All Forum Posts by: Melanie Johnson

Thanks. This thread has been so great for me and I am just so appreciative of everyone's ideas and comments. I live in LA and I actually had been thinking of investing out of state but my aim is to build long term, sustainable wealth and I'd love to be closer to the properties so this is all making me rethink investing in SoCal. 

"It's not impossible" - LOL things that people tell me are impossible are some of my favorite things to do! :-) 

Thank you again! 

I can't believe how much conversation this has generated! Thank you so much to all that offered their feedback. A few things to mention: 

1: All of my CC debt has low interest that I negotiated when I worked out my payment plan. I have 3 cards I'm paying off; the two with the lowest balances ($3k/just under) have 9.5% interest, the one with the highest ($13K) is about 3%. 

2: I could probably pay off the two low balances completely, and pay a big chunk of the $13k one this month and keep $10k in cash reserves,  and based on projected income from my W2 and a small business I run, pay off the remaining of the biggie by the end of November and still keep my $10k reserve through it all. I project I'll be back up to $20-30k in cash by March 2022 if I go this route. This is KIND OF what I'm leaning towards. That said, @JackOrthman I have really enjoyed your "zig while the others are zagging" advice and you have given me a lot to think about! 

Does this change any calculations? 

Thanks everyone for all of your thoughts. You've given me a lot to think about, and a lot of motivation too. Thank you! I appreciate it! 

Hi everyone! I'm new to the forums and to REI. I haven't done my first deal yet. Actually, my husband and I nearly bought a place earlier this year. That place fell through at the last minute, but although I was hugely disappointed at the time, in hindsight, it wasn't a great deal for us, I learned a lot and the whole experience got me inspired to start looking into real estate investing.

My husband and I have a small amount of savings - around $25k, which is enough to buy a rental property - but we also have credit card debt of about $19k. That sucks and I'm not proud of it - but I'm so proud of how far we've come. Two years ago we were drowning in over $40k of CC debt, I was just coming out of being laid off, and I was regularly worried sick about what we were going to do to survice. So I feel really proud of our efforts to pay it down. We have worked hard and hustled, and now finally we moving into positive net worth territory even with the credit card debt after years of having a negative net worth. 

Anyway, one of the reasons our potential house deal fell through earlier this year was because of the credit card debt. I'm now in a position where I could pay it all off in one fell swoop - but it would wipe out most of our savings and we'd have to start rebuilding them before we would again be in a position to invest in a rental property. 

I have a few options. I could pay off some of the debt and hang on to more of our cash reserves, which I could use to start investing. I could keep paying a large amount each month to the card companies (I have payment deals with them so interest is low). I could take some money out of my 401k and lend it to myself to put towards the debt. OR I could pay it all off in one fell swoop, start rebuilding my reserves firstly by paying myself what I was paying the credit card companies. 

What would you do if you were me? All advice welcome!