Advice on my investing plan!

[Jared Yates]

Hey guys. I'm a new investor in Louisville Kentucky and I'm looking for input on my investment strategy. For reference, I'm a full timE paramedic. I cUrently have no rental properties or experience. My current budget has allows me to save $1000 a month for down payments. I've built up a pretty good down payment including 14k cash, another 15k in a Roth IRA, and a 10k emergency fund.

 Currently my strategy is to focus on cash flow. I want to buy a quadplex and try to get $150 a door. That would put me at 6k a year that I could combined with my savings for another down payment next year. That would give me progressively larger down payments every year. I would like to acquire another similar property the second year and then another the third year.  according to my math, once I hit 20 units and if I'm making $150 cash flow on each unit, I should have enough  cash flow to retire. 3k a month. Btw that would make me 31 when I retire which is my ultimate goal.

 With the resources I have listed and considering the Louisville area Marketplace, what would you guys recommend?  Does my plan sound realistic or am I about to make a tragic mistake?  All input is welcome! 

[Joe Villeneuve]

Now that you've laid out you starting point (14k cash, and a 10k emergency fund OR another 15k in a Roth IRA), and your ultimate financial goals (3k a month), what is the plan you are referring to?  

What you have listed here (buy a quadplex and try to get $150 a door...once I hit 20 units and if I'm making $150 cash flow on each unit) are strategies...not a plan...and you must have a plan or you'll be spinning your wheels.

The plan needs to involve how you are planning on getting financing, how you will use that financing, how each entrance strategy you use is based on the exit strategy for that deal, which is laid out based on the entrance strategy for the next property, and so on.

Do you have a team in place to execute your plan...when it is designed?  Do you have a plan on how to develop your own funding source of continuous cash to use for investing?  You don't ever want to spend your own cash.  You want to use it and infinite number of times, but never spend it.  Once you spend it, it's gone.  You need to have as part of your plan, a way to use (invest) your cash in vehicles that will quickly return those funds to you (hence the term use) so they can be used again, and again, and...

When you spend it, or use it once, it's gone...and you need to start all over again with new funds.  Your first investment should ALWAYS be in an investment that continuously generates new cash to invest in cash flow properties.  That first investment needs to become your own personal "money machine", your own ATM.  Do that, and the rest will take care of itself.