Some updates over the past few months. overall things are up and down.. still stressful.
1. Work. I am still at that company that wants me to work downtown. Since my last post they have been saying. "we will just work downtown through June", then thru July, then August and now it appears never ending. I am required to be onsite Tues-Wed and stay overnight. I really dislike 'traveling every week, packing up, staying over, working late'. I was only passively looking but I did apply for and interview somewhere else. I did really well but did not get the job. My Israel trip is Sept 28 so will stop really looking until after that. Company hired 12 other full timers since last post and I am the only contractor. I continue to have nothing to do, no official role, and feel my job is not stable and is at risk. The word is that the company is going back to the full timer model (vs contractor). I did switch to W2 so I could maybe find another house
2. I signed a contract on a house.. $433k. My house is expected to sell around $530k and is on the market as of Saturday. Close date Oct 17. I should find out this week if I can hold both homes at the same time (short term). The new house is in downtown Naperville (which I prefer better than my outside of downtown subdivision). It is older and needs some work but is selling at a price point of $182/sq foot. Average is $238/sw foot and based on my estimates and quotes I can raise the value easily to $238 or more like $250k. the improvements I have in mind are likely to bring it to $600k+ based on comps.
I am nervous about this house as I do not have the loan locked down yet (expect approval Tuesday though) and those who have read me a while knwo that my last loan attempt fell through at the last minute. I have until Sept 25 to secure loan approval and expect news Tuesday. If I can not hold both loans for a short while I may be in trouble trying to sell fast enough to do a dual close and may back out of the contract.
Really need prayers.
The reason I signed a contract on a house was because I really do not want to live here anymore, I have nothing in common w anyone, for some reason I live by all sorts of dogs who bark all the time and I want to lower my monthly payment and get unstuck. I have wanted to sell and move for a while.. a LOOONG while but never got the courage up and homes were too expensive. To find a $433k house in the heart of downtown Naperville with almost 2500 sq feet, large kitchen, good floor plan,basement w high ceilings that can be finished, and large rooms is an amazing find. AND the ability to get my money out immediately if need be.
I did not sign up for school as I can not really concentrate on school w the work situation and will be out of town part of the quarter w Israel.
I will likely restart school after the new year.
Rentals. I am thinking of sellign that new 2 flat. I will talk to realtors and my property manager Tuesday. I should net $100k
I pay all taxes today. This is my last big milestone. I have not really pulled much from the rentals as I have been 'catching up' on the tax escrow.
I put down $10k on the new house (from my personal emergency fund). I was able to pay that back in full from the rental proceeds this month which to me is huge.
After I close on this new house, do the 'bulk' of the work I want to do on it I want to re-evaluate jobs and what I want to do. Right now I need to keep this high dollar job for the loan.
I will update on the loan and house situation as it develops
I reached the end of my 5 year plan and need to set NEW goals..and a new plan
Viewing the '5 Year Goal Status' Category
I have completed my first full week at work. I think I like work and it will work out. I am making friends and just SOCIAL contacts and am out of the house. I am so much more focused working out of the house. more exercise more energy .. lots of good benefits. have not received a full check yet but I will be making a much more. over $1200 a month more on 40 hours
I will start the 401k in July and prob do my first test of the rents then (3 units will be paid off by then).. with doing 100% in 401k for 2 months to get that maxed out and just relying on rents for normal expenses.
2 flat is up for rent and being shown. Hoping to get it fully filled by mid next month. Shows well
My current plan (unless something changes) is to sell it.. it just has bad vibes for me.. feels bad. everything I did with it turned to bills and nightmares. . I do not need the income but I can use the cash. It is like 90 years old. I just want to move on.
I do not expect to make much if at all on it.. maybe $5k . but I can expect to have approx $50k cash back from the sale due to the accelerated payoff on it..
That will go towards investments.
I can expect to receive $73 k ish from Dad's estate. I was planning to invest that all. all in Vanguard
So total $125k ish to Vanguard which dependent on the market may bring me up to $475k.. contribute $18k to the 401k this year and then other savings. Hoping to break $500k this year. I have $350k now.
I will be happy when all the work of Dad's estate and everything is done so I can relax, enjoy the memories and grieve.
3 unit payoff will happen whenever I get rents this month. I just talked to the property manager and I should have those rents mid next week.
Paying that off is the major item in my 5 year goal.
I am breaking off all 'entanglements' .. ie guys I have been dating for a while and am not serious about so I can be open to finding someone else.It is scary to do so.. and upsetting and lonely.
I am working on making more girlfriends. everyone is busy and has their own lives. I will join some groups etc.. hobbies whatever. I DO have more people to call which is nice and associate with
Working out more. and trying things out at the church.. different volunteer assignments and meeting more people
I do want a long term relationship
School started .. New Testament. Love it!
I may take off from school for the summer. I prefer not too but may have to due to scheduling of classes
I am picking up information this weekend to be certified as a chaplain too. exciting stuff
Those who have been following a while may remember that I stutter. The national stuttering association annual convention is in Chicago this year. I will be presenting a job search workshop. neat stuff! Lots of people do not know that but inside I carry it and it comes out when I am tired or down
I will start escrowing a full months expenses starting in May and then tracking my net from the rentals. This way I will have a more accurate idea of what is really coming in that I can depend on. I expect that to average to a net between 7-9k a month
so far I feel I am winding up my 5 year goals and getting ready for something (not sure what) but just continuing to wind things up and move forward
If I ever get sick of the rentals I can sell them now that they are (will be next week) paid off.
Still want to build my investment positions. only have $350k and less w the market going down probably..
I want that up to $500k by end of the year.. we will see.
Hope everyone is doing good. I could not have gotten this far without the support of this group.
Networth attached from the end of last year and I met all goals except increasing my investments to $380k. I was almost $43k short. That was due to the excessive money put into the 2 flat. I want to have at least 50% of my networth be savings and investments. Right now i am at 22%
I also started school last year. Masters in Ministry leadership.
2 flat carpet and appliances go in today. so on the home stretch!
I will set new goals next shortly. Rentals are definitely stabilizing but w the income from those and this job I need to take some steps to save taxes. I am talking to my accountant on that.
FINANCIAL GOALS FOR End of Year 2018
1. $425k in Total Investments
2. Rental emergency fund $18k+
3. Personal emergency fund $15k+
4. Payoff 3 units
5. $20k left on 2 units or SOLD
I work on contract as most folks know. Today I am stress testing my plan if I was NOT renewed and did not find work for 6 months, had no 2 flat rent and 30% vacancy across the rest with no 'other payments' coming in.
Enlightening!! Makes me feel grateful to have a job. I encourage all of you to do a similar exercise.
Today is tax day for me. I am figuring out and gathering all my tax documents for me and the rentals
i also need to gather the not for profit tax info
I lost $28k gross income to my bottom line by closing the not for profit
This 5 year journey has been a wild one.my first 2-3 years were very tight. I had a good year last year and now I am Very tight again
I updated my financial goals to the left there for 2017. Those are highlevel goals. I will track monthly and set some mini goals to get to those larger goals
I continue to be off track (per my 5 year goal) towards my personal residence payoff with no clear ideas or plan on the horizon to make that up
I am also short with investments (primarily because I bought more homes) with no clear plan on the horizon to make that up
I want to formulate clear plans to make those gaps up and I really want to put together a plan to make $1000/month more income by March 1
I am putting in 25% my 401k now through the end of June. it makes things pretty tight but my contract only goes through the end of June.
Anyway I am sharing the homes budget for next year. Vacancy, maintenance is estimated based on #s from prior years and then rounded UP. Net assumes homes are paid off. They are not paid off yet. Payoffs start March 2018. . My payments exceed $7500 a month right now. I DO plan to use any extra net from the homes this year to build up the 'rental emergency fund' so not drawing anything from the rentals yet and hoping for no large expenses. I am not planning on any improvements this year
Budget attached. Red means rent is Section 8.
I will be posting more this next few days as I get caught up
Year end goal updates and networth at year end below
VERY busy at work but did get renewed thru 6/30 and woudl think they will renew me again after that. VERY BUSY.. Working lots of hours which of course means more $ as I am paid per hour. I am still on match.com but it is expiring 1/16 and will take a break for now. I am dating some guys. two of them. not sure if they are a match but figuring that out as we go along.. but need a break
I DID close my rescue.. bittersweet..emotional. sad.. but DRAMATIC change in stress level.. loss of $30k income on top of $1750 month loss when my ex moved out. VERY TIGHT year for 2017 and need to find additional ways to make more money to meet savings goals.
2017 is the last full year of the real estate payoff. real estate will be paid off in full 6/2018
Currently dealing with 2 vacancies and 1 unexpected turnover. Upsetting and expensive. I am not as 'on it' as normal with work stuff and also hurt my knee badly
I am dropping HSA funding this year and will not do a ROTH or regular IRA this year. Does not make sense to do so. Doing just investments and fully funding 401k and beefing up emergency funds (for rentals)
Anyway will post new goals shortly. just saying HI.. miss you guys and talk to you soon. ..rachael
GOALS FOR End of Year 2016 RESULTS
1. Maintain emergency funds at correct levels-DONE
2. Increase total savings and investments to $310k-$41k short, only had $270+
3. Increase rents across all units by $600-increased $305
5. Raise rent or sell 411 house-DONE, + $50
6. Buy 2 more homes-bought 2 flat and 2 homes
7. Fully fund HSA accounts-DONE
8. Fully fund 401k account-DONE
New 2016 goals below and on the left. I have NO pending large repairs across the rentals. what a change. the first two years were ongoing repairs and fix ups.. no such pressure now.. of course still maintenance and I do WANT to do some long term things but they are not required..
Still setting personal goals.. looking forward to another busy wild and crazy with ups and downs year.
Need to reduce my stress, the amount of stuff I have going on and do more for ME
GOALS FOR End of Year 2016
1. Maintain emergency funds at correct levels
2. $310k total savings and investments
3. Increase rents across all units by a total of $600 month by year end
5. Fix up/raise rent or sell 411 house
6. Buy 2 more homes
7. Fully fund Roth/HSA accounts
8. Fully fund 401k account
I will try to fund the HSA and Roth by February then all the rest goes towards taxable savings.. I will try some of the methods folks are using on here to track #s etc. I do VERY little tracking of personal. adn want to do more.
If the 3 units were paid off and I was not accelerating payments on them so much (I pay over $5k for the mortgage right now) I am at about $7k net cash flow/month with a 5% vacancy rate and other escrows included (tax, repair, insurance etc).. I am still smoothing things out so NOT at that right now.. but these 2 months w the new property manager have been the best in terms of stress and money in a looonng time.. I will check my vacancy rate these past 2 years .. and then again this year and onward. I have the feeling I will have less vacancy adn faster tenant placement w these guys..
really excited to compare this years #s to last years and have some more baselines. I did have a handy dandy excel sheet for that (which I still do) but lack of management reports and accountings from the old manager for 6 months makes it more challenging..
Year End Wrap up #s
LOTS of savings!! the hard work paid off. I saved $53012 OUTSIDE of my 401k. went to taxable investments, ROTH or HSA
Also got $200k from family.. used it to pay off 6 homes and put almost $80k towards investments
GOAL RESULTS and Networth chart attached
I will set 2016 goals tomorrow..and work on rental year end #s
Also want to track my personal costs like others are doing..
RESULTS FOR End of Year 2015
1. $15k rental EF=-DONE
2. $35k increase in savings/investments-DONE
3. 1 Roof for 6 homes-DONE
4. Decrease negative cash flow on rentals by $400/mth-$356 INCREASE
5. Stay within maintenance and vacancy budget for all rentals-OVER BUDGET
6. Make all 6 homes/3 units payments-DONE
7. Fully fund Roth account-DONE
Contemplating HOW I am going to reach those goals on the left by 6/18
1. Payoff 3 units 6-2018. requires $69k. I plan to save $1750 a month in a separate account starting next month
2. Retirement investments.. requires $200k more in 33 months. That is $6060 savings a month. I will set as my goal starting next month (to average that). this wil include credit for 401k contributions
3. owe under $100k on house--no ideas yet
4. income of $8000 NET a month. will need to raise rents/cut costs and possible get another house in thre or income stream or something
I will start posting these goals so I can work towards them
Seem pretty impossible now but impossible does happen
Goal 6/2018, $100k left on house, $8k net monthly income (passive) and $400k investments (goal WAS $300 k. raised it to $400k today)
This is the first of probably a few posts as I go through the numbers
General results this year
1. $40,207 total savings (went to Roth, rentals, emergency fund and investment savings) .. still .. wow.. lot to save!
2. $249,882 increase in networth off of last year-mostly from primary home ownership and rentals
3. only $1099 OVER yearly budget for rentals for maintenance/repair and vacancy budget. BUT did lots of long term repair items this year.
4. $31,595 in long term improvement to rentals-includes 2 new roofs, fixing 2 roofs, water fix at that one house, and updating 2 homes and updating 2 3 units
5. $220 DECREASE in negative cash flow over last year on the rentals
6. ABOVE decrease is primarily in 6 homes. 3 units had INCREASED negative cash flow to budget
Will study some more and list accomplishments. trying to diary the journey. this was a big year..
Set some new financial goals to the left
I get my next free and clear house 2/2016
My main goals continue to be to smooth out the rentals, keep my job and have enough cash reserves. there is no leeway in 6 homes/3 units payments and the deal was signed assuming I would NOT have a primary mortgage payment until 2016 or later. That is why things are so much tighter than expected.
Need to rebuild rental emergency fund to $15k asap and considering increasing the personal (lose my job) fund to 4 months which would be $14780. 5 months is $18475
Need to sell this Tahoe
Rescue interested in the cage bank has not been in touch lately and I am thinking they are struggling to get the funds. I put in a call today.
Diarying.. got into a crazy car situation today. hit something in the road . got an instant flat in the LEFT lane on 290.. where there is no shoulder.. had to cross 4 lanes with one tire flat and cars whizzing by to get to the right shoulder. Anyway. I am ok (working at home) and new tire and tire fix are free.
Projections. Diarying this so I can see how they change.
5 year goals are to the left.. I am looking LOW for savings and main house payoff. NOt sure if I will push to pay the house off but I think I WIll push the payoff on the 3 units early by 5/2019 . then all rentals are paid for.Savings will be hard to increase from my rate now unless I make more somehow. Estimates in the below are high for savings but like to set goals high vs low.
Thought I would post a quick networth here... it is fun to look back and see the progress.. October 1 marks 1 year on SA.. wil recap progress then.. 6 homes and 3 units are not in my name yet. they are on a contract for deed but still listed here. Values are the price I paid. I did a lot of figuring yesterday and basically things look positive for the 5 year goal. ..I am not on target to reach it but on target I think for 'year 1'..where I am short is this: pay off the house goal (no plans yet but still stabilizing) and $300k cash (only projecting as of now $170k need to increase this) and 3 units and 6 homes will likely only give me $6000/month. and 3 units will likely not payoff til 5/2019... I have a little under 4 years m more to meet my stated goals so I think off to a good start. but SUPER IMPORTANT I stabilize and have lots of extra cash on hand for emergency. I will be 47 6/2018.. birthday is October.
Trying to stabilize here and get on a routine..
Settled 2 flat yesterday.. lots of drama.. tenants were upset and threatening to sue me... not sure for what. I advised them about the foreclosure months ago..and set them up w a lower rent.. lots of landlords just walk off. I maintained the place to the end and returned security deposit. Anyway hopefully that chapter is closed. They will rent from bank and then new owner now.
Hope to hear on refinance Monday.
JOb interview tomorrow and one next week. all for large companies. one contract at $65/hr. one is salary .. likedly $120-130k.. unsure.
I wish I had word on a job nearer . I am concerned I am going to get offers next week and still not have heard or gotten any leads on local jobs. so far I have been submitted for 4 local jobs.. have no word at all on 3 yet and did an interview on one and got beaten out.
The contract job at $65/hr (likely at least 2 years) appears NOT to offer 401k for the first year.. crazy. I will ask for that exception if I get it. I work at home today and will try to incorporate some job search. I used to just wait for a job to end before looking for another. I will be more vigilant now. it is VERY NICE to have the luxury of looking for a job while working one so i have minimal downtime and I need that.
Marching forward. settling a lot of stuff this next 3 months then things smooth out.. (wiping my brow)
I did open a taxable investment account at Vanguard I am really liking Vanguard. put $1300 in it. I will merge Sharebuilder into that. less fees.
Networth update.. $132,611. I am 43 and trying to rebuild as fast as I can..
I buy the 2 3-units TOMMORROW!! scary/exciting stuff
If my plan works (got almost 5 years to go) I will have $5500 cash flow from the rentals in 5 years..
No word on my own house (the short refinance. I need to clarify that ASAP).
Paid off the warranty this month. Still paying extra on the car but want to get that paid down ASAP.
Fully funded 6 homes large expense fund and moved to interest bearing account
$4000 total in emergency fund (need $15,000)
Cut auto insurance (yesterday) by $480 a year
Re quoting 6 homes and then the 3 units to see if I can lower them.
If hte house works out (where I live) I will get $400 offset on the policy cost because of multi line
Here we go
Quick note on current status towards goals
Goals are numbered to the left. My whole plan is based on the idea of 'sow seed/sacrifice' now.. 'reap later'.
1. I have acquired 6 homes in Joliet a few months ago..they are on a 5 year amoritization. Pay off date 5/18. They would net $3500 if paid off now so I will assume they will net that amount then.
I close on a 2 3 units also in Joliet that are on a 7 year amoritization and with $60k will be paid off in full in 5 years. I plan to come up with the $60k 5 years from now to do this. They would net $2300 now if paid off and will assume they will net the same then.
Both sets are fully managed and have an associated budget. I can share that if folks are interested. Both will require between $300-700 cash outlay each month to meet the amortization. In other words. they are negative cash flow and may be through the entire 5 years though we are already raising rents on the 'joliet 6'
**these are the last buildings I will fully amortize over 5 years, though I plan to buy more because I am short of my $8000 target in 5 years. Note my plan is calling for no cash flow now.. all cash flow in 5 years
2. I have $83,000 cash. $45k will go towards the 3 units in 3-4 weeks
3. I have health insurance. Federal exchange
4. I am trying to work out a 'short refinance' on my own home right now w the bank. A 'short refinance' is a special sort of loan like a short sale except YOu keep the house. It wipes out all overages and allows you to buy the house at market rates, market value. House is prob worth $430k. We are negotiating at $350k right now. (fingers and toes crossed and prayers).. Note: this extra expense was not in the 5 year plan right now.. so still working out how to do this so as to not impact the rest. I need to 'plant seeds' now and not take on excessive monthly payments. I would buy the house however as I will have built in equity, it is really nice and it is 'known'. New roof, furnace etc and I know the house.
5. On the 2 sets of homes/buildings alone at current market value (price I paid) I will have $500k equity in 5 years
6. I have 2k in this fund and need $16k. I work on contract and was just extended til June 2014 so will work on this in the next 6 months. I can not take on the home (my own) without this fully funded by then
7. I have properly escrowed the 'Joliet6' as I call them w $6k cash and a monthly $500 allotment. Need to escrow $6k for 3 units by Dec 1. Monthly repair allotment already built in to 'budget'
8. 2008 Tahoe paid off. Genesis on track to pay off 8/2015 at doublepayments but I may delay that.. unclear??
This is the current status. I will update each month. Note if I extend out the 5 year plan..I am short on income (which will translate to that $300k savings) so any more real estate will be bought with the idea of cash flow now . I am also seeking ways to gain more income. I make $110k now at work and have $2k/month coming in from a rental (which I am going to let go.. and will likely lose between 6 months-2 years from now.. to the bank).. currently with an attorney who is attempting to delay the foreclosure suit as long as possible.