I have a pretty good W2 and my goal is to save $40,000 by July this year to either use in addition or keep as cushion for the rental property.

Total return per year would be $11,109 per year.Now, paying cash leaves you with a $20K cushion.

I will put in 30-50k down payment—— 25k furnishings/updates(were good at staying on a budget)—— 25k in reserves which is about 7 months of cushion for vacancies.

In addition to what you see in this thread, I'd recommend adding a fat safety cushion to your budget for all unplanned expenses. 

.- New warranty on roof transferable to me- Besides electric and furnace, he says it should be turn key- Could use some paint- I used the BP Rental Property Calculator and even figuring in $65k (instead of $60), lower rent, painting, lawn care, CapEx for furnace ($4k and redo electric at $8k) and a few other cushions, I still come up with about 13% ROI.What am I missing?

We are putting 25% down so Liberty has somewhat of an asset cushion, but as Brent would say 25% was not enough protection in 2007.

You need to make sure your rents cover the mortgage, tax, insurance, cushion for repairs etc. 

Without the cushion of a 9-5 woth good health benefits Id like to compare!! 

From there it was a domino effect that collapsed everything.So you need a cushion to protect yourself against Murphy.

In a tight market like today, if you add in a large contingency cushion, you may be pricing yourself out of the deal with an offer too low.Being in CA, we don't have to worry about any blizzards, but certainly gas prices can affect material costs.