General Adulthood, Planning for the Future: Business, College, Budgeting, Investments, etc! $$$ - General

Make sure you account for the repair/maintenance costs too.

Just got the loan approval back for my house a week ahead of schedule. BDA: first time homeowner! We're scheduled to close on April 5th.

[QUOTE=Big Dumb American;49977953]Just got the loan approval back for my house a week ahead of schedule. BDA: first time homeowner! We're scheduled to close on April 5th.[/QUOTE] What's the house like

Double wide doors for his big dumb American ass Jk lub u bda

[QUOTE=geel9;49977976]What's the house like[/QUOTE] Link snipped. I quite like it. 1000 sq ft, two bed, one bath, with bonus room (office). Big ole fenced yard for the dogs. Going in at $62k, with about $3k in small repairs and updates needed, most notably a new water heater and a second attic access panel. The rest are minor code requirements, like GFCI outlets near water sources.

I just learned from my mom that the dentistry we went to was supposed to knock me out via gas [I]then[/I] give me the shot because my parents knew something like my breakdown would happen and the dentists didn't believe my parents. My mom also said that my dad is more mad at the dentists than he is at me but I don't really believe her. Sometimes I really wish I didn't have to grow up with Asperger's. :cry:

[QUOTE=Big Dumb American;49971897]If you're concerned about the money down you'll need to actually purchase a property, it may be much cheaper than you'd think. While a 20% down payment on a property is pretty common, you can get FHA loans for as low as 3.5% down, with a few stipulations. If you have any military service under your belt, the VA will even qualify you for zero down loans![/QUOTE] to add onto this if you're poor and rural you can also get USDA loans with 0% down basic conventional loans go all the way down to 3% if you're a first time home buyer.

[QUOTE=Big Dumb American;49978301] link snipped I quite like it. 1000 sq ft, two bed, one bath, with bonus room (office). Big ole fenced yard for the dogs. Going in at $62k, with about $3k in small repairs and updates needed, most notably a new water heater and a second attic access panel. The rest are minor code requirements, like GFCI outlets near water sources.[/QUOTE] Looks comfy as hell

[QUOTE=Big Dumb American;49978301] link snipped I quite like it. 1000 sq ft, two bed, one bath, with bonus room (office). Big ole fenced yard for the dogs. Going in at $62k, with about $3k in small repairs and updates needed, most notably a new water heater and a second attic access panel. The rest are minor code requirements, like GFCI outlets near water sources.[/QUOTE] Dig it. Wish i had more yard room for my pup.

[QUOTE=antianan;49976343]So after looking at your posts full of tables and stuff i feel like i'm doing something wrong, as i have never calculated my income and spendings whatsoever. But as long as i have enough money to get things i need i don't care about this stuff at all, and considering i rarely spend more than like 500$ per month, i guess i have nothing to worry about hehe.[/QUOTE] You might want to spend a month calculating your expenses to prevent headaches in the future. If your circumstances change, you'll already have a good idea of what you will/won't be able to afford.

[QUOTE=fruxodaily;49975576]ive been told most benefits for me will be cut off the moment i pack my bags and leave, i think they would if i was struggling other expenses wise - right now its Netflix - $12 Spotify - $12 Phone - $50 (might downgrade to $45 depending on how much data i use this month) General food (takeout mostly) - $50-75 Alcohol - $30 Misc. - ~$40 then i have yearly subscriptions so Dropbox - $100 ExpressVPN - $130 Adobe CC Student - $150 these would be charged near the end of the year i think i could do it i just need to buy the car off dad and move work from Ipswich to Brisbane[/QUOTE] You can definitely do it but you need to put your priorities in order. I'm not saying those things aren't important to you, but sometimes you gotta cut one thing to gain another. Netflix - Do any of the people you plan on living with have it? If so you can split the cost. I just use my roommate's Netflix. Actually, it's his dad's, but no one cares. $0 Spotify - Can't speak on this one as music is my number one passion and I wouldn't even cut that myself. Downgrading the phone won't do a whole lot for $5. It depends on what you lose so it may be worth keeping it as is. Notice here eating out is taking up a chunk of your expenses. Maybe cut it to only two nights a week for example. Everyone loves some takeout but maybe hold back a little. Cook, cook, and cook more. Cook family sized meals and save leftovers. I can eat 2 days off one box of hamburger helper. That's like $4-$5 with ground beef. I can eat even longer on rice. I get some chicken, cook it, throw it in some rice, have a slice of bread...it's cheap and extremely easy. Chicken, vegetables, stuff that's going to fill you up and fuel you up, stuff that's going to keep you full and make you not hungry for more, at least not until your next meal. Really though it seems the car is the biggest issue here so you'll need to talk to your dad about that. I can't speak like I know your dad but after all he is your dad so you two should be able to come to some sort of agreement, hopefully.

Spotify Student discount cuts it down to only $5 a month if you have a .edu address.

Welp, looks like the o2 sensor and catlytic converter are out on my car. Good thing my cousin's a mechanic, he gets discounts on that shit.

[QUOTE=Bradyns;49975243]If anyone is struggling to budget, there's a pretty nifty service called [URL="http://www.youneedabudget.com/"]You Need A Budget[/URL] - it's subscription based at a somewhat reasonable cost, but if things are really tight I wouldn't recommend using it. But, if you can spare some change here and there it truly is a godsend - I am awful with my money, even when I am "responsible" - It has plugged the holes in my wallet to the point that I could afford get my new second-hand car and save for bond to move out, all whilst paying off and saving for monthly expenses (phone bill/shopping/private health insurance/board) and yearly expenses (car rego/car repairs) with money saved for a rainy day. Only been using it for a few months but it's changed so much to the point where I've opened up a securities trading account with my bank. You can try the 30-or-so day trial to see if it's for you.[/QUOTE] [url]http://www.youneedabudget.com/blog/post/ynab-is-now-free-for-college-students[/url] If you have an .edu email address and can send something verifying you are currently enrolled in classes for the school year (like a school ID, report cards, etc), they will give you a free activation that lasts until the end of the academic year (August 31st), and that you can indefinitely keep renewing it as long as you are still currently enrolled in classes each year.

[QUOTE=Big Dumb American;49978301][link snipped] I quite like it. 1000 sq ft, two bed, one bath, with bonus room (office). Big ole fenced yard for the dogs. Going in at $62k, with about $3k in small repairs and updates needed, most notably a new water heater and a second attic access panel. The rest are minor code requirements, like GFCI outlets near water sources.[/QUOTE] Looks downright cozy as hell, congratz [editline]21st March 2016[/editline] [QUOTE=Psychokitten;49980114]Welp, looks like the o2 sensor and catlytic converter are out on my car. Good thing my cousin's a mechanic, he gets discounts on that shit.[/QUOTE] bah, you dont need that shit. Unless you live in an emissions nazi state. In that case, condolences.

[QUOTE=Big Dumb American;49978301] I quite like it. 1000 sq ft, two bed, one bath, with bonus room (office). Big ole fenced yard for the dogs. Going in at $62k, with about $3k in small repairs and updates needed, most notably a new water heater and a second attic access panel. The rest are minor code requirements, like GFCI outlets near water sources.[/QUOTE] WHERE DO YOU LIVE?? Like not street address but general area. Even where I used to live before the bay area that'd probably be over double that, closer to $200k. Edit: nevermind. Reverse google searched got me the actual address. BDA while that's comfy and all you may want to take it down. Unless you're fine with your address being on fp.

[QUOTE=thrawn2787;49980625]WHERE DO YOU LIVE?? Like not street address but general area. Even where I used to live before the bay area that'd probably be over double that, closer to $200k. Edit: nevermind. Reverse google searched got me the actual address. BDA while that's comfy and all you may want to take it down. Unless you're fine with your address being on fp.[/QUOTE] Lol whoops. Forgot how technology works. Thanks for the heads up. Otherwise, yeah. That's Midwest housing prices for you!

[QUOTE=thrawn2787;49980625]the bay area[/QUOTE] That's because everything in California is grossly overpriced. [editline]21st March 2016[/editline] BDA, what do you think about house flipping? Being you're all real estate savvy and all. Is it a worthwhile endeavor if you're skilled enough? Or a potential disaster?

A house in SF that costs as much as my house in Ohio would barely even get me a house in the ghetto.

[QUOTE=OvB;49980806]That's because everything in California is grossly overpriced. [editline]21st March 2016[/editline] BDA, what do you think about house flipping? Being you're all real estate savvy and all. Is it a worthwhile endeavor if you're skilled enough? Or a potential disaster?[/QUOTE] House flipping can be a fantastic source of income if you know what you're doing and understand the risks, but personally speaking I think it has limited potential when compared to buy and hold investing. While there are many pros to flipping, here are my general issues with it: 1) Tax penalties: income from the sale of a "flipped" house is subject to capital gains tax, which can take a huge bite out of your profits. Income from the sale of a buy-and-hold property can be exempt from this tax, however, so long as it is being invested into another property using a 1031 exchange. There are are stipulations and limitations to the 1031 exchange, and eventually tax DOES have to be paid, but only on the final "cash out" sale where you keep the profits.This can save you obscene amounts of money if you have been continuously investing and reinvesting that money across several different properties. There are many other legal and tax benefits that buy-and-hold investors enjoy that can substantially limit their tax obligations when compared to flippers and traders. 2) Flipping only capitalizes on a single aspect of wealth generation in a property: forced appreciation (property value increases as a result of improvements and renovations). This completely ignores the three other potential forms of wealth generation that can be had from real estate investing: traditional appreciation, rental income, and equity. A buy and hold investor can capitalize on all four and make considerably more money with less risk, albeit over a longer period of time. 3) Buy and hold properties grow wealth at an exponential rate. The passive rental income is reinvested into additional properties, which generate more passive income, which is reinvested into even more properties, etc, all of which continue to generate an ever increasing amount of rental income for you. It takes time, of course. My plan has me buying only one property per year for the first four years. Then two. Then three. Then four. Eventually I'll have dozens of properties generating constant passive income for me. As a flipper, on the other hand, your income potential is limited by your ability to personally find and oversee rehab projects, which only pay out once. This also brings me to the next point: 4) Time investment! While you can still earn a great living as a flipper, it is a JOB requiring a high amount of personal oversight, and is ultimately limited by the amount of different projects you can juggle simultaneously. If you stop seeking properties to flip, you stop earning. Buy-and-hold investing, however, limits the necessity for involvement past the buying process while still guaranteeing passive income. Once you have found, analyzed, purchased, and fixed up a property (all work that a flipper must do as well), instead of cashing it in for a nice short term payday, you can simply hire a property management company to oversee the landlording of that property and enjoy regular passive income for as long as you continue holding it. Your involvement will be limited to simply checking the financial statements once a month and occasionally inspecting the property and approving expenses. In this way, you can continue being paid regardless of whether or not you are actively working. Instead of working for your money, your money works for you! 5) And finally, all the benefits of flipping a property can be enjoyed with a buy-and-hold strategy called BRRRR (Buy, renovate, rent, refinance, repeat) Investing! This starts essentially the same way as flipping: you find and purchase a distressed property at a premium discount and then force appreciation through renovations, dramatically increasing the value of the property and building a ton of equity. Instead of selling, however, you rent that property out for a year, and then cash in on that fat equity by refinancing the property! So, you get a big cash payout as you would with a flip, but you also retain control of the property so that it may be continue to provide passive rental income AND can take advantage of the tax benefits. It's the best of both worlds! Sorry if this is poorly formatted. On my new tablet, and it's kind of a bitch to type on. Keyboard is much too big for thumbs. [editline]21st March 2016[/editline] All that said, flipping does work as long as you know the formula. It is all about the numbers: you need to know that you can make money on a property before you've even bought it. It's not a guessing game, but a step-by-step analytical process. You can make very nice money off it in a short period of time. I don't want to imply that flipping is bad, I just think it is limiting when compared to holding properties. However, if you are unwilling or unable to commit yourself to long term property investments, flipping could definitely be worthwhile for you.

[QUOTE=OvB;49980806]That's because everything in California is grossly overpriced. [editline]21st March 2016[/editline] BDA, what do you think about house flipping? Being you're all real estate savvy and all. Is it a worthwhile endeavor if you're skilled enough? Or a potential disaster?[/QUOTE] I said before the bay area, I know million dollar homes that have no lawn/land and are very small are not normal. Used to live in Southern New Hampshire. [editline]21st March 2016[/editline] [QUOTE=geel9;49981087]A house in SF that costs as much as my house in Ohio would barely even get me a house in the ghetto.[/QUOTE] SF isn't the same as the rest of the bay area, but yeah, basically. That's why I get paid the big bucks B)

I'm not questioning your methodology BDA, I know you're a real intelligent guy But I can't help but imagine a 3am infomercial guy with quarters glued to his suit selling his get rich quick book with a cover that looks like it was designed using powerpoint clipart when I read about exponentially increasing passive income

Whether or not my suit has quarters glued to it is none of your business thank you very much.

[QUOTE=Big Dumb American;49981447]Whether or not my suit has quarters glued to it is none of your business thank you very much.[/QUOTE] [img]http://i.imgur.com/yXt6VeT.png[/img]

It's hardly getting rich quick though. Unless you're starting out with multiple properties or some really hot deals, you're probably looking at a minimum of 5-10 years of deliberate and methodical planning and followthrough before you hit the tipping point, and even then you still must devote at least enough time to find, analyze, do your due dilligence on, and finally purchase any potential investment properties if you want to be able to keep up with that growth potential. It's not an automatic process by any means. Hell, when you get to the point that you can start affording 10+ properties a year, simply finding and analyzing new properties to invest in may become your new full time job, assuming you want to keep growing your wealth.

What if I get a small loan of a million dollars from my dad?

[QUOTE=Big Dumb American;49981458]It's hardly getting rich quick though. Unless you're starting out with multiple properties or some really hot deals, you're probably looking at a minimum of 5-10 years of deliberate and methodical planning and followthrough before you hit the tipping point, and even then you still must devote at least enough time to find, analyze, do your due dilligence on, and finally purchase any potential investment properties if you want to be able to keep up with that growth potential. It's not an automatic process by any means, and once you reach that point in your investments your new full time job could be looking for new investments to make.[/QUOTE] Oh yeah I can imagine, I'm sure buying one property is stressful enough let alone several What kind of profit do you expect to get back in the short term? Basically rent minus mortgage payment and property managing company's slice of the pie

[QUOTE=OvB;49981496]What if I get a small loan of a million dollars from my dad?[/QUOTE] At an estimate of $25000 cash out of pocket per unit and an average positive cashflow of $200/month per door, a small million dollar loan from your dad could theoretically purchase about 40 rental units, earning you $96000/year. Truly a struggle getting started with such meager funds. [editline]21st March 2016[/editline] [QUOTE=TrafficMan;49981501]Oh yeah I can imagine, I'm sure buying one property is stressful enough let alone several What kind of profit do you expect to get back in the short term? Basically rent minus mortgage payment and property managing company's slice of the pie[/QUOTE] My current goal is to get at least a 7.5% annual return on my cash investment (cash on cash return), with a minimum positive cashflow per unit of $200 per month. But I'm still pretty damn fresh at this, and my first investment is at least a year away, so the numbers may change as I learn more. There are a lot of different expenses to account for. There's the loan payment, insurance, property tax, property management fees, maintenance and upkeep, large capital expenses such as replacing the roof, vacancy rates, and signing fees for new tenants and renewal fees for continued tenants (with a property management company). You need to account for everything and compare it to annual rental income to see whether the numbers work. And that's just for the cashflow. You also want to crunch the numbers for building equity through paying down the loan, forced appreciation of the property via renovations, and average general appreciation rate. The overall well being of the area is quite important, too. Population trends, school ratings, crime statistics, etc. Buying your unit in an area with high crime, bad schools, and a shrinking population spells tragedy for your future property value as you can imagine. Yet, areas with great schools, low crime, and rapidly growing populations are going to be exceedingly expensive and probably provide a steep barrier of entry for beginner investors. It's all about trying to find those magic middleground areas that balance affordability with desirability and growth potential.

So I signed up for both a 401k and a stock purchase plan through my employer today! Granted, that employer is Walmart, but I work there 40 hours a week and plan on staying for a couple more years at least.

[QUOTE=LtKyle2;49973248] Now, a question for anyone into investment; I'm 20 and am interested in starting a investing account while I'm young. I've seen commercials like ETrade and was wondering what would be the best way to start? I know next to nothing other then my father begging me to start now to put money into a IRA while I still have time.[/QUOTE] If you're looking to save money purely for retirement or large first time purchases(like a car or house) and have a taxed income, I was recommended opening a Roth IRA account at someplace like Vanguard.com. I had a professor who has a whole video guide if you're interested. [media]https://www.youtube.com/watch?v=znTvlwbzMGk[/media] The only downside to using Vangaurd is the 5500 limit per year. So this is meant for young people who only want to set aside 2 digits per month. As you get older and get better paying jobs, you're going to want to max out the limit and open accounts at other places to increase your money in the future. Also, [B]the minimum for opening an account is $1000[/B].