When people talk about wanting to create financial freedom they often talk about owning their own home.
The Great Australian Dream is to own your own home.
But actually owning a home is not an asset in the true sense of the word asset.
An asset should be income-producing if you want to create real financial freedom.
Your home, unless you’re renting out rooms, is actually a liability. Homes generally cost you a bomb in maintenance and repairs. Then there are all those homewares, furniture, garden supplies and equipment, and other trappings that you want to buy to make your home beautiful. More liabilities.
If you own a home in a major city, chances are most of your cash flow is going into paying your bank for the privilege of living there, and not leaving you with much else.
And that’s before you’ve even paid rates, renovated or furnished it.
So if you really want to get ahead you need to think about ways of creating income-producing assets.
Maybe instead of living in your own home, you might consider rent-vesting where you rent where you want to live, but buy where you can afford a positive cashflow property. Or maybe consider renting out rooms in your place to increase your cash-flow.
There are definitely more ways than one to peel an orange.
I have a friend who never paid rent because she bought a house and then rented out all the rooms except her own to foreign students. Her international tenants paid extra for short term rental.
What ways can you think of to create income-producing assets? See if you can create a list a mile long of all the ways you could get ahead financially by thinking outside the square.
Further recommended reading to help you get there faster: