Day 8 of The 14-day Passive Income Challenge - 1 Asset vs 2 assets - Chaim Ekstein

welcome welcome welcome today's number eight  day number eight of the 14 day passive income   challenge and i'm happy that you're still with us  let's jump right into it we're going to discuss   today one asset versus two or more assets and as  always i would like to hear what you have to say   about it comment in the comment section below  if you agree if you disagree if you have any   other ideas that you think we can all benefit  from and that we can have a conversation about   it i'm reading every comment and i'm replying and  make sure you subscribe to the channel underneath   this video for all our updated videos on your  passive income journey if you remember in day   four we discussed about having one asset earning  a twenty percent rate of return versus having four   assets in each bringing you five percent which  also equals to 20% now we're going to dive a   little bit deeper into it and again i'm going  to take an example of somebody having a 100 000   home just for simplicity reasons i know it's not  the reality now for most people most people's   homes are much more expensive than that but that's  the example we're going to use and person A is   going to have let me choose blue person A is going  to have a house worth one hundred thousand dollars free and clear versus person B will have the same  same same type of house also one hundred thousand   dollars but with a big fat mortgage of let's say  one hundred thousand dollars which would be red and we discussed earlier that the one hundred  thousand dollar home the one hundred thousand   dollar cash that person B has will be invested  in an account earning some kind of return for him   now let's assume this house is  appreciating at a five percent return   that means by the end of  the year of year number one the house will be worth how much a hundred and  five thousand dollars the question that i have   for you is person B's house how much will his  house be worth at the end of year number one yes also 105 000 meaning in other words the  fact that you have a mortgage of 100 000   doesn't make it or break it when it  comes to apreciation of the house   your house is still appreciated with five percent  which means your house is worth now 105 000 so   both person A has a net worth of five  thousand dollars more by the end of the year   and person B has a net worth of five thousand  dollars more by the end of the year plus person B   also has whatever the increase was on the  other account minus the interest that he paid   let's make another page just for person B  so person B has one asset which is the house   100 000 which is hopefully increasing at a certain  return for him every year as we discussed earlier   but person B took out the mortgage from one  hundred thousand dollars where he bought   another house also worth a hundred thousand  dollars the money came from this and this   house is also appreciating in money every year  and as long as they return the monthly return   from the rent plus apreciation is more than  what he pays on the mortgage on this house he's still ending up being in a profit  are we on the same page with this let me   know in the comment section if it's not  clear now he does this again and again   and again he does it again another 100 000 house okay and of course this is also appreciating  and of course now he has to pay a mortgage on   this also because he took a mortgage from here  so he's paying it back again and this is how   he keeps doing it again and again and again now  now i'll admit i might be oversimplifying that   but understand i'm trying to put this in a few  minutes and hopefully we'll have another chance   to elaborate on it and make it more appealing  to your specific situation but for now please   review this again and again and comment in  the section below if that makes sense for you   or if you have any other questions on it and  i can jump in and guide you and answer you   and make sure that we are 100 super clear  on this because this is very very important   in your passive income planning strategy and i  don't want you to miss any of that and yes as i   told you i'm reading all the comments i'm replying  to all the comments and subscribe to the channel   below this video to make sure you don't miss any  videos on our passive income journey together