All Forum Posts by: Meredith Ogden

Hey @Meredith Ogden!

That will be a great lump sum to get you started on your journey, but I am going to agree with everyone above... Don't put all that capital into your first deal. We do TONS of fix and flips here in Denver, and I help numerous STR clients as well. Both are great strategies but you do need to be able to navigate them correctly otherwise, you could loose that 100k real quick.

I wouldn't wait until you receive the money to get in. I would find other avenues to start getting your feet wet in the industry and make sure you enjoy these strategies. Flipping, if you are willing to do the work, you could find a deal and partner with someone who has the expertise and the funds, and work together on it. As for an STR, you may start somewhere smaller. Not sure what your current living situation is, but you may have an opportunity to get into a new home with a Mother in Law suite, or an ADU that you can STR, just to see if that rental strategy works for you. This would be a house hack, and you'd be able to get in with 3-5% down.

I will also disagree with everyone above, you could make both of these strategies hands off, with the right moves.

These baby steps during the next year will gain you the confidence and the knowledge, to best utilize that 100k, if that is the best case at that point. and you may be able to stretch that 100k into a few deals, or limitless deals if you have the right pieces to play

Happy to chat more and give my guidance!

Hi Maredith, It's great that you're considering leveraging your vested stocks to start investing in real estate! Here are some considerations regarding the tax implications and getting started in real estate investing:

1. Tax Implications: Cashing out stocks may trigger capital gains taxes, depending on factors such as your income tax bracket and how long you've held the stocks. Short-term capital gains (stocks held for less than a year) are typically taxed at higher rates than long-term capital gains. It's essential to consult with a tax advisor to understand the specific tax implications and explore strategies to minimize taxes, such as timing the sale or offsetting gains with losses.
2. Real Estate Investing: Flipping and short-term vacation rentals can be lucrative real estate investment strategies, but they also come with their own set of risks and considerations. Flipping involves purchasing properties below market value, renovating them, and selling them for a profit. Short-term vacation rentals involve renting out properties to travelers for short stays, typically through platforms like Airbnb or VRBO.
3. Getting Started: If you're interested in flipping, start by researching local real estate markets, analyzing potential deals, and networking with real estate professionals, contractors, and lenders. Consider attending real estate investment seminars or workshops to learn more about the flipping process and financing options.
4. Creative Financing and Hard Money Lending: Creative financing techniques such as seller financing, private lending, or using a self-directed IRA can help you acquire properties with minimal cash outlay. Hard money lenders specialize in providing short-term loans for real estate investments, typically with higher interest rates and shorter repayment terms than traditional mortgages. Explore different financing options and determine which ones align best with your investment goals and risk tolerance.
5. Finding a Mentor: Connecting with a mentor can be invaluable in gaining insights, guidance, and support as you navigate the world of real estate investing. Look for local real estate investor groups, networking events, or online forums where you can connect with experienced investors who may be willing to mentor you.Hope it helps :)

@Meredith Ogden That's a lot money so take your time and understand the "challenges" you face when jumping into REI.

First, you could be punished for pulling the money (Uncle Same hurts people). Depending on account holding the money you could pay early withdraw penalties, taxes, who knows. Speak with a tax professional. 

Secondly, "My 2 main interests in real estate are flipping and short term vacation rentals" - these strategies are full time jobs. If you have the ability, flexibly, and time go for it! Otherwise understand the difficulties when flipping RE and managing STR.

Third, don't put all your eggs in one basket. What other funds can you leverage outside of the vested stocks? Pulling all that $$$ at once is crazy risky. Even before 2020 I'd never leverage my retirement just to do REI. When I started I scaled back my lifestyle, sold stuff, and got debt free to fund my first rehab. You should to be investing in other things (more baskets) at the same time which you are. Don't rob Peter to pay Paul.