All Forum Posts by: Aaron Z.

@James Wise Thanks for weighing in.  I guess I should be more clear...I'm not averse to have A job, just not my current job...which pays well but requires frequent moves, a fair amount of travel, is high stress, comes home with me on the weekends and evenings, etc... I also don't need more income than my job, just more income than I spend, which is significantly lower since I've always had a high savings rate.

@Louis A. You understand correctly.  I don't really have a desire to deviate from my past method but I wanted to throw it out there for BP members to scrutinize, to see if I was looking at this the wrong way or if I was missing something.  I think my return on invested capitol is pretty good overall.

Regarding your second point, thank for sharing -- I can see how re-employment could be appealing and even welcome after a nice break and I'd be okay with that after giving "retirement" a chance to make sure I wasn't shorting myself.  All of my properties are located where my family plans to move to upon retirement and they are within a relatively small area so that I could easily manage them myself if I wanted to stay busier and add some non-passive income.

@Steve S. Yes, my experience has been between 15 & 25% on my capitol invested, 20% Cash on Cash return. If I go too high then my cashflow starts getting squeezed on each property and if I go too low I start to feel like I'm sinking too much capitol in the property for just a minimal cashflow increase.  And the $2,500/mo is after all expenses and I'm being fairly conservative based on my past experience.  I know it's hard to fathom but I've seen houses here on BP where people have blown away the 2% rule...although this is typically on a cheaper house. What I've found is a way to get 1-1.3% on newer homes, relatively more expensive homes.  I'm sure at some point I'll detail my process here on BP but I'm just not ready to yet. 

@John Chapman That's a great point.  Weighing the merits of an "easy" but lower return on cash invested or a much higher return on cash invested but with a much more complex and time consuming is something that I've spent a lot of time overthinking recently.  I like how you phrase it that I chose the easy way first...I guess most people don't/can't go that way due to the capitol requirements but it always just made sense to me.  And I don't know if I'll have any desire to continue RE investing after FI but I'm not one to sit still for very long and I love the feeling of executing and finishing a well planned project especially one where I can spend some time working with my mind and my hands...I get zero chance to work with my hands currently. Best of luck bridging that final gap.

Louis A. I mentioned and am including the inability to easily obtain financing without W2 income right from the start of my post. Lane Kawaoka Louis A. So what would be your exit strategy for me in this case? Please be specific. What is wrong with quitting my current job and starting another layer if this isn't the life for me? Why is it critical that I keep adding to a large pool of money instead of putting it to work now and living off it? Do you both suggest that I work for 10 more years? 20? Each year saving 50+ thousand to be deployed in yet another property? I do realize that this analysis is unfair to you since you don't have exact numbers and I'm not willing to provide those, so you probably feel you are being necessarily safe. But can you put down exact numbers that would make you feel safe given my projected expenses in retirement? I'm really trying to understand where my plan is so weak.

@Lane Kawaoka "I spent a decade working my way up through junior level jobs, being a first level supervisor, and managing professional and learned a lot of how a mature business works and inter personal. I wish I would have had this mindset earlier but I realized recently that working for someone else is a privilege to try things out (FSU) on someone else's dine. You don't want to be trying some new marketing scheme or leadership technique the first time when you get your one shot to swing the bat. It is not the time to be "finding your management style" when you step up to the batters box with your own capital at risk."

You've worked very hard.  Thank you for your response.  I'm sure you read every response above but just to add some amplifying information:

I"m currently at 65k passive income at retirement in 18 months without any further actions taken. I'm looking to add a few more homes and complete the plan with about 95k totally passive income in 18 months.  My expenses in retirement are flexible, but my calculations put "comfortable" at 85k in a moderate cost of living area.  My bare bones post-retirement living needs are much lower at about 70k. Additionally, I have and continue to develop VERY marketable skills and as such I can always get a job if needed.  I always have several backup plans and I make it a point to avoid burning bridges so that I always have lots of employment options.  Nothing has ever been given to me aside from my drive and my discipline and being born in the 20th century in a country full of opportunities. 

Don't worry about me - I started this thread trying to turn the next 18 months into an optimization problem for BP to solve but honestly I'm just asking for input picking the best route forward from a list full of really great options moving forward...

Zach Quick Thanks for your feedback. Your outside perspective is exactly why I started this thread.

Zach Quick Sorry for the misunderstanding. 3 times and 150-180k of capitol tied up to do it. Based on my past 10 years of experience in this niche. It'd be great to make a single larger purchase and cashflow the same, but there are not a lot of multi-families that sellers want to sell at a price that makes sense in the local area that I operate in...or at least I don't know of any. For me that's new territory so there'd be a learning curve that would slow the process and add some risk. But I like the idea...and I'll look a little harder to find a deal like that. Any recommendations on how to find a good deal on a multifamily that will cashflow a true $2500/mo that will require less than $150k in capitol? That truly is outside my area of knowledge - but for the right deal I'd even invest out of state...

Zach Quick Hi Zach, thanks for the feedback. I think you are referring to me solely following the BRRR route? That is not my intention. By buying a small number of additional houses with the capitol I have now, I can meet my goal income in pretty short order which is fairly low risk since I've followed this process before. This thread is a way to get feedback on whether there is merit in spending more time on the BRRR method now, which is not an area I am experienced in. I'm just investigating the BRRR on this duplex as a side project. Please let me know if I misunderstood what you were saying.

Andrew Johnson Good point. I'm actually scheduled to close on a duplex BRRR in 2 weeks and I'm definitely watching it closely to see how it goes. My estimates are: 40k purchase 35-40k reno 85k pulled out with the refi 1400-1600 rent I've partnered with a close friend where he has the time and I have the capitol. I'm also using a GC that I'm familiar with and trust. There is no staying with my current job though...I'm done in 18 months...I could work another W2 job if needed, but for less pay and less stress. I'm just ready for a change. Thanks for helping me think this through.

Joe Splitrock Glad to see there is at least 1 other person that follows a similar investing plan...I understand how the high capitol requirement turns off some people but if you are saving 50k a year then it makes a whole lot of sense. Yes I can retire and yes I want to retire. Will I feel regret for not saving my capitol for use after I retire? Maybe, but I'm leaning towards no if using the capitol now means I retire significantly sooner. Thank you and good luck to you sir as well!

Thanks Roberto Costa I appreciate you taking the time to reply.