Investing in Real Estate And Stocks at a young age (21)

18 Replies

Hello everyone,

So I invested in my first stock. It was nothing big but it was a big step for me because this was the beginning for me. I want to invest in real estate and want to make this my career but I read more and more on this website and I see professionals say get rid of all school debt before you start investing in real estate and I feel like if I do that I will never start. My debt is looking at 40k+ right now and I still have a year of college left. So I guess my question is, what can I do to get into real estate without paying off my debt first? I want to start getting into real estate now while I’m still in college but I don’t know where to look. Do I need my real estate license to start? Can I invent without getting my license? Are there internships that help young people like me get into the business? 

@Stephanie J. Valme Great questions and I expect you'll see a bunch of different answers. First, you do not need a real estate license, although there are several blog posts and articles on BP about the pros and cons of that. Bottom line it's a big time investment IMO. Rather, there are internships, probably, or the informal internships you make yourself. Reach out to investors near you and ask how you can help them. Maybe it's ride along to a job site, maybe it's just meet and talk. Or offer to do some of the less glamorous work the investor doesn't want to do.

Your question about getting rid of debt is a big one. It may be difficult to get your name on a loan with that...but it doesn't mean you can't be an investor. There's a book all about investing with low or no money down, focused on how to craft creative deals using partners or other methods. It's worth checking out, or use the free option of reading a bunch on creative deals on BP forum. Bottom line -- you don't need to wait and pay off your debt. That could take a while. Use real estate investing to help pay off your debt faster.

Your best option is perhaps to go to the local REIA and offer investors help for whatever skills it is you possess. Get your foot in the door and learn from them so that, when it comes time, you are ready. Unfortunately, student loan debt is pretty serious and is generally in your best interest to pay off before taking on tens of thousands of dollars of more debt (if you even get approved with 50k in student debt already).

Patience is a virtue - I've been waiting for 3 years now biding my time until my career starts and I can finance the investments. In the meantime I've been utilizing any opportunity to learn about real estate, from working as an intern auditing apartment complexes to working as a leasing specialist learning how property management companies operate to make it a lot easier on me when I begin investing. It has paid off immensely.

Thank you all for the advice! So are you guys saying that going to college for this was a waste of time and money? I mean I came to college to get the knowledge needed but if school debt is the reason why I can’t succeed in this field was it worth it? Did anybody go to college for this? I have been reading a lot and the coming story like is I had nothing and didn’t go to college. So I’m wondering if I made the right choice in going to school

While college did not teach me exactly what I am doing in real estate, it gave me a solid foundation in general business principles including accounting, finance, and management that I think are irreplaceable. Application of these skills and knowledge is vital to growth in the industry.

Regarding the student debt, depending on the rate it is at, it may be worth focusing on paying it down while you further your education in real estate. If you find yourself wiling and able to invest with OPM, you can get into the game earlier. Given your age, I think understanding basic principles through college education, reading the forums, and analyzing deals in your free time will go a long way.

Best of luck!

If a 21 yr old showed me a debt laden balance sheet id say   POLITELY go find another person to joint venture with.

Invest other peoples money is an overrated concept.  

@Stephanie J. Valme

When I was younger I was in a similar boat.  I recommend Leveraging.  This comes in various forms and can be accomplished BUT with discipline.

Best of luck!

Originally posted by @Stephanie J. Valme :

Thank you all for the advice! So are you guys saying that going to college for this was a waste of time and money? I mean I came to college to get the knowledge needed but if school debt is the reason why I can’t succeed in this field was it worth it? Did anybody go to college for this? I have been reading a lot and the coming story like is I had nothing and didn’t go to college. So I’m wondering if I made the right choice in going to school

 I am graduating this fall with a degree in Accounting and only plan on being an accountant for 10 years max while I use the money I make from that to purchase real estate. I guess it depends on what your major is, but I'd say most business majors have some sort of value to it - but perhaps not $50,000 worth of value.

What do you mean an overrated concept? Like in the sense that its not the only way to go with using money for houses? Originally posted by @Jody Newman :

If a 21 yr old showed me a debt laden balance sheet id say   POLITELY go find another person to joint venture with.

Invest other peoples money is an overrated concept.  

I’m 23, recent college grad and I invest in the stock market and real estate. I can tell you doing both is probably the best (if you can do that) but only one of those two puts money in my account each month.

Getting mentoring from someone who’s more experienced in real estate can help but it’d not necessary.

To be successful the key things are save money, be disciplined and stay focused. You have to be in REI for the long term to really see the pay offs.

@Stephanie J. Valme If you've been studying investing/finance/real estate in college, I would guess you have a strong foundation in the fundamentals of how to do this as a business. Others may have experience in construction, or plumbing, or networking. As long as you are bringing something to the table, you can make this work -- so long as you back it up with persistence and a positive attitude.

An oft repeated line is that if you can find a good deal, you can find people who want to invest in it. Keep in mind not everyone wants to invest in someone else's project -- but some people do. Yes, it's harder than using your own money -- you need to network, build credibility, learn how to present the deal in a reasonable way. And be ready forrejection. But that persistence and positive attitude will let you push through. You only need to find the first good deal once -- then you have "experience" from which to keep moving forward.

@Stephanie J. Valme there is a lot on this thread that I disagree with and only a little that I agree with. As an investor you will need to learn to manage debt. Never get into consumer debt (buying things on credit that go down in value) except for possibility a car that is reliable and very inexpensive. 

Having student loans of 50k does not have to be a big deal. Yes it will effect your debt to income ratio but it will also force you to learn how to invest like a professional, which is to say investing using other people’s money. I wouldn’t tell you that you have to pay off your debt before you start to invest. I would say you have to learn to manage your debt and finances before you start to invest.

The best way to start may be to find someone who is successful at the type of real estate you want to do and offer to be a free assistant in exchange for knowledge and experience. Yes I said “free.” You have to get out of the hourly wage or salary mindset if you want to be an investor.

As far as college goes, I don’t think college is a waste of time if it has helped you learn how to work hard, how to problem solve, and how to set and reach goals. If you didn’t learn those things then yes, it was a waste. Because those are 3 things that successful people have in common that you need in order to succeed at this business on a large scale regardless of the subject you studied.

@Shiloh Lundahl Thank you that really was encouraging to know that I am not completely in the dark when it come to my debt. And yes I have already started reaching out to intern for people and help them out so I can get the knowledge. I will definitely do better at handling the debt so it doesn't get bad

Hi @Stephanie J. Valme  

First off - congrats on taking the first step. Asking questions and taking action puts you ahead of 99% of your peers and you should be proud of yourself.

Second - I'd agree with several of the posts here. The most valuable commodity someone your age has is time, meaning if you're serious about this, you can absolutely (i) go to school, (ii) get a part-time job to start tackling that debt (reception at the student center is a great one because you get paid to do your homework and read books!), and (iii) still have plenty of time left in the week to offer an experienced investor free assistance. By the way - experienced investors LOVE seeing ambitious young people willing to work hard to reach their goals, someone will gladly take you on.  

Also I'm not sure where you are in this, but starting to track your spending and learning to live below your means is probably the most impactful decision you can take right now. Downloading Mint and setting a spending budget will pay massive dividends, and is very simple to do. That alone was one of the most valuable steps I took in my early 20s, even if my income was low. 

Personally, I would do the above before running to buy a deal (note, I didn't say you had to completely pay off your student debt, but you do need to take control of your finances and have a plan to tackle the debt). Also, since I just finished it last night, and agree with everything in it - Set For Life by Scott Trench offers a great blueprint for getting started in your 20s.

Good luck!

Also helpful hint if you want to know where to find an investor - if you're living in off-campus housing, ask your landlord

Don't take advice from anyone who doesn't have what you want including me. But if you can get a partner who can get a mortgage in their name you are fine to invest with them. scenario, my friend bob has lots of money but no time, i have no money but lots of time, bob foots the bill I do the work and me and bob split the profits, maybe bob gets 70% so I can entice bob to put the money up and I get 30%. So what I just got 30% of a great deal which is still better than 100% of no deal and because I put nothing down my return on investment is unlimited. (Point is it can be possible once you start to think creatively, Brandon Turner is a big fan of change your thinking from "Can it be done?" to "How can it be done?") I am not 100% sure on this but i don't think private money lenders care as much about your student debt if the deal is good enough since they understand you aren't paying the mortgage (Your tenants are and they are only putting up 80% of the value anyhow so if the deal is worth only 90% of what you pay for it and you suck and they need to foreclose and sale well they still make 10% or the deal would have to fall hard for them to lose their principal).Also you can absolutely get a mortgage with student debt. I have student debt but also a great credit score and strong job income, banks want to lend you money dude. 

Do the OPPOSITE of what all the other people your age will do:

Don't buy a new car - drive a POS
Live within your means - make a budget and stick to it
Don't rent an expensive place - rent a room on the cheap
SAVE every penny
Don't care what people think
Put 10-15% back per month for retirement
Invest in real estate
Set realistic goals for yourself

Thank you everyone! I am really soaking up all this information

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here