Just Bought My First House

[Jesse Choe]

I just bought my first house in Aurora, Colorado after saving some money and moving back 2 years ago to my hometown after living in Los Angeles, East Texas, Houston, and Connecticut. Then I learned about the BP podcast and books after purchasing house. I just finished Brandon Turner's "Rental Property Investing" book and just started Scott Trench's "Set For Life" and listened to over 100 hours of podcasts. I work two job now and possibly looking to take a 3rd part time job. To keep making money and saving money. So i Just got a roommate to offset half my mortgage. I only have 5k in equity so far and planning my next property purchase hopefully by end of year. 

What did you guys do after your first purchase? Also, I am saving all the rental money from roommate's rent and putting into savings account. Would you rather spend that money on next house purchase or save that for a emergency and maintenance fund? I was thinking about pulling money from my 401k to purchase for my next purchase. What are your thoughts.

I'm new to the game and looking to learn.

[Paul Doty]

I agree with Erin's stance on savings vs. reserves. Having cash on hand in case life goes sideways is important, and that aggressive investing is what really gets you ahead. I'm often torn between the two. I'd like to have a lot more in reserves, but don't want to spend 3-4 years on the sidelines while I get there.

 My goal is to invest in deals where I get my cash back as quickly as possible. I also want to only buy deals with consistent positive cash flow. This way they will be able to sustain themselves in the event of me being unemployed or some other interruption of income. The idea is to get the money back into cash reserves as quickly as possible to minimize risk.

Truth be told, I know the number I should have in an emergency fund. I work towards building that, but have yet to get there or even close. Perhaps I should make this a goal for 2020.