What would you do with 10K?

Question

Hi yall, I just finised reading my first REI book "Rich Dad, Poor Dad" and i feel like i need to take action. Here is my first assignment.

I have some family members who collectively have about 10-15k available to invest. Im trying to find a creative way to grow that asset but my financial IQ still needs seasoning, (still working on my first deal so they wont lend it to me) my question to you is what would you do? Our Market is Houston, Tx.

I recall a BP podcast where investors lend money, a one day loans during closing for pretty good returns, but i cant remember what this is called.

I really appreciate any feedback on this, thank you!

Jose.

Tim Puffer · Answer

House Hack. Find a duplex to buy and owner occupy using an FHA loan at 3.5% down.

Brian Turnbough · Answer

That is a great book. I have read it about three times now and have picked up different things to try each time. The one thing you need to ask yourself is why do you need their money? Real estate is about checks and balances. You can't convince someone to give you their money until they know you can control yours.

With that said, you are in a great market to make a lot of money. I am from Houston myself and know the potential there. Try doing the flip and rental calculators on BP. They are good tools to see if you can make a deal work on paper. The Southwest side of Houston is a good place to start looking. If you can get one done and show them how well you did, they will be throwing their money at you.

Good luck!

Jonathan Makovsky · Answer

@Jose Martinezhope you can get the ball rolling soon.

$10K is a nice start, but unless you can use that money for marketing to find more deals, it may not get you very far. Being that the $10K is not yours - and I don't know if your family members are okay with you trying to use that money for marketing - you will need to get shifty.

So my advice is to find a local investor that is doing deals and get involved in any way you can with her/him. Do at least one deal with that person and don't get caught up in how much money you're going to make. Your one focus should be completing a successful deal AND learning everything you can with that person.

Once you have experience, doors start to miraculously open and money will begin to appear in places you will least expect it.

Happy investing and hope to see you get there.

Anthony Dooley · Answer

Create your own luck. Sounds like you are on the right track.

Anthony Dooley · Answer

I wouldn't use money from family or friends unless you are willing to never speak to them again. If you lose their money because you are new to investing, you are the bad guy. The advice above is totally sound. Marketing inexpensively for deals would be the best use of money when you don't have much, but use your own. It's O.K. to keep your day job and W-2 income until you get some experience and close some deals. It takes a lot of marketing/networking to find a great deal off market. There are tones of books, podcasts, and forums to get educated, so never stop learning.

Tim Puffer · Answer

I second @Anthony Dooley- Opportunity finds the prepared. Happy hunting!

Jose Martinez · Answer

thank you all for the great responses. This has definitely given me a broader view. I will search for a deal that matches the numbers i need to make it a win win situation.

@Jonathan Makovsky - luckily i have found a few investors that i can throw ideas off of.

@Anthony Dooleyim definitely marketing on a spartan budget (driving for dollars and also looking at preforeclosure lists)

@Tim Pufferi found a rundown duplex while driving for dollars and im going to send my first yellow letters this week, wish me luck!

@Ramek Llahthats one of my goal this year is to live way below my means, its def a challenge.

@Brian Turnbough im working on my first letter campaign and i will be door knocking this weekend. i will keep my eye out on the southwest side. thanks for the info, id like to get your input on the Houston market, let me know if your up for it. thanks!

What would you do with 10K?

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