Financial expert Dutch Mendenhall’s book “Money Shackles: The Breakout Guide to Alternative Investing” begins with a provocative question: “Have you been sold someone else’s American Dream?” According to Mendenhall, many people have. But the good news is that it’s possible to break free from these limiting beliefs about money and create a new life for yourself — one full of prosperity.
“Alternative investing strategies offer effective, but frequently underutilized strategies for building wealth,” Mendenhall says. “They even often come with advantages that conventional methods can’t match. It might sound new or unconventional, but that’s no reason to get intimidated. Exploring these options allows you to redefine the American Dream for yourself.”
Common ways people are shackled
According to Mendenhall, people often find themselves shackled in several key ways regarding finances and investing. “First and foremost, people must overcome the traditional mindset of their upbringing,” he says. “They’ve been taught to rely on a job, savings accounts, and conventional investments like a 401(k). But the truth is this mindset limits our financial potential. It doesn’t account for other ways to grow wealth significantly.”
Similarly, many people rely solely on the active income they obtain from a job. “True financial freedom comes when you establish passive income streams that work for you, even when you’re not actively working,” he says. “Shift your focus from solely earning through active work to creating wealth through strategic investments.”
Another reason people might sabotage their own financial future is fear of risk. “Some people are afraid of failure or uncertainty, so they stay within their comfort zones,” Mendenhall says. “As a result, they miss out on valuable opportunities.”
He cites a lack of education next. “Without proper financial education, it’s challenging to make informed decisions,” he notes. “Meanwhile, it’s easy to feel uninformed and helpless.” A lack of financial literacy also results in people using their resources inefficiently. “A lot of people find themselves mired in financial struggle just because they don’t know how to leverage their capital and time to build wealth,” he says.
By learning how to make alternative investments, however, people can throw off their previous misconceptions and take their financial future back into their own hands.
The Four Freedom Principals
“Alternative investing strategies make wealth work for you,” Mendenhall explains. “They break the shackles of traditional financial thinking.”
According to Mendenhall, people can obtain financial independence by adopting four “Freedom Principles.”
“Achieving financial freedom requires more than just a single skill or strategy,” he explains. “It requires not only a holistic understanding of personal finance, but also the daily discipline to adhere to these concepts.”
The first of these Freedom Principals advises readers to save on taxes. “Many people underutilize tax-efficient investments and tax loss harvesting from depreciation,” Mendenhall explains.
The second involves increasing earning potential through side hustles, networking, and learning new, marketable skills. The third recommends strategies for avoiding consumer debt and cutting unnecessary spending, so that potential capital isn’t lost through carelessness.
The fourth and most important, however, is learning how to invest wisely through alternative investments. “Many people mistakenly think that a diverse portfolio only contains stocks, bonds, and mutual funds,” Mendenhall says. “But all of those strategies depend on the stock market. For true diversification, your holdings should include investments outside this traditional realm.”
Alternative real-estate investments
What are these alternative investments? “Consider allocating a portion of your investment portfolio into real estate assets,” Mendenhall says. Recognizing that, for many people, purchasing real estate themselves is out of reach, he recommends investing in vehicles that provide access to the real estate market instead.
For instance, Real Estate Investment Trusts (REITs) own, operate, or finance income-producing real estate. This enables individuals to acquire a wide range of real estate assets without the headaches of owning and managing the properties themselves. “REITs often pay dividends to investors, making them an income-generating option,” Mendenhall says. “Thousands of investors have gotten into the game with our own REITs, RAD Diversified and RADD America.”
Another alternative is real estate crowdfunding — online platforms that pool the resources of groups of investors. Similarly, professionals manage private real estate funds that enable collectives of investors to invest without the headaches involved in making investment decisions. It’s even possible to team up with family and friends to invest in real estate together.
While many people choose to invest in residential, commercial, or industrial real estate, Mendenhall is bullish on other tangible assets like farmland and timberland. Even infrastructure projects can present opportunities to individual investors. “These assets can provide great diversification to your portfolio,” he says. “They can also generate income.”
In addition to diversification and passive income, alternative investment strategies like these can bring tax benefits. “Don’t forget depreciation deductions,” Mendenhall says. “Real estate owners can often claim these. It’s also an effective hedge against inflation.”
Real estate investments also come with risks, however. “Markets fluctuate,” Mendenhall says. “There can also be challenges related to liquidity. Some properties require active management.”
Live a rich life
At a time when Wall Street has been a rollercoaster, alternative investing offers a better way to build wealth. “It’s about expanding your financial toolkit for a well-rounded wealth-building strategy,” Mendenhall concludes.
Imagine living a life of wealth and abundance. By getting into alternative investments, you can.