Came into some money (850k), live in California HELP?

Question

Hey guys, my name is Ben, I came into some money (in the title, 850k). I want to know what you guys think I should be doing with it. I graduated college in 2019 (older nonetheless, still graduated). I would like some advice or some input on putting together a deal. I lost my job this past October due to the pandemic. I am starting a new job on May 1st. I will be working for an Excavation construction company as a laborer. I have no overhead at the moment other than my cell phone, car insurance, gas, health insurance, etc. as I am currently living with my parents again. I lack the confidence at the moment to buy anything and feel that hopefully, I can gain that when I start working again.

California is crazy as far as real estate prices go. I can't get much let alone pay the property taxes, on the said property if I did get anything.

BUT I need to put my money somewhere.

Do you feel that there will be a real estate recession on the horizon? Within the next year or 2, thoughts?

I want to move out as well when I start to get paychecks from my job, should I find a duplex or triplex to start?

California is crazy as far as real estate prices go. I can't get much let alone pay the property taxes, on the said property if I did get anything.

BUT I need to put my money somewhere.

Do you feel that there will be a real estate recession on the horizon? Within the next year or 2, thoughts?

I want to move out as well when I start to get paychecks from my job, should I find a duplex or triplex to start?

Jason Shackleton · Answer

Hey @Benjamin Pessah congrats on your windfall of money, that's awesome! You have lots of options here to consider with that amount of cash. I see lots of top investors above saying what they would do in this situation with years of investing experience. However what should you do with little investing experience and lots of cash?

A top investor would lend out funds privately as they know the process and know what investors to invest with and who not to invest with. They also know if the properties their investors are buying are winners or losers etc. This is very risky with little experience. Others may suggest buying a $4,200,000 building with 20% down to get the max ROI on the deal. Again very risky if you do not understand the asset class. When buying from someone who does understand a certain asset class your $850,000 could go up in smoke very fast.

I would recommend starting at the beginning where all investors start. Buy a small deal, duplex or triplex that you can manage and grow slowly from there. Also with no job at the moment you may want to look at private money financing options. Some lenders will allow you to buy down the rate (lower it) with a higher down payment. Start small.

Hope this helps.

Jason

Lawrence Leung · Answer

@Benjamin Pessah I think the recommendation for @Michelle Kotler and @Scott Wolf is great advice in the near term as it takes into account your inability to qualify financially for any lending due to your employment status and also the likelihood you have young credit.  In the long term, you can look into building up your credit and then look into house hacking which I believe you were eluding to in reference to wanting to move out. Once you have a steady income, speak to some lenders and see what you can get pre-approved for and then you will have a budget to work with when looking for your first property.

Benjamin Pessah · Answer

@Rick Pozos I’m sorry that u think my post is a scam. You don’t know my life, you don’t know “how I came into said money” and u don’t know a clue about any of the statements that u spoke on. I would like to think people on this platform could help me out. My best friend is the one who turned me onto this forum. I appreciate the comments but keep the negativity off this thread if you could.

I’m 29 years old, graduated from SFSU (San Francisco State University) in 2019, Fall. I had lower back surgery in February 2020. I then took a job working for a dealership as a BDR (business development rep) AKA online sales, before COVID came along & shut everything down.

Scam? I don’t think so, but please like I asked keep the negative comments off of my thread. I would appreciate it very much.

I’m far from a scam & I hope anyone who has that criminal mindset/mentality should not be involved in a forum such as this.

PS. I’m not even asking for anything, I’m asking for ADVICE. 🤦🏼‍♂️  perhaps I’ll fill out my credentials, maybe that’ll give prospective members more insight too who I am?

Rick Pozos · Answer

OMG can't you see this is a setup for a scam. "Came into some money". Graduated from college, but working as a laborer(really??). Living with parents with 850k in the bank, come on. How does one, "Come into money"?? If it was from parents, look to them for advice. Too many red flags. Am I the only one that sees sirens going off??

Benjamin Pessah · Answer

@Michelle Kotler

@Scott Wolf

that doesn't sound like a bad idea actually. I will look into something along those lines. Thanks for the input!!

Scott Wolf · Answer

@Benjamin Pessah, you could become a private lender, or start looking into the note buying space.

Michelle Kotler · Answer

You might want to become a private lender.  You can partner with an experienced and successful house flipper in your area and make 10-15% interest and take first position on the property in case of default.  You don't have to do any of the work, just use your money to make money.

Came into some money (850k), live in California HELP?

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