Am I on the right track with this strategy (just starting out)?

[Joshua Lee]

I have no properties yet - just working a regular job and doing some freelance work on the side. I'd like to start earning some "unearned income" and building wealth. I've read quite a bit and I've watched a ton of videos. I'd like to check and make sure I'm on the right track.

BTW: I make around 80k per year and I live in central Florida.

Here's my strategy:

- I'm currently living with family and reducing spending. Looking to save for a year or two. That should give me about $15k-$25k.

- Buy a multi-family home - I've seen some for as low as $250k, but I'm sure there will be different deals by the time I'm ready to pull the trigger.

- Take out an FHA loan for 3.5%. That's $7,500 on a $250k home which should be much less than my savings. That means I can either have a cash cushion for any renovations or covering some of my mortgage until I get a tenant or get into a property quicker.

- That puts my mortgage at around $1,500. Looking at the comps, I think I can rent it out for $750 - $1,000. That would put me at negative cashflow of -$750. Maybe call it -$1,000 to cover upkeep. Also, even though this is a negative cashflow it's basically what my rent would be. So, I guess I'm paying $1,000 to live in my home to earn equity in my duplex. 

- According to an amortization schedule, it'll take about 10 years to get 20% of equity in the property. Ideally, I'd put more towards my principle faster if I have the cash.

- Once I get 20% equity in the property, use another FHA loan to buy and live in another multi-family property then rent out both sides of my first duplex leading that to positive cash flow.

- Repeat..

Am I on the right track? Basically, take out an FHA loan for a multi-family, get 20% equity as fast as I can, and then do it again.

[Gregory Schwartz]

@Joshua Lee great plan!

Just wanted to call attention to one thing:

You mentioned, 'I make around $80k per year' and 'Looking to save for a year or two. That should give me about $15k-$25k.'

After taxes, you're bringing in around $5,000 per month. If your living expenses are relatively low, have you considered pushing to hit that $15k goal within 5-7 months instead of 12-24? This means saving $2,000-$3,000 per month and living off of $3,000-$2,000.

If you can maintain that savings rate and keep your cost of living low, you'll be in a great position to jump-start your investment growth much sooner.