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Honest question for RDP...

hallett21

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I have a friend that was in my garage not that long ago.. He was telling me a story about his buddy that got "big money" and basically told them they weren't going to hang out anymore for various reasons, but it came down to the money..

My buddy that was in the garage went from my kinda money to "Real" money over the last couple years and he went by the first guy in his Viking that is bigger than the first guy.. I guess the first guy was mad or something about it because my buddies boat is bigger.

When he got all done telling me the story I told him "that guy was never your friend." LOL.

I don't treat anybody differently, and I know Billionaires (yes with a B, there are a couple on RDP), to guys like Jonathan said that are on the cusp of it, to guys with 50 mill to guys with 50 bucks..

They are either cool, or they aren't.. and I don't give a shit what their bank account says.. LOL. If they are being a douche they'll get booted out of my garage / rdp after party / you name it same as anyone else.





Back to the point of the thread though.. I was really enjoying hearing peoples different view points, and was looking forward to some of the ways "normal guys" like myself are using to Catch a little extra cash here and there.. What they can do to make their assets work for them to create more money..


TAX SAVINGS is a huge one that I know nothing about.. I was talking to one of my buddies and he said "Dave all your kids should be salaried employees making xyz a year" with some sorta tax loophole.. Of course he said that to me three sheets to the wind, and now when I press about it when he's sober he says "get a tax guy". None of my tax guys tell me how to do shit like that. LOL

RD
Lol why is it always people who aren’t accountants giving that advice?

I know plenty of successful business guys who know every loop hole in the book. I often wonder if they all could survive an audit.

My in-laws run a successful CPA firm. They only let the wife and I write off what we legitimately can prove lol.


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attitude

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Ok I’ll bite, like Waterjunkie I feel like I’m going to be coming up to a crossroads shortly. A little bit of a back story. At 23 I was living at home, over the previous year I had been promoted a time or two at work and received about a 50% pay raise. I had also starting working on my bosses race team on the weekends, I was putting money in the bank and feeling good. I decided to buy my dream corvette and boom two weeks later my girlfriend is pregnant. No big deal, we’ve been together for years and we can afford to move into our own place. At 23 I just paid of my 4 year old truck, had my dream car, just moved into my own house (rental) and had a baby on the way, I felt like I was on top of the world. I’m going to be 26 this year and the money I was making at 23 just isn’t cutting it now, iv received about a 10% pay raise sense then but that’s not enough for the lifestyle I want to raise my family with. What I love about my Job is that it is close to my home (5 miles) I work 4-10s and I have very good job security here. On the contrary Ive pretty much reached the ceiling on how far I can go. At what point do you trade in time with your family and job security for something with more money, more risk, and less time at home? We plan to have another kid within the next year or so now that or son is about to be 2. Do I wait until our second baby is a little older? Do I wait and see what’s going to happen with the economy? Or do I just say fuck it time is money and start looking now?
 

hallett21

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Ok I’ll bite, like Waterjunkie I feel like I’m going to be coming up to a crossroads shortly. A little bit of a back story. At 23 I was living at home, over the previous year I had been promoted a time or two at work and received about a 50% pay raise. I had also starting working on my bosses race team on the weekends, I was putting money in the bank and feeling good. I decided to buy my dream corvette and boom two weeks later my girlfriend is pregnant. No big deal, we’ve been together for years and we can afford to move into our own place. At 23 I just paid of my 4 year old truck, had my dream car, just moved into my own house (rental) and had a baby on the way, I felt like I was on top of the world. I’m going to be 26 this year and the money I was making at 23 just isn’t cutting it now, iv received about a 10% pay raise sense then but that’s not enough for the lifestyle I want to raise my family with. What I love about my Job is that it is close to my home (5 miles) I work 4-10s and I have very good job security here. On the contrary Ive pretty much reached the ceiling on how far I can go. At what point do you trade in time with your family and job security for something with more money, more risk, and less time at home? We plan to have another kid within the next year or so now that or son is about to be 2. Do I wait until our second baby is a little older? Do I wait and see what’s going to happen with the economy? Or do I just say fuck it time is money and start looking now?
What’s your background?

If you took your shot and failed could you get something going in the next 60 days to pay the bills? Whether that’s your old job or something similar?


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Taboma

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Lol why is it always people who aren’t accountants giving that advice?

I know plenty of successful business guys who know every loop hole in the book. I often wonder if they all could survive an audit.

My in-laws run a successful CPA firm. They only let the wife and I write off what we legitimately can prove lol.


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When I was mid 20's, I followed "Some Guy's" tax advise and " Don't worry, they'll never question this" plan --- Ummmm, no, they not only questioned it, I had to appear before the IRS, then with a straight face claim I'd lost all the receipts. Which I know they'd never heard before. 😂
After they fucked me, the gang bang continued with the state bro's, my ass was sore for later after following that tax advise.
I've had my same ole accountant gal since then, when I get frustrated by her conservative ideals, I think back to that sore ass and then thank her.
 

RiverDave

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I'd be far more wealthy if I had the balls to be. My dad was a penny pincher and played it really conservative, never wanted for anything and died an honorable, man, but not rich, but certainly comfortable. I tend to be conservative, and my wife makes me look like a dare devil --- different strokes for different tolerance levels.

Growing up my Dad's best friend and boat racing partner, one of the most interesting men I've ever met, owned the biggest home on Lake Arrowhead, first Mercedes Benz dealership in Palm Desert and hung with the Rat Pack when they were in Palm Springs. His son and I grew up best friends, until their family shit hit the fan in about 70'. This is NOT the Amway friend who lived in Havasu I mentioned.
Johnny Carson was a regular house guest and taught me card tricks as a kid.

Ole Bill (The most interesting man in the world look and act alike) had done it all, could talk you out of your pants and you'd thank him laughing your ass off as you were walking away in your skivvy's. Later had two homes, one on Long Island sound, another in Del Ray Beach FL. His son and I who'd I'd grown up with at Lake Arrowhead took their motorsailer to the Bahamas towing a 17' Boston Whaler when I'd fly out to vacation with him.
He was by all indications filthy rich and had been for as long as I could recall back into the early 50's. I thought it odd after his son Hank and I returned from the Bahamas, here was the X-rum runner worldly Bill asking if I had $ 200 I could loan him. Loan him ? Fuck, I've been on your boat with your son for a week burning your fuel money, hell yes, here's $ 200 you're welcome to it, want more ?
I even spoke with Johnny Carson from his phone that evening, and hadn't spoken with him since I was a kid. When I flew out the next morning, something still felt off.

A month later, my forever man hero Bill, the most interesting man I'd even met, was dead of a heart attack. The shocking news was, he and his family were flat broke and didn't have a single pot that was their own to even piss in. His entire existence was an elaborately fabricated lie, it was a ruse, nothing about it was real and he owed money to everybody and I do mean everybody. He was as it turns out, the ultimate con man and so good at it, he'd pulled it off for so many years, it was his and his family's normal and it came as the biggest shock to both his wife and son.

There is no moral, other than things are not always how they appear.
Well I enjoyed the rat pack and Carson portion of the story.. I'm not sure why you keep posting stories about people that were wealthy (or in this case fraudulently wealthy) that died of heart attacks broke.. ?

I don't want to die of a heart attack broke. Hence the reason why I was talking to some people about learning more about money and how to make it work for you. Would you like to be part of that conversation? Or suggest I'm gonna sell Amway, and keep posting downer stories about why people should stay in their lane or their box.. You stay in your box if that's what makes ya comfortable.. I want to fill my box full of hundreds and get another box and do it again.

RD
 

RiverDave

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When I was mid 20's, I followed "Some Guy's" tax advise and " Don't worry, they'll never question this" plan --- Ummmm, no, they not only questioned it, I had to appear before the IRS, then with a straight face claim I'd lost all the receipts. Which I know they'd never heard before. 😂
After they fucked me, the gang bang continued with the state bro's, my ass was sore for later after following that tax advise.
I've had my same ole accountant gal since then, when I get frustrated by her conservative ideals, I think back to that sore ass and then thank her.
Jesus, do you have like a rain cloud following you around?

RD
 

RiverDave

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Ok I’ll bite, like Waterjunkie I feel like I’m going to be coming up to a crossroads shortly. A little bit of a back story. At 23 I was living at home, over the previous year I had been promoted a time or two at work and received about a 50% pay raise. I had also starting working on my bosses race team on the weekends, I was putting money in the bank and feeling good. I decided to buy my dream corvette and boom two weeks later my girlfriend is pregnant. No big deal, we’ve been together for years and we can afford to move into our own place. At 23 I just paid of my 4 year old truck, had my dream car, just moved into my own house (rental) and had a baby on the way, I felt like I was on top of the world. I’m going to be 26 this year and the money I was making at 23 just isn’t cutting it now, iv received about a 10% pay raise sense then but that’s not enough for the lifestyle I want to raise my family with. What I love about my Job is that it is close to my home (5 miles) I work 4-10s and I have very good job security here. On the contrary Ive pretty much reached the ceiling on how far I can go. At what point do you trade in time with your family and job security for something with more money, more risk, and less time at home? We plan to have another kid within the next year or so now that or son is about to be 2. Do I wait until our second baby is a little older? Do I wait and see what’s going to happen with the economy? Or do I just say fuck it time is money and start looking now?
I would be looking into what you can do on the weekends to generate extra cash, and I'd be WILDLY aggressive on investing it at first until it grew then be more conservative. I don't know what your skills are so I can't suggest what to do part time on the weekends.. If it's web based you'd be surprised how you can still spend time with the family, but make money at the same time on your phone.

For myself I'll do odd machining jobs if someone needs it.. Or I will buy and sell cheap shit, and try to turn % profits etc.. I know a guy that does alright slinging used golf cart parts out of his backyard on his spare time.
RD
 

Tooms22

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I have grown to learn that you can't tell how people actually afford/buy anything due to credit, loans, trusts, co-signers, inheritances, etc.

But here are a few things I look at: Kids, financial risk, interests

Kids: If you have kids, you can usually afford less. Sports, healthcare, college, wanting to leave them something when you pass.

Financial risk: Some people make $500k a year and buy $40k boats. Some people make $100k a year and finance $125k boats. Unless they tell you their income, you don't really know where they fall on the spectrum. Even then, you don't know how much they spend on other crap.

Interests: If boating is your only thing you love to do, then you'll likely spend more on your boat. So tie in the example above: maybe the $500k a year family goes on 20 diverse vacations throughout the year, has a million dollar home, has 4 nice cars, and has 2 vacation homes. The $100k a year person could be living well below their means in every other aspect of life but spends big on the boat. Both are probably in over their head but it's all about what you prioritize.

I just assume that a dude with an old jet boat could be making way more than me or the guy with the new Howard deckboat could be making half as much as me. I'll never know. It just depends on how they run their finances.
 

attitude

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What’s your background?

If you took your shot and failed could you get something going in the next 60 days to pay the bills? Whether that’s your old job or something similar?


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I work as a PM for a telecommunications engineering firm, basically we design routes and get permits for projects such as the new Verizon 5G system. I could probably either get my old job back or find a new one but it would be tough as our industry has been slow since about November last year and we are just starting to pick back up. That is another reason I like this job because we had to lay off 1/3 of our employees last year but I have decent job security.
 

attitude

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I would be looking into what you can do on the weekends to generate extra cash, and I'd be WILDLY aggressive on investing it at first until it grew then be more conservative. I don't know what your skills are so I can't suggest what to do part time on the weekends.. If it's web based you'd be surprised how you can still spend time with the family, but make money at the same time on your phone.

For myself I'll do odd machining jobs if someone needs it.. Or I will buy and sell cheap shit, and try to turn % profits etc.. I know a guy that does alright slinging used golf cart parts out of his backyard on his spare time.
RD
I work as a PM for a telecommunications firm, I have CAD experience but only 2D not 3D. I was thinking about learning how to wrap vehicles as my little brother has a dirt bike graphics business and my step dad owns a label company and can get material at cost, but that was just more for mine and my friends vehicles. There is something about wrapping that makes my OCD happy when it comes out perfect lol.

Also, I am pretty active in the stock market thread, so far I’ve manage to make a couple hundred here and there but nothing big so far.
 
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clarence

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TAX SAVINGS is a huge one that I know nothing about.. I was talking to one of my buddies and he said "Dave all your kids should be salaried employees making xyz a year" with some sorta tax loophole.. Of course he said that to me three sheets to the wind, and now when I press about it when he's sober he says "get a tax guy". None of my tax guys tell me how to do shit like that. LOL
If you have a non-incorporated business and you hire your minor children as employees, what you pay them is a deduction to the business. Neither the business nor your children have to pay payroll taxes like Social Security and Medicare on that income, and up to $12,200 in income can be earned before any federal income tax is due. Just be sure the work they are doing is reasonable for their age and their wage is reasonable for the work. Keep good records. My favorite child job? Modeling. But there are dozens of others.


 

Canuck 1

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I work as a PM for a telecommunications firm, I have CAD experience but only 2D not 3D. I was thinking about learning how to wrap vehicles as my little brother has a dirt bike graphics business and my step dad owns a label company and can get material at cost, but that was just more for mine and my friends vehicles. There is something about wrapping that makes my OCD happy when it comes out perfect lol.

Also, I am pretty active in the stock market thread, so far I’ve manage to make a couple hundred year and there but nothing big so far.
At 25 years old you need to learn patience. As others have eluded to .... 9-5 pays the bills, 5-9 is where the extra comes from. Eventually you will find your angle
 

RiverDave

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If you have a non-incorporated business and you hire your minor children as employees, what you pay them is a deduction to the business. Neither the business nor your children have to pay payroll taxes like Social Security and Medicare on that income, and up to $12,200 in income can be earned before any federal income tax is due. Just be sure the work they are doing is reasonable for their age and their wage is reasonable for the work. Keep good records. My favorite child job? Modeling. But there are dozens of others.


I have no problem actually paying my kids to be child models.. lol. I got good lookin kids! Plus they have more rdp shit in their closets than I do.. 😳
 

CarolynandBob

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This may be way off base for this tread, It is more of a mind set question. Dave, if it take this tread in the wrong direction than what you wanted, then please delete.

You have a chance to play and win the power ball lottery or what ever the one that pays out the huge winnings. Say you won $500 mil after tax, do you do it? This is life changing money for you and your family for generations.

For me the answer is no I do not want it. I know it sounds crazy, but I think it would change you and your life so much, that you probably wouldn't be as happy.

The way I think about it. I am happily married, have great friends and good family. Now you throw that much money in the bank and now you cannot relate to those same people the same way you use to. Your problems change. I think you would lose most of your friends over jealousy, them wanting loans or gift or whatever. I would think your family would expect to get on the easy train as well. At least some of your family. It may also put different strains on your marriage.

Now you have to be weary of everyone, because you don't know if they are trying to scam you.

Now if I could win a few million anonymously, then I would take that as no one would know and it wouldn't change your life that drastically.
 

YeahYeah01

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I see a lot of guys that own their own business, make a lot of money and carry a lot of stress along with it, sometimes for decades. Where three day weekends aren’t worth being away from the company because you end up working all day mon/fri anyway on the phone. I also know some people that work for companies that make north of 200k without all that stress and a ton of vacation and flexibility in their schedules. Which guy is living better?
That's my thought as well. I meet a lot of business owners and do business direct with them. The question of why I don't own or start my own business comes up a lot. I know the industry I am in from the bottom to the top and understand.

There are times where I think it would be a good idea but the amount of liability and stress that comes with it just does not pencil out right now. We have a solid profit sharing plan for upper management so I get a significant cut of all my projects with out the liability of owning the company.
 
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Tobester

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Our plan is to build wealth through real estate. The wife and I have gone through several renovations of our primary residence. We have moved, bought and sold 3 time in the past 6 years. Each time earning and increasing equity gains in order to meet our goal to live in downtown Huntington Beach. We are somewhat settled down now as our kids are starting school and we want to provide some stability for them.
In August 2019 we purchased a lot in Havasu and we should be getting the C of O for our new house this month. This will be our vacation home but we also plan on using it as a short term rental to cover the mortgage. Since we have gone through the construction loan and build process homes prices in Havasu have continued to increase. Wife and I are refinancing out of our construction loan and into a 30 year fixed. Since we have considerably more equity after the appraisal we made the decision to do a cash our refi. We both had to change our mindset and approach our investment property from an investors perspective (I think this is hard for many people to do). So, were pulling $25K out and plan on using the cash to purchase a rental property in Tennessee or Georgia. We had a few deals accepted last year in Georgia but backed out due to the uncertainty of Covid. With the cash out refi our mortgage will increase approximately $125 a month on the Havasu house. With our income the increase in mortgage is low risk and we know we can purchase properties in Georgia that cash flow between $400-$600 a month.
Our goal is to buy one investment property a year. The faster we can compound properties the faster we will be on a path to wealth. Not rich but wealthy.
My idea of wealthy is the ability to live where you want and maintain a life style of your liking within the income of your choice.
 

RiverDave

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This may be way off base for this tread, It is more of a mind set question. Dave, if it take this tread in the wrong direction than what you wanted, then please delete.

You have a chance to play and win the power ball lottery or what ever the one that pays out the huge winnings. Say you won $500 mil after tax, do you do it? This is life changing money for you and your family for generations.

For me the answer is no I do not want it. I know it sounds crazy, but I think it would change you and your life so much, that you probably wouldn't be as happy.

The way I think about it. I am happily married, have great friends and good family. Now you throw that much money in the bank and now you cannot relate to those same people the same way you use to. Your problems change. I think you would lose most of your friends over jealousy, them wanting loans or gift or whatever. I would think your family would expect to get on the easy train as well. At least some of your family. It may also put different strains on your marriage.

Now you have to be weary of everyone, because you don't know if they are trying to scam you.

Now if I could win a few million anonymously, then I would take that as no one would know and it wouldn't change your life that drastically.
I disagree entirely.. If you let money change you than that’s on you. You might lose a few friends to jealousy.. They weren’t your friends to begin with.

Besides everyone knows the standard operating procedure when you when the lottery is to call everyone you know and ask them to

A. Either borrow a large some of money
B. Help you move..

If they say no in either direction than they get nada.. zip, zilch. Nothin!!

If they say yes, tell them you will get back to them as you may be able to figure it out yourself. :D.

In for a pound right? Help those that would help you.
 
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RiverDave

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Our plan is to build wealth through real estate. The wife and I have gone through several renovations of our primary residence. We have moved, bought and sold 3 time in the past 6 years. Each time earning and increasing equity gains in order to meet our goal to live in downtown Huntington Beach. We are somewhat settled down now as our kids are starting school and we want to provide some stability for them.
In August 2019 we purchased a lot in Havasu and we should be getting the C of O for our new house this month. This will be our vacation home but we also plan on using it as a short term rental to cover the mortgage. Since we have gone through the construction loan and build process homes prices in Havasu have continued to increase. Wife and I are refinancing out of our construction loan and into a 30 year fixed. Since we have considerably more equity after the appraisal we made the decision to do a cash our refi. We both had to change our mindset and approach our investment property from an investors perspective (I think this is hard for many people to do). So, were pulling $25K out and plan on using the cash to purchase a rental property in Tennessee or Georgia. We had a few deals accepted last year in Georgia but backed out due to the uncertainty of Covid. With the cash out refi our mortgage will increase approximately $125 a month on the Havasu house. With our income the increase in mortgage is low risk and we know we can purchase properties in Georgia that cash flow between $400-$600 a month.
Our goal is to buy one investment property a year. The faster we can compound properties the faster we will be on a path to wealth. Not rich but wealthy.
My idea of wealthy is the ability to live where you want and maintain a life style of your liking within the income of your choice.
You are buying rental properties abd pulling 400-600 cash positive a month? Or that’s the total rent?

I know a guy that is buying properties in Ohio and paying 75k’ish and pulling 750 a month in rent.. the numbers are AMAZING for a rental. I am considering jumping on that train.

just wondering how those stack up against your numbers?

One thing that I like about a vrbo property at a vacation spot is you get to use it every now and again which offsets the spending on a vacation.. Ohio / Georgia etc (cheap rentals) doesn’t exactly check that box.
 

Mrs. Riley1

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We are in the market for our first rental property as well. We are looking in Nevada though and planning on getting an extra $300-400 a month over the mortgage. We are not trying to make money now. We are looking to have an extra income stream in retirement. The plan is to purchase three properties and have them paid off by the time we retire which would give us about $4000 a month in income to go along with my husband’s pension.
 

LargeOrangeFont

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You are buying rental properties abd pulling 400-600 cash positive a month? Or that’s the total rent?

I know a guy that is buying properties in Ohio and paying 75k’ish and pulling 750 a month in rent.. the numbers are AMAZING for a rental. I am considering jumping on that train.

just wondering how those stack up against your numbers?

One thing that I like about a vrbo property at a vacation spot is you get to use it every now and again which offsets the spending on a vacation.. Ohio / Georgia etc (cheap rentals) doesn’t exactly check that box.
Anything in the mid west to south is a much better investment right now. Why would I spend $300K in Phoenix to make $500/month when I can spend $300K in the midwest and probably buy 2-3 houses that make $500 a month each. The equity does not build like it does out west however. You have to look at it as a long term, "annuity" based portfolio.

1% of the purchase price in rent per month is a great metric to hit.
 
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Singleton

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Lol why is it always people who aren’t accountants giving that advice?

I know plenty of successful business guys who know every loop hole in the book. I often wonder if they all could survive an audit.

My in-laws run a successful CPA firm. They only let the wife and I write off what we legitimately can prove lol.


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you have ethical accountants and unethical.
My FIL ran the family farm for years. Like all family farms, your kids end up working the farm.
His original bookkeeper retired and he got a new one. New guy was younger and ran it like a business not a farm.
First thing done was putting all family members who worked the farm on payroll. However the kids had no idea they were getting paid. When he sold the farm, all the family members who worked received the bank account data to the savings account were all payroll checks were deposited into. Wife got a nice little bonus as well as my two older boys who worked the farm in the summer
 

riverroyal

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for myself my family income hasnt changed much in 15 years. Problem is everything else has sky rocketed. Buying a 100k boat in 2005 was no big deal. Buying a 200k boat now is out of the question.
At 52 now Im not changing anything, careers or large purchases for at least 3 more years. At 55 the pension penalties change, I will revisit a new 'career' then.
Now....if I was 30 I would get out of construction all together.

How are people buying 200k boats now? refi, inheritance, finance most of it.
If you bought a Nordic in 2015 for 120k that boat will sell for 130 plus today. So, buy smart and the expensive toy is sort of free. 700k DCBs, thats just FU money, but good for anyone that can do!
 
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hallett21

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I'm gonna sling tacos on the corner when I retire. It is rare to see a taco cart empty. Or just go be a greeter at Bass Pro Shop.
We lived around the corner from one in Pasadena. I bet that truck made 5k a night. All cash.


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DWC

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You are buying rental properties abd pulling 400-600 cash positive a month? Or that’s the total rent?

I know a guy that is buying properties in Ohio and paying 75k’ish and pulling 750 a month in rent.. the numbers are AMAZING for a rental. I am considering jumping on that train.

just wondering how those stack up against your numbers?

One thing that I like about a vrbo property at a vacation spot is you get to use it every now and again which offsets the spending on a vacation.. Ohio / Georgia etc (cheap rentals) doesn’t exactly check that box.
I’d be interested to hear what maintenance is like in a VRBO vs rental. Seems like the churn could do a little damage. Any inmates with some experience? Having rentals too far away or in deep blue states would worry me a bit. The laws to get people out in Ca are pretty tough and only gonna get worse. Very interested to see pros/cons on both.
 

t&y

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We lived around the corner from one in Pasadena. I bet that truck made 5k a night. All cash.


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Oh yeah. No bullshit, those trucks and carts are making some serious cash for a street vendor. We had a couple locals who closed down their business location to run trucks and haven't looked back. There is a bit of a mafia and you better be ready to defend your winnings.
 

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Pixie dust spreader on the tilt o whirl
 

Tobester

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You are buying rental properties abd pulling 400-600 cash positive a month? Or that’s the total rent?

I know a guy that is buying properties in Ohio and paying 75k’ish and pulling 750 a month in rent.. the numbers are AMAZING for a rental. I am considering jumping on that train.

just wondering how those stack up against your numbers?

One thing that I like about a vrbo property at a vacation spot is you get to use it every now and again which offsets the spending on a vacation.. Ohio / Georgia etc (cheap rentals) doesn’t exactly check that box.
You nailed it RD. Numbers are very similar to what you outlined. We are close friends with a couple that has purchased 7 properties over the past 2 years. Through their learning curve they have introduced us to contacts in states and locations we never even plan on seeing or visiting. For reference, some of the areas are heavily populated with Section 8 housing. Understanding the quality and risk of a section 8 tenant, there is also the security of the state backing the rent as well as the tenants incentive to make sure the payments are made monthly or they will be dropped from the program.
Most investment properties will require 25% down. $100K properties in Georgia can get $900 a month (or more). $75K mortgage costs you $350.00 plus taxes and insurance call it $450 a month. Your now earning $450 a month on a $25K investment.
If we can get 5 properties we can solely use the income from the properties to rinse and repeat annually. 10 properties and we can purchase 2 properties annually and so on. Its a compounding effect. The more doors you have will minimize your exposure for issues that arise from the rental business.
This plan does not help me quit my W2 job any time soon but is an avenue to retire a lot sooner and provide much more financial freedom.

I have recently been telling my wife next time you want a new car you need to buy a house. Use the cash flow to make the car payment to offset any new monthly expense. Hell, I am even thinking how I can buy my kids properties to pay for their colleges. Id rather put $50K down on a $200K house that cash flows $1K a month. Deferring all the payments to my kid would be $12K a year and they would never have to worry about student loan debt.

I also think something this thread is missing is that DEBT is not always bad. If you have the ability to make small investments while taking on debt but creating income you have now created an avenue for a lenders money to work for you.

The idea of working for 30 years, purchasing a house and retiring on a 401K is the American dream that has been sold to us and is a giant lie. The 30-year mortgage is set up by the banks for the banks to profit. The 401K is designed for wall street to make huge profits. There are avenues and opportunities out there where you can make the system work for you instead of you always working for the system.
 

attitude

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You nailed it RD. Numbers are very similar to what you outlined. We are close friends with a couple that has purchased 7 properties over the past 2 years. Through their learning curve they have introduced us to contacts in states and locations we never even plan on seeing or visiting. For reference, some of the areas are heavily populated with Section 8 housing. Understanding the quality and risk of a section 8 tenant, there is also the security of the state backing the rent as well as the tenants incentive to make sure the payments are made monthly or they will be dropped from the program.
Most investment properties will require 25% down. $100K properties in Georgia can get $900 a month (or more). $75K mortgage costs you $350.00 plus taxes and insurance call it $450 a month. Your now earning $450 a month on a $25K investment.
If we can get 5 properties we can solely use the income from the properties to rinse and repeat annually. 10 properties and we can purchase 2 properties annually and so on. Its a compounding effect. The more doors you have will minimize your exposure for issues that arise from the rental business.
This plan does not help me quit my W2 job any time soon but is an avenue to retire a lot sooner and provide much more financial freedom.

I have recently been telling my wife next time you want a new car you need to buy a house. Use the cash flow to make the car payment to offset any new monthly expense. Hell, I am even thinking how I can buy my kids properties to pay for their colleges. Id rather put $50K down on a $200K house that cash flows $1K a month. Deferring all the payments to my kid would be $12K a year and they would never have to worry about student loan debt.

I also think something this thread is missing is that DEBT is not always bad. If you have the ability to make small investments while taking on debt but creating income you have now created an avenue for a lenders money to work for you.

The idea of working for 30 years, purchasing a house and retiring on a 401K is the American dream that has been sold to us and is a giant lie. The 30-year mortgage is set up by the banks for the banks to profit. The 401K is designed for wall street to make huge profits. There are avenues and opportunities out there where you can make the system work for you instead of you always working for the system.
This is something that interests me. I do have a couple of questions, why do you reference putting 25k down on a 100k loan? Let’s say you put 5k down on 5 houses and the payments were 600 a month, that’s 1500 in profit each month with charging 900 a month in rent. Also, how difficult is it to buy and maintain these houses? Are you constantly flying back and forth or do you pay for a good property management company to watch over them?
 

LargeOrangeFont

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You nailed it RD. Numbers are very similar to what you outlined. We are close friends with a couple that has purchased 7 properties over the past 2 years. Through their learning curve they have introduced us to contacts in states and locations we never even plan on seeing or visiting. For reference, some of the areas are heavily populated with Section 8 housing. Understanding the quality and risk of a section 8 tenant, there is also the security of the state backing the rent as well as the tenants incentive to make sure the payments are made monthly or they will be dropped from the program.
Most investment properties will require 25% down. $100K properties in Georgia can get $900 a month (or more). $75K mortgage costs you $350.00 plus taxes and insurance call it $450 a month. Your now earning $450 a month on a $25K investment.
If we can get 5 properties we can solely use the income from the properties to rinse and repeat annually. 10 properties and we can purchase 2 properties annually and so on. Its a compounding effect. The more doors you have will minimize your exposure for issues that arise from the rental business.
This plan does not help me quit my W2 job any time soon but is an avenue to retire a lot sooner and provide much more financial freedom.

I have recently been telling my wife next time you want a new car you need to buy a house. Use the cash flow to make the car payment to offset any new monthly expense. Hell, I am even thinking how I can buy my kids properties to pay for their colleges. Id rather put $50K down on a $200K house that cash flows $1K a month. Deferring all the payments to my kid would be $12K a year and they would never have to worry about student loan debt.

I also think something this thread is missing is that DEBT is not always bad. If you have the ability to make small investments while taking on debt but creating income you have now created an avenue for a lenders money to work for you.

The idea of working for 30 years, purchasing a house and retiring on a 401K is the American dream that has been sold to us and is a giant lie. The 30-year mortgage is set up by the banks for the banks to profit. The 401K is designed for wall street to make huge profits. There are avenues and opportunities out there where you can make the system work for you instead of you always working for the system.
1000%.

I was ready to buy 3-4 properties last year but Covid happened, so I paused.

This initially started for me with the same Idea of buying rental properties to cash flow college for my kids, and then carry that cash flow into retirement. The Havasu properties I have are doing well, but the math does not make sense at the current prices. I have the little snowball at the top of the hill, It is time to push it over the edge. I have 3 doors now, It is time to hit the accelerator.

If you want to pool or share info, I am happy to. I like the idea of going into a market (especially one that I will rarely if ever visit) with a "buddy" just have a second set of eyes, and second set of experiences and a second set of references to draw from and to learn from each other.
 
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LargeOrangeFont

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This is something that interests me. I do have a couple of questions, why do you reference putting 25k down on a 100k loan? Let’s say you put 5k down on 5 houses and the payments were 600 a month, that’s 1500 in profit each month with charging 900 a month in rent. Also, how difficult is it to buy and maintain these houses? Are you constantly flying back and forth or do you pay for a good property management company to watch over them?
You need at least 25% down for a rental property.

You are paying a property manager, so factor in 10% for that.
 

attitude

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In everything I have seen, it is a requirement.
Got it, that just shows how inexperienced I am. I wouldn’t even think of trying to buy a house on this coast for a rental, buying a house to live in is pushing it in CA lol. The back east thing interest me though, I believe there is someone else on RDP who’s family owns a bunch of cheaper rental properties on the east coast and ever since he wrote about it I’ve been interested.
 

troostr

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I work as a PM for a telecommunications firm, I have CAD experience but only 2D not 3D. I was thinking about learning how to wrap vehicles as my little brother has a dirt bike graphics business and my step dad owns a label company and can get material at cost, but that was just more for mine and my friends vehicles. There is something about wrapping that makes my OCD happy when it comes out perfect lol.

Also, I am pretty active in the stock market thread, so far I’ve manage to make a couple hundred here and there but nothing big so far.
A good buddy of mine went from running someone's farm, basically 24/7, to working a 4 on 4 off for the local refinery. Within a month he was going bat shit stir crazy after redoing most of his house on his days off. He's got an always spotless old Caddy he cruises all the time. A couple guys asked him who keeps his stuff so clean- "I do", turned into him being booked for detail work and making over 40K cash in the first year! He has about 4k in a little trailer he goes mobile with, and gets his RO water from my dairy. His son that just graduated is taking over his old trailer to keep an income stream while he's off at college, and he just bought a new one.

Just an example of what can go from friends and family side work to killer side income! Possibly a business that, if your kids are into when they get of age, you could set them up in. Just like a little detail trailer, what would your input overhead be? With a lower overhead than a traditional brick and mortar storefront shop, you can be crazy competitive, and with your OCD, your results will sell your future work! Doing it out of your place, your wife, and very soon your getting older by the day 2 year old that is curious about what dad is doing the garage may take an interest in helping out a little with a solution sprayer or squeegee so you still can incorporate some family too! There's a lot of win/win looking at the idea. (IMO) A possibly great opportunity with VERY little risk.
 

attitude

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A good buddy of mine went from running someone's farm, basically 24/7, to working a 4 on 4 off for the local refinery. Within a month he was going bat shit stir crazy after redoing most of his house on his days off. He's got an always spotless old Caddy he cruises all the time. A couple guys asked him who keeps his stuff so clean- "I do", turned into him being booked for detail work and making over 40K cash in the first year! He has about 4k in a little trailer he goes mobile with, and gets his RO water from my dairy. His son that just graduated is taking over his old trailer to keep an income stream while he's off at college, and he just bought a new one.

Just an example of what can go from friends and family side work to killer side income! Possibly a business that, if your kids are into when they get of age, you could set them up in. Just like a little detail trailer, what would your input overhead be? With a lower overhead than a traditional brick and mortar storefront shop, you can be crazy competitive, and with your OCD, your results will sell your future work! Doing it out of your place, your wife, and very soon your getting older by the day 2 year old that is curious about what dad is doing the garage may take an interest in helping out a little with a solution sprayer or squeegee so you still can incorporate some family too! There's a lot of win/win looking at the idea. (IMO) A possibly great opportunity with VERY little risk.
That would be awesome if it grew into something that big. Luckily my parents have big friend groups and i would be able to network through them, but who knows I may start to wrap my truck and hate it lol! I mainly wanted to do this to help my little brother expand his dirt bike graphics business but he is 16 with a full time job, going to school online, and custom designs 10-15 graphics kits a month so he decided he didn’t want to add to his portfolio. My wheels are already turning so I planed to go through with wrapping my truck anyways but I already have a buddy who wants to wrap his truck. I’m excited to get the material ordered and get started.
 

gqchris

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That would be awesome if it grew into something that big. Luckily my parents have big friend groups and i would be able to network through them, but who knows I may start to wrap my truck and hate it lol! I mainly wanted to do this to help my little brother expand his dirt bike graphics business but he is 16 with a full time job, going to school online, and custom designs 10-15 graphics kits a month so he decided he didn’t want to add to his portfolio. My wheels are already turning so I planed to go through with wrapping my truck anyways but I already have a buddy who wants to wrap his truck. I’m excited to get the material ordered and get started.
Sounds awesome!

I will tell you that as a customer, make sure you are super trained and detailed on how to remove the car parts to do the wrap correctly. That's what always concerned me about wanting to wrap my Ferrari. I didnt want someone pretty much disassembling the car without being meticulous about it!
 

attitude

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Sounds awesome!

I will tell you that as a customer, make sure you are super trained and detailed on how to remove the car parts to do the wrap correctly. That's what always concerned me about wanting to wrap my Ferrari. I didnt want someone pretty much disassembling the car without being meticulous about it!
That will definitely be a learning curve as every car is different. I would like to get into SXS and buggy’s. My Mom and Step dad have a huge Glamis group and the new thing for them is to have Can Ams to match their buggy’s but for some reason no one has their X3s wrapped, even my step dad who’s son designs graphics doesn’t have a wrap on his. I think that would be best way to learn. Even if this doesn’t pan out to be something big I am completely fine with it, I have just always wanted to learn because something about it fulfills my OCD needs lol.
 

humvkev

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This is such a helpful thread. I have always thought about what to do with any extra cash and where to put it. One option has always been in property but I also didn't know how to start and all of the details. Granted I haven't spent much time on it as this option has just recently presented itself. I thought about something in Havasu or Parker so that I can also use it, but I feel that that option has sailed with the prices they are now. maybe the prices will come down some in a year or two but I doubt it, maybe the just flatten out some.
 

troostr

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I'm a partner in the farm- 5th generation. I'm no baller at all, but not hungry either. There are definitely tax benefits to owning businesses. There's also stress liabilities as well. We have the toys we want, and for the most part, use them when we want. That mitigates the stress. (along with having Great managers!) My operation is 24/7 because if you're not milling them, you're drying them. Side hustles for me have to be pretty self sustaining or it takes too much attention from my bread and butter. Some rental homes here local are good fairly easy returns and purchases that are easily written off. A benefit we have is the Federal Law Enforcement Training Center (FLETC) that gives trainers and some faculty a $3500/month per diem so 3k/month for a furnished rental is a cakewalk. That makes regular rental houses in the area overinflated for what they should be, but great if you're the property owner. We'll take $500/month off if they pay in cash. Currently, all of them take advantage of the discount. Growing up I watched my dad build up a huge antique car and truck collection. He had a trucking company along with the dairy that a partner ran at the time. Between the two, he would write off all the in house labor and the parts to restore everything from steam tractors to old Peterbilt's to Cadillacs, Packards, Hudsons, you name it. I learned we had a write off opportunity as long as our regular maintenance kept our working fleet repairs to a minimum, there was plenty room to add restoration costs and keep the "Maintenance and Repairs" line on our financials on par with industry averages. My dad still has almost everything he's restored plus. For me, I like to find the rough diamonds, shine'em up and flip'em. The input and even some of the tractors and trucks I can write off. I have my own full shop, so the busy work when we are slow and guys aren't breaking shit keeps my mechanics busy and gives them something different to work on from time to time. 90's and up John Deere tractors aren't the most fun "toys" to flip, but green tractors hold crazy value. Old trucks and cars are more fun, but not as easy to flip. At the house we've always tried to have things to keep our kids busy after chores are done besides a playstation. Four wheeler, trampolines, a fishing pond, my kids are far from bored. It's great because their friends are always over at our place because they have so much stuff to do. (A couple of years ago they asked for this little zipline kit off amazon for Christmas, I ended up building them a 550 ft run down the hill behind our house) I've always liked Pinball, so those come when I can score a deal. They get cleaned and serviced up, enjoyed until they aren't, then flipped. I've always done well on collectible toys. Boats and RV's not so much, but we hardly ever flip those.

That's probably way more rambling than anyone cares to read, but it's our situation just to throw it into the pot.

I don't live near enough to water you can really enjoy a 200k+ boat. I do have plenty farm ground to work though and new 8 wheel JD's are well over 400k. I have several of those, also great write offs. To me, if you're wanting or needing a side hustle it has to check a few boxes: Is the initial investment more than I can stand to lose? if so, I'm out. Is it something I enjoy doing? if not, I'm out. Is it something that is going to take away from quality family time or time I need to maintain my primary income? (my wife got us into network marketing years ago- what a time sponge! All it did was make us product junkies lol) It has to be legal, obviously. Is there good opportunity for return on time and investment? There's probably more one should consider, but that's a basic start.
 

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That's my thought as well. I meet a lot of business owners and do business direct with them. The question of why I don't own or start my own business comes up a lot. I know the industry I am in from the bottom to the top and understand.

There are times where I think it would be a good idea but the amount of liability and stress that comes with it just does not pencil out right now. We have a solid profit sharing plan for upper management so I get a significant cut of all my projects with out the liability of owning the company.
My story is similar. I work for a company with unheard of benefits and excellent pay. A culture from the top down of "employee first". I thought about starting my own business about 10 years ago but didn't. I know this isn't the norm and for a lot of people the thought of working for someone turns their stomach. I've known a couple guys that worked for themselves for a long time and when their success came to end and were faced with going back to work for someone were paralyzed to the point of near financial ruin. Simply because they couldn't bring themselves to work for the man.

There are so many factors in career and life. One thing that is out of peoples control is the element of luck. haha... Hard work is also a key element but if you talk to any successful person there is an element of luck to their story, self employed or W2.
 

Flatsix66

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RD here is your financial plan:

1. Sell RDP
2. Buy run-down trailer parks near a high concentration of child molesters or a prison
3. Raise the space rent to the point where all the retirees are forced out and can't sell their trailers.
4. Evict old people and take ownership of trailers
5. Renovate trailers into multi-room crash pads.
6. Negotiate a deal with the local court to house the recently released child molesters in your trailers
7. Sell boat storage in the back of the park.
8. Buy RDP back
 

Dalton

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$100K properties in Georgia can get $900 a month (or more). $75K mortgage costs you $350.00 plus taxes and insurance call it $450 a month. Your now earning $450 a month on a $25K investment.
Maintenance, property management, capital expenses, vacancy, and probably a few things. Rents at 1% of purchase price is fine, but not a slam dunk, usually cash flowing around 100 dollars per month.

IMG_1838.jpg



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Tobester

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Maintenance, property management, capital expenses, vacancy, and probably a few things. Rents at 1% of purchase price is fine, but not a slam dunk, usually cash flowing around 100 dollars per month.

View attachment 978309


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Dalton you are correct and I agree with the costs you outlined should be considered. I am not recommending anyone to invest their entire savings into an investment property. Scoring a slam dunk is never a guarantee and one's due diligence is required. There are many variables for things to go wrong and you have to be prepared. I do really like the 1% rule. You just have to find them -
 

lakemadness

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You nailed it RD. Numbers are very similar to what you outlined. We are close friends with a couple that has purchased 7 properties over the past 2 years. Through their learning curve they have introduced us to contacts in states and locations we never even plan on seeing or visiting. For reference, some of the areas are heavily populated with Section 8 housing. Understanding the quality and risk of a section 8 tenant, there is also the security of the state backing the rent as well as the tenants incentive to make sure the payments are made monthly or they will be dropped from the program.
Most investment properties will require 25% down. $100K properties in Georgia can get $900 a month (or more). $75K mortgage costs you $350.00 plus taxes and insurance call it $450 a month. Your now earning $450 a month on a $25K investment.
If we can get 5 properties we can solely use the income from the properties to rinse and repeat annually. 10 properties and we can purchase 2 properties annually and so on. Its a compounding effect. The more doors you have will minimize your exposure for issues that arise from the rental business.
This plan does not help me quit my W2 job any time soon but is an avenue to retire a lot sooner and provide much more financial freedom.

I have recently been telling my wife next time you want a new car you need to buy a house. Use the cash flow to make the car payment to offset any new monthly expense. Hell, I am even thinking how I can buy my kids properties to pay for their colleges. Id rather put $50K down on a $200K house that cash flows $1K a month. Deferring all the payments to my kid would be $12K a year and they would never have to worry about student loan debt.

I also think something this thread is missing is that DEBT is not always bad. If you have the ability to make small investments while taking on debt but creating income you have now created an avenue for a lenders money to work for you.

The idea of working for 30 years, purchasing a house and retiring on a 401K is the American dream that has been sold to us and is a giant lie. The 30-year mortgage is set up by the banks for the banks to profit. The 401K is designed for wall street to make huge profits. There are avenues and opportunities out there where you can make the system work for you instead of you always working for the system.
Why leave cash in? Search for better deals, value add deals. I have many rentals and I don’t have a penny in them. They cash flow. My cash on cash return is infinite since my cash investment is zero.

Only difficult thing for some is coming up with the cash to initially purchase the property and improve it.
 
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Dalton

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Dalton you are correct and I agree with the costs you outlined should be considered. I am not recommending anyone to invest their entire savings into an investment property. Scoring a slam dunk is never a guarantee and one's due diligence is required. There are many variables for things to go wrong and you have to be prepared. I do really like the 1% rule. You just have to find them -
Internal return- mortgage pay down, and tax benefits are worth something also, I just don’t like to see people jumping in with rents like 300 bucks over the principle and interest thinking they’re making 300 bucks, That could work though if someone knows a market extremely well and is going for appreciation, just breaking even could be OK, but it’s better to cash in on both appreciation and cash flow, as appreciation is more speculatory.


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