I recently got engaged and we are set to be married next year. We are both coming into the marriage with a fair amount in savings. I would guess it is about 90k between us. I have been looking into deferred comp and IRA's through my work and other ways to invest the money and I have a few questions. A lot of the models show an average of 8% gains. Is this optimistic, or is this a reliable figure?
Another option is investing in real estate through rental properties. I figure on keeping roughly 20k of the 90 in a savings account just as emergency money. Then, with the remaining, buy my first property. I am looking in the 60-100k range. It would be for a 3 bedroom, ~1500sq ft, in one of the best school districts in the area, that I should be able to rent out for $1200. My parents have had good luck with this on a few that they have. The plan is to roll the money I profit from one into the next. The ultimate goal is to have around 5 in the next 10 years. Maybe more, depending how things go. That would give me around $3000 a month until the loans get paid off, then it would go up even more. Then, if and when I need the money when I retire, I sell off the properties.
Right now I am leaning towards the rental properties. I am going to get a decent pension when I retire, nothing crazy, but not where I would need a huge amount to supplement. The rentals would fit in with this better I feel because it gives me more money now and will still provide more than enough when I retire. I know neither way is foolproof, but with the housing market the way it is, I feel there would be no better time to get in on the rental market.
What would you guys do?
Another option is investing in real estate through rental properties. I figure on keeping roughly 20k of the 90 in a savings account just as emergency money. Then, with the remaining, buy my first property. I am looking in the 60-100k range. It would be for a 3 bedroom, ~1500sq ft, in one of the best school districts in the area, that I should be able to rent out for $1200. My parents have had good luck with this on a few that they have. The plan is to roll the money I profit from one into the next. The ultimate goal is to have around 5 in the next 10 years. Maybe more, depending how things go. That would give me around $3000 a month until the loans get paid off, then it would go up even more. Then, if and when I need the money when I retire, I sell off the properties.
Right now I am leaning towards the rental properties. I am going to get a decent pension when I retire, nothing crazy, but not where I would need a huge amount to supplement. The rentals would fit in with this better I feel because it gives me more money now and will still provide more than enough when I retire. I know neither way is foolproof, but with the housing market the way it is, I feel there would be no better time to get in on the rental market.
What would you guys do?