What you do with CAPEX?

[Olga Peksheva]

Hello, 

I am new to real estate. 

What do you do with the monies set aside for capex (expenses)? Do you keep it in separate account? Do you invest?

It hurts me to keep them in the bank (saving account) that makes less than 1%.

thanks,

Olga

[Nathan Grabau]

I would not think of the money as money that is not earning you anything, as much as money that prevents a future derail event. I have had multiple furnaces go out early in the purchase of property and had I not had reserves to cover this, I would have had to back out of deals I was working on to cover the cost. 

What you are doing here is you are being smart here, so you can be aggressive everywhere else and not have to worry.