Investing in Real Estate as newly Enlisted Military

10 Replies

I am enlisting in the U.S. Navy and I want to get started investing. From what I understand the best steps would be to save for at least a year and rank up to at least an e3. During that time I could build credit, but also look into owner financed properties. I am looking to use the VA loan and owner occupy until I leave to another duty station. I've read other posts about military investing, but it sounds like those people have been in longer, have education, and get paid more. I need info and if anyone has experiences investing or other people investing as newly enlisted, or under 4 years in the military. Thanks!

Are you married? Lower enlisted stay in the barracks and do not receive BAH until they have gained rank. In the Army only E6s and up could live off post unless married.

You’ll also need to wait a bit to get your VA loan benefit.

Focus on your career first, investing can wait. You might THINK you know what you want to do... but take some time to see what the rates ACTUALLY do. Don't go chasing bonuses... and keep the thought of "what would this rate do in the civilian world" in the back of your mind.

Save away, but get e4 and a more perm station before you focus on investing...

At least you're interested in real estate though and not new car like the others lol....

Not married so I will have to wait a few years and rank up. I believe I could make e4 within 2 years, and e5 in the next 2, then I might re-enlist. I am also doing a few college courses throughout my time. I want to go on a ship and travel a bit so I plan to do that first and save my cash. I want to do damage control which is firefighting in the civilian world. Ill play it by ear though and see where it takes me. Thanks for the replies.

You have the right idea, Jacob. You'll need to pick up E-5 or have dependents to get BAH, so save up, study up, advance, and work to put yourself in a good position in a couple of years.  Deployments are great for stocking up a nice chunk of cash if you can avoid blowing it all on port calls (the inside of a bar in Thailand looks pretty similar to one in the States) and the inevitable post-deployment sports car buying spree (you'll see them sitting in the parking lot 3 months later when folks can't afford the payment, insurance, and gas).

One of the hull managers (government civilian who manages shipyard repairs) I used to work with started out as a junior Hull Tech, saved like crazy so she could start investing, invested over the course of a 30 year career as she eventually pick up Warrant, and now has a multi-million dollar rental portfolio.  She works because she likes it and her and her husband take baller vacations multiple times a year and can afford pretty much whatever they want.  No reason you can't do something similar!

You don't need to be E-5 to move out of the barracks, although it is guaranteed that you are allowed to life of base at that point of time and receive BAH. Depending on where you get stationed, on Whidbey Island for instance, many Sailors leave the Barracks after they made E-4 and routed a Special Request chit through their CoC all the way to the Base CMC.

@Kevin Touw makes an excellent point, save your money! I was able to save 10-15k during deployment, and towards the end of it i was looking for real estate and even put an offer in before we got home (closed 2 weeks after we were back). 

As soon as I moved in I had 2 roommates that paid $500 each, I had no living expenses due to them and also received BAH, now i was pocketing and locking for the next deal. 

Concentrate on making rank asap, find out your base policies and how to get off base quicker. When you are able to receive BAH, move in with someone until you find a deal so you can use the VA loan properly.

Just my .02

@Jacob Marsh

Many of our clients in the military have used their time to educate themselves (here on BP and books), build their network, and plan their systems in advance. So when the right time and opportunity came their way, they were prepared enough to pull the trigger. Best of luck to you!

I am AD and I recommend when the time is right, invest in something that cost less than your BAH. House hack if possible. Key is "less than your BAH". This ensures no money out of pocket. Next you must ensure the local rental market will cover your cost/expenses and cash flow after you are transferred which will happen. I agree with Matt K., do not let investing prevent your obligation to master your craft and put service before self. That is why you volunteered and what tax payers expect. However you will need a place to live if not forced to live in dorms. I also recommend to let all others know your looking and am willing to try to help sailors solve their house problems. Allot of them do nto buy right and when they leave or have to leave, they cant sell under typical circumstances because they will lose $ and they don't want to be a landlord. That is a golden opportunity to use some creative tactics to take responsibility of the home and rent it to others. This is a common problem. As well as people buying and being forced to move unexpectedly after closing. They need help and we can help. Lastly, consider raw land buys and sells. You can do this while in dorms. Just learn your area and buy right. To learn your home area's study and pay close attention to the MLS and other retail sites regularly to understand local area pricing. This way when you talk to folks you can know in your own mind what is a great deal vs a deal. But definitely learn your job and become an expert first without distractions. "Don't get married just to get our of dorms" that never works out well.

A lot of good tips for you in here shipmate. And you’re mind is in the right space! Just be patient and you’re going to do fine. I’m in a similar boat but you have a great advantage if you do this right.

Focus on your career first and what you want to do rating wise. Don’t accumulate ANY heavy debt (or any debt at all if you can avoid it), that means a car payment too! Dave Ramsey instilled a lot of good values in me. I don’t agree with all of his tactics but he is a very good foundation. I’m completely debt free since around September 2017. I only have my mortgage. E-5 in the Coast Guard, 6 years in and i work for H&R Block on the side. I’m renting out 1 out of 3 rooms in my home. Even though I am looking for my next property to buy and rent this current residence out, my main focus is saving up a hefty Emergency Fund/savings for the next 4 - 6 months while absorbing as much knowledge as possible, attending REA groups, running numbers in the biggerpockets calculator, networking, all that.

Last piece of advice. TAKE COLLEGE courses online. 1 class every semester will do. I’ve been doing so for the past year and some change so that I can apply for getting commissioned and have my degree in the long run. Moral of all this is give yourself exit strategies aka a lot of options! Don’t be afraid to reach out man, we can keep each other accountable.

@Jacob Marsh all good advice given here.  There are numerous ways that you can use your benefits and more importantly the unique lifestyle of a service member to help you build wealth.  Just make sure you don't let your peers likely bad financial habits rub off on you.  Have a goal and continuously work towards it.  When I was still in I was jokingly referred to as stingy, cheap, a tight wad, etc.  I still went out and had fun, but I know how much it cost me to drive to and from work.  Now I have 16 units with not much effort and some awesome cash flow.  My peers from the service are now looking to me to help them get into real estate investing. I'll send you a PM with some articles that I think will help you out.

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