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Updated about 12 years ago on . Most recent reply

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Jay Famm
  • Xenia, OH
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Okay, I have a serious question for all investors who wish to answer.

Jay Famm
  • Xenia, OH
Posted

Say you were an average minimum wage worker making around $1500.00/mth. All your liabilities add up to around $1500.00/mth, so your basically living check to check. Now, you have a savings of $15K that you have inherited or obtained that you would like to start investing in real estate with. 
The question is, would you 
A. Start finding property to buy right away? 
Or 
B. Wait till you could somehow living check to check save more money? To add to the question above if you chose A. What technique(s) would you chose in getting started, (examples: wholesaling, quick flip, rehab, tenant occupied, lease-option, duplexes) whatever it might be, which techinque would be your goto to get started with the experience that you have in real estate investing right now?  If neither A. nor B. what would be your C. option instead?

Most Popular Reply

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Jon Holdman
  • Rental Property Investor
  • Mercer Island, WA
14,127
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22,059
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Jon Holdman
  • Rental Property Investor
  • Mercer Island, WA
ModeratorReplied

IMHO, the number one goal should be to move up from a minimum wage job. Real estate investing, as opposed to a real estate job, is about cash on cash returns. 12% is pretty good. That's 1%/month. On your $15,000, that's $150 a month. That's just not enough to make a huge difference.

Now, how could you apply that $15K to move up off the minimum wage scale. Is it some real estate JOB like wholesaling, fix and flipping, being an agent, property management, etc.? Or, is it taking that $15K and spending it on some sort of trade school? Cosmetology, welding, auto repair, dental assisting, etc. Lots of jobs out there that would jump you up a fair bit from minimum wage that can be had with a year or so of training.

Tiger M. has a great story, though, and there's a hidden pearl in there. I'm assuming, Tiger, you kept the hotel desk job while being an agent. Wholesaling and being an agent are really the same job. Wholesaling is offered up (mostly by people selling $15,000 courses) as a way to quick and easy money. Its not. If you plunk down a significant chunk of your nest egg on a course the most likely result is your nest egg will be that much smaller. The real key is you're going to have to work at these jobs. Both brokering and wholesaling are commissioned sales. You have to work at the job with no income for a while before you collect a paycheck. Both are going to require you to put some some amount of cash and a large amount of hours.

Now, its entirely possible to be successful doing either of these. Some folks are. But you should really ask yourself if that is the right course for you. No matter what you do to try to better your situation from being stuck at with a minimum wage job, you're going to have to invest some money and a LOT of time. Examine yourself. What do you like? What are you good at? What are the options? Then choose a course. Don't fall for the guru dream of quick and easy money in real estate if you just buy some course. Its nothing but a dream.

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