10 Principles To Make Millions In Real Estate: Compound Interest

10 Principles To Make Millions In Real Estate: Compound Interest

Welcome for the fourth and final video
in this installment. We’re going to be talking about compound interest. Just as
a reminder, we’re talking about the 10 core principles that you need to go from
nothing to millions in the game of real estate. You don’t understand these foundational
principles, you’re going to be lost. So, I’m here to help show you the way. And
compound interest, this is number 9 of 10 principles that I’m going to be
teaching you. And here in this video, I just want to start by telling you right
now. Some of the stuff… Some of you don’t really like math a whole lot. And that’s
not going to be a great decision. I’m going to invite you to fall in love with
these principles. When I was brand new, this stuff was confusing as anything. And
and sometimes I’d be confused for like a year before I could finally straighten
it out. I hope that I can be a better teacher than the one that I had (Which I
didn’t really have one) so that I can really help you get this a whole lot
faster. So, today we’re going to talk about compound interest. Why do you need to
understand this in the game of real estate? Well, let me ask you, do you want
to make $100,000 or do you want to make millions of dollars? Well, if you want to
make millions of dollars, you need to understand this principle. So, number 1,
I need you to get that even though we see and hear about people doing deals
like, “I just did this deal. And I made a $130,000. And
I did this other deal and I made $250,000.” And
sometimes, we just perseverate on these deals that we hear about these stories.
And were like, “Oh, my gosh. I’m going to make all this money overnight. It’s going to be
awesome.” I wanna help you understand something. If real estate works and it
makes you lots of money, would you stop what you’re doing? This is
one of the heirs that I’ve made. And this is one of the heirs that I know many
people make. You do something that works and then you stop doing it.
Why do that? All of your growth and compound interest stops when you do that.
Let me explain compound interest. If I buy a home… And let’s just say for a
moment that I buy it… I have money in a 401k or IRA. And I put a 20% down payment.
So, let’s just say I put $35,000 of my money in this house. But 5 years goes
by and in that course that 5 years, I’m able to sell this home and I make a
$70,000 profit. Now by the way, can you see that 35,000 times 2 is
70 grand? If in 5 years, I made 100% return on my money… You
want to back up this video make sure you understand what I’m saying because this
is basics, friends. I doubled my money, I did it in 5 years.
That means that 100%… Because I made a hundred percent on my
money. Divided by 5, 5 years, is 20% every year. So, check this out. I
doubled my money and now, because I sold my home, I’m going to replace it for what?
2 new homes. This home is going to be bought with my original money that came
out. But this home is going to be bought with my $35,000 of
profits. So, how much money have I put in the game so far? Only 35. But I
don’t have one home, now I have what? I have 2. Now, 5 years goes by and I
sell those homes and I use the money to now buy how many? 4. My 35,000
goes in one of them. My profits from this home, this home and this home
buy this home, this home and this home. I now have 4 homes with the same $35,000. But let’s just say when I sell all of these, what I’m left
with is a $150,000. aAd I started with 35.
We could figure out what our return is. 35, 70, 105, 140. I’ve made a huge amount of
money on whatever he started with. The growth curve (I’ll do it in a different
color) looks something like this. A little is turning to more is turning
to more. Now imagine if I could just fast forward and start with 150
grand instead of 35. Then in 5 years, that might turn into 300. 5 more years it turns into 600. And that’s just one part of
compound. All you’re doing is making your money produce a track record for you.
Once you have a track record, trust me. When you’ve done several deals, you’re
going to get that nosy neighbor, that good friend, a family member that knock on the
door. “Hey, I see you’ve been doing this. I got some money. Can you help me do the
same?” When they ask that, if you’ve got a system and you’ve learned how to do this,
more what might you say to them? You would say yes. And all of a sudden, you’re
now getting your money growing like this. But you’re now… You’re going to go buy a
couple more homes with them. And you’ve got the exact same thing happening. And
they’re 2 become 4. And they’re 4 become 8. And all of a sudden, your
growth curve looks like this and you’re achieving what you want faster. And then
more track record. And then you get 2 or 3 more partners. And before you
know it, your growth record now all the sudden, it’s like, “Wow, I’m going to track
to get where I want to be in 20 years. Uh-oh! I brought up partners. It’s going to
be 12 years. Man, I brought in more partners, it’s going to be 8 years. I
brought in more partners, going to be 4 years.” How I retired in 4 and a half
years is because I understood the game of compound interest. It’s a super. It is
what Einstein called in mathematics and Finance. He says, “It’s the most important
principle that’s ever been conceived of.” And don’t just know it, live it.
Experience it. Have this experience. How would you do that? Well, there’s a couple
of things you can do. First, hopefully I’ve given you enough information that
you’re comfortable to go out there right now and just… Friend, get out there and
make that first deal happen. Go make it happen. Like take action on your life. If
you’re sitting here and you’re saying, “Kris, I don’t know if I know enough yet.
I don’t know all your 10 principles. I would like to actually have a mentor. I
want someone to have my back. I need help.” Well for you, you’re going to want to click
the link and actually learn about how you can get just that. You can get all of
my principles and you can also get the hand-holding that you’re looking for. So
you can go out there and freaking crush it in real estate. Most importantly, never
allow knowledge or the lack of money or resources to keep you from doing
something. Get the knowledge, get it quickly and then take action on it. Thank
you so much for watching. I hope you’ve enjoyed this 4-part video series on
4 of the 10 principles. Man, there’s so much more to share on it. So, make sure
you get your hands on my 10X real estate course, if you haven’t already. If you
have it and you’ve watched it, then you know that what I’m telling you is really
important. You now understand the basics and the foundation so you can go out
there and start crushing it in real estate. Thank you so much for watching
this. Make sure that you are a subscriber because guess what’s happening tomorrow
baby? I got another video coming your way
designed to help empower you, strengthen you, develop the mindset, the wealth
that’s gonna allow you to live as limitless a life as possible. Take care.

26 thoughts on “10 Principles To Make Millions In Real Estate: Compound Interest

  1. First to like and comment

  2. I love compound in my ROTH IRA. 8th wonder of the world. He who understands it earns it, he who doesnโ€™t pays it!

  3. There he is! Letโ€™s make it happen ๐Ÿ‘

  4. Compound interest is SO underrated! Especially in the stock market as well!

  5. You seem to have some flexibility in your life. How about you mentor me, and in return Iโ€™ll give you 5% of my income for the rest of my life. Walk the walk

  6. So where are the other principles? I don't understand…

  7. We gonna need to see a house tour or your kids again

  8. Can you do this on the dole lol.

  9. Hi Kris, its a fantastic video, thanks for sharing the knowledge

  10. Thanks for sharing. Great video

  11. Flaw in the argument is that it assumes that homes YOU buy and hold go up but homes you buy later have NOT appreciated by the same compounded rate. If your property's appreciated during those 5-year increments, so have the ones you want to go out and buy after 5 years. But the general principle is right re: compound interest.

  12. I bet he read The Richest Man in Babylon

  13. Bad credit
    Bad background check
    No hope…
    No luck ๐Ÿ˜ญ

  14. Compound interest is one of the most powerful things in the world. Thanks for sharing Kris

  15. How can I get into real estate? Iโ€™m 16

  16. Hey Kris, love your videos! You may have covered this in a previous video, but are you creating llCs for each property to protect your assets?

  17. Someone explain this, how can you double your number of homes just by the first down payment that you put in the Beginning on your first home? Hows is seeing the bank for that ?

  18. Lease option, are you taking the 5k down in the Beginning or at the end of the sell ??

  19. Lease option, if the tenant just pay 3k down and he was supposed to pay 5k how much Do you increased the rent ??

  20. Hi Kris, I just want to thank you for the content you put out. Iv used your videos and a few other you tubers as my mentors essentially and started my property journey about 6 months ago, now I'm 3 apartments up and going strong. Thanks again.

  21. Hi Kris, really love your videos!
    I was wondering how this would work in India since the EMI payments are more than rent i would receive from the house.
    Keep up the great work!

  22. I want to buy land in Vietnam and create a community where foreigners and expats can come to live. You can build a small two story house for 10k or less and I would charge $300 – $500 a month.

  23. Great explanation Kris!
    Ideal for any realtor at any experience level.

  24. Beautiful video! ๐Ÿ˜€๐Ÿ˜€๐Ÿ˜€ Have you ever sold anything in an online auction? ๐Ÿค”

  25. Awesome video! Keep it up

  26. So u keep buying small houses or what are you saying? If u start with 150k what do you buy…

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