I faced a loss in my business as my debtor filed for bankruptcy. To maintain a good reputation i need to pay all my creditors for which i sold my property no 1. I also had a business loan on my other property no 2. Now the cash i have right now by selling property no 1 can pay off all my debt but i dont want to close my bank credit as doing so will leave me cash crunch. i have made a plan to recover business and gradually close my debt against property no 2 and invest the extra cash into real estate and stocks again which i got against property no 1. Please suggest me if i have taken the right decision or not. also suggest me where should i invest in real estate in world for fast returns.
Hey @4success,
Honestly, I had trouble following that. It sounds like you are borrowing some money and lending some money. You also asked about “fast returns”.
Three of PFC principles are:
- Avoid debt
- Buy and hold
- Simple is better than complex
I think you’re breaking all of those rules… how can you simplify your situation? Can you get fully out of debt, and start investing early and often? Also remember to think long term. Fast returns = fast broke. Slow and steady over decades = rich.
in simple terms i have sold one of my poperty. What are the best ways to manage this money keeping these points in mind
- i have to write off approx 1,50,000 USD as one of my debtors got bankrupt
- i have a loan of approx 1,20,000 USD from bank
- i have to invest money ( which i got from selling property) into real estate to avoid taxation
now if i follow your principal of avoiding debt and close all my loans ( in addition with buying real estate), i would be left with no cash.
Well, you already have no money. You’re just living the fantasy of having money by maintaining cash and debt. Paying off the debt doesn’t put you further back, it just removes risk and interest from your life. So yeah, I’d pay off the debt, then start building up your cash again.