Some Boring Financial Prep, and Another Aha! Moment.

A whopping EIGHT months have passed since the last post on this blog, so surely that guy has packed up shop and moved along to some other venture. Nope! I'm still at it, and still have my sights set squarely on using Real Estate Investing as my ticket out of the 9-5 world. I still have yet to purchase my second piece of investment property, but I am completely confident that I am doing what is necessary for my long-term plan.

As an update on the action steps of my last post, I ended up combining the two. I brought the potential partner with me to scope the house out, and then eventually make the offer as partners. In the end the seller rejected our offer, but it was a great experience and something that took me way outside of my comfort zone. Which was great.

To fast forward a bit, that same partner and I had planned to launch a direct mail marketing campaign targeting a specific area near where we live (southern suburbs of Seattle) which was going to involve throwing several thousands of dollars towards mailing all of the properties that matched our criteria in that given target area throughout 2017. With the hopes of digging out some off-market opportunities.

Well, that idea got back-burnered, and I made the somewhat difficult decision to use that money instead to continue to eliminate debt and strengthen my financial foundation. Between redirecting that money I had set aside for the Direct Mail campaign and putting off buying a property, me and the Mrs. are now in position to have no debt to our name (outside of our primary residence and one rental property's mortgages). By doing this we will be able to set aside several thousand dollars each month that we can snowball into the capital we need for investing by the end of 2017. I say it was a somewhat difficult decision to make because I was so anxious to buy something, and the thought of putting that off until 2018 was brutal.

In the past few months since I made that decision I decided to do some more reading in order to continue to prepare myself. Not necessarily just for Real Estate Investing, either. I went back through Rich Dad, Poor Dad and The Millionaire Real Estate Investor again, mainly to hear what gave me my first Aha! moments now that I know a little more than I did back then. I've also read through Kiyosaki's Cashflow Quadrant, Gary Keller's The One Thing, and I'm currently reading Frank Gallinelli's What Every Real Estate Investor Needs To Know About Cash Flow. All of which have been great, even life-changing types of reads for me. I've also read Daniel Goleman's Emotional Intelligence which was recommended by Kiyosaki in Cashflow Quadrant, as well as a "traditional" investment book called The Four Pillars of Investing by William Bernstein (which I highly recommend if you want to learn the basics of how to invest in "traditional" asset classes). This combination of books helped me grow as a person, and also helped me better define what it is that I want to accomplish with Real Estate and in life ... which are intrinsically tied together in my case.

The new Aha! moment I had recently was concerning my strategy moving forward. Up until the last month or so, my plan had always been to look for, or be a part of, flip deals so that I could build some capital to begin acquiring long-term holds. This was fine, I knew it was challenging to find great deals in the Greater Seattle area, but also knew that it could be done. The problem with that was strategy was that it would be hard to reach my goals in a timely manner that way. I'm determined to be able to leave the 9-5 world by my 40th birthday (I just turned 36 in March) and become a full-time investor. In order to do that, I need to build enough of a portfolio to where my cash flow meets what my W2 income is now. Hitting "singles" or the occasional "double" on Seattle-Area flips and finding modestly cash-flowing investment properties probably wouldn't get me there. Maybe saving up and buying a small apartment building could get me there, but the initial capital involved would be a concern with that.

Then I started to dig into a strategy that I had obviously heard about before, but never really felt drawn to: Out-of-state Turnkey Investments.

You hear mixed feelings about out-of-state and/or turnkey investing, which tends to turn some people off of whatever the topic is. And, who knows, maybe I'll get deep into the process of it and figure out I don't want to do it either. But it makes too much sense to me to not pursue it and find out. 

There are several reason why this strategy makes so much sense to me:

1. Cash Flow & Purchase prices I can afford to acquire at a rapid pace. I've always been envious of the people who I hear on podcasts or read on blogs talking about buying cash flowing investment properties at such affordable prices. It never really clicked with me that I could use Turnkey to my advantage, and buy where it makes more sense for me to right now.
2. I am already an out-of-state investor ... by accident. The one rental property that I own is across the country from me in Atlanta, and I have not seen it in person for 8 years. So I am comfortable with a management company handling it for me (and the fees they charge).
3. I don't know what I'm doing! What I mean is that I would be leaning heavily on someone else to try and find, finance, rehab, and lease a property anyway. And with the right Turnkey company, they can help me, or connect me with someone who can.  
4. My goal has always been to get become a heavily Passive investor. And with out-of-state Turnkey, I can start to make that a reality right now.

Having found a couple of reputable Turnkey businesses helps with be comfortable moving forward with the idea as well.

So that is where I am at in My Journey right now. I'm close to having ZERO non-mortgage debt, and I'm about to start my due diligence on Out-of-State, Turnkey Investing!

Next Action Steps:

1. Speak with several Turnkey Companies. I want to find out what markets are good places to invest in long-term holds, and choose one to focus on buying my property on.
2. Speak with a Mortgage Professional. I would never claim to be knowledgeable about mortgage products. So I want to sit down with a couple and see what kind of buying power I have, and will have.