The company I work for manages approx. 100 units in the LA area and the average expenses for our stabilized properties run around 40% of rental income, less vacancy expense (this does not include principal & interest, and I used three years of data to average out the expenses, so I would figure a bit higher to include all possible capital expenditure items.)

Also be sure to set aside 5-7% of rent each month for repairs, vacancy, capital expenditures, and 10% for management.

I've seen the spreadsheets and cash flow projections but how often have you had to pay for repairs or other capitol expenditures that reduced your cash flow?

I'm inputting Capital Expenditures and Property Management at 10% each.

What you have done is traded a set hours, paying job with some benefits for a no set hours, no base pay job that will require expenditures.

As a side note, I did a research project on lotteries back when I was an undergraduate, and as it turned out most of the states simply eventually substituted regular expenditure for lottery money - in other words, all the benefits such as increased money for education et al were never realized since the states just used the money that had been allocated before the lottery to do tax cuts or spend on other projects. 

Will try to write it here instead.I'm curious about your accounting - it doesn't look like you have accounted on any of the properties for capital expenditures. 

I don't recommend skipping this step even if your partner is not concerned about it.Regarding taxes, you must keep records of all expenditures throughout the process and monetary distributions when you sell.

Ancient Indian burial ground?  

Do not save all of the increase or even all of the increase above cost of living (you deserve some rewards for you hard work), Example if you get a 5% raise at the end of year one and the inflation rate is 2.5% would imply the raise above 2.5% is money beyond your previous year's expenditures.