How Do I Get Started Right Out of College OR In College?

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How Do I Get Started Right Out of College OR In College?

Braden Taylor
Haubstadt, IN · Member since 2017 · 8 posts · 1 vote

Hello all!

I am currently a sophomore in college going for a double major in accounting and finance. I recently discovered the "real estate realm" and I am incredibly interested and fascinated. My question is there any way that a college student can start investing? And if not, how do I get started as soon as I have graduated? Also, I've heard about loans where you only have to put a 3.5% dp. It seems too good to be true, but could someone indulge me on that as well? I know very little about all the possibilities out there so feel free to list off some tips and tricks. I already have a feeling that most of the comments are going to swim around the lines of, "Focus on school first" or "Learn as much as you can while you're young." I just want to say for the record that I am putting school as a priority for now and that I am trying to learn as much as possible on this subject. I just want to know if there are ways to get started ASAP.

Thanks in advance!

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Matt K.
Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
9y

Look at ways to reduce your living expenses... doesn't sound cool as investing but you're investing in yourself with college. Learn how debt works, learn how the math works, then you can see if you can outperform the debt or you should pay it off. Even without buying right away you can reduce your living expenses by getting room mates for example. 

You can do a FHA loan w/ 3.5% down... do you have a job?

I'd find out who you are as a person and what speaks to you... find out what you're good at and more importantly what you struggle with. Once you find what you're good at, become REALLY good at it and use it.

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  • Matt K.
    Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
    9y

    Look at ways to reduce your living expenses... doesn't sound cool as investing but you're investing in yourself with college. Learn how debt works, learn how the math works, then you can see if you can outperform the debt or you should pay it off. Even without buying right away you can reduce your living expenses by getting room mates for example. 

    You can do a FHA loan w/ 3.5% down... do you have a job?

    I'd find out who you are as a person and what speaks to you... find out what you're good at and more importantly what you struggle with. Once you find what you're good at, become REALLY good at it and use it.

    1Reply
  • Braden Taylor
    OP
    Haubstadt, IN · Member since 2017 · 8 posts · 1 vote
    9y

    @Matt K. I appreciate the advice! Very simple, but very true. I'm trying to keep my debt as low as I can. I don't even have a credit card yet, but I probably should to start building credit. When it is all said and done, I'm hoping to have a little less than $10,000 in student loans, and then getting those paid off ASAP. I have a few jobs: I do some bookeeping, budgeting, and business consulting for a local architect, I work at at CPA firm during tax season, and I own a little side business with my friend doing pressure washing and sealing driveways, patios, sidewalks, etc. Very fortunate to have what I have. But that FHA loan, I just heard about it. Don't know/think it would apply to me. Was just curious.

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  • Matt K.
    Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
    9y

    Depending on your income it can, look up house hacking.  Seems like you're getting some good experience... and you're on a solid path, be patient.

    1Reply
  • Braden Taylor
    OP
    Haubstadt, IN · Member since 2017 · 8 posts · 1 vote
    9y

    @Matt K. Will do! I appreciate it.

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  • Bryan Witters
    Chicago, IL · Member since 2017 · 9 posts · 2 votes
    9y
    Braden, First of all, congrats on stumbling upon the advantageous realm of real estate. I'm a recent college grad (finance) as well. I found myself in a similar position during college. Definitely complete your degree. Having a steady job will allow you to save cash for down payments on properties. When you start off, you will not have nearly enough rental income to live off of. However, I would look into professional designations to supplement your degree. I know you've heard this but you need to separate yourself and show that you can work your tail off. For me the the CFA track made the most sense because equity/commodity markets interest me, but find your own, create a plan, and don't pick your head up until you find yourself where you saw yourself in the beginning. Then repeat. If I were you I would definitely look into house hacking. I'm sure you have rent that you are paying in college and it SUCKS. House hacking can relieve you of rent if your financial model makes sense. As far as getting started now, get a job and SAVE as much as you can. I waited until after college. While I'm saving a large amount of cash from each paycheck, it is frustrating to pass up on a good deal because you are not financially ready. Remember you will need your 3.5% FHA down payment and cash reserves for unexpected repairs/ vacancies. PS You may also want to look into the FHA 203k loan.
    1Reply
  • Braden Taylor
    OP
    Haubstadt, IN · Member since 2017 · 8 posts · 1 vote
    9y

    @Bryan Witters Sage advice! I may have to look into house hacking for next year (I'd do it this year but I am on campus housing). Would you happen to have a recommended $$$ figure that you might need for reserves to take care of the unexpected events? 

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  • Bryan Witters
    Chicago, IL · Member since 2017 · 9 posts · 2 votes
    9y

    @Braden Taylor No worries. You will need time to save up enough cash anyways. Even with the FHA loan it could take a considerable amount of cash to make a down payment, and have an appropriate cash reserve, especially in some markets... I am inChicago and multifamily properties are quite expensive. check out some properties in the area you would like to invest in and figure out how much cash you are going to need to bring to the table. Then figure out how much money you need to save each week, month, year, to purchase a house on a certain date. MAKE SURE YOU DECIDE ON AN END DATE FOR THIS GOAL. It will put a little pressure on you to save and help you to accomplish your cash goal.

    To answer your question, it depends on your strategy. With house hacking I have read three months worth of mortgage payments at a minimum. Get out that trusty financial calculator and calculate the payment.  The more cash you have the better for the first time. 

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  • Abbott Mary
    Real Estate Agent · Knoxville, TN · Member since 2015 · 23 posts · 6 votes
    9y
    Originally posted by @Matt K.:

    Look at ways to reduce your living expenses... doesn't sound cool as investing but you're investing in yourself with college. Learn how debt works, learn how the math works, then you can see if you can outperform the debt or you should pay it off. Even without buying right away you can reduce your living expenses by getting room mates for example. 

    You can do a FHA loan w/ 3.5% down... do you have a job?

    I'd find out who you are as a person and what speaks to you... find out what you're good at and more importantly what you struggle with. Once you find what you're good at, become REALLY good at it and use it.

    Completely agree with this. Living outside your means can make high income earners broke while living within your means can make low income earners wealthy. $500/mo cash flow is great but becomes pretty meaningless if the person makes irresponsible financial decisions. Personal finance is the first building block to financial independence in my humble opinion. As for house hacking I think it's the best first home purchase a young person can make. 

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  • Matt K.
    Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
    9y

    Everyone always so against renting, yet crunch the numbers it can make sense. I can show you houses here locally (and I'm sure in most metros) that are cheaper to rent then they are to buy (without a considerable down-payment). Then add in the fact that you can get room mates to further reduce your expense it can more or less achieve very similar results as buying a house to house hack. If you're smart you could even leverage a cheap lease against a STR demand and live free....

    Check out rental arbitrage (link is just interesting example)

    http://blog.airdna.co/most-profitable-airbnb-citie...

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