Turning 1K to a million
Looking to get started in investing. I’m currently working a W2 job as a truck driver I also have small demolition company. I don’t have much capital to get started but, I’m serious, very open minded, hungry and coachable. I don’t believe in the word realistic, I have about a thousand dollars to start out with. I’m looking for suggestions on the best way to use that money and get the best return. Thanks in advance for all replies.
You will need a bit more than $1,000. I would suggest getting an FHA loan to buy a 2,3,4
Unit multi family.
Preferably one that needs work in one or two units. Add lots of elbow grease to add value,
Then move out and have the whole place rented and cash flowing. Or stay and save the extra money from not having to pay a mortgage.
Once you have enough equity, or cash to buy another.... you know what to do!
Good luck. You can make it if you save,
Focus, and keep working.
Honestly...turn your truck into a library and listen to podcasts...Biggerpockets, BP Money, Real Estate Guys, DIY Money, Listen Money Matters, plus so many more Real Estate Podcasts.
Read books and save. It will come to you your plan
@Matthew Irish-Jones I really don’t appreciate the input, I will definitely put it to use.
@Joe M. Definitely, I never listen to music. I’m all about podcast and YouTube, I will for be subscribing to the ones you suggested as well. Thanks for the input, it will be put to good use.
Invest in yourself first ....you have skills that are worth money to someone and they have the funds to do a deal and help you learn along the way.
You are going to want down payment AND and cash reserves...that sucks but if you do it right you'll reduce the risk and stress of investing.
Deavin - Welcome to BP! Do you own a home or rent currently? @Matthew Irish-Jones gave great advice about something called house-hacking. This is where, as he stated, you buy a small multi-family and live in one unit and rent the others. You can live for free or even make money if purchased and rehabbed correctly. You also get the benefit of using conventional mortgage financing and very small down payments. I recommend the BP podcasts and The Book on Rental Property Investing by Brandon Turner. Brandon also co-wrote a recent book with Joshua Dorkin - How to Invest in Real Estate. Easy reads / listens but great beginner information.
Good luck on your journey!
@Deavin Cox
You are 10 doubles away from a million.
This guy is great. I suggest watching him (especially at the 2:45 min mark)
https://youtu.be/D9cPAuZIigs
@Deavin Cox
listen to bigger pockets podcast about Ashley’s success story in Detroit. ep #331.
$1k to $1m lets run the numbers and let's be realistic because we need to work with reality, not fantasy.
1. Investing in the stock market with $1k, SP 500 historic returns 9.8% (Investopedia). Run the math it ain't happening. At least not when you can enjoy the money.
2. Buying and investing in properties. Run the math. There is not enough to buy anything to do serious damage. Ok, let's say you hit the 1% chance you buy a no money down property for $100k. What now? Let's say 10% appreciation rate. That's not enough to get you to $1m while you can enjoy the money. No way to scale with no money. All that work and you still not at $1m. Waste of energy and time.
3. Last option, take the $1k to get licensed as a realtor pay for online courses and state fees and make $1m in the next 5yrs. Most attainable option and one you can scale and really grow your business.
You said you don't believe in the word realistic but we live in a world where we must understand and know the meaning or else we are in fantasy. I am not trying to be a downer here what I am trying to show you is that what you want to achieve you just have to go down the easiest road and the most attainable one. The truth in your case is you need more money to do anything substantial in real estate investing. These are the facts. Wish you the best to $1m you can do it.
@Deavin Cox. I agree with this advice. Immediately you should prepare yourself to qualify for a loan. You can purchase a property with up to 4 units with less than 5% down payment and finance closing costs so long as you live in it as your primary residence. Investigate your credit and income qualifications to see if you can get financed. Call lenders until you find a loan officer who understands these programs and is willing to invest the time to help you. If you do it right you can live rent free or maybe even cash flow a bit positive. Then save money, work on adding value to the property, and start working on a plan for the next one.
Work harder on your demo company. Hard work in the trades can get you there. Much faster than REI. All my Plummers and HVAC guys do very well.
@Josh C. What he said! For example, I called the demo guy I normally use about helping on another project and he told me he is booked well into next year and turning down work almost daily. This is a guy who was in trucking, started to do demo on the side after buying some equipment and now can’t even keep up with the demand. Which, of course, provides him with the income he needs to continue to invest in his business and/or real estate. Good luck!!
@Deavin Cox can you use your demolition business or trucking business to create more cash? What would $1000 invested in to your demolition business do for it?
@Deavin Cox
Depending on where you are. You could try land flipping too.
@Frank Wong thank you for your REALISTIC numbers. But if you knew me and my story you would understand why I don’t live in the realm of reality or fantasy. I appreciate the input, I truly do but this is America where anything is possible if you just believe.
@Deavin Cox you can absolutely make it happen as a truck driver. How do I know? I have helped a truck driver buy 4 houses in the last five years. How did he do it? He used a flip phone until last year, does not pay for internet and is in general very frugal and takes the extra money to put into investments.
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You do not have to go with out internet! He does buy cameras and lenses for his photography hobby (it’s not a cheap hobby). The point is that he understands what is important to him and cuts out what is not.
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Also, he started out with using the equity in his primary home to buy a $60,000 condo that was a short sale that took 8 months to close and ended up costing $67,000. 4 years later it is worth 130,000 and cash flows 400 a month.
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The point I am trying to make is that you can do it and to be patient with your process! You also may be more ambitious than 4 houses in 5 years and if that is the case I suggest being even more patient and focus on your process! The actual purchase of a home is a lag indicator of your everyday process and habits.
@Yelena Damsky
[Ashley Hamilton - BP #331 - Spotify ](https://open.spotify.com/episode/6LHzvQ9bmHOl9HATrYzELg?si=Z0DaQky1RYeHSBrz01AjKQ)
I was so inspired. It was one of the reasons I signed up here. Being from Detroit, It moved me.
Originally posted by @Deavin Cox:@Frank Wong thank you for your REALISTIC numbers. But if you knew me and my story you would understand why I don’t live in the realm of reality or fantasy. I appreciate the input, I truly do but this is America where anything is possible if you just believe.
Deavin, if you knew me and my story, I think there's a fair chance your hair would instantly turn white and you'd spend the rest of your life gibbering in a padded room. Every day I am able to get out of bed is a God-given miracle to me, and I don't abuse that miracle by insisting it's just not glorious enough, that God can and should do better.
This whole thread reminds me of a joke I once heard. This overdressed, overly made-up woman gets on a plane to Paris and goes and sits up in first class. The attendant asks to see her ticket, and it's a coach ticket. She points this out to the woman, and the woman turns to her, snaps her fingers in the attendant's face, and says: "I don't care! This is first class! I'm first class, and I'm going to Paris!"
The attendant goes to the senior attendant, the senior attendant approaches the woman, same thing happens. "I don't care! This is first class! I'm first class, and I'm going to Paris!"
The senior attendant calls for the pilot to come over. The pilot looks carefully at the woman, and then goes over and whispers in her ear. The woman nods, stands up immediately, and goes and sits back in her seat in coach. The attendant and the senior attendant are flabbergasted. "What did you say?" they asked the pilot.
The pilot shrugs. "I just told her this part of the plane wasn't going to Paris."
@Jim K. Lol, nice joke
One think I learned after making a lot of mistakes on the two rentals I owned in the past - do NOT be in a hurry. If you're getting the real estate fever, just sloooowww down. Trust me, it's super super easy to get yourself into a lot of debt and trouble otherwise. Keep learning and keep saving. I know everyone talks a lot about buying with no cash. It all depends on your comfort level with risk. One thousand is a good start on saving, but I wouldn't be comfortable trying to do anything with that. Having cash to cover your mistakes and keep you out of trouble should be on your list of priorities as a newbie. Personally, I think that's something people don't talk enough about in this business. And when it comes to rehab ... you never know what's behind those walls, better make sure you have the resources or some kind of plan on how you are going to deal with things that come up. That's just my opinion and it's worth what you paid for it. LOL
This. 1000 times this. You have one of the most valuable resources available to a newbie investor - time. Use that time on the road to listen to EVERY episode of BP podcast, and then every audiobook they recommend on the episodes. You'll get a PhD in real estate in no time and make money doing it.