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Updated over 9 years ago on . Most recent reply

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40
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5
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John Roeder
  • Investor
  • San Clemente, CA
5
Votes |
40
Posts

Cash Flow allocation?

John Roeder
  • Investor
  • San Clemente, CA
Posted

Hey guys and gals! I am a newbie and after tons of research I think I have narrowed down my market. I am excited to purchase my first rental and I am at the point where the only thing left to do is pull the trigger, but I have a few final questions I wanted to bounce of someone with experience. In terms of allocating part of the rent to vacancy/repairs/cap ex, what if I took it all as cash flow instead of saving it because I already have approx $5000 for those events already saved up?

Most Popular Reply

User Stats

31
Posts
17
Votes
Trevor Tilton
  • Investor
  • Independence, MO
17
Votes |
31
Posts
Trevor Tilton
  • Investor
  • Independence, MO
Replied

Hi John! As a rule we try to have 4% of each property's value on hand for repairs. Any less than that is dangerous, any more than that and that's money you don't have working. This system works great for us!

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