So the principle of a five year loan. So where I use this is basically when people have their own home and they've got some equity in their home and they're not sure about using. They're emotionally attached to paying down their mortgage because that's what we're taught to do. The reality is that's often not the best thing to do for you. It's better to take some equity out of the home and invest it into another property so you start getting your portfolio working for you.
The thing is, that concept is hard for some people to agree with because you're taking on more debt. So what we have to look at doing is rather than just seeing it as taking on more debt and we're never going to pay this down and the mortgage is going to increase on the home and all the emotions go along with that, what we do is we say, "Well listen." What you're doing is you are granting yourself a five year loan. Now the reality is you still owe the money here. What you're doing is you're going to increase the money here, but you going to put it in this. The equity doesn't change too much. There'll be some costs in there, but effectively you take that on a five year loan.
The impression is that you're taking the money out of your equity in your home and you're putting it into an investment. The idea is you're going to pay that back in five years time. The strategy you use is based on paying that back in five years time. When you do that, that tends to open up the ability to go, okay, I can see that. I'm not just never going to pay off the home loan. That's the fear. What I'm doing is I'm borrowing from there, putting into here in the hope that this will then make enough money to pay that back in that five years time. That works really, really well for a lot of our clients if they're struggling to get their head around, when they're first starting out.
Practically what happens, I find, is that that five year loan is forgotten in most cases. They'll make rent. This will go well. They'll sort this out and then all of a sudden they'll start to sort out the emotional side and deal with that and then it's never a problem. So that's the principle of a five year loan if you're struggling to sort of get her your head around borrowing from the equity in your home to use for an investment. You absolutely should look at doing it because it can really catapult your portfolio into just another league. Rather than being a one-house family, which most people are in the world, you join the ranks of being a landlord and a multi-property landowner and really all the benefits that go along with that. They are substantial. You put yourself in a different class of person and I'm not talking about who you are or you know what you're about. I'm talking about the fact that financially, if you look at the wealthy classes, they own property and you can join them.
This is the first step. Getting that first property is the first step into joining them. It's absolutely essential and important I think to do that and get involved in that. Long-term when it comes to retiring and pension, that is what's going to sustain you more so than what I see happening with pensions. All right guys, any questions? Comment, subscribe. I love to have conversations. We'll chat real soon. See you later. Bye.