Page 3 of 4

How Lucky are the Richest Guys on Wall Street?

This post is based on and inspired by ideas from the book Fooled by Randomness by Nassim Taleb. It’s one of the most insightful books I’ve ever read.   It’s about the role of chance in life, and how we are often blind to and fooled by it.

Get it and read it.

It ESPECIALLY applies to money and the markets.

The points I make in this post are derived from his book.  Here we go:

Russian Roulette

Have you ever played Russian roulette?

I have.

water-balloon-russian-roulette

I’m kidding. I haven’t.

          Why not?

 Because that’s stupid!

Because as exciting as it sounds, I just can’t stomach the worst possible outcome. It’s not an acceptable risk. Not even to play once.

No matter how smart I am (or how smart I think I am), the outcome is ruled by randomness. By chance.

Read More

How Much Money Will I Make From My Rental Property?

This is a short, simple, down-and-dirty tutorial to so you’ll know how much money your rental property will make before you buy it.

Going from simple to complicated, the first thing to understand is the 1% rule, which is easy to do in your head, and can save you the trouble of breaking out the calculator for properties that are overpriced.

1% Rule

The 1% rule is quick and easy. Monthly rent should be at least 1% of the acquisition price. The acquisition price may be a higher number than the purchase price. It’s purchase price plus the money to get the house ready to rent.

Example.

$80,000          to purchase house                plus

$20,000          remodeling                            equals

$100,000        acquisition cost.

$100,000 home should rent out for at least $1,000 a month, or it would not be a good investment.

          What is the logic behind the 1% rule?

If a house will give you 1% of the purchase price each month in rent, then it gives you 12% of the purchase price each year.   That apparently means the investment makes 12% a year!!!!

          WOW, THAT’S AWESOME! I’M RICH (ON MONEY!!)

Read More

Prospective Tenant? When in Doubt, Just Say No!

I had a chance to avoid an eviction.  I don’t think you can avoid them all, but this one, yes.  I didn’t listen to the obvious warning signs.

My experience with purchasing my first rental property was scary enough to give up on real estate investing for the rest of my life!

Actually, my wife recently remarked to me that she was SHOCKED when, after going through the stress of purchasing the first rental property, she realized I wasn’t going to stop. She said she thought I had enough!!!

If you haven’t read about my first rental yet, read about it here.

After I bought this house, I discovered the seller had concealed the fact that something under the house had pushed up the floor almost two feet in the middle of one of the rooms. It was quite the ordeal figuring out what it was and how to fix it.

Also, while the house was vacant, someone decided to climb into the crawl space under the house and steal all the copper plumbing.

So I guess real estate investing isn’t for me!

  • But my love for real estate runs too deep!
  • My threshold for self-punishment still not met!

I had a desire to succeed in real estate.

I decided to get back on that horse and keep riding!

Read More

How I Bought a Rental Property With Cash and Without a Clue

After moving back to the USA from Japan in 2012, I started a new job in Alabama.  I met a fellow military member who shared my passion for real estate.  Meeting him had a profound effect on my life financially.

What he did with real estate is exactly what I wanted to do.

And he was wildly successful.

His Background

When I met him, he had been living there for two years.  In that time, he purchased four houses with cash, remodeled them mostly on his own, and rented them out providing substantial cash flow each month (especially without a mortgage!)

He bought in the range of $25-35k, putting a few thousand and sweat equity into them, then renting them out for around $750 a month.  The numbers were REALLY working for him.

If you apply the 1% rule to these properties, a house that totaled $40k in cost to rent out should pull in $40o to be “worth it.”

These were almost double that.

Read More

The Flippin’ Truth about Flippin’

I’m going to tell you what I’ve learned flipping six houses in D.C., all while living overseas.

Next, I’ll share exactly how much I made (and lost) on each of these flips.

I’ll close out with my recommendations on flipping as an investment strategy.

          Let’s get started!!!

So I flipped a house in D.C.

It was the subject of my last post.  I detailed how I go from no clue about flipping to trying it once.

Now I have a small clue.

          How did I do?

I cashed a big, fat check for:

$16,908

Read More

The Best Damn Finance Book I’ve Ever Read

First, a little about me and my website:

  • I paid off $32,000 in student loans in a year.
  • Paid off our $280k mortgage in 6 years.
  • Flipped several houses in Washington D.C. to help me build income for real estate investing.
  • Purchased twenty rental properties with cash.

My website is all about helping others to get out of debt and create passive income from real estate.

But you can not mess with real estate until your finances are straight.  You gotta go get Jim’s book! (or at least read his website)

cover graphic

“Spend less than you earn–invest the surplus–avoid debt”

The central theme of Jim’s website and book.

It’s hard to believe the Path to Wealth can be this simple.

But in his book, you’ll see it is.

I got to admit. I love this book! My review is going to sound a little over the top, but it’s a damn good book!

I’ve been big into finance and real estate books my whole life. I’ve read them all.

stack of books

Ok, way more than this!

About a year ago, I stumbled across financial independence and early retirement websites and it opened up an entire new world to me!

I began seeking out all the top blogs in this field, and one that kept coming up was jlcollins.com.

To put it bluntly, his Stock Series was the most comprehensive explanation of investments I have ever read. There is so much noise and confusion out there in the finance world, and he slices right through it and tells you what’s really important.

He makes it easy to understand the complex world of money. His approach to investment is so simple, it’s alarming!

I followed his blog closely and eagerly awaited new posts.

When he sent out an email explaining he was writing a book and soliciting help from his readers for proofreading, I jumped at the chance!!

The only reason I volunteered was because I wanted to read the book ASAP!!!

As luck would have it, I was selected to be a proofreader, and had the opportunity to read the book before publication. (Actually, I’ve read it about 20 times. Occupational hazard!)

The book is exactly what I was hoping it would be.

Read More

I’m Flippin’ Rich!

This post will describe my first house flip.

First a review of my background.

I’m Rich on Money.

  • I paid off $32,000 in student loans in a year.
  • Paid off our $280k mortgage in 6 years.
  • Flipped several houses in Washington D.C. to help me build income for real estate investing.
  • Have purchased several rental properties without using debt.

Back to my flip.

I was scared to death about it!!

But it made me some money.

       How did you get so flippin’ Rich, Rich???

(Ok, I’m not Rich.  It’s a play on words!!)

Let’s review a little what I’ve done so far.

I’m in the military. From 2003-2005, I lived near Washington, D.C.

Read More

How to Flip New Construction

In my last post, I talked about the purchase of my first house ever.   It was a townhouse near Washington, D.C., and I paid $280k for it.  I thought I paid way too much and was sure I’d just made the worst decision of my life!  It wasn’t.  I wanted to make more money, so I tried to figure out how to flip new construction.

Read More

Monopoly and the Game of Life

monopoly-man

A little about me.

  • I paid off $32,000 in student loans in a year.
  • Paid off our $280k mortgage in 6 years.
  • Flipped several houses in Washington D.C. to help me build income for real estate investing.
  • Have purchased several rental properties without using debt.

This is the story of my first time touching real estate, and what I learned.

I’ve loved the game Monopoly ever since I was a child. I’ve been playing since I was 5 years old. I played with my friends for hours on end! I soon figured out that usually the first person to get a monopoly would win the game.

We were serious about it! We used calculators as banks accounts instead of cash. It made the game move faster.

I’ve always sensed that Monopoly somehow mirrors reality. Having a monopoly, or having several properties in the same area, can help you win at the game of life.

My Grandmother had a small monopoly.

Read More

payoff debt billboard

How to Payoff Debt and Build Wealth

payoff debt billboard

I’ll show you exactly how I payoff debt and build wealth.

Among acquaintances, friends, and co-workers, my thoughts on money seem extreme. I don’t have many among those groups to share and discuss with.

I’ve been devouring books about money my whole life. I was soooo happy when I found the world of FI, real estate, and investing blogs. I feel like there is a community of people out there that understands me.  They understand how important it is to payoff debt immediately.

When I was in college, I got a job at Fidelity Investments as a stockbroker. It was a 3rd job, a side hustle to payoff my student loans. It was a great introduction to the world of finance. It made sense for someone like me to get a job like this. I’ve always had an interest in the stock market.

Read More

Page 3 of 4

Powered by WordPress & Theme by Anders Norén