Learn How To Start Investing In Real Estate
Learn How To Start Investing In Real Estate

How Some Americans Are Enjoying Record Wealth Without Income Growth

Written by Than Merrill

How is it that some Americans are enjoying record wealth while U.S. job and income growth remains stagnant?

Most seem bullish about the future. The National Association of Realtors (NAR) reports optimism is at a seven year high, and the U.S. housing market keeps marching upwards. At the same time, there are a few pessimists that are grumbling that fundamentals like U.S. job and wage growth simply aren’t cutting it. So what shape is the economy really in? How are some experiencing more prosperity than ever before, despite the deficiencies some are concerned about?

The Fundamental Question

Even though the American housing market is storming back into action, jobs and wage growth appear to be lagging. Even the NAR has pointed out that jobs and new construction aren’t keeping up with population growth.

Of course, it doesn’t help that statistics can be so confusing. The numbers are often twisted. Dropping unemployment claims can be skewed by individuals leaving the workforce or giving up on the hunt. Many individuals are also now working off the grid as freelancers and are spending more time traveling. Many jobs are going overseas too, while we are in the throws of a massive retirement wave of boomers.

However, the Wall Street Journal proclaims that the U.S. has hit a new record high in net worth, at just over $80 trillion.

As far back as 2013, the St. Louis Fed had been reporting incredible net worth gains, topping the pre-recession fall. However, the Fed was one of the first to admit that there has been significant disparity in wealth gains.

Homeowners have seen a substantial rebound in equity and wealth over the last few years. Most renters might not have. However, real estate investors seem to be doing incredibly well. Market Watch coverage reports top destinations have been enabling home flippers to pocket over $100,000 per deal when fixing and reselling homes.

So yes, the economy is healing, but the numbers show that is has already more than proven to have legs. Some may not be feeling the lift in their wallets. However, there appears to be no reason why more individuals can’t dramatically boost their incomes and wealth by investing in real estate.

Passive Income Investors Disrupting the Digits

Flipping houses has been turning in huge profits for real estate investors, but it isn’t the only strategy creating game changing wealth and incomes. Passive income investors have been doing very well for themselves too.

For some, buying and holding rental properties is the only option for getting ahead, and getting back on track with income and retirement savings. Many are finding their age and skill sets are a tough sell in the new hi-tech economy. For others, rental properties are simply the best way to get to the next level and speed along their goals of financial freedom.

Rental property investing stands out by being able to deliver both ongoing income and passive wealth building. Many may find it takes far fewer properties to be able to retire than they think. Those taking advantage of turnkey property investing can find this particularly true and that they are able to begin enjoying more freedom sooner. Turnkey investment programs also empower a greater spectrum of individuals to take advantage of the rewards of income property investing. Both busy professionals and those that have been unable to find employment to participate, and avoid having to spend months or years learning a new career.

How Passive Income Investors are Fixing and Fueling Economic Prosperity

Many are underestimating is how passive income investors are helping to rebuild the economy. They may make great money, but it is not just about a few grabbing all of the wealth. Firstly, they are providing a valuable, and much needed service in housing. Each home being acquired, renovated and rented is also creating multiple jobs, and generating substantial revenue for local government and public services. This recycling of property also improves the value of local communities and lifts neighboring home values to create more equity and wealth for neighbors, even if they aren’t actively investing themselves.

The rewards of passive income investing in rental homes is also removing many from the workforce pool. Some may still retain jobs, or keep working at reduced hours, but many are finding they are able to retire earlier than planned. This means making more room for others to scoop jobs that were previously occupied, even without new job creation.

Of course, you can only play so much golf, and spend so many days on the beach before it becomes as much of a chore as your old 9-5. So many financially free passive income investors go on to start new business ventures or become venture capitalists funding other people’s start-ups. This creates even more jobs, and when successful, can certainly add to increased wages for those that work for them.

In summary, passive income investment in rental properties has become a go to avenue for those wanting to get ahead financially, and for those that need to generate income. While the U.S. economy might actually already be in far better shape than many realize, ongoing investment of this type is certainly one of the largest and most significant drivers of new jobs, wages, and wealth for everyone else.