After maxing out your 401k, Traditional IRA, having a 529, investing extra in a separate brokerage account, having a SEP, having 3 months emergency fund, paying off debt (except for mortgage for primary home), what are strategies one can undertake to build up assets/wealth as a sole breadwinner of the family without sacrificing life experiences? Tax strategies? Real estate (Is it worth it to get a second mortgage? or best to wait until your primary home is paid off before buying another home to rent out?) House flipping (how to start on that?)? Envelope system (Is it good to use when saving for vacations, things to buy that is not included in the monthly budget? Or might as well put money into investments than spending on these things?)? How much is a good savings rate? How do you stay motivated and prevent burnout while doing all these things?
I don’t have answers to all of your questions but I just want to say WOWWWW YOU ARE AWESOME!!!
I don’t know much about real estate, but paying off your home early is not generally a high priority (due to the low interest rate and equity) so I feel like it’s pretty normal for real estate investors to have multiple mortgages?? I imagine house flipping is a lot of work so my question for you is, what do you consider as sacrificing life experiences?
Instead of an envelope system, if you don’t want to use cash, you can use a budgeting platform like YNAB. Or even just open up a separate account for a sinking fund and add money to it every month. Of course financially it’s better to invest than spend money on vacations, but traveling is important too!
A good savings rate totally depends on your income and responsibilities but the more the better!
To stay motivated I would say to give yourself goals/milestones and make sure to reward yourself as you accomplish them! You work hard and deserve to be celebrated!
I’ve been reading a ton of blogs and reading Facebook groups on BRRRR (Buy, Rehab, Rent, Refinance, Repeat) to educate myself on the house-flipping front. I currently live in a terrible market for true cashflow on properties, so I’m sloooowly playing around with the idea of getting more ROI elsewhere (but which requires long-distance management, etc. to consider).
I keep hearing about the Bigger Pockets podcast - that could be a great starting place for us both to learn the ins and outs! The people in the real estate investment community are generally pretty helpful, just like they are here (whoo hoo, PFC!).
I try to siphon out my savings on the receiving end when I get paid, and then don’t budget TOO strictly after that. As long as I pay off my bills in full each month, I just kind of adjust as I go. Some months I play and eat out a lot more. Other months, I feel hermit-y and hunker down at home with homemade food. The less I personally obsess over the little details, the richer I feel and the less likely I find myself to fall off the bandwagon and splurge on unnecessary items.
On the savings front, I try to balance out my investments 50/50. I’m trying to save up for a new down payment, so I have more cash on hand than I usually do. Btw, look into programs that let you put down just 3-5%, even if you might have PMI; if you have good credit and aren’t buying pricy properties, that amount could be dirt cheap. Mine is $39/mo and allowed me to save 15% of my potential down payment into my index funds instead - totally worth it to me.
Thank you both for your advice. I will definitely look into your suggestions.
I am glad I got to join this community. Yaay!
Google and Amazon have been my go to but, after googling “house flipping”, “personal finance”, “investing”, “f.i.r.e.” and buying books, the choices are pretty much the same and I feel like I have already read most of them.
And then I saw Jeremy’s post on Daniel and I was like thinking how he was able to invest on real estate, how did manage to save a lot to come up with a down payment, be the sole breadwinner of the family, and still enjoy life.
I am like I must be doing something wrong and I need guidance. I mustered up the courage and messaged him all those questions and he suggested I post it here. Best advise ever.
Considering that you are investing lots of money every month, you are already doing WAY better than the majority of Americans. Of course - we can always do more, but you should definitely be proud of yourself for what you’ve already accomplished!!
Thank you for this message and your kind and encouraging words.
I started late investing and most of the time I feel behind.
I didn’t get to max out everything until a few months ago as I still had loans that I wanted to pay off early this year.
Hopefully🤞 I won’t have the need to take on any new ones.