All Forum Posts by: Andy Gibson

Just curious, I'm a big magazine fan (physical copies). Are there any good REI magazines you all have found beneficial for things like market news/trends, success stories, etc.?

Quote from @Michael Izbotsky:

Quote from @Andy Gibson:

Does anybody have experience using a 401k loan to fund a property? Pros/cons? 

Unlike a SBLOC I mentioned above, the money you take out as a loan from a 401k is no longer invested in the stock (or bond) market. So you miss out on market participation. However, the interest you pay on a 401k loan is paid back to yourself, whereas the interest on an SBLOC is paid to the lender. 

The most important thing is to consider what happens to the loan if/when you leave your current job. Most 401k plans require you to repay the loan within a very short amount of time (few months or less). I've only come across a couple 401k plans that allow you to carry the loan and continue making payments after you're no longer employed with that same employer.

If you don't repay the loan, then it's counted as an early distribution. You'll have to pay taxes plus a 10% federal penalty and sometimes a state penalty, depending on the state. For example, California charges a 2.5% early distribution penalty. 

You can find a lot of information from the plan documents, but it might be best to just call the 401k provider and ask them the terms of the loan.

 Helpful, thanks!

Quote from @Brett Synicky:

Quote from @Andy Gibson:

Does anybody have experience using a 401k loan to fund a property? Pros/cons? 

Do you mean a loan from your own 401k for you to personally buy real estate or using your 401k to loan to a third party to buy real estate?

 Loan from my own 401k for me to personally buy real estate

Does anybody have experience using a 401k loan to fund a property? Pros/cons? 

Quote from @Nicholas L.:

@Andy Gibson

interesting question. can you elaborate?  i don't know if this is something a financial planner will have any expertise in.  a real-estate savvy CPA might be able to help you.  or just ask the question here in the forums.

the best way to have a down payment... is usually cash.

Yea, I guess I’m struggling to figure out how best to pull cash together. Most of my wealth is in retirement savings, a taxable investment account, and my house. I have cash savings, but not to the tune of 20-25% down on a SFH.

Seems like I really have a few options:

1. Cash out my investment account and pay the capital gains
2. Work to save a lot of cash (Which I just reduced my 401K savings rate to only cover my employer’s full match so that’ll be a couple hundred extra each month and I’m about to fully pay off my car in six months and that’ll be an extra $500/mo. I can save in cash.
3. Look into a HELOC on my personal residence but I’m not crazy about this

 4. Look for some alternative financing so I don’t have to sell investments and incur capital gains tax.

5. 🤷🏻‍♂️?

I felt like maybe a financial planner would be helpful here, but I’ve realized they’re very expensive even for just a fee-based consult and I’m not really looking for someone to create an entire financial plan for me right now.

Quote from @Bill Hampton:

@Andy Gibson

Make sure you work with a fee-only financial planner who is a fiduciary. Not a stockbroker or insurance salesman. 

A financial planner will look at your complete financial picture, provide unbiased advice on your current situation and help you map out a plan to reach your goals. 

This will help you determine if you're on the right track or need to make adjustments. 

Good luck. 

Thank you! Very helpful.

Hey guys, I’m just getting started on my real estate investing journey. I work in analytics consulting and have managed my finances and investments well by myself. 401k, investment accounts, high yield savings account, own a house in a nice neighborhood with a traditional 30-yr mortgage, etc. 

Before I buy my first property, I’m curious to talk with a financial advisor to ensure I’m in a good spot and figure out the most tax efficient way to pull together a down payment. I’m pre-approved for a second mortgage, have a realtor who is investor-friendly, etc., but I’m curious what your alls thoughts are on how beneficial a financial advisor could be.

I’m not interested in having someone actively manage my investments as I’m comfortable with doing all of that. More interested in more of an assessment and guidance related to real estate. What are your thoughts?

Just a lurker on this thread (and much of the site), but I wanted to point out that it's been proven time and time again that breed-specific legislation (BSL) doesn't decrease dog bites in municipalities and cities that implement them. 

If you have some free time, definitely do some research around BSL and the studies that have been released. I'm an owner of a rescue pit who's been shot in the face with buckshot and she's the absolute sweetest dog in the world and has 0 aggression towards humans or other dogs.

My hope is that the more people that research and learn about BSLs, the more people that will hopefully be vocal in voicing opposition to such legislation in their communities. Vilifying a breed because of how a subset of terrible humans bred and use them is not fair to an entire, wonderful breed of dog. 

Carry on :-)