Where do you find funding to invest in property? Well there’s the buy to let mortgage, but there are also other ways.

Save for the deposit – if you follow all the previous steps 1-10 you will find yourself in a position where, soon, you will have a growing amount of capital to invest. The first step on the property investment ladder, then, is to get an Agreement In Principle (AIP). This is where the bank or mortgage lender will agree to grant you a mortgage because of the funds you have available. This AIP can be in the form of a certificate which you can show to prospective vendors.

Interest only or repayment mortgage?

In interest only mortgages, you will only be paying back the interest on the mortgage – after the mortgage term, you will still owe the bank what you borrowed. The benefit is that your payments will be less, therefore profits higher.
With a repayment mortgage you will have paid off the capital at the end of the term. The property is yours. You will, however. Your monthly profits are therefore reduced, but you are gaining more in equity. Obviously you should seek the proper advice from an Independent Financial Adviser (IFA).

What if you don’t have the money to invest?

There is always a way, if there is the will. There are books written just on how to find finance for buying property. Here is one tip I can give you. There are people out there who have the money to invest, but simply don’t have the time. They will gladly invest in you if they are confident they will get a return. So go and find them. (More on this later).
Then there are family members with inheritance or pension payoffs who have nothing to invest in. Why not split the profit 50:50 with them. In an example later on, I show how you would both get £11,000 each. They put up, for instance, £110,000 and they get a 10% return in six months and you have a £11,000 payout for the project. Nice.

Other People’s Money

There are many ways to raise capital, here are a few:

Credit cards – especially 0%.
Loans and overdrafts
Private investor Go into partnership with someone who is cash rich and time poor.
Bridging Loans – there are pros and cons to this. Its very quick and easy, but it should only be for the short term (Days) and is high interest.
Multiple offer using creative financing.
Equity release on your home property.
Joint venture
Friends and family
Crowd funding

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This short book is about Financial Freedom and how you can gain it as quickly as possible. From now on we will call Retirement – Financial Freedom, because that is what it is. When someone retires, they receive income from the investments that their company, pension provider or the Government have made on their behalf.
Financial Freedom is therefore when the income from your investments covers your expenses every month. The aim is to reach Financial Independence as soon as you can, so that you can lead the life you always wanted. You can then retire – if you want.
There are Twelve Steps to Financial Freedom. The first four steps should be done in order, sequentially. The last eight steps can be done in any order and also concurrently. However, I’ve set all of the steps in a logical sequence, which if you follow, will get you to your goal in the shortest time

Private Income versus expenses

A concept to get your head around is what can be called private income. This is any income you receive which is NOT from your job. I will go in to more details later on, but briefly this could also include:

Interest on savings
Dividends from shares
Profits from a part-time business
Royalties from book or music sales
Profits from property rental income

Passive income myth

There will always be some activity required from you. This will be in varying degrees depending on the type of income. The important thing is that you are in control of that income.
You might hear the term passive income to describe private income. Be careful with the term Passive income, as it implies that you don’t have to do anything. Bank Interest could be very passive income, but you still need to keep tabs on the interest rates and inflation.

Therefore, if your private income exceeds your expenses every month you have achieved financial independence. You can then resign your job. (If you want to). That is what I and this book are all about.

Why Seek Financial Independence?

Here are three key reason why you should seek financial independence as soon as possible.

1. Job Insecurity

As you know, the days of a job for life are gone forever. We are all at the whim of a global financial system. Small companies to large corporations face a constant struggle for survival. Governments need to try to balance the books.
The biggest overhead for companies is Human Resources, so the quickest and easiest way to reduce this overhead is to restructure (aka sack some employees).
Faced with this we have a choice, we can put up with it and hope it’s not our turn next, or we can take back control and choose Financial Independence as soon as possible.

2. Pension crisis

In spite of the above we are all living in the best time ever to be alive. We are healthier and live longer than at any point in human history. This is a problem for the current Pension model, which is not sustainable.
The current system simply can’t afford to pay pensions to all the people who are retired and all the Baby Boomers who are about to retire. This is why governments are increasing the retirement age. Again the answer is to wrestle back control, now, by building your financial independence nest egg.

3. Work on the projects you want

Another big reason to go for financial independence, now, is more philosophical. What is the meaning of life? Is it to get a good job and build a career, whilst simultaneously making the business owners wealthy?
Or is it to grow and express yourself. Or, work on something worthwhile and perhaps even change the world for the better. Many lucky people find a career that fulfills this basic human need for meaning.
The vast majority don’t and are just working to pay the bills; I know I used to. So if your career is not meeting your life’s purpose then choose financial independence. This will give you the time and freedom to work on the projects you want to.
I passionately believe in personal development and that every person should fulfill his or her potential. For many people a humdrum job prevents them from fulfilling their potential.

In this day and age, nobody should have to do a job they hate.

How Long Will It Take?

In this book, I will share how to reach financial independence, step by step, as soon as possible.
How long will it take? I honestly don’t know; everyone is different, but the beauty is you can go at your own pace. You set your timescales. Be warned though it is NOT a get rich quick scheme. Get rich quick schemes are scams designed to make their creators rich, not you.

The 5 Stages of Financial Independence

You can break down Financial Independence into five stages. This helps you from being overwhelmed by how far you may need to go.

1. Financial protection

The first stage is financial protection, where you will protect the wealth and income you have now and prepare for protecting the riches before they come.

2. Financial security

Next is financial security – this is when your private income (remember income derived not from a job) covers your basic needs: Mortgage, food, utilities, transport, insurances and tax. If you lost your job, for instance, you could still survive at a basic level.

3. Financial vitality

Next is financial vitality, This is when your private income covers the basics plus allows for a modest lifestyle: Satellite/cable subscription, mobile phone, clothes, education, fitness classes etc.

4. Financial independence

I would define Financial Independence as when your private income covers all of your expenses to allow for your current lifestyle now.

5. Financial freedom

Why stop at Financial Independence when you could carry on for Financial Freedom, which is when you can choose your own lifestyle?

So if you are ready, let’s dive into the first step on the road to financial independence.

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