Is anyone rich here?

[YY1]

We did the rental property gig for 30 years. That was enough! I would love to invest 12K and add 1k a month and end up with love 300K in 11 years. Chances are slim that would happen.

We started in 2006 with my wife's house. She was nervous...but we did so well that when a somewhat distressed house across the street came up for sale in 2015, we bought that.
She has been a finish carpenter and cabinet maker, and I have been an electrical apprentice and have other building maintenance experience, so we do 80% of our own repairs.
The "loan to value" ratio on that second house is about one third of what comps in that neighborhood are going for.
Having "supply side" investments lets us "pass along to the consumer", just like the big boys do.
In 2020, our rents went from $1100 a month to $1850 a month per house, but the costs remained basically the same.
We have so much cushion, that we can still undercut the market and make good profit.
We usually have dozens and sometimes even hundreds of applicants when one of them gets vacated.

Additionally, I raided my brokerage account in 2012, for down payment money to purchase a 23 unit "mom and pop" self storage facility that is .5 mile from our house.
This had the dual purpose of generating a little spending cash, and providing me with a large, multi-car garage that other people are paying for.
(Interestingly, I have never lived in a house that had a garage with a concrete floor, and still don't)
I changed the culture of that business to cater to "car people" and currently have 5 of the 13 tenants with project cars stored there.
I currently have a waiting list of car people that can't find a "normal" storage facility that will let them work on their cars.

My wife refinanced the second rental house and paid off the first in 2021 (after a 9 year tenant, that basically bought the house for us), dropping the total cash outflow payment by over 100 dollars a month and decreasing the term by 5 years, and I paid off the shop complex in 2022 (five years early), all with proceeds strictly from those rentals.

We also write our own leases, do our own taxes (the record is 115 pages), and have never had a financial advisor.

We are kind of hoping for a correction in the housing market soon, so we can acquire a third rental house before we get too old to continue actively managing them.

BTW, most of this time, our work salaries have been 55K or under for me and 41K and under for her.
...and both of us have "only" high school educations, and started from abject or borderline abject poverty.

You CAN do it, if you do decent research, and have a sound plan.

 

[YY1]

You just have to guess it right.

Therein lies the rub.

 

[jeff alder]

We started in 2006 with my wife's house. She was nervous...but we did so well that when a somewhat distressed house across the street came up for sale in 2015, we bought that.
She has been a finish carpenter and cabinet maker, and I have been an electrical apprentice and have other building maintenance experience, so we do 80% of our own repairs.
The "loan to value" ratio on that second house is about one third of what comps in that neighborhood are going for.
Having "supply side" investments lets us "pass along to the consumer", just like the big boys do.
In 2020, our rents went from $1100 a month to $1850 a month per house, but the costs remained basically the same.
We have so much cushion, that we can still undercut the market and make good profit.
We usually have dozens and sometimes even hundreds of applicants when one of them gets vacated.

Additionally, I raided my brokerage account in 2012, for down payment money to purchase a 23 unit "mom and pop" self storage facility that is .5 mile from our house.
This had the dual purpose of generating a little spending cash, and providing me with a large, multi-car garage that other people are paying for.
I changed the culture of that business to cater to "car people" and currently have 5 of the 13 tenants with project cars stored there.
I currently have a waiting list of car people that can't find a "normal" storage facility that will let them work on their cars.

My wife refinanced the second rental house and paid off the first in 2021, dropping the total cash outflow payment by over 100 dollars a month and decreasing the term by 5 years, and I paid off the shop complex in 2022 (five years early), all with proceeds strictly from those rentals.

We also write our own leases, do our own taxes (the record is 115 pages), and have never had a financial advisor.

We are kind of hoping for a correction in the housing market soon, so we can acquire a third rental house before we get too old to continue actively managing them.

BTW, most of this time, our work salaries have been 55K or under for me and 41K and under for her.

You CAN do it, if you do decent research, and have a sound plan.

without a doubt! Karrin and I had 9. We did mostly HUD home buybacks. I'm an Industrial electrician maintenance millwright. Karrin is a great gopher and painter. We also did a bit with the landscaping on the properties so they would have tenured curb appeal when we sold them all. We have one left that is an old Sears Craftsman house. It was also our 1st. It has paid for itself at least 4 times in rent. We are selling it to my cousin's son. He has his 1st newborn and it's 4 blocks from his work. WIN WIN Once this is done we are done.

 

[YY1]

without a doubt! Karrin and I had 9. We did mostly HUD home buybacks. I'm an Industrial electrician maintenance millwright. Karrin is a great gopher and painter. We also did a bit with the landscaping on the properties so they would have tenured curb appeal when we sold them all. We have one left that is an old Sears Craftsman house. It was also our 1st. It has paid for itself at least 4 times in rent. We are selling it to my cousin's son. He has his 1st newborn and it's 4 blocks from his work. WIN WIN Once this is done we are done.

That's the way you do it....and you don't even play the geetar on the MTV!

 

[Dan the man]

I'm surprised more people haven't talked much about the crypto markets. I found Bitcoin in early '13 and have been into it ever since. I've mined, I've tried the buy low / sell high thing, I've made some money here and there, but DAMN if I knew in early '09 what I know now, I'd be a billionaire. The volatility of crypto is what makes it useful for the buy low / sell high thing. You just have to guess it right. And after 12 years, with all my research and having been through several big crypto up / down price cycles, it is an educated guess at best. Some say that crypto "is not an asset / is not a commodity" etc. It doesn't have to be. If I can buy for X and sell for X+, I have more dollars.

Back in March when prices were down, I put in $14K across bitcoin, solana, xrp, cardano, chainlink, and doge. Since then, my account has been from $14K to 19 to 15 to 17 to 19. I'm hoping to sell it all for 30-40 when prices top out in this price cycle, which could be in 6 months to 3 years. Just got to watch the markets, do research, and hope for the best. Try to learn and guess right.

I've heard of people making big money in options and calls / puts, but I know nothing about it so I don't do that.

I watch a few youtube channels like Michael Bordenaro and ClearValueTax, and a lot of other YT videos on the economy, the markets, the banking system, where our money comes from, etc. It's a huge house of cards. Right now we are in a bad spot. If interest rates go up, this happens. If interest rates go down, other things happen. And neither is particularly good.

I never had much in my IRA or 401K, about $6500 total, but when I hit my birthday this spring, it really jumped into my mind what I need to be doing. I'm now putting 20% of my pay into my Roth 401K, and I'll be raising that to 30-40% in a few months once one other bill is paid off. I have some other sources of income from rental duplexes and other things, so my job isn't paying for my whole life. I've got 15 years until I hit 70 (damn I'm getting old!), and I've got to load up the 401K and maybe an IRA HARD until then!

My 401k at work had a 20% limit and if you went over 15% you were required to fill out some kind of form stating that you were able to afford to go over 15%. I never went over 12% so I don't know exactly how it worked out.

 

[Dan the man]

We started in 2006 with my wife's house. She was nervous...but we did so well that when a somewhat distressed house across the street came up for sale in 2015, we bought that.
She has been a finish carpenter and cabinet maker, and I have been an electrical apprentice and have other building maintenance experience, so we do 80% of our own repairs.
The "loan to value" ratio on that second house is about one third of what comps in that neighborhood are going for.
Having "supply side" investments lets us "pass along to the consumer", just like the big boys do.
In 2020, our rents went from $1100 a month to $1850 a month per house, but the costs remained basically the same.
We have so much cushion, that we can still undercut the market and make good profit.
We usually have dozens and sometimes even hundreds of applicants when one of them gets vacated.

Additionally, I raided my brokerage account in 2012, for down payment money to purchase a 23 unit "mom and pop" self storage facility that is .5 mile from our house.
This had the dual purpose of generating a little spending cash, and providing me with a large, multi-car garage that other people are paying for.
(Interestingly, I have never lived in a house that had a garage with a concrete floor, and still don't)
I changed the culture of that business to cater to "car people" and currently have 5 of the 13 tenants with project cars stored there.
I currently have a waiting list of car people that can't find a "normal" storage facility that will let them work on their cars.

My wife refinanced the second rental house and paid off the first in 2021 (after a 9 year tenant, that basically bought the house for us), dropping the total cash outflow payment by over 100 dollars a month and decreasing the term by 5 years, and I paid off the shop complex in 2022 (five years early), all with proceeds strictly from those rentals.

We also write our own leases, do our own taxes (the record is 115 pages), and have never had a financial advisor.

We are kind of hoping for a correction in the housing market soon, so we can acquire a third rental house before we get too old to continue actively managing them.

BTW, most of this time, our work salaries have been 55K or under for me and 41K and under for her.
...and both of us have "only" high school educations, and started from abject or borderline abject poverty.

You CAN do it, if you do decent research, and have a sound plan.

By raising the rent by $750, how do you keep from paying more taxes? You only have so much you can deduct. We know of a lady who raised her rent because she could and put herself into a higher income tax bracket it cost her about half of what she raised the rent. You can deduct the interest, real estate tax and any repairs she made but it wasn't enough.

 

[jeff alder]

By raising the rent by $750, how do you keep from paying more taxes? You only have so much you can deduct. We know of a lady who raised her rent because she could and put herself into a higher income tax bracket it cost her about half of what she raised the rent. You can deduct the interest, real estate tax and any repairs she made but it wasn't enough.

Creative writing 101

 

[Demonx2]

I'm surprised nobody has mentioned closed-end funds (CEFs). They trade like a stock unlike a mutual fund that trades at the end of the day. There's a universe of them out there with most of them paying "dividends" monthly. 6%-8+% is common.

I started buying them 10+ years ago so my return percentages on initial capital is higher as their monthly returns have gone up over the years. I've essentially almost built my own mutual fund of them as I have so many different ones. (Some with more $$ in them than others.)

You buy them when they trade at a discount to their NAV as they ebb and flow with the market. Like any investment, there are good ones and bad but in general they are a more steady return investment tool than owning individual stocks (which I also have). Not saying they are the only thing to invest in but instead that they are a nice additional investment in a diverse portfolio.

 

[MOPARMAGA]

A friend and I had the perfect idea years ago. Macon and Bibb county have an ordinance that says you cannot serve alcohol and have nude dancing in the same establishment. There's a pair of buildings on the east side of Bibb County that are mirror images and are less than 5' apart on one side. We had talked about knocking both facing walls out and replacing them with thick glass. Bar in one building with bikini servers and nude dancing in the other so you could look right out one building into the other. lol

That is a perfect idea.
The city I work in & the city I live in doesn't allow those or bikini coffee stands....but it's Washington so homeless people can whatever they want lol.

 

[timk225]

I'll tell you how I got my first rental duplex. In early 2019, my realtor friend and I had been looking for a while, but I was never able to get $5000 all at once for a down payment, plus a seller who would do owner financing.

My path to rental ownership thus began on March 31, 2016, when Tesla opened up reservations for Model 3s. I was third in line at the local mall to put my $1000 down. My 3 was delivered in May 2018. At the time, I would get a $7500 tax rebate for buying an EV.

So in February 2019, when we did our taxes, I found myself with over $7000 extra dollars, which was set aside as my down payment for a duplex!

In March 2019 I got one, and I spent 3 years putting all the rent money into payments, and paid it off in 3 years flat. Along the way I got to meet all sorts of interesting and largely undesirable renters, and my 18 page lease grew to 19 pages with additional terms and conditions as renters one by one would get evicted for this reason or that.

Now we have a total of 5 rental units, and we are going to start making double payments on our house mortgage to pay it off in 8 years or less instead of another 21 years of payments.

Fun fact about renters - when facing eviction, they become legal scholars, and claim "You can't evict me because of" (fill in whatever reason they give). I'm now 3 for 3 on evictions, including under covid restrictions. 5 for 5 if you count Section 8 renters in which case all I had to do was call the county Section 8 office and say I was not renewing their lease.

But now I have a good group of renters, I'd like to keep them.

A year later, my wife's mom died, and my wife got some money. She wanted to buy a new Volvo XC40. I said "Don't buy a car, buy a duplex". I laid out my plan to my realtor friend, who owned about 40 rental houses, and he liked it. We found a duplex for $38K that needed a roof badly, and all new paint inside, the old paint was peeling like crazy. Spent another $26K fixing it up. She got her Volvo, I handled getting renters and the house rebuild. 4 years later, her Volvo (a depreciating asset, by the way), has less than a year left on its payments, then she will still have her duplex and its full value, plus $1400 a month income from the 2 apartments.

 

[YY1]

...my realtor friend...

That's a hell of a thing to have.

I wish we had one.

We actually approached any and all realtors we came in contact with asking if they would work with us to find houses that fit our criteria.

None were interested, even though we stated we could be interested in buying a property every 1-3 years.
It would have been guaranteed sales on basically a retainer.

No takers.

One actually screwed us out of a good deal on a house in the same neighborhood that needed some work (just like we were looking for) by stalling on sending the offer, which got rejected for missing the deadline even though it was for 5K more than the offer that was accepted, and the reason it missed the deadline was a highly publicized blizzard that crippled air travel (the offer was sent air mail overnight).

 

[BSB67]

We did the rental property gig for 30 years. That was enough! I would love to invest 12K and add 1k a month and end up with love 300K in 11 years. Chances are slim that would happen.

If you invested $12K in a simple S&P 500 Index Fund in 2014 and added $1K every month following, that would be $284,000 today. No broker fees, no crazy magic stuff, no tip-of-the-day non-sense, no market watching and moving stuff around. Drop it in, forget about it.

Then, if you add no additional money to it for the next 20 years, based on a reasonable 7% S&P 500 annual average gain, it would be $1,140,000.

 

[jeff alder]

If you invested $12K in a simple S&P 500 Index Fund in 2014 and added $1K every month following, that would be $284,000 today. No broker fees, no crazy magic stuff, no tip-of-the-day non-sense, no market watching and moving stuff around. Drop it in, forget about it.

Then, if you add no additional money to it for the next 20 years, based on a reasonable 7% S&P 500 annual average gain, it would be $1,140,000.

Thanks for the math but we did wonderfully with the 9 rentals. We invested in ourselves. There is a nice windfall in the end when all the properties are sold that someone else already paid for 5 times over. We enjoyed taking an active role by investing in ourselves and not relying on others, markets, war, pestilence or disease. We also were able to provide nice properties for family and friends and a few strangers that became lifelong friends.

 

[YY1]

We got 84K in the first rental (mostly paid by tenants) and 77K in the second (again mostly paid by tenants) and I got 94K in the shop complex (one more time, mostly paid by tenants).
Actual "out of pocket" is closer to 65K total for all three properties (down payments, closing costs, inspections, etc).

Value on the houses is currently 250K each and the shop is probably 300-350K.
A similar one across the street with fewer but larger partitioned areas sold last year for 750K.
Kinda hard to find comps for properties like that.
Commercial valuation is not as easy as residential.
All told I think the value of the business is actually less than the value of the property.

The houses clear between 11 and 16K each and the shop does about 8K (would be more but I'm using four units for my garage and 3 more for parts storage and housing related items).
I could probably pay myself for the unit with house stuff and write that off, but that's kinda "red flaggy" for the little it would actually save.

It's the best "second job" I've ever had considering the income versus the actual hours worked.

 

[BSB67]

Thanks for the math but we did wonderfully with the 9 rentals. We invested in ourselves. There is a nice windfall in the end when all the properties are sold that someone else already paid for 5 times over. We enjoyed taking an active role by investing in ourselves and not relying on others, markets, war, pestilence or disease. We also were able to provide nice properties for family and friends and a few strangers that became lifelong friends.

Great. Just respond to your statement.

 

[jeff alder]

Great. Just respond to your statement.

DITTO

 

[BSB67]

DITTOView attachment 1716442152

Not sure your point. My numbers include market drops.

 

[jeff alder]

Not sure your point. My numbers include market drops.

My point is that the scenario only points to this one term in history. If an investor does not fall in that age category and had a long term that was needed for his retirement in a year where the "gains" went down it would not be quite so rosie beause he doesn't have 10 years after the fact to possibly recoupe his loses and hope even more he didn't have to pull in 2008 when he just got his *** kicked in 2002. Using known past history for an example is easy. Predicting the future not so much.

 

[mopowers]

Even with under 10 yrs 'til retirement, I welcome market corrections and downturns. It means I'm getting a discounted stock price.

 

[jeff alder]

 

[BSB67]

My point is that the scenario only points to this one term in history. If an investor does not fall in that age category and had a long term that was needed for his retirement in a year where the "gains" went down it would not be quite so rosie beause he doesn't have 10 years after the fact to possibly recoupe his loses and hope even more he didn't have to pull in 2008 when he just got his *** kicked in 2002. Using known past history for an example is easy. Predicting the future not so much.
View attachment 1716442175

Certainly there are worst case time periods when coupled with poor short term money choices, yes it could be negative.

Some folks see these drops in a vacuum of all the dynamics. I was in the market all through the 2000s with simple investing and continued monthly contributions. As mentioned above, during that period you are plowing money into a discounted market. When the market “recovers”, you’ve actually just made a pile of money.

For the recent 11 year time period, 2014 to 2025 used in my previous example where $12K turned into $284,000, the market dropped three times, 32%, 24%, and 21%.

If you’re more than 3 years out from retirement it is unlikely you’ll be hurt financially in any meaningful way. Furthermore, you should not see retirement as some on/off switch for your money management strategy.

Of course there are always exceptions.

 

[jeff alder]

Certainly there are worst case time periods when coupled with poor short term money choices, yes it could be negative.

Some folks see these drops in a vacuum of all the dynamics. I was in the market all through the 2000s with simple investing and continued monthly contributions. As mentioned above, during that period you are plowing money into a discounted market. When the market “recovers”, you’ve actually just made a pile of money.

For the recent 11 year time period, 2014 to 2025 used in my previous example where $12K turned into $284,000, the market dropped three times, 32%, 24%, and 21%.

If you’re more than 3 years out from retirement it is unlikely you’ll be hurt financially in any meaningful way. Furthermore, you should not see retirement as some on/off switch for your money management strategy.

Of course there are always exceptions.

I must have misread the previous 12 K turned into $284,000. I thought it said 12 K plus a 1 thousand dollar out of pocket contribution per month for the whole term which would account for an actual $132,000 out of pocket personal contribution to the final $284,000.

 

[BSB67]

Correct

 

[Inertia]

Since 1995 I have been invested the whole time, there have been many " crashes", the average time to recover is 3 months by my experience. With lotsa media to back it up.

​

""The average time to recovery from a 5%-10% downturn is three months. The average time to recovery from a 10%-20% correction is eight months"

Stock market corrections and what investors should know

While stock market volatility can be unsettling in times of uncertainty, remembering these things can help you weather the storm.

www.invesco.com

Lotsa folks just don't understand the Market, think it's a "gamble" cuz you don't take the time to learn how to play, or the rules/ tools avail.

How many gambles do you know where you can get a partial refund if you ask for it.

Can you get part of your bet back if your horse is last outta the gate, get partial refund if you get dealt shitty cards, get partial refund while a flipped coin in the air.

Gambling you make your bet. You are locked in till the final result, final result is win or lose.

Stock market. Carefully choose a "stock, etf, whatever"- if it doesn't do what you intended, sell it, now.
Get mosta your money back by your decision, by a tool (software) that sells if YOU HAVE TAKEN THE TIME TO LEARN HOW TO MITIGATE YOUR LOSS !

Just sitting there letting your $$$ value drop is just laziness, or lack of knowledge.

The chart shows "crashes" and rebounds,

Our recent administration is the biggest threat to the stock market in history .

 

[jeff alder]

Since 1995 I have been invested the whole time, there have been many " crashes", the average time to recover is 3 months by my experience. With lotsa media to back it up.

​

""The average time to recovery from a 5%-10% downturn is three months. The average time to recovery from a 10%-20% correction is eight months"

http://[URL]https://www.invesco.com...html?msockid=3edc50ceb4a16ec6352d4523b5086fac

[/URL]

Lotsa folks just don't understand the Market, think it's a "gamble" cuz you don't take the time to learn how to play, or the rules/ tools avail.

How many gambles do you know where you can get a partial refund if you ask for it.

Can you get part of your bet back if your horse is last outta the gate, get partial refund if you get dealt shitty cards, get partial refund while a flipped coin in the air.

Gambling you make your bet. You are locked in till the final result, final result is win or lose.

Stock market. Carefully choose a "stock, etf, whatever"- if it doesn't do what you intended, sell it, now.
Get mosta your money back by your decision, by a tool (software) that sells if YOU HAVE TAKEN THE TIME TO LEARN HOW TO MITIGATE YOUR LOSS !

Just sitting there letting your $$$ value drop is just laziness, or lack of knowledge.

The chart shows "crashes" and rebounds,

Our recent administration is the biggest threat to the stock market in history .

View attachment 1716442223

By the looks of that Dart you are doing well! It is a long-term long haul to do well. But with every bet still a gamble of sorts whether you understand it or not. It will be interesting to see what Trump single handedly does to it or more over what happens as he departs his 2nd term. No one can truly see the future, but it can be predicted to a certain extent based upon past practice, trending, historical market data ETC. It is risky if you are not diverse and the 500 is based mostly on American companies (about 80 percent last time I looked) it fails to encompass a world view of the market. Everyone has the opportunity to invest in themselves one way or another and thus you only have yourself to blame. A terrible crash could still wipeout a lifetime of investment based on the timing in cooperation with a person's date of retirement. If the Middle East ever gets intercontinentally nuclear ballistic...Trump pisses in Putin's Wheaties, Communist North Korea and China or another Bat or Rat at a research lab in China gets loose... everyone better be invested in their own underground vault with plenty of food and water and 12 percent will be worthless. Invest in yourself, guys. Only you are in charge of your own destiny!