It's fun to have toys but just be very careful using debt, even with a cashflowing property...to buy or pay for them. If the tenant stops paying or the global economy crashes...you're in deep doo-doo. I was running around with an investor today in my contractor truck a '02 Ranger...he had to hop out of his Bentley to come ride with me. In conversation, he asked if I had a higher end car tucked away somewhere. Nope - just not my thing! I have a bunch of cars all paid for in cash but nothing fancier than '04 Sequoia to carry the kids around and client groups. Like most of you, I keep my money working in rentals or joining partners to buy & flip more. If you're retired and want to enjoy....good for you...you earned it. My new investor got to run through half a dozen deals with me, wanted to do several off the rip, but we'll do one and see how it goes. After half a day with me, he remarked that I reminded him of Sam Walton who he apparently knew. People in our business often forget that the guy driving the Olds or Buick is the guy with money....most flash has no cash, at least in atlanta. Not always as with my investor today. He loved the Bentley but didn't buy it...he earned his money the hard way but his wife wanted him to drive something at that level so she bought it with his money! Classic...it's all about living the life you want to....enjoy yourself be but very careful with leverage. Happy Investing!

Ha, ha, yes, I measure everything in quantities of either a down payment or a months worth of cash flow from a unit. Gym membership, hmmm that's half a months cash flow. A weekend getaway, hmmm, several months cash flow, think I'll pass. I've been working on my boat lately... so I can sell it. It's worth right about the same amount as a downpayment in my investment area. I then no longer need the tow vehicle which will cover closing costs. Also, I keep it in a boat yard which is $120 per month. I can't help but think that $120 per month loss is like losing the cash flow from a rental unit. So selling the boat and buying a property is like gaining two units. My buddy has a better boat anyway. When I retire I'll buy another one, my investments will pay for it and I'll have the time to use it.

Yep scale down to build bigger. I'm a lot like @Sharad M. every time I get close to having closing cost it's like a giant magnet and I'm just drawn to it. I can't think of buying anything else because I already know if I sow that seed I will reap much bigger returns that whatever else I could buy with it.

I live in a mobile home and drive moderate cars that get paid off. Then I refinance them again for the down payment on another house. I figure ill let my paid off houses buy all my toys in the next 5-10 years. All my friends with toys are broke and can't figure out how I can keep buying all these houses.

Im with you @Bobby Beard I have gotten rid of most of my "doo dads" to invest in more rental properties. I also am a big fan of what Account Closed just said as that is classic Rich Dad. Whenever I find myself wanting a new car or a new gun or whatever I look for a property to buy so the cash flow makes the payment for me.Problem is after I buy the property I take the cash flow and look for another property lol.

This is a fantastic strategy. I guess I'm not the only one that's doing it. :) Instead of paying cash for a car, use the money to buy an investment property. Make the car payment with your monthly positive cashflow. With this strategy, the tenant is buying you a house by paying down the principal. The positive cashflow will buy you a relative new car every 5-7 years. Once you have enough equity in your investment property, you can do a cash out refinance and buy a 2nd property. Several years later, you can use the equity from your first two investment properties to buy two more. Rinse and repeat every several years or every real estate cycle. I think I just laid out a real estate investment pyramid scheme. Short term sacrifice for long term gain. I hope you make the right choice.

I just went through this for the last 20 months. I am a car guy. I like driving a nice car. I also have other expensive hobbies. I Also have a pretty good job as an engineer. Back in July of 2012 I sold my $48K (when new) luxury car and dropped down to a Ford Focus. Everybody, and I mean everyone gave me a hard. time. The guy at the DMV The lady at the DMV One of the barbers where I go get my hair cut The wife of a close friend really gave me a hard time. However in that time I drove the focus (less insurance, gas, and maintenance cost) My wife and I were able to 1. Produce a play 2. Have our first child 3. Go out of town for our 5 year anniversary 4. Renovate our house and finish the basement 5. buy our first Rental property Now just this past Saturday I got rid of the Focus and got a new/certified used 2013 Honda. (the proceeds from our property can pay the note on the Honda) Could we have done all of that while I still drove the luxury car at a total cost of $1K /month mmmmmmmmmmm......Maybe, but it was much easier while driving the focus.

The 40' Carver is like real estate in some ways. You can rent it out, you can deduct the interest on the financing, and maintenance costs will almost always go over budget. I used to really want one, but once I could afford it, real real estate won out.

@Minh L. "However, a sound practice is to find something to pay for the toy before you buy it." Absolutely, I agree. I'm not recommending going into debt for toys, especially if you haven't put yourself in a stable financial position first. I'm just saying there maybe should be a bit of balance. Make your investments, but also don't forget to enjoy yourself along the way.

Updated about 12 years ago on 03/07/2014. Most recent reply

265
Posts: 58
Votes

Bobby BeardPoster

Real Estate Investor
Panama City, FL

Investor Mindset

Is it me?

Bobby BeardPoster

Real Estate Investor
Panama City, FL

Posted February 16, 2014 22:22

Since I have gotten into RE and doing pretty good with it I find myself looking at all my toys ( boats, extra vehicles, 4 wheelers, gun collection, etc ) thinking to myself I should sell all of it and invest into more properties. am I the only one? Lol

0 Votes

56 Replies

Jump to Last Reply

Most Popular Reply

1,991
Posts: 1,136
Votes

Sharad M.

Carlsbad, CA

Sharad M.

Carlsbad, CA

Replied February 16, 2014 22:36

Bobby, I have never been into buying toys. Every time I think of buying anything that I don't really need, I do consider what I could do with that money if I invested in RE.

For instance, I bought a used-car last year and I was going to pay cash for it, but instead I bought a house with that money and now the house pays for the car each month and I have left over at the end of the month.

I am obsessed with RE. I can talk RE non-stop all day. This is what gets me going.

Sharad M.

Podcast Guest on Show #155

5 Votes

Sort By:

Oldest

Loading replies...

Struggling to find reliable real estate advice?

Join over 3 million real estate investors to build connections, learn from others, and share your journey — all for free!

← 1 2 3 →

Your Profile Views

Curious to see who's interested in your profile? Unlock your views with Pro

Connect with others

7 day free trial. Cancel anytime.

PRO

Upgrade to Pro

Market Finder - key investor metrics for all US markets

Deal Finder - investor-focused filters and notifications for new properties

Calculators - Unlimited access to 9+ property analysis calculators

Find an Agent

Find & Match With an Investment Friendly Real Estate Agent

Enter your market to get started

Rent Estimator

Address or ZIP