All Forum Posts by: Jared Ebert

@Kenneth Garrett 

I like the idea of not using your own money, but even with the BRRRR method, you still have to come up with a down payment and the rehab costs. How else would you pay for that?

@Joe Villeneuve 

What do you mean by this sentence below?  Also, 1073741824?  SHould this mean something to me?  

6 - Why you never ever spend your seed money, only your profit. Use your seed money to infinity though.

A couple random questions. I’m a complete beginner. I just listened to the podcast with “Swanny” who started with condos and upgraded to multi family through 1031 exchange. Several times he talks about how cash flow is “tax deferred”. I don’t understand this. You’re RE income is taxed like earned income, right?

He also seems very concerned about having “too much” equity homes which is part of why he sold his condos and traded up to the apartment buildings. Why is equity a problem? Is it as simple as that money tied up in equity is not making you money buying other properties? Thanks.

I am a high earning professional in a high stress job. I love my job, but I'm also often burned out, and my biggest goal with real estate investing is to find a way to pull back from my job. I think I can reasonably take about $35k from my income annually to put towards REI.

I'm a complete newbie. Originally, I was most interested in SFH. The more I read, the more I lean towards multi family. I can't help but wonder if I should wait and save and make my first purchase a multi family. I'm obviously not going to purchase a huge apartment complex, but I could theoretically purchase a 4-15 unit building with a few years of saving.

Is it better to wait and go big with the first purchase even if it means waiting, perhaps for years, to save enough? Or is it better just to get started and maybe trade up later?

I am a high earning professional in a high stress job just getting started in my career in my mid 30s. I've never invested in RE. I love my job, but I'm also often burned out and don't see myself doing it into my 60s. My biggest goal with REI is to find a way to pull back from my job and retire early. I would like to be financially independent within 15 years from now.

Almost certainly unrealistic, but my goal would be to replace at least half of my income by RE within 15 years, about $180,000, and I could drop down to half time at my current job.

I can’t not get my job’s match which is 6%. At my salary that maxes out my 403b. I put in $19,000, my job puts in $19,000. Then we’re also offered a 457 where I can put another $19,000. It’s hard not to use the 457 because maxing this retirement account saves me about $6,000 on taxes. We save 20% of our income towards retirement (retirement accounts, real estate investing, etc) which comes to about $73,000 annually. Subtracting $38,000 from my retirement accounts leaves $35,000 to use annually towards RE investing.

Reading RE books and listening to the BP podcast, I get really excited and fired up about it, but I can’t quite make the connection to how it makes sense. Feel free to tell me how dumb my math is, because I’m just not getting it.

$35k as a down payment at 25% down, means I can buy a $140k property annually. Let's say it cash flows $300 monthly, yearly I have $3,600 in cash flow. Which in this hypothetical example, my ROI is 10.3%.

If I repeat this process every year, at the end of 15 years my cash flow is $54k. Nowhere near my goal of $180k.

Part of what doesn’t make sense to me is that in 15 years, I’ve invested over $500k and only earned $400k in cash flow. I know I’m ignoring any appreciation, but I hear over and over again not to count on appreciation because that’s a gamble.

How are people getting into this business enough to replace they’re income? Or buy multiple properties per year? I understand this is most likely a very complex question. I appreciate any input. Thanks.