TLDR: The HENRY method prioritizes growing Net worth over Cash Flow (at least at the beginning of your investing journey).
There are three pillars in the HENRY real estate investing method.
- Make (High) Active Income
- Avoid Taxes on Active Income
- Re-Invest Tax Savings
You are in this group because you have already achieved the first step in the HENRY method.
Steps 2 and 3 become more enticing for people with large tax bills - which is why this strategy is more effective for HENRYs than it is for lower income earners.
That means you would've saved $40k in taxes - which you can now re-invest into other assets.
💥 BOOM! 💥
Now imagine what that would look like if you did this every year for 5 years.
Lower-income earners looking to invest in real estate prioritize cash flow - their goal is typically 10k a month in passive income.
Now, that's not a bad goal to have - I'd argue that is the END goal - but it shouldn't necessarily be the initial focus for HENRYs.
**The HENRY method prioritizes net worth growth over just cash flow by analyzing a real estate investment on a holistic level considering tax savings and equity growth - and not just cashflow, cashflow, cashflow.**
In other words: "The goal isn't 10k in cashflow in 5 years - the goal is a net worth of $3,000,000+ in 5 years"
This should be everyone's goal - because if you can achieve a net worth of $3M (or more) in a short period of time, you can always "trade" your assets (while avoiding any taxes) for highly cash-flowing assets. (And cashflow much more than $10k a month).
The end goal is the same - but the HENRY Method is ideal for High Earners because:
- The type of properties bought saves HENRYs significantly more in taxes
- HENRYs can use increased tax savings to re-invest more money in the market
- Dealing with fewer tenants and headaches
If you're ready to take MASSIVE ACTION - then head on over to the Course section and follow the steps to get going!