To win the fiat game, you need to trade depreciating assets (dollars) for appreciating assets, or at least stores of values (stocks, commodities, Bitcoin).
Most everyone does this already with home mortgages. But for the W-2 and 1099 readers out there, you probably are not taking advantage of the available loans through the Small Business Administration.
Short Recap on the Fiat Game
- Borrow Dollars
- Put it in assets
- Repeat as needed
When you put it into a store of value (Bitcoin, gold) then the game stops. You’re out of dollars.
You can restart the game if the asset price rises, and your equity in it is a higher percentage (like getting a HELOC).
If your asset is flat, down, or isn’t income generating, it’s more difficult to get financing for that kind of thing.
Income Generating Assets
This one is more interesting, because it lets you keep playing the game over and over. Borrowing for something that is income generating on paper (even if it’s not making an actual profit) like a rental property or business is easier.
You can eventually buy yourself out of the loan, or increase your equity as the business grows and keep borrowing that way.
This only keeps working if you’re truly generating profit.
One of those paradoxes of life is how businesses that don’t need cash can get it easily. Those that really need probably won’t get it.
If your rentals are making money, then of course you’re safe to lend to, because you’ll repeat the business somewhere else.
If your business is making money, then of course you can get a loan, because opening a second location will probably be successful.
SBA Loan Changes
Recent changes to SBA loan rules means non-citizens can no longer get them. If you’re a US citizen, it’s now easier for you to get an SBA loan.
There are definitely opportunities that require minimal upkeep in personal man-hours which you can still use an SBA loan to buy or build.
(Especially with boomers actively retiring, you may not need to start a brand new business, but just acquire one that’s already out there.)
The stereotypically most common minimal-upkeep businesses are storage facilities, laundromats, and car washes. Self-service places with simple supplies for upkeep. Spend a lot of effort vetting and building, and then just do occasional troubleshooting and maintenance. The skill level required for people onsite is low enough that it’s easy to hire any workers who need to be onsite.
For me personally, I’m exploring the idea of using an SBA loan to build a Tesla supercharging station.
This guy is fascinating to me. He’s doing a small-town business with friends and family, going with a very “general store” homestead type of vibe.
Combining that with a hosted Tesla supercharger is brilliant because (1) superchargers are not common in rural areas, (2) it attracts people with disposable income, and (3) a supercharge takes around 15–30 minutes to charge, which is enough time for someone to pop into a store, have a bite or buy some kitsch, or maybe explore.
Superchargers end up on Tesla maps, so it’s free advertising, too.
They take essentially no maintenance once they’re set up, maybe calling in a technician for repairs if something bad happens.
Every business needs to be vetted, but if this idea makes even a modest amount of profit, and there’s a “free loan” waiting for me to take advantage of it, then the only cost this is asking for is the time to set up a brilliant location.
This is exactly the type of side business a working professional should take advantage of.
