Investor · Detroit, MI · Member since 2016 · 211 posts · 144 votes
Can anyone share what investors do once they get a positive monthly cash flow and how soon will they use the money they save or earn to buy their next deal?
I am thinking of how long money just sits or collects before it is put into another deal. ?
I mean positive cash flow is what results after paying all expenses plus debt service.
Do some investors hold on to those earnings for more than one year before they use them to get into another deal?
Just how much money do investors allow to sit there before it is redeployed?
Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes
7y
My husband and I are buy and hold investors. We aim for good cash flow and get it. We primarily keep our gains in the business. When we make a real estate purchase, we often pay for the down payment from our own funds (equity in) and use business funds to pay for the improvements and operation costs.
We could take an owner's draw from the business, but we don't need to since we are both gainfully employed in other professions. Our real estate investments factor into our retirement plan and are not being used to support our living expenses at this time.
Specialist · Lakewood, CO · Member since 2014 · 1k+ posts · 1k+ votes
7y
@Gilbert Dominguez I have a certain amount of reserves I keep for emergencies with the property. Early on, all cashflow went to the business to continue building and buying more... now it goes to medical bills and a stupidTooExpensive primary home... in a couple of years it will go into more investments. A few after that into toys...
It's whatever you want to do with it... it's your profit and congrats for having it!