With Independence day upon us this weekend it makes one think about freedom. One of those freedoms that many of us seek is financial. To have enough passive income coming in that there is no worry of paying the bills. That freedom from needing to work a J-O-B for the pay check.
Finding Your Freedom With Rental Properties
Some of you may be on your way, some may just be getting started. Either way, do you know what you need to accomplish to get there?
Here are questions you should know the answer too:
- How many units do you need?
- How much per door are you going to cash flow?
- How are you financing the acquisitions of units?
- How long will it take to acquire these units?
The good news is none of these question take an algorithm to figure out. This is one of the reasons I love real estate, it is one of the least complicated investments out there once you know the foundational principles.
Let’s quickly review a couple of these questions as an example.
How many units do you need? Well, first you need to determine how much per month you want coming in. Then how much per unit you make. It becomes basic math at that point.
For instance, to bring in $5,000 a month on units that bring in $200 in cash flow you will need to acquire 25 units.
How long will it take you to acquire those units and how will you finance them?
There are many ways to go about this. You could find a 25 unit and get seller financing on it? That would likely be the fastest and best case scenario with financing. That could be the target method, but it is not the only option. You can work your way up to it acquiring a portfolio of three and four family properties. This could be done while still working a day job as well, which always makes getting financing easier.
The point is there are many paths to reach your goal, but you need to be clear on what the goal is and then put down a plan to get there. That plan may have some detours along the way, but working toward the destination is most important in the end.
Financial freedom through rental property investing is attainable for anyone willing to put in some time and work. Most importantly be sure you buy right. Always run the numbers on a deal through the property calculator.
If you are just starting out and need to learn the foundational principles to investing in rental property be sure to check out the ScaredyCatGuide to Investing in Rental Property Course.
Posted Using LeoFinance