Starting out as a young investor

[Cody Cunningham]

Hey all!

My name is Cody, I am 22 years old and new to the BiggerPockets forums. I was inspired to join after reading some of Turner’s books. 

I’m at a point in life where I’m trying to consider what kind of lifestyle will allow me to give my future family the life I always wanted to give them. About a year ago I read Rich Dad Poor Dad, and eventually made my way to some of the BiggerPockets books where I realized that real estate investing was probably the best way to go. 

I’m currently finishing up my Bachelor’s degree in Business and working on my Real Estate License (I know that’s not necessary for investing, just wanted to work on it). I also have a life insurance inheritance that was left to me by my mom’s passing. While this gives me a sort of “head start”, I obviously want to put it to good use.

An issue I have is that I live in California, and honestly starting here isn’t cheap. Furthermore, I don’t exactly have two years of tax returns that would allow me to pre-approve. There’s so many things on my mind; should I start in CA? Should I wait a couple years? These are just some things.

In many ways, I feel like I don’t have someone to talk to and bounce ideas off about this kind of stuff, which is why I felt inspired to join and do more research and communicating here. I am honestly open to ANY ideas you guys have, and I feel like just putting this out there and listening to advice will go a long way in helping me figure out what my journey will be.

I appreciate you all and look forward to talking more with each of you!

Best,

Cody

[Michael Haas]

@Cody Cunningham the faster you can decouple your money earned from your hours spent the better. The two big ways to do that as a young person are:

1. Invest in Real Estate, Stocks, Crypto, or Small Businesses. Money doesn't sleep, which makes it a great employee :). Bonus points if you can use bank loans and leverage - I don't know many billionaires that got that way without using a little leverage to amplify their impact and return on investment. 

Take @Bradley Dosch & other's advice about HouseHacking as well - and I disagree about HouseHacking not being scalable. My wife Jess and I scaled 4 HouseHacks into now 10+ rental properties in a very expensive market because you can repeat househacks yearly for 1/4 the cost of a typical real estate investment. I'd call that very scalable. If you have $50k for your downpayment and that can buy you a $1,000,000 househack locally (5% down) or a $250,000 property out of state (20% down), which of those options will help you scale a high value real estate portfolio faster? Of course you don't have to househack forever, but its the #1 beginer real estate investing strategy by a huge margin in my book. #2 is STR investing, and #3 is BRRRR / Flip.

2. Start a business, or get into a success based / commission based role with uncapped earnings potential. As a lifelong entrepreneur I've had many years where I've doubled or even tripled my income... but as a W2 employee I doubt you can ask your boss for a 300% raise and get one!

Good luck Cody, and reach out anytime! Cheers,