Setting up Accounting for first rental

[Matthew Fitzgerald]

Hey all we are closing on our first deal and I was wondering how to set up the accounting to benefit me the most..... Some info I think may help... We are buying out of state, so we are using a property management company. We are buying with a heloc against our primary residence. Also I'm going to get an umbrella policy. We are looking at only small multifamily 2-4 units. I hope this info helps. Thanks Matt

[Daniel P.]

I would disagree on the umbrella policy. All it takes is 1 lawsuit. I personally don't want to lose my personal assets because someone sues me hence getting the umbrella policy. Understand that you are still at risk, if the lawsuit wants more than what your umbrella policy covers you are still risking your personal assets (house, car, investments). 

Besides, umbrella policies are cheap so I would recommend just getting one.

Investopedia's definition of an umbrella policy:

An umbrella insurance policy is extra liability insurance coverage that goes beyond the limits of the insured's home, auto or watercraft insurance. It provides an additional layer of security to those who are at risk for being sued for damages to other people's property or injuries caused to others in an accident.

Just my opinion here.