When I was growing up, like many of you I played the popular board game Monopoly. One important principle I learned from the game has served me well through out my career as an investor. In fact, the basic strategy has been a key influence in the way I think about wealth.

Four green houses lead to one red hotel.

If you’ve played the game, you know exactly what I’m talking about.

If you haven’t played the game, the basic idea is that after you collect some property, you can invest in building small green houses on the property. Each house increases the rent other players must pay you when they land on your property. As you make money, you can add extra houses to your property and your rents go up. After four green houses, you can upgrade to a red hotel – the big money.

For some that was just a game. For others, it’s became a principle for successful real estate investing.

Think about it like this. When you start investing in real estate, chances are you’ll start with a property and then two and you’ll start to watch your monthly cash flow begin to build. The amount may not immediately be huge, but it gets you going in the right direction. You then have options of trading up to bigger more lucrative real estate investments, or simply re-investing your profits in additional units – but the key is that you can take your positive momentum to continue to increase your real estate wealth (and cash flow).

It becomes a process that you can repeat over and over and eventually you do more than win a game of Monopoly – you can experience true financial freedom