CW Blogcast 52 - Grow rich borrowing money.

Published: May 9, 2013, 2 a.m.

We know it sounds counter-intuitive to say you can get rich borrowing money during inflationary times but, if you\u2019ll stick with us for a few minutes, we\u2019ll show you how it makes perfect sense. Let\u2019s start with a simple economic truth \u2013 the value of a dollar declines over time. In fact, it declines a whole lot.

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In real terms of stuff you can buy, a dollar in 1972 has fallen all the way down to where it\u2019s only worth .24 cents today. This is what is referred to as inflation. It attacks the value of your assets and devalues your money, savings, home equity, stocks, bonds, mutual funds\u2026and your debt.

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Did you catch that last one? It also decreases your DEBT! That means that if you acquired debt in the form of a mortgage is 1972, and kept refinancing it over the years, that mortgage is only worth a fraction of what it was when you took it out. Bad for the bank because they are on the short end of the stick. Good for you because, once again, in real terms of wealth that mortgage has gone down in value.

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This is how you actually get paid to borrow money.

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Now we\u2019re not suggesting you run out and load up on silly consumer debt like new cars, fancy televisions, and expensive vacations. To profit from this debt strategy, you need to acquire long term, fixed rate, debt in the form of a mortgage tied to an income producing property.

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It\u2019s that simple. Well, to be honest, there are a few more details. Call us at 714-820-4200 and we\u2019ll tell you how to get started.