| 22 years old - Savings Investing |
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fybpm
New Member
Cash: $ 1.95
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Joined: 14 Jun 2005
Location: Merced, CA
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| 22 years old - Savings Investing |
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I am 22 years old and I am a branch manager at a mortgage company. I have a mid-six figure income and I have already this year maxed out my 401k contributions with employer match. I own 3 properties: $417k owed worth $460k, $302k worth $355k, and $224k worth $255k. I also have about $20,000 in savings accounts; no debt whatsoever. What other tax deductible vehicles should I look into taking advantage of and if I have none avaliable to me as I stand, what other places should I look to invest? I'm a big fan of working hard, I say work full time now rather than part time forever. I'm all ears for early retirement suggestions!
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Tue Jun 14, 2005 7:00 am |
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xboxundone
Senior Member
Cash: $ 67.83
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| Re: 22 years old - Savings Investing |
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quote:
Originally posted by fybpm
I am 22 years old and I am a branch manager at a mortgage company. I have a mid-six figure income and I have already this year maxed out my 401k contributions with employer match. I own 3 properties: $417k owed worth $460k, $302k worth $355k, and $224k worth $255k. I also have about $20,000 in savings accounts; no debt whatsoever. What other tax deductible vehicles should I look into taking advantage of and if I have none avaliable to me as I stand, what other places should I look to invest? I'm a big fan of working hard, I say work full time now rather than part time forever. I'm all ears for early retirement suggestions!
I realize that you came here for investment advice... but let me ask this you say you own 3 properties are you renting these out and erning income on them? or do you just own three homes and are holding onto them as n investment... the reason i am asking is you have a LOT of debt hanging out there... Now yes you could sell the homes and cover yourself but then all you have left is your savings(maybe 10 or 20K more)... I make this point to say that you should keep your 20K as you nest egg for hard times... Especially with owning 3 homes!! Congrats on being a happy home owner 3X's over by 22 that is a feat in its self!
Also if you savings is in basic bank account savings move it to ING direct or something similar that pays 3% as you are lucky to get 1% from the bank.
Just my 2 cents.
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Tue Jun 14, 2005 12:41 pm |
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jlee1224
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Joined: 26 May 2005
Location: Baltimore
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Maxing 401k if good. Next step would be to own a taxable account. Buy all stocks in the taxable account, and increase your bond exposure in your 401k to compensate. This would maximize tax treatment.
If you'd like tax-deferred growth, you can open a nondeductible IRA. You get no tax breaks now or later, but your growth would be tax deferred, which if you hold stocks for 40+ years, could be very sizable. After that, I'd just increase my taxable account.
I'd have repeat the question of what you are doing with the three properties. Do you live in one of them? Renting the others?
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Tue Jun 14, 2005 12:49 pm |
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David Briggs
Senior Member
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NQU, VMT and EIM all pay a monthly dividend exempt from federal income tax. Dollar cost average in on declines.
~~David
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Tue Jun 14, 2005 1:03 pm |
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fybpm
New Member
Cash: $ 1.95
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Joined: 14 Jun 2005
Location: Merced, CA
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I live in one property and I collect rent on the others. 1 home is 1200 a month i collect 960, one is 1500 and i collect 1175. so i come out negative, so i do have a seperate account that holds extra money to cover those payments and for any emergencies or repairs...
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Wed Jun 15, 2005 4:22 am |
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jlee1224
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Location: Baltimore
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You probably know this, but you are running some short term risk in holding the rental properties, losing 565 a month, plus maintenance costs and such.
Do you have LLC's set up for your rentals?
I would keep the 20k in your bank account and keep adding to it to use as maintenance and upkeep for your rentals. Hopefully you'll make up the 7k/year deficit with capital gains of your property.
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Wed Jun 15, 2005 12:57 pm |
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fybpm
New Member
Cash: $ 1.95
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Joined: 14 Jun 2005
Location: Merced, CA
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oh, no risk definately. the 2 rentals are in Merced, CA. the home of the NEW and only the 9th University California. Property value meadian was about 135k in 2001. like 210 in 2004 and its about 280k now. We used to have a JC, a mall, a target and a wal mart. now we have everything from best buy to home depot, barnes and noble to applebees. and merced is even now building an international airport! its crazy here!
all the properties are within 2 miles of the uc also, even my primary is 3 blocks away 
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Wed Jun 15, 2005 5:26 pm |
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MattL
Senior Member
Cash: $ 46.85
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Joined: 25 Jun 2005
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What's the time frame on your extra investment money?
Debt Elimination
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Sat Jun 25, 2005 8:26 pm |
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bong12187
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Joined: 31 Jul 2005
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Hmmm� Need more info. Home = years amortized, apr/interest rate, pmi, cash invested to close the deal, years bought, which of the 3 is your home, property tax and other hidden tax involve.. Same with rental houses. Clarification, 401k contribution max out to meet employer matching or max out up to $14k for the year? If not, do you have traditional IRA or ROTH? Are you maxing out? Sorry, can�t give you any advice until I know all of these. Before the crash of 1987 people were buying properties to be able to bring down their earned income through phantom income. However, when Congress enacted the revision of tax law in 1987, real estate loss were limited. Result, we had a real estate bust after that. As for me, I just can�t imagine buying properties that will not make money right away. What you are doing is actually a speculation. Buying properties for rental should be all about cash on cash return. Take care of your invewstment. I almost bought a triplex in Inglewood area for rental. Seller was aking 400k and I walked away after seeing the #s in my due diligence. Rent was going for 800 each for 2 bedroom 1 bath per place. For me, less money coming out of my pocket in closing + positive passive income later translates to higher return. Appreciation is fine but that should be icing on a cake. If that is what I am looking for then I�d just start flipping them instead.
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Sat Aug 06, 2005 9:10 pm |
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abmglobalteam
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Location: USA
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| what about business ppl? |
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can any one who is running his own business start a saving plan?
am afraid from that because i dont ear certain salary.. one month i may earn $10000 and the next month only $500!!!
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Fri Aug 12, 2005 5:00 am |
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VMCAffiliate
Member
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Joined: 28 Jun 2005
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What type of college degree do you have?
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Fri Aug 12, 2005 6:39 pm |
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joseanes
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Joined: 30 Aug 2005
Location: Marlborough, MA
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| Re: 22 years old - Savings Investing |
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quote:
Originally posted by fybpm
I am 22 years old and I am a branch manager at a mortgage company. I have a mid-six figure income and I have already this year maxed out my 401k contributions with employer match. I own 3 properties: $417k owed worth $460k, $302k worth $355k, and $224k worth $255k. I also have about $20,000 in savings accounts; no debt whatsoever. What other tax deductible vehicles should I look into taking advantage of and if I have none avaliable to me as I stand, what other places should I look to invest? I'm a big fan of working hard, I say work full time now rather than part time forever. I'm all ears for early retirement suggestions!
Vanguard 500 Fund.
A great way to start if you have a few thousand lying around.
If not... T Rowe Price offers Equity Index funds, and other mutual funds with automatic contribution plans. Minimum initial and periodic investment: $50 - http://www.troweprice.com/
I detail a basic savings strategy on: http://aneshome.com/money/entries/entry_152.php
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Tue Aug 30, 2005 2:06 pm |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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Why not more investment properties?
For liquid investments, try tax-free munis.
TIAA-CREF? (I still don't know much about that one)
"Expect me when you see me."
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Tue Aug 30, 2005 11:57 pm |
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EBuchanan3
New Member
Cash: $ 1.20
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Joined: 02 Sep 2005
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quote:
Originally posted by fybpm
I live in one property and I collect rent on the others. 1 home is 1200 a month i collect 960, one is 1500 and i collect 1175. so i come out negative, so i do have a seperate account that holds extra money to cover those payments and for any emergencies or repairs...
I wouldn't worry much about the stock market if I were you. First priority for me would be to get the rented homes into income generating instead of income reducing properties. Passive income is the best 
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Fri Sep 02, 2005 4:31 pm |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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quote:
Originally posted by EBuchanan3
First priority for me would be to get the rented homes into income generating instead of income reducing properties. Passive income is the best
TOTALLY AGREE!
"Expect me when you see me."
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Fri Sep 02, 2005 4:42 pm |
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