Purchasing a rental property

[Ryan Ramsay]

Hello, Im 19 yrs old. I was someone lucky enough to receive a trust fund from my parents after they pasted away. I don't want to be an idiot and spend it all away. Ive been looking into housing/duplexes among other things and was hoping to get someone more expiernced to give me some advice on what would we be a good route to take or if I should wait. Thank you  

[Cory St. Esprit]

I think the biggest question is why you want to do it, aside from not wanting to waste it. Real estate requires a certain set of knowledge, skills, and abilities. If you don't want to squander it but want more passive, you could invest it in tax-advantaged mutual funds. 

Now, if real estate is something you do want to do, that's a different store. I'd look in your local area for meet up groups, get to know some people, and be patient. Don't think you need to buy the first property that comes your way (I did that initially...actually just sold it at a break-even after all expenses). Now we have 6 more properties (multi-families, vacation rentals and commercials) and have started to "figure it out."

So, should you wait?

1. Is college in your future? If so, your best bet is to graduate debt free. 

2. Do you have consumer debt (car notes, credit cards, etc.)? If so, become debt free on those. 

3. What's your current living situation? (renting, paid for house/condo, etc.). 

4. Do you want to be a landlord? It's not just sitting back and collecting rent checks. Trust me. Listen, my full time job is I own a restaurant franchise portfolio and then we have real estate. This past week, I feel like I spent more time on the real estate than the restaurants (city inspections, building permits, managing a construction crew, late rent from tenants, etc. etc. etc). 

I don't think there's an inherently wrong or right answer here. My biggest piece of advice is don't jump. Just wade in, figure it out, test it out.