If you spend all or most of the $40K on the next property, and if you will have some cash reserves for emergencies, I can get behind this scenario where you would continue to pay her $550/month. 

I also have a tenant information update form that I place with the letter so I can have their current information, name of all tenants, contact information, employer, emergency contact etc. 

I'm just starting my REI learning process, but have previously lived by the "have 3-6 months of emergency savings" principle.

I already have a nice sized emergency fund for repairs and such, and 'm working on negotiating the price down some more so there's still wiggle room.

I have an emergency fund but I'm not dipping into that.

Truth be told, I enjoyed his second book more (Emerging Markets), but it's hard to beat MF Millions as an introduction

up front cash for emergency roof fixes, etc.?

A fridge malfunction is an emergency because tenants can loose their food. 

I keep a cash cushion that (I think) is adequate for emergencies. 

If so, how do you manage maintenance or emergency issues if you are managing remotely?