Forming a strategy versus receiving opportunitties

[David O.]

Hi All,

Let me start with the end in mind: I will produce a $20,000 per month passive income and $5,000,0000 net worth by March 11 of 2019.

1. I have some money to invest starting out 20k- 50k.

2. I already have a business that occupies a lot of my time and don't want to create another job for myself. I am willing to invest up to 10 hours per week to set up the real estate portfolio but would like to be systems focused.

I would love to hear some tips on what strategy to follow to produce this cash flow/ net worth result in real estate?

Anyone producing similar results or with similar goals?

Does it make since to start with a strategy or just start looking for deals that the numbers make since on?

I am blessed with a good business in financial services that allows me to support my current lifestyle so over the next 5 years I should not need to pull anything income wise from the Real Estate.

Look forward to your response,

David

[Bob Hines]

If you want to have both $5 mil and $20k/month, you would be better off working on creating the $5 mil in capital first as $20k/month is $240k/year or a 4.8% annual return on $5 mil. If you only want a 4.8% return on $5 mil, you would probably be better served by investing in dividend stocks and bonds at that point.

If you wanted the $20k/month more than the $5mil, that could be had for a lot less than $5 mil. ($2.5 mil at 9.6% return, $3.0 mil at 8% etc) of real estate. Then the question would become, "Do I continue working for the $5 mil once I have enough income?"

I suggest re-evaluating your goals and determine what is the most importantfor you as your goals seem a bit conflicted-they are great goals individually but most people don't start out in real estate aiming for a 4.8% return. If you want the $5 mil, you need to create and realize equity. If you want the $20k/month, you need to create cash flow.