On track to retire by age 27! Rachel from KY

[GravyBoat]

we just got back from vacation in San Diego

Next time you're back be sure to hit me up. We have a group that meets once a month out here

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[Rachel888]

What's your contingency plan?

What happens if the economy dumps the bed, like many expect it to do, and your properties are worth a lot less than what you think they will be? Are you going to be cash strapped?

There is definitely a thing as growing too fast.

Just some things to keep in mind. I'm sure you've already considered it.

We plan on holding onto our properties for at least 10-15 years, so when there is a decline, we should have enough time to ride it out and wait for the value to increase. I think if anything, with the way our rentals are, and the housing market goes down, our rentals will do even better... so cash should never be a problem. Just gotta time it right when we eventually sell. Lots to think about, and obviously nothing ever goes perfectly to plan!

 

[Dave Daily]

Hey guys! First time poster here, but what an absolute dream to have found a forum with like-minded people. The only person in the world I have met who is as ambitious as me and shares the same goals and values as I do is my fiance, Andrew... so at least I am lucky in that regard! But a whole community of you... it's like Christmas morning!

So a little about me: I'm 25, I'm a finance analyst (sitting at my cubicle right now, not being the best employee...), I live in Kentucky with my fiance (30 yrs old) and our dog. Andrew and I had an incredible year last year. Here are some of the things we accomplished in 2017:

• We bought 2 rental properties, which bring in $3k/mo cash flow combined, 25% rate of return
• We started a POD T-Shirt business, earns about $1k/mo
• I got a promotion and a $10k raise
• I wrote and published my first ebook, Money Honey, earns about $500/mo
• I lost 20 lbs, Andrew lost 25 lbs... we are in the best shape of our lives!
• I won a $15k Sweepstakes the same weekend Andrew proposed... absolutely nuts
• We traveled to Colorado, NY, & Greece

The point here is that we went from $0 in passive income to $4,500/mo in passive income... all within a year! To top it off, we just closed on our 4th rental property 2 weeks ago which will bring in another $2k/mo. I feel like I can share these details / accomplishments with you all and it won't come off as braggy (because it sure feels like it and I don't mean to) but rather excited at how impactful the Millionaire Fastlane mindset is.

We are thrilled with our momentum and can't wait to retire early. So now for our goals...

• Retire by May 2020 (I will be 27, Andrew will be 32) and move out West
• Grow passive income to $10k/month AT LEAST with real estate
• Hire property management company for our rentals
• what else? (would love some suggestions)

I'm excited to be here, interact with you all, and hopefully make some new friends. Would love to talk to other real estate investors, authors, or POD business owners! You guys are awesome!

Are there any other youngins in here like Andrew and me? I would especially love to hear from those of you who ALREADY retired and that had to walk away from extremely lucrative full-time jobs. My worry is that our full-time/actively earned income is so high that we won't want to quit, even though we can!

Rachel

Youngin’ at heart here. Nice intro. I’m officially jealous. Welcome to the forum.

 

[rk123]

We plan on holding onto our properties for at least 10-15 years, so when there is a decline, we should have enough time to ride it out and wait for the value to increase. I think if anything, with the way our rentals are, and the housing market goes down, our rentals will do even better... so cash should never be a problem. Just gotta time it right when we eventually sell. Lots to think about, and obviously nothing ever goes perfectly to plan!

Awesome story.... very happy for you.

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[Nik@16]

No, CAP is the net operating income divided by the sales price of the house... ROI is the net operating income divided by the amount invested (basically down payment.)

Our cap rate for our duplex is $7,000/$93,000 = 7.5%. Our ROI is $7,000/$34,000 = 21%.

Our cap rate for our 11-unit is $32k/$430k = 7.5%. Our ROI is $32k/$110k = 29%.

ROI is Net Operating Income - Mortgage Payment. Net Operating Income does not included mortgage payments.

 

[Davejemmolly]

I'm confused!
Can you explain your NOI calc for me again?

I assume you mean that is the total amount left after all expenses?
Gross rent, minus mortgage, minus holding costs (rates / taxes and maintenance etc)

Does this mean you have a net return of 7.5% for the duplex?

 

[NicholasCato]

Damn now thats a motivational introduction!

What you guys have accomplished in a year is my 1st goal post to financial independence.
I'm an artist getting into POD t-shirts and reaching $1K a month in sales across multiple platforms is the plan.
Right now I only make around $100 a month in sales from two designs so I'm definitely giving you guys a follow hopefully to pick up some tips and strategies.

And I just got your book! will be reading it alongside MFL as I'm half way through with that book so expect some nooby questions once I'm done! haha

Nice meeting you two!

 

Dislike ads? Remove them and support the forum: Subscribe to Fastlane Insiders.

[JB999]

No, CAP is the net operating income divided by the sales price of the house... ROI is the net operating income divided by the amount invested (basically down payment.)

Our cap rate for our duplex is $7,000/$93,000 = 7.5%. Our ROI is $7,000/$34,000 = 21%.

Our cap rate for our 11-unit is $32k/$430k = 7.5%. Our ROI is $32k/$110k = 29%.

Those numbers look good. You need to subtract your mortgage payment out of the NOI to calculate your ROI. Out here in Cali we call it our cash on cash return. Basically same thing as your ROI. If you want to take it a step further, you can add back the principal reduction on your loan then divide by your down payment to calculate your total return.

I’ve done very well with my real estate. The magic really starts to happen after you have owned them for several years and you start raising your rents and your principal reduction gets bigger and bigger.

Keep at it.



Sent from my iPhone using Tapatalk