Stashing Cash away

[Account Closed]

I've got a question for all my debt-free investors. My strategy I'm employing is buy and hold rentals purchased with all cash. I've got my entity set up and have already begun contributing cash to accumulate to buy my first property (should be able to pay for my first $50-75k property in the next 2 years). Saving up cash is a slow process by nature, but I need to know, where do you suggest I hold the cash while I'm accumulating it? Business Savings and Business Money Market accounts aren't paying a squat and I'd like to make a little money on my money while I'm in the slow saving phase.

This is not a cash vs leverage post. My mind is made up. I've seen too many people lose their shirts being over leveraged. I'm trying to build a nice solid base here in my 20's to bring my cash flow to where I want it in my 30's.

It's simple, not complicated, and it works for me. If you want to run your rental business on the financial redline and be 2 months of vacancies away from bankruptcy, by all means go for it. I have been raised to focus on strong cashflow and mitigating risk. Running negative every month is stressful and hoping for appreciation to outweigh your cost of borrowing money is like playing the roulette wheel IMO.

[Steve L.]

You are going to need to find a way to super-charge your return or find a cheaper price point entry-level property. Money market accounts don't even keep up with savings right now.

Small hard-money loans (1st, 2nds), mobile home, business investments would be what I would look at.

Anything where you can invest time + money and achieve a high double or triple digit return yearly (on smaller amounts) is where I would start.

This has to be one of the most naive paragraphs I have ever read on this site. Sounds like you grew up in the depression.

Money is cheap right now and deals are plentiful. Assuming because someone uses leverage means they are "2 months of vacancies away from bankruptcy" is ludicrous.

Buy a couple houses and maybe you will decide that a $400/mo tax deductible payment on $1,200/mo in rent actually has very little to do with playing the roulette wheel.