Headed to Omaha

So, I've talked about investing in a partnership.  And we've identified some candidates online in and around Omaha, Nebraska.  Well, seeing in person on the ground - especially starting out - and seeing online are two very different things.  So, this weekend, I'll be heading out to Omaha in part to see some properties and neighborhoods.  I hope to...

A candidate

My brother-in-law and I have identified a couple possibilities.  One is a house in an Omaha suburb called La Vista.  It's a bread-and-butter 3 bed 2 bath house that is a foreclosure property.  Other homes in the area sell for about $110k to $130k and it's listed for $80k.

I think we can get it for less, but what I'm realizing is that the most difficult part of the offer phase is figuring out what will need to be repaired or rehabbed and how much that will cost.  Not only do foreclosure properties generally need repair/rehab, but the way that I have been taught to invest is to do all repairs or rehab up front to minimize tenant issues during the first several years.

The Why

Exploring ways to increase readership of this blog, I joined StumbleUpon today (this is also one of the icons in the "Share" box to the right).  If you've never checked out StumbleUpon, it is essentially a website recommendation service.  I checked a few boxes for my interests and entered the site.

It automatically took me to a video posted on a website named Ted.com.  The video started and it is a short talk given by a gentleman named Simon Sinek.  Now, I don't know anything about Ted or Simon Sinek, but listening to this talk was like a smack in the head.  It is titled "How Great Leaders Inspire Action" and describes among other things something called The Golden Circle, which is represented graphically below:

Plan Starts to Take Focus

One of the biggest obstacles for my investment strategy in single family rental homes is that I live in New York City.  Not only are the prices here outrageous, the competition for a "deal" is very difficult also.  And that also goes for the general metropolitan region.

So, instead of giving up, I asked myself how to get around this problem. 

By prevailing over all obstacles and distractions, one may unfailingly arrive at his chosen goal or destination. -  Christopher Columbus 

My answer was to invest elsewhere - and take on a partner local to wherever the investment is located.  Doing so also allows me to use NYC dollars (where the cost of living is higher, but so too are the salaries) an invest in a middle-America area.

Savings?

I've been diligently saving money the last several years.  I set an automatic transfer to occur each payday so that $500 goes from my checking account to my money market account.  When I started out many years ago, it was $300 and it grew as my salary did.

I put the max in my 401(k) each year.

As a result, I have a pretty good amount of savings.  I know most people don't, so I should feel pretty good.  Right?

Then tonight I read a piece in the September 12, 2011 issue of Forbes called "The Price of Abandoning The Gold Standard".  The article describes the detriments of Nixon's decision to remove the US Dollar from the gold standard back in 1971.

How, Exactly?

It's great to start a blog with the stated purpose of building your non-job income to the point that it allows you to leave your daily job.

But then pen meets paper.  The rubber meets the road.  The cars revving at the stoplight have to throw into  "drive".  You get the point.

How, exactly, will I accomplish my stated goal?

For me, it will involve real estate.  I love real estate and have since I was a kid.  My dad owned real estate. My grandfather owned real estate and so did some uncles.  Eventually, I started a career in real estate.  My journey will involve real estate.

And that's great, because real estate is one of the most powerful wealth builders around.  Most of the super-rich in America - and indeed the world - own real estate.  How, exactly?

Revisited

I initially started this blog back in 2007.  It was an interesting year for me - I was nearing the end of one job and about to start another.  I was feeling out of balance and ready for something different.

I started a new job in January 2008 and promptly stopped blogging.  I had found my thing thing, my new j-o-b.  And it was great.  Wasn't it?

As I reflect back on 2007 from the vantage point of 2011, I'm finding that it's pretty much the same thing all over again.  My current job has been satisfying, rewarding (financially and otherwise), but ever more frustrating also.  The company I work for has had some changes and that may affect my day-to-day job duties.  My boss is difficult and demanding.  NYC is still expensive and it'll be even more so when my daughter starts school in a couple years.  I'm more convinced than ever that I need to find and take advantage of opportunities for additional investment income so I'm less reliant on my job, as well as making more time for my family and my health.

So bottom line:  I'm refocusing.  In 2007, this blog was about leaving work behind - as in "leave work in the office and use your non-working hours better".  Today, in 2011, this blog will be about leaving work behind - as in "building passive income so that you can leave your job".  And I intend to blog about my journey - partly to help others in a similar work/life unbalance and partly to keep me on track toward my goal of getting more "life" in my work/life balance.  I'm glad you're reading this and that you are part of this journey.