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The secret to making a million

the secret to making a million!

Let’s face it. It is an unavoidable part of human nature to imagine ourselves in a million dollar apartment or managing a business that is worth millions. More often than usual, we conceptualize ourselves in luxurious settings, and most of us have dreams of owning all the things that the rich own at some point in our lives. However, between those fantasies, we fail to see the reality. It is the way that the rich have acquired the money over time and more importantly, how they got to that first million and grew from that. The first obstacle is getting to a million, which requires an immense amount of patience, resilience, and thirst to learn more, especially in Dubai, which is a place filled with evident luxuries and a serene lifestyle.
We often trail off into the wormhole of the “whys” and the “what ifs” that come in between what we want. Focusing the energy into the trailing thoughts will only generate feelings of vengefulness against the rich, and unnecessary anger, which may make you give up before you even try to take your first steps to a million. Focus and energy are critical driving forces towards a clear growth mindset. Contributing your attention to what you want and attaining good energy will create a love for learning and room for further accomplishment.
On the practical side, investment is one of the best ways to generate long term returns, particularly real estate. Real estate offers better returns than the stock market without as much volatility and has a high tangible asset value. If you’re worried about the risk of investment, then real estate crowdfunding will help you with diversification, meaning that the risk will not be concentrated in only one property.
“The million dollar choice would be choosing to financially educating yourself by taking some time aside from formal academic education”
– Andy Tanner
Crowdfunding is one of the convenient ways to create a diversified investment portfolio. It is a way in which investors can own a fraction of a property with lower capital than what is needed to invest in the entire property. With just a consistent investment of AED 20,000 over a series of years, you can have returns that are worth a million dirhams. A company such as Smart Crowd could help you initiate your long term success goals with a reduced risk factor.
Attaining a million by using a short-cut is only a myth. As easy it is to be gained, it can fly out of your pocket just as quickly. Intelligent investments can significantly turn your lifestyle into something that you have always wanted, but the factors of focus, discipline, and diligence are what you need to be well on your way to being a millionaire. Earning returns from investing in real estate occurs over some time, and can contribute to positive growth in your long term investment goals, or even help with initial the creation of your long term goals. The key to sustaining money and adding value to it is investing.
Below is an example to demonstrate the power of being consistent and patient with your investment:
  1. If the investment started with an amount as little as AED 20,000 and an individual resort to yearly investments of AED 20,000, it can result in the value of a million over 23 years assuming a steady return of 7% annually.

  2. Discipline is key here. You invested AED 20,000 every year and reinvest the returns that you have earned as well. Without discipline that money will be spent and will miss the opportunity to work for you.

  3. As a comparison, if you were disciplined enough to save that money and leave it your savings account which gives you an interest of 1% it will take you 41 Years to get to million. And if you don’t’ save or invest that money, you might never get there.

  4. The example below only assumed annual return cash return of 7% and does not assume any appreciation in the asset value. You might get to a million sooner if the asset value appreciates as well providing you both a nice annual cash return and price appreciation. This one of the things that makes Real estate very interesting. Read our blog on “The best investment of the Century”
Years Yearly Investment (AED)
Return @ 7% (AED)Balance (AED)
120,000.00NIL20,000.00
220,000.001,400.0041,400.00
320,000.002,898.0064,298.00
420,000.004,501.0088,799.00
520,000.006,216.00115,015.00
620,000.008,052.00143,067.00
720,000.0010,015.00173,082.00
820,000.0012,116.00205,198.00
920,000.0014,364.00239,562.00
1020,000.0016,770.00276,332.00
1120,000.0019,344.00315,676.00
1220,000.0022,098.00357,774.00
1320,000.0025,045.00402,819.00
1420,000.0028,198.00451,017.00
1520,000.0031,572.00502,589.00
1620,000.0035,182.00557,771.00
1720,000.0039,044.00616,815.00
1820,000.0043,178.00679,993.00
1920,000.0047,600.00747,593.00
2020,000.0052,332.00819,925.00
2120,000.0057,395.00897,320.00
2220,000.0062,813.00980,133.00
2320,000.0068,610.001,068,743.00

Your financial freedom is only 5 clicks away.

With Smart Crowd, you can build a simple & affordable crowdfunding real estate investments portfolio starting from AED20,000
organized financial life

The reason why you’re not rich…YET!

The reason why you’re not rich…YET!

organized financial life
Where There Is A Will, There Is Always A Way! ​
Disclaimer: We don’t have anything against the rich and the poor. We appreciate both classes equally, but we want to encourage a mindset for personal and financial growth.
There has been constant turmoil between the rich and the poor because of the differences and inequalities between the two classes. Aside from the wealth differences between them, it is vital to understand how the rich can sustain their riches. An essential part of that is the mindset – how one would want to invest and grow in terms of assets rather than mistaking liabilities for assets. Financial literacy allows you to be aware of your business and how to make the most of your money, leading to better money habits. It ensures that you aren’t the one who is working for the money, but your money is working for you.

Money habits mostly depend on the mindset.

Economic expansion in the UAE is imminent due to the expected event of EXPO2020. 2019 has already welcomed increased business activity as 6,700 business licenses have been issued and the Dubai International Financial Market has already attracted Dh680 million in net foreign investment.
One of the factors that predominantly exists within the mindset of the poor is that they need to earn a large amount of income to be rich. They don’t necessarily know how to make the most out of their existing earnings and instead feel obliged to save and spend it in the future. Investing money rather than spending money is what will give the real value. The rich vs. poor mindset has a significant gap with regards to how they manage the fear; their will to take risks. Poor people have been saving money and spending it into endeavors that provide them with no return while rich people have been investing money, and earning returns — an intelligent choice, which comes from formal and self-learning about financial matters. Most poor people usually expect their investments to grow into 10x within a month. This short term goal setting merely causes them more loss than gain, and make them less prone to investing their money anywhere with the expectation of low returns.
A poor person might say something like “I want to save up to buy something in the future,” but a rich person might say “I want to save up for a future opportunity.” The poor mindset is the one that needs some more positive alterations if you want to generate wealth.
Rich people, however, make these investments even if the returns are miniscule. Why, you may ask? Because returns are returns, no matter how big or small they are. Putting these returns to use in future investments also allows them to expand in terms of wealth. Dedication to thinking about the future and checking in on your long term financial goals are the building blocks to securing wealth and unlocking your potential.

Sustaining riches comes from long term planning and goal setting.

Starting early can be one of the steps to help you produce a hefty amount of return in the long run. It can start from the smallest of investments with the smallest of returns. It does NOT have to be the biggest investment of your life right away. An example could be that, if someone starts investing a modest (Dh10,000 per year) at the age of 26, assuming a growth rate of 9% per annum, their wealth can grow into millions (close to Dh3 million) by the age of 65.

What are you waiting for?

With Smart Crowd, you can build a simple & affordable crowdfunding real estate investments portfolio starting from AED20,000

Dubai’s economy is BOOMING! and it’s only half-way through 2019!

Dubai’s economy picks up speed, promises stronger Q2 2019

Summary

  • 35% increase in business licenses issued by DED
  • DED issued 9,489 new licenses during Q1 2019
Signalling growing investor confidence in Dubai, new business licenses issued in the emirate during the first four months of 2019 increased 35% compared to the same period of 2018 according to a report issued by the Department of Economic Development (DED).
The DED also has issued 9,489 new licenses during January-April 2019 as Dubai continued to accelerate in line with the emirate’s strategic plan to evolve into a sustainable economy driven by productivity and innovation.
Economic expansion in the UAE is imminent due to the expected event of EXPO2020. 2019 has already welcomed increased business activity as 6,700 business licenses have been issued and the Dubai International Financial Market has already attracted Dh680 million in net foreign investment.
“The secret to getting ahead is getting started.”
-Mark Twain
With investment and economy steadily soaring through the year, it would be an ideal time to start investing in property with SmartCrowd, the crowdfunding platform which makes investments simple.
Investors can now invest in fractional real estate and unlock wealth on a bigger scale due to the rising economy, striving to solve the problem of income inequality in retrospect.

What are you waiting for?

With Smart Crowd, you can build a simple & affordable crowdfunding real estate investments portfolio starting from AED20,000

Why buying off-plan may put property buyers off

Why buying off-plans may put property buyers off

Summary

  • Off plan still very popular. 55% of all real estate transactions were off-plan

  • Historically, only 40% of projects are delivered on time

  • Investors are expected to pay for the property for many years even after handover before generating returns

  • In off-plan you are reliant on price appreciation to make a decent return

Purchasing off-plan properties is still a very popular way to jump into the real estate market, particularly in Dubai. Already in 2019, over half – 55 per cent – of all real estate transactions have been off plan. Investors are eager to be involved in the real estate market, and many first timers are using off-plan purchases as an affordable way to get on the property ladder.

While purchasing an off-plan property may seem like a low-cost way to enter the property market, there are a number of variables that you have no control over that will affect your return on investment.

With so many unknowns, purchasing properties off-plan can turn from an investment to speculation.

Hoping that once the property is handed over it will be worth more than when you purchased it is nothing short of a roll of the dice. Most off-plan properties have an expected handover period of 3 to 5 years, but unfortunately the industry has a bad track record.

Only 40 per cent of projects in Dubai get delivered on time, meaning an off-plan buyer would have to wait even longer to see any return on investment.

During this time, the money that was invested is totally inaccessible in case of a major life change such as a job loss, or a drastic change in the real estate market itself. This puts all of the risk on the shoulders of the buyer.

If you do manage to make it through the nearly six years it might take to receive your property, your return on investment may still not be all that you had hoped. In the current market, off-plan properties are selling at nearly the same price per square foot than the existing or “ready” market. It may be worth more in the future, but then again, maybe it won’t – that is the risk that off-plan buyers take on.

Now with post-handover payment plans, purchasing off-plan can seem even more attractive upfront – but buyer beware. Developers and brokers can be misleading when they claim that buyers will see great returns on a four or eight year post-handover payment plan. They calculate returns based on only what has been paid until the date of the handover, and then determine the rent on that money, ignoring the fact that the buyer will have to pay the remaining 40 to 50 per cent over eight years. Factoring in the cost of the service charges, many times buyers end up paying out of pocket as their returns don’t cover costs.

Let’s take an example of a AED 1 million property that is expected to be handed over on 4 years with 5 year post hand over payment plan. Let’s assume you are required to pay 30% until the handover and the remaining 70% during the 5-year post hand over plan. For simplicity we will assume all payments are paid on a linear fashion. In the first 4 years to handover you will be obliged to invest approximately AED 75,000 per year. Remember this is money being paid to the developer and you are not earning anything on it yet. Once the property is handed over and lets assume you can rent it out for AED 80,000. Lot of agents and developers sell the idea that you have only put in AED 300,000 (AED 75,000  x 4) and are earning AED 80,000 in rent and that is 26% ROI. This is extremely misleading as they forget to mention that you still have 70% of the property value to pay.

On a 5 year post hand over payment plan that equates to AED 140,000 per year. Even if we don’t assume service charges, property management or any other fees you are still required to pay an additional AED 60,000 out of your pocket for another 5 years (AED 140,000 less rent AED 80,000). So for the next 9 years you will only be paying and not earning any return on your money. The post hand over payment plan is good as you got your renter to pay for part of the property purchase. The AED 1 million property only costed you AD 600,000 as the renter paid AED 80,000 per year for 5 years. Now let’s assume the property is worth AED 1.3 million at the end of these 9 years your total return will be an impressive AED 700,000 on your AED 600,000. Not bad at all but it took you 9 years to earn that. However, we have not assumed any delays, any service charges or other costs. If the property prices don’t increase or your rent is less than the returns will be much lower. You need a lot of things to go right your way for you to make money on an investment like this over a long period of time. It could work out or it could not.

You as an investor should be rewarded for the risk you take. Now assume a similar property can be purchased on day one that is rented at the same price. You would buy that for AED 1 million and collect AED 80,000 rent per year and after 9 years that property is worth AED 1.3 million.  In the 9 years you would have earned AED 720,000 in rental income and AED 300,000 in gain on the property for a total of AED 1,020,000.  Keep in mind you did have to park AED 1 million in this case, but you started earning right away and had more control on your investment. If you look at the returns in % terms, there is not much difference.  If you factor in the time value of money the off-plan might have a slight advantage. Total returns are not too dissimilar, but the risk levels are very different. Off-plan is much riskier than buying something that is ready, and you can start earning right away. For higher risk your return should be higher than the alternative. If that is the case and you are getting rewarded more for the level of risk, you are taking than it might make sense to go down that route but if you are getting the same return then why would you take on additional risk. 

Thankfully, there is more than one way to buy into the real estate market without emptying your bank account with a huge upfront purchase cost. Crowd-sourcing platforms like Smart Crowd bring the same affordability that off-plan purchasers are looking for to the ready market by allowing buyers to invest in a fraction of the total property.

With crowd-sourcing investment platforms, buyers don't have to wait years to see returns on their investments. They can start seeing rental income from day one.

In the long-term, crowd-sourcing also protects your investment, as you won’t need prices to increase substantially for you to make high returns. A steady rental income releases you from the ebb and flow of a volatile market. Real estate investment may feel like a gamble, particularly when purchasing off-plan properties. Savvy investors who want to buy into the real estate market without throwing the dice look to group investment platforms to provide a low cost to entry, immediate returns and less risk.

Why it could be the best time to buy a home in Dubai

Here’s why landlords across Dubai are being more flexible than ever before when it comes to prices, rent-free periods, and payment terms making it one of the best times to be a tenant. Our investment director Jake Wright has his say on alternative income structures in addition to short term rental agreements that can secure tenancy. Read more on Khaleej Times.

Expo2020: What can you expect?

Expo 2020: What can you expect?

Connecting Minds, Creating the Future.
Ever since the BIE, Bureau International des Expositions in Paris awarded Dubai to host the Expo2020 in 2013, there has been a constant buzz surrounding what is to come. People’s minds enrage with curiosity as time passes and the date of October 20th 2020 comes nearer. With the Expo only about a year ahead, there have been several advancements made within the site and the concept at the same time. It is only natural for residents and visitors to grow more curious and attracted towards a unique venture that promises to astonish the world in 2020.
The site
The Expo site is located in an area known as Dubai South, close to Al Maktoum International Airport. The site covers 4.38 sq km and has four main entrances. As of now, 2019, there is about 40,000 workers on-site daily to ensure that the project keeps up with its tight schedule, making sure everything is completed within its time.
Free bus tours are currently transporting visitors around the 4.38 square-kilometre site as it nears its completion, throughout the summer. People in the UAE have the golden opportunity to have a hands-on visit to the beautifully structured pavillions before anyone else! The tours take place on Mondays, Wednesdays and Saturdays and will run until August 31st.
The event
Most people have been quite curious about the event itself. What goes on in an Expo seems to be a mysterious aspect to those who haven’t ever witnessed one in the past. Several different countries will be participating within the Expo, showcasing innovations and ideas revolving around sustainability mobility and opportunity.
The hope is to stimulate the development of a knowledge economy here in Dubai. The Expo site is built in a way so that it doesn’t only attract people during the Expo2020 period but becomes one of the landmark tourist attractions of Dubai even after the event. It is expected that we are to welcome 190 participating countries in the region and millions of people across the globe. The theme would inspire innovators to create a better, peaceful world with more interactions, partnerships, socialising and solutions over the six months and beyond.
The sub-themes of the event better help us to understand the essence of the event.
  • Mobility would allow innovators to create smarter and better connections.
  • Sustainability would inspire them to create balance within the world around us.
  • Opportunity would unlock the potential for several new ideas.
What will this do for Dubai?
Once the site is fully developed, it is expected to be home to 1 million residents on average, while accommodating 500,000 jobs. The youth are said to be an integral part of the mega-event since they would be able to avail several opportunities through the Expo. They will also be able to contribute towards a more significant change in the region and retrospect, a difference in the world.
It is a celebration of culture, collaboration and innovation. An anticipated amount of 25 million visitors in Dubai during the Expo 2020 is already increasing the economy charts of Dubai.
According to the National, the public has been enthusiastic about the Expo. In a March 2019 survey, Dubai residents are confident Expo 2020 will deliver a positive impact on the economy, society and culture. Since it is the first event of its kind in the region, the aim is to leave a meaningful and lasting legacy. Not only for the world to witness, but for the residents to stand tall and be proud of as well.

Investments made easy.

With Smart Crowd, you can build a simple & affordable crowdfunding real estate investments portfolio starting from AED5,000

Should you focus on savings or income generation?

Should you focus on savings or income generation?

This question is known and debated amongst, by several different people not only in the financial world but in life in itself. The reality behind this question might be strange to some individuals as they might choose either of the two. Some readers might have already answered this question in their minds, based on their lifestyle and experiences.
Several types of research have led us to find out that attracting wealth has a lot to do with spending habits. When you earn less, there is a tendency to spend in that way, knowing that there is less money to fall back onto, so saving is maximised. The habit that is seen in most people who start earning more is that they begin to change their lifestyle then and there. They change their spending habits following what they make, so they are left with the same amount of money as before and the same situation. Less money to fall back onto and less money saved.
However, it usually does not end up in this for most of the situation that we encounter. Typically, the purpose for people to earn more money is to upgrade their lifestyle. Also, to live a more lavish life that they might have imagined to have when they just started up with a career. Short term luxuries seem fantastic to all of us. However, we need all that money in other specific situations; we usually lack it and fall into a loophole of a money trap problem. There are several things that our minds cannot foresee amid the excitement of earning more. This could include health emergencies, financial emergencies, a sudden loss in business, a sudden loss in an investment made, a lost job or even a natural disaster.
It’s not about earning more or spending less. It’s about earning more AND spending less.
If your goal is to attract sustainable wealth, you need to be doing both.
It is true. Your search towards earning more certainly shouldn’t stop, but you need to make sure that your spendings remain intact. The only way to maximise your earning is if you save a lot of what you earn. Depending on where you are in life, you can begin to think about the long term and how these savings themselves can help you make more money. What you earn adds to what you have already accumulated. It might be exciting to see that much growth in terms of money in your account, but a lot of things need to be considered to KEEP that money.
Investing is one of the most powerful tools that can allow you to accumulate wealth over a period of time. It is an excellent long term solution even when it comes to sudden changes in one’s life since the passive income can be something you can fall back on when it is needed. You can save what you make out of the investment and start building a strong portfolio for your future. As mentioned before, nothing can be predicted, and anything can happen. A strong portfolio is one that is diversified, meaning that returns are generated from several places instead of just one. This allows you to narrow your investment risks and make use of your profits if one investment supposedly fails.
Working smart in terms of both earning and saving can save you and your family from a lot of trouble. It can even set an example for those around you, and you may be able to inspire others into adapting to a healthy, long-term mindset. In this way, you won’t only be helping yourself, but also indirectly guiding the others around you to be better, smarter people.
Do you think one is better than the other? Or, do you believe that earning and saving are both essential aspects of getting through the maze of finances?

Affordable real estate investments

With Smart Crowd, you can build a simple & affordable crowdfunding real estate investments portfolio starting from AED 5,000

Women in the Investment Market

Women in the investment market

Not all heroes wear capes — but women investors should undoubtedly do so. Before we explore all the new arising opportunities for women in finance, it would only be fair to take a look back at the history of women in finance. Women have often been overlooked with regards to positions of power. There has also been an evident early history of discrimination in the industry.
History
Geraldine Weiss, an investment advisor, was one of the first women to make her name in the market. She learned everything about finance and investing from reading, research, listening to her parents’ conversations and studying finance at college. Investment firms were not keen on hiring her. Then, being a secretary was more relevant as a “womanly” profession, than being a financial professional. Despite her knowledge and studies, she was not able to attain a job within the sector. It was only in 1966, by the age of 40, that she decided to start her investment newsletter. Since she didn’t want to involve gender discrimination with what she did, she always ended her newsletters with “G. Weiss” rather than her name. When she gained a sustained amount of success concerning her newsletter, she revealed her identity as Geraldine. She further went on to publishing her newsletter “Investment Quality Trends”, for 37 years until she retired in 2003. The newsletter still exists and still follows Weiss’s strategy.
This has a lot to do with why there is such a big gap between women and investments. The main question is, why don’t women actively invest in their financial security?
Although in recent days, things have been notably more smooth, it is sometimes seen that financial professionals treat women differently. They are even less likely to listen to investment ideas from women and are also expected to push women out of business conversations. This might not be intentional, but it can be one of the most predominant reasons as to why women don’t try in the first place. Women have more detailed factors to their investments. For a male advisor, this might be difficult to understand. This is known because 29% of women prefer female advisors since they can relate to their reasonings more.
What does progress look like?
The fact that financial professionals and companies are becoming more comfortable with accommodating more women investors, there have been several successful investments made by women. Some even generating more returns than men usually would from their investments. The growing advancement in more women-friendly financial improvements opens new opportunities for women, as more come forward with new ideas in terms of businesses and ideas. According to Forbes, 96% of women have shared responsibility for their family’s financial decisions. It shows an immense amount of advancement in terms of the discriminating of the past and the evolving open-mindedness of the present.
Even though women investors are less in number, they are proved to be much more successful in terms of their investments due to the fact that they think about money differently than men. The transition from traditional “budget makers” to “investment experts” wouldn’t be too far off, since women have historically managed finances within the household. The success rate should urge and inspire more women to step their foot forward to step onto the investment ladder to reach for their financial independence. We at Smart Crowd, are part of a movement where educating and empowering women to take control of their finances is normalised, as we strive to make investments accessible to everyone, regardless of their gender. Education is key to shifting the mindset and perception of women as investors.
"You can only truly become accomplished at something you love. Don't make money your goal. Instead, pursue the things you love doing and then do them so well that people can't take their eyes off you."
Maya Angelou

Affordable real estate investments

With Smart Crowd, you can build a simple & affordable crowdfunding real estate investments portfolio starting from AED 5,000