1031 Exchange

Who cares about this and why is it important to make the leap to big investment money? A 1031 Exchange is a tool you can utilize to avoid paying taxes on the gains from selling your property. You have to roll it into another property within a certain period of time and it has to be into another property of similar use. This allows you to capture the gains instead of losing them to taxes and roll those gains into another place as an investment.


What’s great about this is that you can take a property that you’ve fully depreciated throughout the years and sell it with its value also having appreciated and roll those gains into another property. There are many reasons to do a 1031 exchange. The following are just a few reasons why you’d want to. Upgrade or consolidate property, relocation to another area, and change ownership of property types, i.e. change from owning residential real estate to commercial or retail.

Ultimately my goal is to own enough rental property or businesses that allow me to live comfortably on the monthly cash flow in retirement. This exchange allows me the ability to potentially grow my investments exponentially through economies of scale. That is what I’m excited about in the future. This is what Robert Kiyosaki did with his wife when they were starting out in rental properties. They were able to take their 20 or so rental properties, sell them, and traded up for 2 bigger apartment complex units. What is nice about this is the track that it leads them down. Eventually with enough experience/success larger investors will start to come at you with deals that you’d be able to finance or find financing for that would lead to infinite return deals using OPM (Other People’s Money), which is the best possible way to maximize your returns.