All Forum Posts by: Ben Ashburn

Not much I can add to the responses above.

Go to some local meet ups and just get to know some other folks there.  Find some real folks that are actually doing deals, not the glitzy ones that like to talk and offer paid coaching, etc.  It will take about 10 minutes before you start seeing pitches for paid strategies, etc.  Go easy on those.  In fact, avoid them at first until you have had a chance to network with other local investors.

At some point you will want to figure out what to do with the house.  Either make it a rental, or make it a flip.  You could even owner finance it, but definitely study that very carefully.  

But the house should tell you the highest and best use, based on its location and its value.  If the house is at the median or higher, then it works as a flip.  If it is less than the median and it will generate cash flow as a rental (assume you have a mortgage, even though you don't), then you will know it is good rental property.  You will probably need to do some minor updates for the rental house, but that will be much less than what would go into completing a flip. 

Learn about the BRRR strategy. You might be able to rent that house out, season it, and then do a cash-out refi - this gives you some of those funds back to go do another rental. If you do decide on the rental path, get a good property manager -- many reasons for that.

The rest of the cash you can consider to be reserves.  I haven't earned the right to give you any pointers on how to manage that, but just be careful.

Equity traders like to teach/preach the use of strict self-imposed trading rules as a risk management technique.  How much of your funds will you put into one trade, how leveraged do you want to be, so on and so forth.  Get some rules in place for yourself, learning from others as a guide. 

If you lose a little money at first, don't beat yourself up too much.  It is bound happen - but just have those risk management controls in place to prevent a big loss.

Ben,

I am so sorry for your loss. My wife has lost both of her parents before she was 40 and it has been a lot to deal with over the years. So, I have lived through this situation supporting my wife. Advice: Most financial advisors say you should put all the inherited money in a high yield money market account and let it sit there for a min of 6 months until you are mostly past the grief process and you are able to think clearly. We did not do that but that actually is good advice.

Your story sounds so familiar to me because as I mentioned my wife suffered the loss of her mother in 2010 from cancer. Therefore, we inherited about the same amount after probate. I would like to tell you our story and I hope it helps you. A few years earlier, I had done some indepth research on the self storage industry and wanted to invest in that but my wife wanted a bigger home. So she immediately found the perfect home, we bought the bigger home and moved in it. Then I got busy dealing with renting our old home and rehabbing/selling the mother-in-law home as well as a maintaining a full time IT job.  So anyway the new home is everything we always wanted and a lot more like bigger mortgage, more taxes, bigger utility bills, a lot more upkeep cost, bigger lifestyle and on it goes. I am a realtor and know how to negotiate / buy real estate at great prices so we got a great deal on the home and it has lots of equity in it but it does not cash flow. 

My advice is to invest in real estate seeking maximum cash flow such as multi family homes or apartments and/or self-storage. If you don't have the knowledge or experience to invest in real estate directly then research this website (also check out joefairless.com) and listen to all the many podcast (like Old Dawg's REI Network or Best Ever RE Advice) on RE investing and read the recommended books (like Rich Dad Poor Dad or REI for Dummies). Also, investing in syndication can yield good returns (usually start at about $40k) as a passive investment while you are learning the biz. Joe Fairless has a great book just released which teaches the entire process of syndication and/or you can just invest with him (I read the book and loved it).

All the best to you and family,

Kevin Williams