Has anyone here followed the 50/30/20 budget? Was it effective? Did you like it?

Good work user. I hope I cam be like you some day. How did you do it and how many rental properties do you own?

good plan, and live in poverty for the rest of your life.

>to retire at 40, you need at least 60% savings on gross income
Did you just pull these numbers out of thin air? This depends on how much income you make and how much you need for retirement. It would be retarded to make an assumption like this not knowing the facts.

For those with ambition, retirement should come until you reach $2MM. Because at that point you can live on a 4% draw down which is $80k per year. And even that isnt much if you want to have a cozy retirement.

This.

Save up for down-payment and buy a house to live in. Save up another down payment and move. Rent out the previous house. Wash, rinse, repeat. Buy with 15 year mortgage with fixed payments. I have 3 single family rental houses up for rent, a duplex that is basically two apartments plus my house to live in which basically is the same as my rentals and could be rented if I wanted to move again. I used to do the management myself but pay a place to deal with it because I can afford to.

Do you save in a reserve account in case A/C unit or fridge go bad? Also, are you houses under an LLC?

You can easily retire with $1 million if it is rental real estate equity as there is no draw down, you keep them forever. I earn 12%-18% return rate on equity but it's more common to be below this.

My wife's dad had twelve rentals and he told me when I was just a punk kid banging his daughter that "if I wanted to be a millionaire, do it the old fashioned way, borrow a million dollars and buy rentals with it, sit around drinking beer for 30 years while your tenants pay for it." This is literally what he did. But there are 15 year loans available if you only want to sit around drinking beer for so long.

Yes I have a reserve fund but even if you don't you can get stuff like that on credit cards or just work out a payment plan with the place, obviously the fund is better but a credit card will do when you are starting out. I have them in my name outright, a million dollar insurance policy which is cheap when tacked onto my policy. I do a bunch of fucked up shit unrelated to the rentals so I need the insurance regardless. I do have shell LLCs with friendly liens on my properties to make me judgement proof as well.

I've always thought about getting some small trailers and starting off renting them out that way. But you'll only get trashy people like that. but I don't have the capitol for anything else.

You would have nothing but problems renting stuff out like that. I make sure rents are so high scumbags can't afford it. I rent to guys with a decent job but who can't seem to save any money up because they spend it all buying nice cars, RVs, boats and shit like that on payments.

I do feel like you are making it out to be a lot easier than it actually is.

Starting out is a huge risk: The real estate market goes to shit, you cant find renters, and you are stuck paying off mortgages you cant afford on your own.

Banks unfortunately dont just give out $1MM loans to any old shleprock on the street.

Not to mention upkeep, insurance premiums, liability, and the overall hassle of dealing with shitty renters (again, this is when you start out and cant afford to pay a management company).

I only buy properties I can afford to live in. You could rent rooms if you had to. Insurance premiums are cheap, so is liability insurance. If you never intend to sell the property what does it matter if the real estate market goes down? Rents don't ever go down. Some renters are shitty but most can be avoided with screening and high prices. I never said it was easy, only that it was possible. There is also no social security, Medicare taken out. You can depreciate the property which reduces income tax, so your rental earnings pay way less tax than a job.

Also they won't loan you the $1 million at once but they will let you buy a house, than another, then another until you snowball your income and equity. My wife's grandfather did this and was a history teacher, my wife's dad did this and he was an insurance agent, I did this and I was an animal caretaker at a zoo. None of these are high paying jobs.

this

This is basically my life

>Live off the dividends on your brokerage and withdraw 4% a year on the index funds forever.

i thought you wanted to live off 3% per year if you're really paranoid about surviving market downswings/crashes

I'm not that paranoid, if it all goes downhill I can always give handjobs for cash to hobos in back alleys. I once jerked off a woodland caribou (It was part of my job at the zoo, I don't do this for fun obv), so how much worse can it really be?

Ok buddy.

That didn't work in Baltimore, Detroit, Atlanta, Houston at el.

The 4% withdraw rate works if your average real return during the first 10 years of retirement is positive.

You would have to adjust if you retired and the market went to shit like in 2009. But even then it slowly recovered.

During a crash, you can switch your index rate to only pull the dividends from the index funds and brokerage you have. That way you're not "selling".

And before the shills say dividends are the same as selling a portion of the stock at that given rate: no it is not.

A dividend is reflected in the stock price on ex-date, but the market almost always prices in the dividend adjustment and moves the price upward. Look at historical analysis.

Also, if you never sell, your company could decide to increase the dividend. This will be surely larger than inflation or any COLA adjustment on your annuity or SSI

Back to you

>work at zoo
>take investment advice from

Ok faggot. LARP some more. You will be homeless with this constant leverage. You do not understand risk nor finance.

damn dude came in this thread and #REKT the zoo keeper lmao

The hard part about a "crash" tho is that a lot of times those dividend paying companies also slash their dividends to stay alive. But I agree if you can live cheaply during these times, and you have the correct asset allocation in place, you will be good.

I'm not a zookeeper, I'm a landlord. I don't know jack shit about the stock market, so I just buy index funds and dividend paying blue chips and hold. Unlike you stockmarket fags, I do know lots about real estate finance and risk. You need millions to retire with stocks but can get by with $1 million in real estate equity. Other than real estate, I mine more bitcoin per month than any rental so it's like another one. I also am a silent partner in a Russian massage parlor and loan money to shady car dealerships and bail bondsmen because there is no maximum interest rate and thugs collect with physical violence. But sure because I worked at a zoo to get my start I obviously don't know shit about finance.

As for Baltimore, Detroit and those other spic and nigger infested shit holes, of course it didn't work out for them. When I said the rents are too high to keep the scumbags out, that was a code word for white.

and the /pol/ comes out.

but i agree, i would prefer to not rent to nigs cause they are a pain and dont pay on time...ever.

>I don't do this for fun
sure

Lol I mostly post in /pol/ and usually lurk here. I used to post on /b/ all day from the zoo, so I'm moving up in the world.

>"if I wanted to be a millionaire, do it the old fashioned way, borrow a million dollars and buy rentals with it, sit around drinking beer for 30 years while your tenants pay for it." This is literally what he did.

This is seriously a strong strategy, but over the past couple of years literally every fucking person has caught on to this and it's really hard to find properties that will have cashflow after all expenses.

>Starting out is a huge risk: The real estate market goes to shit, you cant find renters, and you are stuck paying off mortgages you cant afford on your own.

Maybe. Even if the market goes to shit, you should have gotten a really solid deal ,though. If you couldn't find one then you shouldn't have bought anything.

>Banks unfortunately dont just give out $1MM loans to any old shleprock on the street.

You don't get a million dollar loan. You get a mortgage for like $80k-200k and build up to $1M by buying one property at a time over years, using your cashflow from one property to save up a down payment on the next property, rather than taking that extra $200/mo after expenses and living on it.

Basically, you want to buy a property that's cheaper because it has something a little bit wrong with it that is actually not a problem but lets you avoid competing with families who see it and think it's perfect and can imagine their kids growing up there and are willing to pay $10k-20k or more above the maximum that would make sense from an investment perspective.

Well usually they had this chick do it and she got really into it all seriously and all I had to do was feed him hay, look him in the eye and pet him on the face really nice. When I had to do it, me and the hay feeding dude couldn't stop laughing.

cont'd

>Not to mention upkeep, insurance premiums, liability, and the overall hassle of dealing with shitty renters (again, this is when you start out and cant afford to pay a management company).

You price all of these things in. According to the little bit of reading I've done, if you're not getting $200/mo per door rented after all of these expenses, including property management fees, then you're getting yourself into a shit deal and stand a very good chance of losing money.

From what I read, the people doing this successfully will look everywhere for properties. They'll run the numbers for hundreds of properties per year, view much less than that in person, make maybe 10 offers, and have 1 offer accepted - since they're offering low enough for it to make sense for getting decent cashflow.

Real estate investment really sounds like a chore, desu. Especially nowadays when the market is hot.

I'm responding to your last paragraph. True Dat, most of my properties needed at least some work and some were foreclosures. It never took more than a month to repair and rent but most people can't pay to live somewhere and afford the mortgage payment for even a month.

I agree 100%.

...

Is this /Pol/ code talk for working somewhere such as say, a poor part of town?

>Maybe. Even if the market goes to shit, you should have gotten a really solid deal though.

Okay? You arent gonna get a deal that protects you from a 25%+ drop in the market and will magically guarantee you renters for life. Of course you try and get a solid deal but that still doesnt mitigate the risk much.

are you saying $200/mo per door as in per room of the house or $200/mo per house in your portfolio?

Nobody cares.

After you price in everything, insurance, principal, interest, repairs, maintenance, management, ect you should clear $200 per unit on the day you buy it. This goes up over time, I've never reduced the rent.

user is making the points better than I could, so I'm agreeing with him. I didn't think anyone else cared.

>are you saying $200/mo per door as in per room of the house or $200/mo per house in your portfolio?

>are you saying $200/mo per door as in per room of the house or $200/mo per house in your portfolio?

The context I've seen that "per door" number in, it seemed ot be referring to poor front door, basically. if you're renting out a single-family home, it has one front door, right? if you're renting out four apartments, that's 4 doors.

so its not per room of the house but it's also not exactly per room of the house - a duplex or fourplex would be counted as 2 (duplex) or 4 (fourplex) doors, even if they were just one structure.

if you want to read more, biggerpockets seems like the place to go. i saw someone say that maybe nowadays, $150 or less per door is as good as you can hope for, but didn't know if he actually knew his shit. 90% the people there seem like that occasional Veeky Forums poster who wants to know how to invest in bitcoins and doesnt know what a wallet is, except way more optimistic about their chances of making money for some reason, since they seem fucking dumb while the newbie Veeky Forums poster usually jsut seems naive. im sure osme people there are actually smart but i doubt they'll give away all their secrets.

Germanfag here, currently throwing all my welfare at crypto and already made 80k this year. Wage cucks stay mad.

I consider $200 a minimum as does every other landlord I know, this obv changes from market to market.

I'm trying to give away my secrets because I am set for life and it doesn't matter to me if someone else makes money. They'd rather get rich quick speculating in shitcoins rather than get rich slow renting and drinking beer. I went from jerking off caribou and now I'm here.

Great advice from you guys, thanks. Jesus bless.

Since you said thanks I will give you one more tip that will get you over the Hump. When you are trying to buy that second house, list your first house for sale at a ridiculous price and list it with an agent at 6% with 1% to selling agent. Nobody will show it but the bank will accept it as long as a "knowledge person" ie the agent who listed it justifys the price. Once you move into the new property, put it up for rent at a reasonable price as well. It will rent or you sold it for beyond your wildest dreams. Your third house you tell them your renting it and point to this rental as evidence and you will never have to try and sell again.