All Forum Posts by: Michael Lucero

Thanks for these Susan. People progressively want more and more for free. You can't get without giving. Seems to be getting worse all the time.

I think your question maybe a bit premature and therefore the answer is no you shouldnt get it. How do you know you will like or be successful at real estate investing. I can tell you one thing, getting your license wont make you successful, you will make it or not based on so many other factors that it makes almost 0 sense to get your license upfront. Why dont you try investing out and see if you are good at it and then get the license later down the road when you have the experience to answer the question yourself based on your wants and needs then. There are so many successful real estate investors without and without their license which tells u its not that big of a factor. The costs in terms of time and money are not worth it when it adds almost no value to being a new real estate investor, it teaches u laws and regulations, which an agent can take care of for you. Sure you may save a little on commissions but who cares if you dont know how to get deals and network. Thats why i say get it later if ur successful and u can calculate the savings from doing so. As an agent you sometimes do get inside off market deals but you can slso network with agents for the same info. Dont think of a license as a golden ticket, the golden ticket is you and your ability, personality, networking, risk aversion or lack thereof, access to capital, etc

 Awesome, glad to hear!

Not sure exactly what you talked about and maybe you already did my suggestions, but I wouldn't talk figures or numbers so much with her, but rather the dream, lifestyle that making a smart move would make. With almost all great achievements in life, they take some immediate/momentary sacrifice to get to the end of the tunnel. Relate or analogize it to something she can relate to. Such as going to school or carrying a baby for 9 months, there is sometimes some pain, tiredness, fear upfront, but when you take that risk, you reap the rewards.

One thing to note is that if you can get a cash flowing rental with instant equity at say 80-90k for this one  it doesnt make much sense to not take it. At 90k and some repairs ur at 95k against 115k value say 110k after closing costs, thats a 15k return on a about 20k investment which is insane. 

We can go back and forth all day but in the end Permanent insurance is not a good way to diversify your investments unless you are uber wealthy and simply want/need to diversify more or are doing estate planning. 

I'd really recommend against getting it.

Hi kaleb To access the equity u have two primary choices. A cash out refinace or a home equit line of credit (heloc). Both have pros and cons depending on what u wanna do. One thing to keep in mind is that 35k of equity is not that much when u consider the seller has to pay both agents' commissions, so i wouldn't like selling unless of course this condo was like really cheap like 100k and u want to lock a high ROI, however i dont imagine that is the case. Do u have any figures for us to chew on?

In response to the 10% interest rate, not sure that's correct, seems to be 0% interest and considering the time value of money, seems like it's actually negative interest. This person lending you the $120K seems to be losing money here. Anyways, the answer to what you "should" do really depends on a lot of circumstances, those with the most weight relating to what you and your wife personally/financially want. If she's on board with you, it might be a good idea to get a 2-4 unit place, live in one, rent out the other 3. If you find a great deal on a SFR, may go for that, however note that we are seemingly at the height of the market, or at least not sure it has that much run left in it, so be somewhat wary.

oops, I wrote buy real estate. If I was forced to not "invest" this money and do something "fun", I'd probably travel to see the northern lights, maybe alaska to go fishing, egypt, etc.

I'd be very careful. Insurance isn't an "investment" if you take dying out of the equation. If you die early on in the policy, sure you have a great return, but ya not so great having paid your life. Personally, I invest in investments, and use insurance (term) to protect against potentially dying. 

One thing to watch out for is the person you are buying this policy from, typically better if its a financial adviser, advising you on various options with pros and cons presented. If you are being sold a policy from an insurance agent/salesman (regardless of what his title is), you should definitely take pause. If it's an insurance salesman, you can be 95%+ confident that they have no clue of whether or not  the policy is actually financially good for you. Sure their company has perfected their marketing material, sales pitch,and counters to whatever you say, however, it doesn't mean they have your best interests in mind. They've been spoon fed to believe it's a great product and that they get fat commissions. I know, I used to work as one. 

Another thing to consider is that most people don't have enough information to understand truly what is best for you unless you're using a solid financial planner/adviser. 

If it was such a good deal, more people would be doing it, don't let any marketing verbiage tell you any different. There are only so many markets that the underlying cash can be invested in. I do however think for estate planning purposes these can be a great opportunity given the death benefit is not taxed. 

These policies are very confusing, so make sure you do your due diligence beforehand.