@Hector Bermudez I also have two boys, but now men at 25 and 28. I would like to leave some cash producing assets to them as well.
@Jeffrey Boyce thank you!
@Martin Carstens thank you. How are your RE endeavors going? Keep pushing
@Todd Powell your story is inspiring....I have been jumping back and forth trying to get something started for myself in the real estate world. 3 years ago I had a seller finance set up and lost it over procrastination. There was lack of knowledge at that point in my life. Had I known what I do now would of made a quick 20k. I started a Hardwood Flooring Business here bear Boston Mass. I make decent money but like any small business it consumes my life. I have 13 and 17 year old daughters and as you know they grow fast. I have not opened up Bigger Pockets in over a year. I used to listen and read real estate anything constantly. To read your story makes me want to light that fire under my *** again. I also just started training for ultra races and signed up for New Jersey and Vermont. I currently run any marathons can on the area. Thanks for your story you made my day. Keep Hammering!
@Ryan Adams . Loved your feedback! Man, get that fired up and lack no fear. Inaction is the worse we can all do. Also, I mistakenly typed that I did 2 Spartan races, but duh, the Trifecta is 3 and that is what we really did. We did the BEAST in Aspen, Co Aug 3rd and it was the hardest thing I have EVER done ! Our flight patterns got us down, and in LA a one hour layover turned out to be 7 hours and then they cancelled the flight to Aspen! We had no sleep and were depleted already, but we then linked up with three strangers and got the airline to fly us to Albuquerque, NM where we rented an Ford Expedition and drove 7 hours to get to the race with 2 hours to spare. We checked into hotel and slept a little and when I awoke it had felt like I had already done the BEAST. When we started the first mile felt like death, but it took me 6 hrs 55 min to finish and it broke me mentally, physically and emotionally. I broke down with tears a couple times. We came into this depleted but pushed through! Same for RE, sometimes we gotta gut it out when it looks tough or impossible. I saw some purple Ultras and thought “how in the world can they do this twice?!!” My advice, go for RE like you are a ULTRA! You can conquer the Aspen mountains!!
@Todd Powell Thank you Todd! I house-hacked a townhouse with college roommates right after graduation, then house-hacked the duplex in 2019. Only one property have we had to put 20% down! I found 1 on the MLS, 1 through handwritten direct mail off-market, and the most recent one was an expired listing.
Thanks for asking about my parents. They are doing really well and in good health thankfully. Dad is up in Newberg every once in a while to help on properties, etc. It's nice to have them only an hour away!
@Grant Schroeder thank you for the response. I absolutely love your hustle. You know if you ever see a reasonable deal out there anywhere close to the college and you don’t buy it, would you please let me know? I’m interested in that market a little bit. At some point I see ourselves moving north to be closer to our kids and grandchild. Thanks again Grant￼
@Todd Powell , I'm 5 days late and $5 short, but congratulations! That was a lot of hard work and a lot of well-earned payoff.
@Randy E. You mean you are too late for RE or just too late to my post? Not sure. Ha
Originally posted by @Todd Powell :
@Randy E. You mean you are too late for RE or just too late to my post? Not sure. Ha
I meant late for your post. Also, though I have been in REI for a few years now, I wish I had started long ago.
@Randy E. Keep pushing! You can catch up for lost time. I did the last 4 years and made it a life changer! You’ve got this !
@Danny Galvan . It is all I know.
@Todd Powell Of course Todd! Hope you have a great weekend, and thanks again for sharing your story!
@Grant Schroeder keep doing great things and it was awesome to get your feedback in this thread! God Bless!
@Kayla Truong thanks!!
How do you find your off market deals?
This is one of those articles where I learn as much or more from the comments than the article. Wow. Thank you. I am kinda of like you, except take your what you call 'fear' and multiply it by 10x. I love it you say you're still living in fear and don't act enough. Could be true we all have hurdles. I'm also 52, earn just a few dozen grand less than you, my same 800K is in retirement funds mostly and some stock funds. Divorce 10 yrs ago kept me from hitting 1.5M to 2M by now with aggressively investing 22% and more of my salary. My new wife invests just as heavily. I have mutual funds, some stocks and retirement fund strategies down pat.
I've been reading about real estate a bit since the 90s, but done exactly......nothing. I envy people with guts like you. This winter I said enough is enough, %@#k it. I've taught myself to do other things before, so I've been reading, watching 100s of videos, taking Udemy courses, analyzing 100s of properties. I've toured many properties. Am waiting for a cash out refi on my house to get cash, made 401K/investment rate mods to save up salary cash faster and want to get a 2-4 unit soon. I'm mostly worried, how do I get the 2nd, 3rd, 4th one when my cash is out? I've studied BRRRR, and other tactics for this. Not willing to dig into retirement funds. I'm searching only on MLS for now to gain experience, then may do direct mail or fsbo to find more. I am building a small team, working on a realtor, cpa, lawyer, a PM I met on here, potential partner in Milwaukee. I'm in south central WI. I'm a data architect manager in a major insurance company so building data analysis processes is easy for me. And I have great access to Landlord/property/umbrella insurance information. Anyways all those advantages I have are just dandy, but you have the best advantage. You actually DO SOMETHING. Congrats and keep up the good work. I hope to be able to say next year i have at least 4 doors.
Nevermind on the 'how do you find off market deals' question. these comments take hours to read, and I just saw your answer.
My immediate thoughts are -- Quit. You're done! Congratulations! Great job! I completely get your fear of letting go of income and insurance. I had an easy time quitting (I was self-employed so self-insured anyway), but a much harder time convincing myself to just enjoy my income -- it took me two years to convince myself I could afford to buy a horse. (I am now spending $1200+ per month indulging myself, and I am so glad; if I had waited another 10 years I am sure I would not have done it.)
Your numbers are alot like mine, and I find no problem living off just RE. I still have two kids getting ready to go to college (one next year - one in two years.) I am putting them through private school, and their college money is saved and ready to go. Health insurance for me has been affordable. Get a quote through the healthcare exchange ... you might be able to get a better policy that provides more coverage?
My rental portfolio yields about $13k/mo, I have one tiny mortgage left (I owe $18k on a $350,000 triplex that grosses $3150/mo -- my payment is $750/mo; will be gone before second child goes to college.) I sold many houses over the years. In the past 3-4 years, I started paying off all my mortgages, and buying with cash. NOTE - I did this solely for peace of mind, as a purely personal choice -- I began buying at 100% leverage on HELOCS and mortgages, and I still keep a HELOC open. Debt truly worked for me; now it just doesn't fit my comfort zone. I would have MORE money if I took on more debt, so I am not bashing debt! I flip, too, using cash ... but I tend to hold for a year to keep my gains in the Long Term range.
So, based on what I did, one thought is to sell a single, highly appreciated property. Use the proceeds to eliminate all your mortgages. You'll have the cash cushion you want on hand. And you can easily step into another investment when you're ready. They are always out there; clearly you are very good at finding them and doing them well!
I agree with the poster who said your taxes may go down substantially. My current flip I bought for $ 300,000 cash, putting in around $75,000 cash and I believe I will get out in the $550,000 range. I am holding it for over a year, so taxes will be 15%. This is an "advantage" of having no income except real estate ... your tax rate will go down.
Good luck in whatever you choose. Put yourself and your family first; you have worked hard and deserve to enjoy it while you are still young and have your health. I think you are in a solid position, and should be safe and secure.
My question for you --please share with me your favorite dividend stocks, and any more crowd street or similar passive income opportunities. I want to simplify further; love to hear more insights from someone doing so well in that vein. I am very interested in passive investing now.
I truly think you will be fine. Best of luck! Excellent work!
Hey, Todd...that's awesome... You did exactly what I'm planing on doing, but there are still many things that I still try to figure out.
I'm a new investor... I was blessed to be able to put together about 200k to start investing in RE. I just bought my first property at foreclosure, which I will close on this week. I will probably fix and flip it (Bought it for 75K, ARV $155, Rehab no more that 25K). I worked construction for few years, I even owned a company and I'm planing to do some work myself...
But my end goal is to use the profits I make on flips and reinvest it into buy and hold properties.
Right now I have a hard time understanding taxes and what entities I should use.
I watched so many videos and asked many people... Some say if I fix and flip I'm considered a dealer so my profit will be considered active income, which means I can't tax deduct it if I reinvest those money into other projects. Other people call flipping short term capital gain and even my CPA told me I can deduct those money...! Now if I can do that I'm thinking why do people use the 1031 exchange?... which makes me think that my CPA is wrong... I'm ok with paying taxes but I need to structure the business the right way from the start... so my question is, how did you do it? You have separate entities? How did you structure your business so you can transfer the properties from the "fix and flip" llc into "buy and hold" llc?
I'm new at it and I'm not sure if everything I said and asked makes 100% sense. But I'm stuck into things that I only need to learn once and it looks like people have different opinions on.
ok, I've finished reading the article and analyzing all comments. If you don't feel comfortable quitting your job now, then you're not in wind down mode, but rather wind up mode for real estate. You want more cashflow. My opinion, not the time to start paying off mortgages and settling in for this level, but rather wind up acquisitions to gain more doors and cashflow. Think abundance versus scarcity, think and grow rich book, etc. Maybe 3-4 more 4-units will make you feel you can finally quit? If the management is getting overwhelming start using property management, but just get more doors to cover that expense.
@Todd Powell Congratulations on all of your success so far. I really enjoy reading stories like yours. Question: How were you able to find the out of state deals to invest in? I'm in CT and the MLS here hasn't been cutting it lately. I'm curious how you market to non-listed properties, also. Keep up the good work.
@Conrad Steinweg . Thanks for your input
@Taylor Shapiro . No out of state deals. Just one opportunity zone deal to avoid cap gains
@Mike Chira . Not sure if it was the perfect path, but I flipped in my own name and paid short term cap gains. I saved cash for down payments on buy and holds. There was no way to do 1031 on flips, trust me, or I would have done it. I hope your RE journey serves you well!!
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