The holy grail of any type of investing is achieving an infinite return. I wrote an article yesterday titled “Understanding Cash on Cash Return,” referencing an old article on the magic of an infinite return.
I wrote my last article about an infinite return almost a year ago, so it’s about time to jump back into the fray. Today, I want to ensure everyone understands what an infinite return is and how to leverage the process to build lifelong wealth.
What is an infinite return? Put simply, achieving an infinite return means having a cash-producing asset with none of your money invested in that asset.
You’ll Need $20,000/Month in Passive Income
In the world of gambling, they call this “playing with house money.” If you start playing slots with $50, you get to $100; you will play with house money. However, the important part is taking your original $50 out of the machine and putting it in your pocket. We’ll talk more about this in a minute.
How I first learned about infinite returns. I first learned about an infinite return when reading “Rich Dad’s Guide to Investing.” Robert Kiyosaki is a massive fan of infinite returns and structures most of his investments to achieve infinite status. In his book “Unfair Advantage,” he dives into how he invests in real estate and the power of an infinite return.
The main idea of achieving an infinite return is to not only get your initial investment back but to reinvest into another asset. You can keep building new assets with that initial cash, growing richer each time. This technique is called the velocity of money.
How does an infinite return look in real life? Each asset class has its own version of an infinite return. Your goal of any investment is to achieve an infinite return, and remove your initial investment. Then you can reinvest into the same asset class, or another. Your assets continue to produce income—not bad. Let’s look at the different infinite returns across the asset classes.
How Would You Invest $300,000
Stocks. The stock market is the most challenging place to achieve an infinite return, at least in a short time. To accomplish an infinite return with dividend-paying stocks, you would use the rule of 72. You can also achieve an infinite return with growth stocks, depending on capital gains. However, you will have to start guessing and using luck. It’s tough to predict which growth stocks will be able to double your money in a short amount of time.
Real Estate. The best way to achieve an infinite return is by renting rooms or house hacking. It costs very little to build a rental room asset ($400-$500), and you’ll make it back the first month. Then every month after that, your room rental is in an infinite return. I have been singing the praises of this method for over a year.
Another way to achieve an infinite return in real estate is by using the “Buy, Renovate, Rent, Refinance, Repeat” or BRRRR method to extract extreme value from a distressed property. If you can find the right property, renovate it, and refinance for more than your total investment, you’ll keep the property. More importantly, you’ll have no money invested and walk away with a profit. Amazing! But it’s not easy. Please read the article “Renovate & Rent VS. Fix & Flip” for more.
Cryptocurrencies. The best way to get an infinite return in crypto is using capital gains. If you can buy into the right “young” coins, you may be able to double (2X) your investment very quickly. It’s good to use a small portion of your investments for speculation—it may as well be cryptos.
Do Men Want to be Providers?
Royalties. Royalties are a great way to achieve an infinite return because you’ll primarily use creativity, not money, to build your assets. I can write as many books as I want, for free. Each book is its own asset. If I make $1 off a book, the book is in an infinite return for the rest of its existence. That’s why I am a HUGE fan of royalties and creativity—at least for side income.
Automated Business. When we start an automated business, we want to be very intentional with our purchases. If we buy, say, a rental car (like a Tesla) or an ATM, we want to wait until we get all of our initial investment back before we buy the next one. Don’t get greedy and over-extend ourselves; using the process of an infinite return can give us more leverage in the long run.
Putting it all together. There are many ways to achieve an infinite return—understanding how to visualize the process is the most crucial part of achieving investing success.
For example, let’s say I bought two identical Pokemon cards for $400 each. When the value of each card reached $800, I would sell one card. Now, I have my entire initial investment back in my hand to deploy to another asset.
I never have to worry about the value of my second card going down because I have no money left on the card. I am playing with house money. The next concept is diversifying my income.
Now that I have my $800 back, I want to invest in stocks or crypto to diversify my income across multiple asset classes. If I invest my $800 across four stocks, maybe in two years, they are all with $2,000 combined. I take out my $800 and build a room rental.
In a couple of months, I have my money back from the room rental, so invest in a vending machine (plus additional cash). You see, my money never stays still. It is always moving and growing—the velocity of money.
Write Book Reviews for Passive Income
Conclusion. Know how much of your money you have invested in an asset. When you receive all of this money back, move the initial investment into another opportunity.
If you keep asking yourself, “what is my next investment?” you’ll constantly stay ahead of the game. Investing is challenging, but those who are proactive become rich over time. Do you want to become rich?
Only a few will ever understand the power of an infinite return—hopefully, you’re one of them. Thank you for reading; if you want to see more from me, follow me on Twitter and my Facebook Page. Enjoy and Happy Investing.
- PDF of the Month: How We Plan to Retire on Dividends 2 (165-Page Free PDF)
- Free PDF Downloads: Download FREE PDF books here (Twitter Link)
- Financial Mindset: Become CEO of Yourself (book)
- Retirement Planning: Don’t Gamble with Retirement 3+4 (696-Page Free PDF)
- Investing: The Pros and Cons of Dividend ETFs (Free PDF)
- Cryptocurrencies: The Magic of Cryptocurrencies (Free PDF)
- Real Estate: Real Estate is a Mindset (Intermediate) (Free PDF)
- Business: Retire Rich, Retire Comfortable with a Business 2 (Free PDF)
- Everything!: The Biggest Book on Passive Income Ever! (book)(Web Edition)(Art Edition)
- I bought a Kindle Oasis: Check it out Amazon
- Read My Books for Free: Free Kindle Books Schedule
- Sign up to Access our “Hidden” Free Kindle Book Schedule
- My first Children’s book: A Child’s First Book on Passive Income (book)
- Book Reviews: 54 Takeaways from 54 Books (book)
- Want to Build Passive Income from Books and Affiliate Marketing? (Learn here)
- Writing: Can Grammarly Make You a Better Writer? (direct)
- My Favorite Chromebook: The Ultimate Chromebook (direct)
- Follow us: On our Facebook Page and Join our Facebook Group
- Amazon Author Page: Check out my author page on Amazon
- Monthly Dividend Planner: Check it out on Etsy
Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
Leave a Reply