Most people are taught today that to retire well you must invest in the stock market and build up a huge portfolio that your investment adviser manages for you. If you don’t have discretionary income available to play the market, you might feel you have nothing to help build wealth. If you’re feeling limited in your ability to create additional wealth with exactly what you have right now, it’s time to get creative!
True wealth does not always come by being born with a silver spoon in your mouth, or inheriting a big chunk of cash from your wealthy aunt. It rarely comes from winning the lottery, and believe it or not, is often created by common hardworking men and women — school teachers, postal workers, mechanics — who have been wise with their money, stayed out of debt as much as possible, and learned how to save not only for emergencies and retirement, but for emotional needs and wants as well.
Another way these “common” people have learned to make more money is by examining their existing resources and determined what they could use of those resources to make more money. Here are a few ideas I am personally acquainted with:
- I have a friend who has acquired white folding chairs that she rents out for weddings. She stores the chairs and other wedding decor in her backyard shed and rents the items for various prices. She spent the money once to acquire the items but once she recouped her costs, has made a continual profit by renting them out at between 20 and 40 weddings per year. This provides her an extra $5,000 to 10,000 per year. I was telling another friend about this smart use of resources and was surprised that she scoffed at it as a legitimate way to create wealth. She thought it silly that I was suggesting “chair wedding rental” a good way to prepare for retirement over investing in the stock market. Think about it for yourself — silly or not? You be the judge. As for me, I think the lady with the white wedding chairs is on to something.
- Peter had a client once that was very concerned about funding retirement but was getting too old to take the traditional 401(k) route. Peter then asked him about what property he owned. The man said he owned a small office building out of which he worked. The basement in this office building was vacant but unfinished and he did not have the money to complete it. Peter suggested that he rent out the basement to a tenant who would be willing to finish the space in the way he wanted, and then charge him half rent for the first two years until the tenant recouped his construction costs. After the second year, he could then begin charging full rent. Peter’s client did just this and is now funding his retirement by using a resource he already had that wasn’t doing anything for him until he got creative with the way he managed it.
Think about what property or resources you are sitting on that you could use to help fund retirement and even create a descent cash flow. Do you have real estate you could rent? Do you own equipment you could lease? Do you have a chunk of change you don’t know what to do with but are sure you don’t want to invest it in the stock market — perhaps you could lend this money through a hard-money loan. Do you own a second home your kids are living in that perhaps you need to lease to someone who will pay you actual rent? Brainstorm ideas, and don’t discount anything until you’ve really given it a chance. Not everything has to be about going with the “herd.” Sometimes white wedding chairs are smarter than an individual retirement account, just sayin’.