The Do’s & Don’ts Of Real Estate Investing For Retirement: HAPPY MEMORIAL DAY!

It is very possible to build a dependable retirement investment portfolio. Although the real estate market is known for having its up’s and down’s, the best investors know how to manage their investments and time their deals correctly to best optimize for success.

If you want to lower your risk and protect your invested capital to prepare for retirement, make sure to cross these items off your to-do list:

Save

It doesn’t matter if you’re 20 years old or 60. What matters is your ability to stay dedicated to building a savings. Investing in passive income properties is arguably the best way to earn consistent cash flow during retirement. You have your property (or hopefully, properties), you have renters, you have a property management company taking care of day-to-day tasks, all while you sit back, relax, and collect your profits at the end of every month.

Sounds great, right?

The truth is, it can be. So long as you have the initial lump sum to afford a down payment or two. That’s where things can get tricky. Which is why I’m here to give you a few tips that will help boost your savings regardless of your age or current income.

  • Spend Smarter: This probably sounds obvious, but it is easier said than done. Small cut backs here and there will add up quickly. Make your own coffee instead of indulging in that daily Starbucks habit. Clean out your closet and sell old clothes at a second hand store. Split restaurant meals with a friend or significant other instead of purchasing two entrees. These simple lifestyle changes will help keep your expenses low.
  • Open An IRA: Establish an individual retirement account (IRA) to help build your nest egg. Both Traditional and Roth IRA’s are viable options depending on your income and whether or not you or your spouse’s day job has a retirement plan in place. Talk to a professional to find out which account will benefit you in the long run.
  • Make It Automatic: The easiest way to safeguard retirement funds is to automate your savings. Set up your online banking account that sets aside a certain amount of money each month. Before you know it, your savings account will have significantly increased in size.
  • Set Goals: Did you know that people who take the time to physically write down their goals are 87 percent more likely to achieve those goals? If saving for retirement so that you can invest in real estate is something you’d like to accomplish, write it down! Create a timeline to help keep yourself on track and be sure to reward mini milestones along the way. Holding yourself accountable by setting a specific goal is the best way to stay motivated.

Identify Your Niche

There are many options to choose from when it comes to investing in real estate. Because there are a myriad of avenues to take, it is important to identify your niche and select an exit strategy that’s right for you. With so many areas to choose from, this task can seem overwhelming. Fortunately, it’s easier than you think.

Of course, your goal is to be financially free in retirement, but how will you get there? To answer this, you must first ask yourself some questions:

  • How much do I currently have in my savings?
  • Do I prefer a more hands-on or hands-off style of investing?
  • How much time am I willing to put into my investing business?

If your savings account is nothing to write home about, wholesaling real estate is worth a shot. You don’t need much money to get started and you have the potential to earn profits quickly. If you are ready to put substantial time into your business, rehabbing is an exit strategy to consider. You must have a hands-on personality, be open to risk, and have an eye for design; however, if you possess these traits, rehabbing is a great way to make significant capital.

Finally, if you’d prefer a more passive style of investing (which most desire in retirement), rental properties are your answer. Once you find tenants, hire a property management company, and pay a down payment, you have the ability to earn a steady stream of passive income that will aid you in living a financially stable retirement.

Worry Less About Cashflow

Whether you decide to go the rental property route now or later, it is important to live by the principal “worry less about cash flow”. The most successful investors prioritize capital growth even if that means sacrificing cash flow for the time being. Think about this: if you purchase a rental property and put down a 50 percent down payment, your monthly cash flow would be significant. On the other hand, you  could invest in two properties and put down only 25 percent on each property. This option would reduce your immediate cash flow but benefit you greater down the line.

Make sense so far?

Look at it this way: with either option you get the same percentage yield. Sure, if you go with option two, you’ll have less cash flow to start. But in retirement, you’ll double your income if you worry less about cash flow and more about capital growth.

Keep these principles in mind when real estate investing for retirement and you’ll be living the life you deserve in no time. We are here to assist Diamond Dust Property Management 561-541-4409 Email: dds@daddyo.biz

 

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How To Lower Your Utility Bill This 2017 New Years

How To Lower Your Utility Bill This 2017 New Years

1. Unplug Gadgets

According to the Environmental Protection Agency (EPA), small, unused gadgets are responsible for draining 100-billion kilowatt hours per year of unnecessary energy loss. When left idle, these same 100 billion kilowatt hours cost households a staggering $10 billion annually.

As referenced in Time magazine, Rob Caiello, vice president of marketing for AllConnect, suggests unplugging video games, microwaves and even battery chargers to keep rising energy costs at bay.

Quick tip: Because it may be inconvenient to unplug each item individually, consider plugging in all energy-draining smaller gadgets or appliances into the same power strip to make powering down easier.

2. Lower The “Heat” In Your Water Heater

The U.S. Department of Energy reports that water warming accounts for up to 18% of a household’s energy consumption. Setting your water temperature to 120°F can help you see small changes in your energy bills over time. It can also serve as an invaluable safety precaution, preventing injuries like hand-scalding or bath-time related injuries in households with small children.

Though, as Jay Best, founder and president of Green Audit USA, shared with LearnVest,  “Don’t go below 120 degrees, as some bacteria can grow at lower temperatures.”

3. Prevent Heat-Loss From Your Fireplace

Many families rely on fireplaces to heat a house and prevent extensive wear-and-tear on their heating, ventilation and air-conditioning (HVAC) units during winter. This makes your fireplace an unlikely culprit of heat-loss. However, drafty fireplaces are one of the main sources of escaped heat that can show up within a home.

To prevent heat-loss from your fireplace and chimney, try one of these energy-saving solutions:

  • Insert caulking around the fireplace hearth.
  • Keep your fireplace damper closed unless ready to build a fire.
  • If you don’t plan to use your fireplace, seal and plug the chimney flue. Keep in mind, once plugged and sealed, you’ll need to reverse the process before making a decision to safely resume active use of your fireplace.
  • Install tempered glass doors.
  • Opening the dampers, located at the bottom of your fireplace, can greatly reduce heat-loss.

Alternatively, you can also open a nearby window, approximately one-inch, and close all doors leading into the room to achieve the same effect.

4.Keep A Clean Landscape

Overgrown or crowded greenery can prevent airflow from reaching the HVAC elements of your home. Not only does this hamper performance, but the additional shade can serve as a catalyst for your unit to “freeze over” in the winter.

To lower winter energy bill costs, and protect the health of your HVAC, keep landscaping near your central heating and air unit uncrowded and well-trimmed. (Bonus: This can also keep your house looking its absolute best when company comes over for the holidays.)

5. Decrease Drafts From Electrical Outlets

Electrical outlets in residential spaces are not often insulated. A lack of proper insulating behind electrical outlets can lead to cold air sneaking in through these unexpected energy-zappers, and increase the amount of heat required to warm a home.

To decrease the amount of air that enters through your outlets, remove the cover plate and use a quality caulking or foam filler to help seal off drafts that may be present. With just a few minutes of DIY work, you can make a huge impact on that skyrocketing winter-energy bill.

6. Bundle Up

Keeping your thermostat at a steady, set temperature may keep you consistently warm, but it also raises your electrical bill more than you might realize (especially in the evenings, and when nobody is in the home).

Putting on an extra sweater, or reaching for that nearby blanket — instead of cranking the thermostat — can help prevent your HVAC from working overtime. According to Dr. Christopher Winter, medical director at Charlottesville Neurology Sleep Medicine, people who sleep in colder rooms not only sleep more efficiently, but are also healthier in general than those who sleep in warmer spaces.

If you need more incentive for making things a bit colder before bedtime, a four-month study, conducted by the National Institute of Health (NIH), revealed those who slept in rooms at 66°F burned more calories while awake than those who did not, and were at a lower-risk category for developing certain metabolic diseases.

7.Inquire About Special Programs

If it’s time for an appliance upgrade in your home, many electric companies — even the government — may offer rebate incentives you can take advantage of when replacing an old appliance with an Energy Star-approved model. This can offset, significantly, the cost of a new appliance and lower your energy bill long-term.

If you own a rental property, discuss the possibility of upgrading to appliances labeled “Most Efficient” — a step up from the Energy Star seal of approval. This will not only save you money on your utility bill, but prepare your passive income property for future renters.

As Benjamin Franklin once said: “An ounce of prevention is worth a pound of cure.” And the same is true of your winter energy bill; it’s a little late, after you receive that astronomic winter energy bill, to begin the process of making your home more energy-efficient.

Just know by taking small, simple actions — and by paying attention to “how” and “when” you consume energy in your home — you’ll do far more than lower your utility bill in the coldest months of the year. You’ll build wealth, one penny at a time.

HAVE A HEALTHY & HAPPY  NEW YEARS

FROM Diamond Dust Property Management LLC

TO YOUR FAMILY

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Happy Thanksgiving

This is the perfect time of year for us to take the opportunity to let you know just how thankful we are that you allow us to be of service to you.

On behalf of our office, at the Diamond Dust Property Management LLC, we would like to extend our best wishes to you and your family to have a safe and enjoyable Thanksgiving holiday.

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Why Should You Get Started In Real Estate?

Time

Time might be the one thing money can’t buy. No matter how much money you have, you will never be able to get back the time you spent accumulating your impressive bank account. What you can do, however, is create more time for yourself in the future. And if real estate has taught me one thing, nothing can rival the amount of time investing in real estate awards savvy entrepreneurs. In fact, it’s quite common for people to become real estate investors for the sole purposes of owning their own time.

Cash Flow

Not surprisingly, the most common reason people start investing in real estate is because of the money they have seen other people accumulate — and for good reason. If for nothing else, real estate is an investing vehicle capable of realizing impressive profits for those that are willing to put in the work. Few investing platforms, for that matter, can match the earnings potential synonymous with today’s best investors. That said, it only makes sense that cash flow is a priority for those who want to get started in real estate.

But what exactly is cash flow? As it’s name suggests, it has everything to do with the income of a respective investor. In its truest form, cash flow represents the amount of capital left over after all the bills on a subject property are taken care of.

Tax Benefits

While not as widely advertised as its cash flow counterpart, tax incentives associated with owning real estate can quickly eclipse even the most ambitious pay days. In fact, there are scores of investors that will swear tax benefits are more beneficial than cash flow. When someone asks you “why you should get started in real estate,” it’s hard not to point out how advantageous some of today’s tax breaks can be.

For starters, it is entirely possible to deduct any interest you pay on a mortgage. According to Investopedia, “Homeowners can deduct the portion of their mortgages attributable to interest payments on their tax returns. These payments are higher during the early years of the mortgage and gradually decrease as the mortgage is paid off.”

While less popularized, but no less beneficial to homeowners, there is one tax deduction in a class of its own: depreciation. For what it’s worth, depreciation can turn a good investment into a great one. According to Investopedia, depreciation allows investors to “recover the cost of income-producing rental property,” the whole cost. Through depreciation, rental property owners can write off a portion of the home’s cost for up to 27.5 years.

The important thing to remember is that nobody is going to hold your hand through the process. Any attempt to take advantage of the tax benefits that coincide with real estate should be met with a proactive mindset. More specifically, there is only one way to ease your tax burden through real estate come tax time: due diligence and a working knowledge of what is within your rights to deduct. As always, consult a tax professional before you decide to make any deductions of your own; just know that real estate is ripe with great tax incentives.

Equity & Appreciation

In a sense, both equity and appreciation go hand-in-hand; it’s rather difficult to have one without the other. That said, real estate investors should appreciate a great equity position on any property they own. Few things can combine to benefit an investor more so than these two indicators. But what is it about them that remains so attractive? Why should you get started in real estate for the purposes of realizing equity and appreciation? Let me explain.

If history tells us anything, it’s that homes appreciate in value much more often than they depreciate. While this may be hard to believe after experiencing one of the worst recessions in American history no more than a decade ago, consider how far we have come. Home values are roughly within two percent of their 2006 peaks, and that is after a significant downturn. If you were lucky enough to buy in 2012, you are likely the beneficiary of some impressive appreciation rates. If you waited until later, there is always the option of improving your equity position.

Every time you pay the mortgage, you are growing your equity. But real estate investors have the added benefit of allowing someone else the privilege of paying off their mortgage, essentially turning their property into a savings account — a very big one. When you buy a property with the help of a mortgage, you have a monthly obligation to pay down the principal. However, nobody ever said the payments had to come out of your pocket. It’s entirely possible to rent out a property to a tenant, and use the rent they pay you to pay off the mortgage. Landlords can very easily improve their equity position in a property without using their own money every month.

It’s important to note, however, that neither equity nor appreciation should be your sole reason for investing in real estate. If for nothing else, these two things are more or less contingent on the state of the market as a whole. The amount of equity you have in a property and how much it appreciated by — or depreciates in some circumstances — are more reflective of market conditions than anything else. Property owners are more or less along for the ride, but what a ride it can be. With that in mind, equity and appreciation shouldn’t be counted on, but rather appreciated when they work in your favor.

So why should you get started in real estate? Quite honestly, there are countless reasons, but those I mentioned above are the most popular. If you want to get into real estate for the sole purpose of proving you can do it, feel free to do so. Perhaps you want to create a legacy to leave for future generations of your family. Whatever the reason is, make it yours and aim high. Only then will you truly know why you should get started in real estate. Follow  us Diamond Dust Property Management or call (561) 541-4409 to get started in real estate.

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Today Is Better Than Tomorrow

Today Is Better Than Tomorrow

Those currently taking the steps to learn how to begin a career in real estate will almost certainly be glad they did so today, as opposed to a decade from now. At the very least, investing in real estate takes time; accumulating wealth is the result of time and knowledge. While not necessarily the equivalent of compound interest, the sooner you get involved in real estate, the sooner you can start reaping the rewards. Start building equity in a home and find out for yourself.

It’s time that learning how to begin a career in real estate coincided with reading market trends. All you have to do is listen to what the market has to say to understand why now is a great time to invest in real estate. Allow us to work with you Diamond Dust Property Management LLC.

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Prices Are Relatively Low

Prices Are Relatively Low

Yes, it’s true: homes have appreciated a great deal since they hit rock bottom during the worst part of the recession. However, while prices have risen dramatically, many cities have yet to see their home values exceed their pre-recession peaks. What’s more, today’s low interest rates are making it much easier for real estate investors and regular home buyers to afford the property they want. Remember, lower mortgage rates make it possible to do more with the money you have at your disposal; that theory holds weight whether you are a first-time home buyer or a new investor learning how to begin a career in real estate.

It is worth noting that there are still great deals to take advantage of. That said, if you are one of the many people that want to learn how to begin a career in real estate, you should pay close attention to the foreclosure market. According to RealtyTrac, “there are currently 912,490 properties in U.S. that are in some stage of foreclosure.” While foreclosure filings have improved dramatically, it is still possible for savvy investors to find great deals on properties they can flip.

Contact Diamond Dust Property Management LLC                                                                     Allow us to help grow your portfolio.

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Rent is Rising the Fastest

The real estate industry has seen its fair share of ups and downs over the last 10 years. However, as the economy has expanded, so too has the housing market. In fact, homeowners are now privy to equity that they never thought they would see again. Appreciation has nearly returned home values to pre-recession levels. Subsequently, rent has seen changes of its own. It is common knowledge that rent in big cities like West Palm Beach and Fort Lauderdale is increasing at a historical rate, but the same can be said about smaller metros. Nearly every city across the country has seen a spike in rental rates – even cities that have struggled to recover. Rents are rising faster than the national average:          Allow Diamond Dust Property Management assist you with your real estate wealth.                       DiamondDustPropertyManagement.com (561) 541-4409

 

 

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