Why Capital Assets Should Be Your Plan B

Picture of by Dr David Phelps

by Dr David Phelps


 learned the value of a capital asset when I was pretty young. In my first year of dental school, I asked my dad if we could invest in a rental property together.

 I told him, if he put up the money, I would manage it.

Fortunately, he believed in me. We bought a property, and I learned how to manage it. Then three and a half years later we sold the property and split about $50,000 in capital gains profits.

It was eye opening. I looked back at the number of hours I had spent waiting tables at a high end restaurant, and compared the money I made there with the profit I made from that investment property. I found out very quickly the difference between trading time for dollars, and acquiring capital assets which produce annuity income. That annuity income is also indexed to inflation – as inflation goes up, its revenues go up, as well as the overall value of the asset.

I never looked back. As I graduated dental school, I took my $25,000 and invested it into more properties. I leveraged that money to make it go as far as I could because I realized that acquiring capital assets – with cash flow, learning how to manage them, and learning how to negotiate for the right properties – was how I was going to build my Plan B.

Today more and more people wish they had a Plan B. Fifteen years ago when my daughter needed a life-saving liver transplant after battling leukemia and experiencing epilepsy, I used my Plan B to be there for her. I needed a Plan B to escape the chains of my dental practice which required me to trade time for dollars, and the annuity income from my capital assets provided just that. 

Since then, I've been able to continue to build off those capital assets. In fact, every time there's a downturn or recession, just like there was in 2008 and just as there is right now with the coronavirus pandemic, there are new opportunities to solve problems in the marketplace that others can't do. In an inefficient market like capital assets and real estate, you can buy at big discounts, capture the cash flows and ride the equities back up again, harvest those equities, take your money off the table, and then do it all over again. You can literally multiply your net worth in a relatively short period of time.

You can’t do that trading time for dollars. No matter how hard you work, no matter how efficient you become at your craft, it's very linear. 

And if you’re just trading time for dollars, you can't afford to have a downturn every 8-10 years that takes you back down again – but that's what happens. People will work, work, work, and then bam – they hit a recession. It takes their 401k and their savings down, and then they keep working and the cycle repeats. It happens decade after decade after decade, and they miss what I call their inflection points: that chance to really pop and make a big difference.

Again, you’re not going to get rich trading time for dollars. It’s a place to start, but you’ve got to convert to capital assets to really build your wealth and gain real freedom.

If you want to join me and learn how to do it, I invite you to schedule a quick call with my team and find out if we could be a good fit.

Don't miss your next inflection point. This is a chance to step up for your family, and provide the security and peace of mind that you want to carry on for generations to come.

I hope to talk to you soon.

P.S. Whenever you’re ready, here are some other ways I can help fast track you to your Freedom goal (you’re closer than you think) :

1. Schedule a Call with Me:

If you’d like to replace your active practice income with passive investment income within 2-3 years, and you have at least $1M in available capital (can include residential/practice equity or practice sale), then click the link to jump on a quick call with my team. If it looks like there is a mutual fit, you’ll have the opportunity to schedule a call with me directly. www.freedomfounders.com/schedule

2. Get Your Free Retirement Scorecard:

Benchmark your retirement and wealth-building against hundreds of other practice professionals, and get personalized feedback on your biggest opportunities and leverage points. Go to www.FreedomFounders.com/Scorecard to take the 3 minute assessment and get your scorecard.

3. Ready to Step Away?

“How Much is Enough?” This simple question keeps hard-working professionals at the hamster wheel of active income far longer than they need to be. Watch this free training, and discover a proven model for determining how much you really need before hanging up the handpiece! www.freedomfounders.com/training

4. Apply To Visit The Mastermind:

If you’d like to join dozens of dentists, docs, and practice professionals on the fast track to Freedom (3-5 years or less), visit www.freedomfounders.com/step-1 to apply for a guest seat.

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