What does synergy for your timeline even mean? It’s a core principle of Purposeful Planning. Combining strategies to coordinate with your personal timeline is what often makes the difference between a solid retirement and a fabulous retirement.

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Transcript:   When it comes to strategy, one of the things that we’ve talked about many times before is how long do you have to accomplish what you want to do and point B. If you’ve got fifteen years, and you’ve got a boatload of cash, three, four, five-hundred thousand dollars, at least, you can do a lot in ten years. Do you make a household income of seventy-five or do you make a household income of two seventy-five? That also dictates what’s possible. Let’s take somebody who has a quarter million dollars of capital available, by whatever means, and they have about five-thousand a month from the family budget to expend. Now, they may have already bought, say, a couple of two to four unit properties and they’ve been paying them off diligently and they say, “Well, Jeff, what should we do with this quarter million dollars? Well, let’s say the first two that they bought, they owe about four-hundred thousand on. Well, that’s four-hundred thousand we have fifteen years to pay off, so we have to, first of all, check it out. If we don’t buy anymore real estate, how much extra do we need to put on those payments, every month, in order to get at fifteen year free and clear properties. They’ve got two of them, we’re talking four-hundred thousand dollars, so we do that. Well, let’s say it comes out that if we buy one more, but now stop buying real estate, because we don’t think in fifteen years we’d be able to pay off, say, more than six-hundred thousand, six twenty-five, so we put on that extra two, two and a quarter, with a third one. Now they take, maybe a hundred and fifty of that two-hundred and they go out and buy notes in their own name. Now, that hundred and fifty is going to give them somewhere in the vicinity of fifteen to eighteen-hundred dollars a month in income. It’s going to yield twelve to fifteen percent cash on cash. Now, I keep throwing around cash on cash, and for those who are not sure of the definition, it’s very simple: take the amount of money that you put in to any vehicle that’s going to produce income, let’s say it’s a hundred-thousand, and if you make twelve-thousand dollars a year on it, you divide the hundred into the twelve-thousand and your cash on cash is twelve percent. That was an easy one. That’s all that is. If you’re buying real estate, you want to see what your cash on cash is, don’t forget to include the closing cost to your down payment and then divide that into the first year cash flow to get your cash on cash. Cash on cash does not include any profits down the road, increase in rents down the road, or anything like that. It’s just what are you going to do right away your first year and then every year you can do it. Maybe the took a hundred and fifty and they’re coming up with somewhere in the vicinity of maybe eighteen, nineteen, twenty-thousand dollars a year. Well, even if they got the highest, twenty-thousand, not likely. Let’s back it down to eighteen, I can’t help myself. We’re going to take eighteen and we’re going to say, “You know what, that’s probably a whole bunch of twelve-thousand after tax, state and fed, and if you live in a tax free state, God bless you. Now they’ve got a thousand dollars a month after tax. Well, they can take that thousand dollars, they don’t need it, they can add it to the five-thousand from their family budget, now it’s six-thousand.