Have 100k to invest, what do I do with it

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Have 100k to invest, what do I do with it

Abby Miller
Member since 2023 · 5 posts · 5 votes

Hey all, I'm 25 years old and have been saving up for the past few years. I have about 100k that I want to invest but not sure where the best place to start is. I'm also in the beginning learning stages. My long term goal is to have a retirement fund and some positive cash flow to supplement my career in the education field.

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Sam McCormackBusiness Member
Real Estate Agent · Cincinnati, OH/NKY · Member since 2021 · 1k+ posts · 833 votes
2y
Quote from @Abby Miller:

Hey all, I'm 25 years old and have been saving up for the past few years. I have about 100k that I want to invest but not sure where the best place to start is. I'm also in the beginning learning stages. My long term goal is to have a retirement fund and some positive cash flow to supplement my career in the education field.


 Using that 100k for a 75k DP on a 300k property, 8k for closing costs, and having the 15-20k in reserves for emergency repairs is a good place to start. Assuming you are using a conventional loan for a SMF property, Cincinnati has properties like that, sometimes as low as 200k. But will likely see closer to mid 200's for anything that is in a good area / cash flowing. Let me know if there is anyway I can help

[email protected]859-443-4952
Sam McCormack Realtor
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  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    2y

    @Abby Miller

    You looking to invest in an asset or invest passively in a fund?

    That is the first question to answer?

    Also are you looking for lower risk opportunities or higher risk opportunities?

    Of course higher risk = higher reward (or higher loss).

    Whatever you invest in make sure to understand your investment and do your due diligence. Happy to chat further on forums or offline

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    1Reply
  • Abby Miller
    OP
    Member since 2023 · 5 posts · 5 votes
    2y

    Thanks for the reply! I'm interested in property investment and relatively low risk to just get my foot in the door.

    0Reply
  • Adriana Stockel
    Northern Virginia · Member since 2023 · 2 posts · 0 votes
    2y

    As Chris Seveny said, are you looking to invest passively or in an asset? 

    What options have you looked at? Short term rental, long term rental, BRRRR, etc.

    If you are in an area with a strong job market, it has good schools, lots places to shop, eat and do things, my suggestion is a long term rental. You can build up the equity in the home and  put some of that cash flow from the rent into a retirement account, HYSA, etc. 

    If you are in an area that is a heavy vacation spot, then a short term rental is best. You can set up the rates per night, it's seasonal so you can also charge higher during the peak season, etc. 

    Are you looking for a primary for yourself to stay? Then househacking is a good option! You can rent out the other rooms, have them cover your mortgage and/or you'll end up paying very little and also building that equity. 

    There are many ways to have positive cash flow in real estate!  Happy to chat and help :)

    0Reply
  • Sam McCormackBusiness Member
    Real Estate Agent · Cincinnati, OH/NKY · Member since 2021 · 1k+ posts · 833 votes
    2y
    Quote from @Abby Miller:

    Hey all, I'm 25 years old and have been saving up for the past few years. I have about 100k that I want to invest but not sure where the best place to start is. I'm also in the beginning learning stages. My long term goal is to have a retirement fund and some positive cash flow to supplement my career in the education field.


     Using that 100k for a 75k DP on a 300k property, 8k for closing costs, and having the 15-20k in reserves for emergency repairs is a good place to start. Assuming you are using a conventional loan for a SMF property, Cincinnati has properties like that, sometimes as low as 200k. But will likely see closer to mid 200's for anything that is in a good area / cash flowing. Let me know if there is anyway I can help

    [email protected]859-443-4952
    Sam McCormack Realtor
    View Page
    3Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    2y
    Quote from @Abby Miller:

    Hey all, I'm 25 years old and have been saving up for the past few years. I have about 100k that I want to invest but not sure where the best place to start is. I'm also in the beginning learning stages. My long term goal is to have a retirement fund and some positive cash flow to supplement my career in the education field.


     Welcome aboard Abby.

    1Reply
  • Julien J.
    Investor · CO · Member since 2016 · 757 posts · 1k+ votes
    2y

    @Abby Miller

    I'd start by bridging your retirement goals to 3 to 5 years from now then backing into the solution.

    Based on what you have, house hack the most units you can. 

    2Reply
  • Abby Miller
    OP
    Member since 2023 · 5 posts · 5 votes
    2y
    Quote from @Account Closed:
    Quote from @Abby Miller:

    Hey all, I'm 25 years old and have been saving up for the past few years. I have about 100k that I want to invest but not sure where the best place to start is. I'm also in the beginning learning stages. My long term goal is to have a retirement fund and some positive cash flow to supplement my career in the education field.

    Do you have a job you want to keep and use real estate solely as a side gig or do you want to learn how to make real estate pay your way for the rest of your life?

     I have a job and would like to use it as a side gig for now. :) 

    0Reply
  • Kevin Kohler
    Real Estate Broker | Investor | Property Manager · Plantation, FL · Member since 2015 · 228 posts · 68 votes
    2y

    Do you know if you are considered Accredited or not?

    0Reply
  • Abby Miller
    OP
    Member since 2023 · 5 posts · 5 votes
    2y
    Quote from @Chris Seveney:

    @Abby Miller

    You looking to invest in an asset or invest passively in a fund?

    That is the first question to answer?

    Also are you looking for lower risk opportunities or higher risk opportunities?

    Of course higher risk = higher reward (or higher loss).

    Whatever you invest in make sure to understand your investment and do your due diligence. Happy to chat further on forums or offline


     Hey Chris! Thanks for the reply! I'm new to this platform so hopefully you receive this reply! I am looking for lower risk at the moment and to invest in an asset... maybe like house hacking. I would love to connect!

    0Reply
  • Eric DeNardoPro Member
    Real Estate Agent · Denver · Member since 2020 · 366 posts · 151 votes
    2y

    @Abby Miller, If you are okay with roommates, I highly recommend buying a single-family house with 3-4 bedrooms (or more!) and then renting out the rooms to others. It's a great way to build equity and get started in real estate! It also depends on what market you are in. If you are in a place with cheaper homes, you could buy a house hack and a rental property with the cash you have!

    [email protected]
    1Reply
  • Abby Miller
    OP
    Member since 2023 · 5 posts · 5 votes
    2y
    Quote from @Eric DeNardo:

    @Abby Miller, If you are okay with roommates, I highly recommend buying a single-family house with 3-4 bedrooms (or more!) and then renting out the rooms to others. It's a great way to build equity and get started in real estate! It also depends on what market you are in. If you are in a place with cheaper homes, you could buy a house hack and a rental property with the cash you have!

    I've been looking into this, but can't seem to figure out how to make the numbers work. I'm in Greenville, NC. 
    0Reply
  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    2y
    Quote from @Abby Miller:
    Quote from @Chris Seveney:

    @Abby Miller

    You looking to invest in an asset or invest passively in a fund?

    That is the first question to answer?

    Also are you looking for lower risk opportunities or higher risk opportunities?

    Of course higher risk = higher reward (or higher loss).

    Whatever you invest in make sure to understand your investment and do your due diligence. Happy to chat further on forums or offline


     Hey Chris! Thanks for the reply! I'm new to this platform so hopefully you receive this reply! I am looking for lower risk at the moment and to invest in an asset... maybe like house hacking. I would love to connect!


     I sent you a message to your BP inbox

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    WebsiteView Page
    0Reply
  • Nicholas L.Pro Member
    Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
    2y

    @Abby Miller

    house hacking is a powerful way to get started.  you said you "can't make the numbers work" - can you elaborate on what you mean by that?

    one thing to note is that cash flowing net positive each month on a house hack was never the point, it was just a happy accident for a few years when rates were low. 

    so, if you could rent something for $1500, or buy something to house hack and still owe $1122.57 toward the mortgage, house hack. You are 1. saving a few hundred dollars each month, AND 2. learning to be a real estate investor, AND 3. (most importantly!) building equity. Make sense?

    unfortunately cash flow is just very tough right now with prices and rates both high. it's basically not possible to just buy a vanilla on-market LTR and net anything.

    now, are experienced investors employing creative strategies still getting cash flow?  of course they are.  but it just takes time, knowledge and money to do that.

    hope this helps

    0Reply
  • Nicholas L.Pro Member
    Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
    2y

    @Account Closed

    i'd consider BOMSTLO an advanced strategy - thoughts?

    it's something I'm looking into, I still have questions about certain aspects of it that I don't have good answers for yet

    0Reply
  • Rick Albert
    Real Estate Agent · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    2y

    I would recommend house hacking and adding value to it. You need to have a roof over your head anyways and you can benefit from better financing. I would not use the full $100K if you can. Then you save up and house hack again and convert your current place into a full time rental.

    1Reply
  • Eric DeNardoPro Member
    Real Estate Agent · Denver · Member since 2020 · 366 posts · 151 votes
    2y
    Quote from @Abby Miller:
    Quote from @Eric DeNardo:

    @Abby Miller, If you are okay with roommates, I highly recommend buying a single-family house with 3-4 bedrooms (or more!) and then renting out the rooms to others. It's a great way to build equity and get started in real estate! It also depends on what market you are in. If you are in a place with cheaper homes, you could buy a house hack and a rental property with the cash you have!

    I've been looking into this, but can't seem to figure out how to make the numbers work. I'm in Greenville, NC. 

     You may not cash flow while you are living in the house hack since you are taking up a room, but your housing costs will be minimal and other people will be paying your mortgage. Check your cash flow as if your room was rented out and see what it gets. Today's rate environment makes it tough to cash flow, but as rates drop, you can refinance and your monthly payment will drop. What numbers are you trying to hit?

    [email protected]
    0Reply
  • V.G JasonPro Member
    Investor · Member since 2022 · 3k+ posts · 3k+ votes
    2y
    Quote from @Abby Miller:
    Quote from @Account Closed:
    Quote from @Abby Miller:

    Hey all, I'm 25 years old and have been saving up for the past few years. I have about 100k that I want to invest but not sure where the best place to start is. I'm also in the beginning learning stages. My long term goal is to have a retirement fund and some positive cash flow to supplement my career in the education field.

    Do you have a job you want to keep and use real estate solely as a side gig or do you want to learn how to make real estate pay your way for the rest of your life?

     I have a job and would like to use it as a side gig for now. :) 

    Good, real estate should not be your forte if you're just starting. This scratch the W2 and invest your retirement + all other funds into REI is short sighted.

    Before you invest $100k, do you have any debt?
    1Reply
  • Peyton From
    Accountant · San Francisco, CA · Member since 2020 · 35 posts · 13 votes
    2y

    @Abby Miller

    Hi Abby,

    Great job on saving and putting yourself in a strong financial position! I would look into house hacking a small multifamily to start out (2-4 units) - because you have a significant amount of cash to support a down payment on a property larger than a single family, and investing in a 2-4 unit will make it easier to reduce your living cost or maybe even cover it entirely plus some cash flow. Definitely keep some cash for closing costs (i use around 4% of purchase price) and reserves. Good luck!

    0Reply
  • Alecia LovelessPro Member
    Member since 2019 · 3k+ posts · 2k+ votes
    2y

    @Abby Miller I, too, recommend house hacking. I owned bed and breakfasts for about 24 years and effectively house hacked those living among the guests. It was a great lifestyle.

    I think it would have been much easier if I had had long term tenants as opposed to vacationers who only stayed an average of 2 nights and needed lots of attention.

    I like the model of buying a 4 bedroom house with as many bathrooms as possible so there's less sharing. You can get more rent for bedrooms with private bathrooms and even a little more for en-suite bathrooms. This will be the cheapest way to get into being a REI.

    If you have more money a 2-4 unit is a better bet, but it’s more expensive. If you live in one unit you can use a low down payment loan but that will ultimately effect your cash flow.

    Any way you slice it you can do either of these and once you’ve saved up your next down payment you can buy your next property with a low down payment and move into the second property and rent out your old room/unit and move into the next and continue this way while you build up a nice portfolio for yourself.

    0Reply
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