What do you do with your cash-flow?

[Michael M.]

I'm wondering what the consensus is.

Among the two options, which do you prefer to do and why? If you remove the coin from the entity entirely, then I suppose this question isn't for you.

Option A: Receive cash-flow and let it pile up, leaving it as liquid cash (current assets), immediately available for CAPEX & so forth.

Option B: Receive cash-flow and immediately feed it to any notes payable, essentially converting current assets to fixed assets (equity).

Both options contribute to the Total Owner's Equity at the end of the day.

Cash Pros:
Liquidity, especially when you need it.

Cash Cons:
The dollar historically get's weaker over time.

Equity Pros:
Real Estate historically get's more valuable over time.

Cons:
Illiquid, especially when you need it.

I'm sure other factors like the pros/cons of depreciation, pros/cons of inflation, etc. play a big role, but I'm not thinking that deep… yet. Still learning here.

Are you Option A, or Option B? Or are you both?

[Shawn S.]

The best advice I had seen on this was so long as you have enough cash set aside for maint issues and/or vacancy, use any other available funds to buy more properties. Do this until you acquire the number you had your mind set on, then aggressively pay down the mortgages to get them free and clear. That is my plan at this point.