Real Estate Investing at 18... Am I crazy??

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Real Estate Investing at 18... Am I crazy??

Rand Knutson
Seattle, WA · Member since 2017 · 19 posts · 14 votes

Hi, I am 18 years old and have around $12000 saved up. I was thinking there must be some way to use the money meaningfully, and then I came across a YouTube video of Robert Kiyosaki's tips from Rich Dad Poor Dad. He says that smart people don't save money, they invest money. I was thinking of opening a Roth IRA and investing the max $5,500 so the money would at least be growing, but then I started researching real estate investing, and heard many think it is the best form of investing. I am thinking after I read a ton, listen to podcasts, videos etc., and learn a LOT on the subject, I would buy my first rental property within half a year.

Is this a tangible goal for an 18 year old going to college next fall? Is there really enough benefit in real estate investing that would warrant this purchase? I would like any advice as I am only 1 day into my researching mission.

Thank you!

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Jason D.
Investor · Rockford, MI · Member since 2013 · 116 posts · 54 votes
9y
Not crazy, I think many on this site wished they'd started at 18. Keep reading and learning until your confident in the path you want to take. Entering college and the demands with that need to be considered. If you move off campus your second year, buying a house and renting out rooms while living there would be one option....I'm sure others will chime in with more. Figure out what your comfortable with a go for it.
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  • Darius Hollis
    Atlanta, GA · Member since 2016 · 30 posts · 21 votes
    9y

    @Rand Knutson Age doesn't matter with investing, in fact you have the advantage of time. My best advice is to research and learn as much as possible. While the benefits and returns of real estate investing far outweigh any other investment vehicle, it can also be risky without a lot of preparation and knowledge. As long as you are willing to do your research and become confident that you understand the market you are investing in and have a concrete plan on how you will find, finance and manage the property, then your goal is 100% tangible. 

    Good Luck!

    1Reply
  • Jason D.
    Investor · Rockford, MI · Member since 2013 · 116 posts · 54 votes
    9y
    Not crazy, I think many on this site wished they'd started at 18. Keep reading and learning until your confident in the path you want to take. Entering college and the demands with that need to be considered. If you move off campus your second year, buying a house and renting out rooms while living there would be one option....I'm sure others will chime in with more. Figure out what your comfortable with a go for it.
    2Reply
  • Matthew Gangi
    Boston, MA · Member since 2016 · 24 posts · 6 votes
    9y

    I am only 20 years old and I am saving up for my first investment, while learning learning learning learning. Crazy? I think I might be a little too, but the good kind of crazy. Grind now and thank yourself later. Anything is possible, and i'll prove that.

    1Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    I skipped most of collage went half a year and then got my RE license at 18... I don't think you should invest.. If I was you I would continue to save I would get a RE license and then intern with a developer  commercial broker big management company something like that.. learn the industry keep saving.... and or work as an agent part time and learn how to make money in the industry you have a lifetime to invest.. and in most markets If your talking rentals the prices of the homes never move much anyway.. half the people on here just invest for cash flow and acknowledge the homes will never be worth much more than they paid for them.. so no reason to feel a need.. learn the industry first.. and learn were the big bucks are and its not in owning a few rentals I can assure you of that....

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  • Rand Knutson
    OP
    Seattle, WA · Member since 2017 · 19 posts · 14 votes
    9y

    @Darius Hollis @Jason D. Thank you for your encouragement! I am motivated and will learn as much as possible before I take any risks. When I am very knowledgeable on the topic, do you suggest real estate investing before putting money into a Roth IRA? I am willing to do the work of Real Estate, so are the returns and benefits much better with RE in comparison to a Roth IRA?

    0Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    9y

    @Rand Knutson starting young. I dig it. Good luck and welcome to the site.

    1Reply
  • Rand Knutson
    OP
    Seattle, WA · Member since 2017 · 19 posts · 14 votes
    9y

    @Matthew Gangi That's awesome. I wish luck to you! I agree we will definitely thank ourselves later.

    0Reply
  • Darius Hollis
    Atlanta, GA · Member since 2016 · 30 posts · 21 votes
    9y

    @Rand Knutson I would personally start the ROTH before investing in real estate because it is a smart investment and with the limit being $5,500, you're left with $6,500 in savings to build back up or immediately put toward investing in real estate; however I would do that because I am very risk averse and I always take the less risky option before adventuring into murkier waters. That said, it honestly depends on your risk tolerance. If you're willing to take the risk and devote most or all of your capital to making your first deal happen, then go for it, just always proceed with caution and if you can, find a mentor or trustworthy agent that you can soundboard ideas off of and ask questions. 

    Real Estate investment done correctly will put any equity, debt investment, or retirement account to shame. You would be hard pressed to find another investment vehicle that can provide the risk adjusted returns that real estate can provide. The trade off is that real estate investing takes more time, effort and understanding than most investments.  

    1Reply
  • Account Closed
    Investor · Princeton, TX · Member since 2014 · 1k+ posts · 1k+ votes
    9y

    @Rand Knutson   What are you planning on getting a degree in?

    0Reply
  • Richard Brideau
    Poughkeepsie, NY · Member since 2012 · 12 posts · 13 votes
    9y

    I wish I knew about all this when i was 18!

    1Reply
  • Rand Knutson
    OP
    Seattle, WA · Member since 2017 · 19 posts · 14 votes
    9y

    @Michael Biggs I am actually going to major in Computer Science, I am not looking for real estate as my career, just an investment opportunity that I could spend a lot of time in.

    @Account Closed I am not particularly planning to retire early, I would be happy to keep building my assets and holding them for the long run, but it is very early, and I do not know how my thinking or situation will change.

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