Starting Out
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback
Updated over 7 years ago,
How much cashflow or flipping profits do you keep?
This is a two part question, I'm curious to know how both buy and hold and flippers distribute their cash flow or profits to themselves.
Scenario #1: Your a house flipper, you finish a project and profit $30,000. Of that $30,000, how much do pull out to 'keep to pay yourself'? Do you take the entire profit as 'income'? Do you take say $15,000 in 'income' and leave the other $15,000 in the bank to help invest in the new flip?
Scenario #2: Your a buy and hold investor, you cashflow on a property $500/mo. Of that $500, how much do you provide to yourself as 'income' vs. keeping it in the bank or invested back to your business. I.E. will you pay yourself say $250/mo. and then leave $250/mo. in the bank to account for potential repairs, capital for new investments etc.?
Thanks!