Are you actively building your wealth? This isn’t just having a savings account you contribute to, but instead taking steps to increase your assets and income. 

A lot of people dream of becoming wealthy, whether it’s through luck like winning the lottery or hoping their big idea works out and they make millions selling it. But you can actually start taking steps now to slowly but surely build your wealth so you can have a much more comfortable lifestyle.
 

Why Use Loans to Build Wealth?
 

A great way to build your wealth is by utilizing loans to purchase assets worth money. It’s unlikely you have the cash right now to purchase such an asset, so you need a loan to make it happen.

For example, you want to purchase a home in order to flip it and make a profit. Even if the home is run down and falling apart, it’s unlikely you can pay for it out of pocket. So you get a loan to buy the home, fix it up, then sell it for more than you sold it for.

Loans give you the ability to purchase desirable assets that you can then later sell for a profit. That profit is the wealth you gained that can then be used to grow even more wealth or be used to live on for awhile.
 

Buying Good Assets vs Bad Assets
 

There are a lot of things you can buy with loans, such as homes, cars, land, airplanes, computers, and more! The possibilities are endless. But just because you can buy it with a loan does not make it a good asset for building wealth.

A prime example of a bad asset is a car. If you buy a new car, the moment you drive it off the lot, it loses value and every mile you drive, the value decreases. It’s very unlikely you will ever make a profit reselling a car you bought brand new. Its value will continue to decrease, not a way to build your wealth.

Good assets are those that either have the possibility of going up in value or have a proven track record of growing and paying you out. If you are a homeowner, you actually already have a good asset, your home! Real estate is a popular investment for growing wealth and if you are improving your home, it is likely worth more than what you bought it for. 
 

Picking Assets That Will Grow
 

Before heading out and getting a loan, you need to have a plan and background on which assets are best for you. If you know nothing about being a landlord but decide to buy a house to rent out for your asset, you might find yourself struggling.

Spend a lot of time researching and learning about different assets and what it will take for it to turn a profit. You also need to know how much effort and maintenance you’ll need to put in. Again, being a landlord might require quite a bit of effort to maintain, while other assets require very little oversight to grow.

You’ll also need to be comfortable with some amount of risk. Investments are never 100% safe and can go badly for you. If you invested your loan into the stock market, only to have your stocks crash and lose value, you will still need to pay off the loan you took out.
 

Getting the Right Loan
 

Just as there are different assets you can buy, there are different loan tools for making those purchases. Buy a second home in order to flip it? You won’t get a 30 year mortgage for it, but instead may get a Hard Money Loan or a Home Equity Line of Credit on your current home to pay for it. 

If there isn’t a specific collateral item like a home or land, you could use a personal loan to pay for your investment. Pioneer’s Signature Loan is a great fit for something like this. No collateral, just a loan that you can use to purchase your investment, pay it off, and hopefully you build some wealth along the way!

Apply for a Signature Loan