Quote:
Originally Posted by fish4fun
a couple paid for residential rentals worth around $75K On top of these annual contributions we’ve got another $10-20K beyond our living expenses that we will probably continue to use for real estate investments.
|
Good choice. I started rental accumulation about your age, but with a mortgage. I let the renters pay off the mortgage. At your early accumulation stage, paid for rentals don't give you the leverage to easily get more with the accumulated savings. Hopefully you know the standard leverage rental buy approaches and take it slow and careful. I opted for a more aggressive approach with loans causing a slightly positive cash flow per rental.
Quote:
Originally Posted by fish4fun
While I appreciate the corporate gig and all it offers, it’s not necessarily my life’s ambition.
|
I gave up the corporate management ladder climbing life style after I realized the rules had changed. They fund my MBA and I gave them a chance to help me use it, but that wasn't part of their plan. Your current job provides cash flow for unexpected rental investment events and documentation for easier loan application. Lenders love steady documented W2s. So it is worth while.
Quote:
Originally Posted by fish4fun
My wife and I have bought into the idea that in 10 years she would go to work at the local university. This would offer up enough income to cover all but roughly $20K of our living expenses, provide insurance and other benefits, and (as long as the policy continues) free tuition for the kids if they decide to go that route.
|
My wife worked in a low paying CA corp job for the benefits, first to supplement my income and insurance for the kids, then to provide benefits when I gave up the corporate job and went contract. Every was working fine until the BOD got caught skimming by the state & feds. Then they restructured my wifes' division out of existence as part of a plea bargain. So don't get too comfortable with your wife working there. Bad corporate business decisions can directly and suddenly impact you.
Free tuition may not be the benefit you think it is. When they are of age and ready, you may want them to get the best education possible, not necessarily the cheapest. This may or may not be the university/college your wife is currently at. Just be prepared. I had to send one child out of state and the other to another city. Not exactly a low cost approach.
Quote:
Originally Posted by fish4fun
In the meantime this would free me up for either continuing to develop the real estate thing which, if all goes well, should be generating at least the $20K needed to cover the living expenses deficit.
|
If all goes well, it should generate one h_ll of a lot more than 20K. I would think a conservative estimate would be 60-80K/yr after expenses but before taxes.
Quote:
Originally Posted by fish4fun
I’d hopefully be in a position to either hand the daily operation of the rental business over to a property management company to make it “passive”
|
IMO don't do it. Unless you stumble upon a terrific competent manager, you will trade one management job for another. Instead of dealing with tenants, you will be managing a PM, not getting it done your way and continually paying for it to be done wrong the second time.
This post is already too long, so I'll end it here.