Newbie Josh from Austin, TX

[Josh L.]

Hi Everyone,

Josh from Austin, Texas here. Nice to meet ya'll. I recently relocated from Colorado, and found this site after listening to a few of the BP podcasts. I'm looking forward to learning a lot and hopefully making a few friends and building my network. 

A little about me - I am a happily married father of 2 girls and (coming soon) 1 boy. I currently work full time as a software engineer and my goal is to use real estate to enable me to quit the rat race within 10 years. My wife and I spent the last four years living in Colorado, making many of the typical bad money decisions like buying new cars, student loans, and maxing out credit cards. The one good decision we did make was buying a house in a hot neighborhood and leveraging the hell out of it with a tiny 3.5% down payment. We decided we'd had enough of living paycheck to paycheck that and hit the "reset" button by moving back to Texas. We sold our house in Colorado, and used the proceeds ($121k) to pay off every last cent of debt we had ($115k). We're at slightly above zero now, and going forward have lots of room in the monthly budget. We are committed to investing and growing wealth from here on. I'd welcome any comments or suggestions on our overall plan:

1. (Completed) Find new job(s) in Texas

2. (Completed) Sell house and pay off all debts

3. (In progress) Live in a rental and save like crazy for emergency fund plus a down payment for a reasonable primary residence

4. Buy primary residence at 10% down on a 15 year mortgage. We gotta live somewhere!

5. Turn on 401k deductions to meet company match, but no more.

6. Save up down payment plus additional emergency fun for a rental property at 20% down

7. Repeat step 6 until we own 5 rentals with positive cashflow. 

8. At this point, begin selling and trading up - sell whichever property has the lowest ROI, use cashflow and additional savings from our day jobs to buy into larger/higher cash flow properties. I am wary of taking on a large number of leveraged properties as I hear that's how most people who go bust get into trouble.

Nice to meet everyone!