Unfair Advantage buying. Again, we made sure there were stable jobs in the area because real estate is only as valuable as the jobs in the area. In the next chapter, the chapter on the unfair advantage of debt, I will explain how we got that $1 million back, also tax-free. In other words, our $1 million was returned to Kim and me and was moved into another project. Our entire 400-unit project is completely free, simply because we use debt to get our money back. Even with a free 400-unit apartment house, we receive about $8,000 a month, also almost tax-free. Eight thousand dollars a month is not a lot of money but, without taxes, it is the same as having a job working for $12,000 a month. Again, please remember that I do not write to brag, because bragging is not cool. I write to explain and inspire some of you to increase your financial education. Also, we did not start at this level. Kim, our partner Ken, and I all started small and dreamed big. Like rich dad, we are always studying, learning, and earning. Financial education and real-life experience is the key. We have no plans on stopping. At this stage in our educational development, why stop? Life is too much fun.
Why Not Stocks, Bonds, or Mutual Funds? One reason why we usually avoid stocks is because real estate is too easy. On top of that, the tax laws and the use of debt as leverage are different. Another reason that I will get into later in the chapter on risk, is that I have more control over real estate than I do on stocks. Does this mean you should not invest in paper assets such as stocks, bonds, mutual funds, and ETFs? The answer is no. If you love paper assets, become the best paperasset investor you can be. The Rich Dad Company has courses on paper assets because they are an important asset class. The issue with paper assets is control over risk. Once a person knows how to control risk, paper assets can be a fabulous way to secure lifelong wealth. Personally, I have taken and continue to take classes on paper assets. The reason I take paper-asset classes is because the principles of investing are the same, which means that the principles apply to 75
by Rich Dad, Robert Kiyosaki