money out of my pocket. 

I want to put my money into things that appreciate in value rather than depreciate.

Picking up my friends Porsche this week reminded me of when she first acquired the Porsche when we were running the company together. We both had company cars on leases, but whilst I gave my
car back, she kept hers and bought it because she loved the car. 

We did not pay cash for the cars, I think I had a Merc at the time, but they both cost around £45,000 on the road at that time.

Today those cars would sell for around £10,000, which is quite a big drop in value.

Around the same time, I remember buying a property and putting around £50-£60,000 into the deal, which came froma remortgage on another property. Let’s say for argument sake that it was
£50,000 roughly the same price as a Porsche or Merc. 

Five years later, I sold that property and made over £100,000 profit, plus I enjoyed rental income in my pocket of around £15,000 a year after paying the mortgage.

See the difference? One appreciated in value and gave me income, the other depreciated in value and cost money to keep on the road. One cost money - the service on the Porsche was £1500 and that was not even a major service - while the house gave me a semi-passive residual income after loan costs!

Now, you might be thinking that driving a nice car is fun and that you should also enjoy life. Where is it end? Do you keep putting all your money into properties and driving an old banger
until your 70 years old and can hardly climb in and out of it a Porsche let
alone drive one?

Can you have the best of both worlds? Can you have your cake and eat it?

The answer is yes! I’m going to tell you how you can do it. Instead of putting £100,000 cash on the car you could use it as a deposit to buy a property and then use the residual income after costs to lease a car for 2-3 years. 

You have the asset and a new car. You have not wasted your cash on a car which goes down in value, you have put your money to work in an asset.

The poor work hard for their money. The rich make their money work hard for them.

For instance, £100,000 towards a £300,000 house which you turn into a 5 room HMO should produce over £2000 gross rental income per month.

Monthly rental	£2000
Loan costs interest only £200,000 x 3%	£6,000 pa
Monthly mortgage	£500
Monthly running costs	£500
Management	£200
Total monthly costs	£1200
Gross monthly income	£800

I was at a seminar run by one of my mentors T Harv Eker   He wrote the book secrets of the millionaire mind.


He said that would be people when given a choice of one or the other will make
a choice of one or the other. For instance, would you like a winter holiday or
summer holiday? But, he goes on to say, wealthy people will not choose one or
the other they will choose both! 

Why choose one when you can have
both?

What I’m getting at is can you have
a set and the fancy car?

The answer is, yes, you can have
both!

Would you like to tell me how are
you can have both assets and the fancy car?

Well, that’s over this episode. In
the next episode I’ll tell you how are you can have both.

Not really, I’m going to tell you
now. I won’t leave you with oneOf those soap opera, EastEnders cliffhangers.
Bum bum bum bum.

Here’s how it works.

Instead of putting your cash into a
car, put your cash into an assets such as a cash flowing property.

Take the rental income after tax
and expenses from the cash flowing property and use that money to lease a
car. 

In the earlier example, I said that
I received rental income from the property I bought. That rental income
would’ve been more than enough to lease a Porsche and I wanted to lease a
Porsche. You can do the same with property.

You can lease a pretty good car for
anything from £250 per month to a supercar for £1000-£1500 per month.  

Even with mortgage expenses you
should have more than enough income to lease a car. In fact, if you don’t have
enough income to lease a car then I would argue that perhaps the deal is not a
very good deal.

In my forthcoming book, Yes, money can buy you happiness, I go into more detail about creating wealth and owning assets. 

So you can have both and you can’t have your cake and eat
it. After all, what’s the point of having a cake if you can’t eat it!

Check out my new book on Amazon, Yes, Money Can Buy You Happiness

http://bit.ly/moneykin