Pharmacist Net Worth 2020. Poll!

[wagrxm2000]

Ok, nevermind. But that was the gist of what he said - to get a consult and index on your own (plus a few more interesting points).

But again, that wasn't the point of the post. His name was referred to here, and I acknowledged that I came across the name before and pointed out where.

The ways 1 line in a post can lead to tangents here...

Did you not see the title of the thread or the article posted with it?

If I was suppose to read it, I passed since there is no point

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[wazoodog]

A bit of a side question here.

Under wagrxm2000's posts, it says "Do not respond to this."

How does that appear? I don't think I see it under anyone else's posts.

Anyhow, regardless how it appears - point noted.

Ah, nevermind - it's your signature. It looks really auto-generated.

 

[wagrxm2000]

A bit of a side question here.

Under wagrxm2000's posts, it says "Do not respond to this."

How does that appear? I don't think I see it under anyone else's posts.

Anyhow, regardless how it appears - point noted.

Ah, nevermind - it's your signature. It looks really auto-generated.

It's a warning

 

[wazoodog]

It's a warning

 

[flowers47]

A lot of millionaires in this thread but how many can quit their 9-5 job and still have a good life? Now THAT is wealth.

 

[flowers47]

A good follow up question is how is your wealth distributed? Is it in your

1) retirement funds? Can’t really touch
2) primary residence? Don’t recommend touching
3) brokerage accounts? Still need to pay taxes
4) business?
5) rental properties?
6) cash/gold?

It makes a big difference.

 

[PharmDminus]

A lot of millionaires in this thread but how many can quit their 9-5 job and still have a good life? Now THAT is wealth.

welcome back BMB

 

[Splenda88]

A lot of millionaires in this thread but how many can quit their 9-5 job and still have a good life? Now THAT is wealth.

Not everyone want to quit the rat race...

 

[wagrxm2000]

A good follow up question is how is your wealth distributed? Is it in your

1) retirement funds? Can’t really touch
2) primary residence? Don’t recommend touching
3) brokerage accounts? Still need to pay taxes
4) business?
5) rental properties?
6) cash/gold?

It makes a big difference.

3) brokerage accounts. During retirement, since no income taxes are minimum.
5) rental properties. Hope to break even with rent but can't touch.

Good to see you back bmb

 

[flowers47]

3) brokerage accounts. During retirement, since no income taxes are minimum.
5) rental properties. Hope to break even with rent but can't touch.

Good to see you back bmb

Unless you have a sizable 401 k and social security...both are taxable income.

You own rental properties now?

 

[wagrxm2000]

Unless you have a sizable 401 k and social security...both are taxable income.

You own rental properties now?

Long term capital gains tax during early retirement is your friend.

 

[flowers47]

With rental properties, you can actually do a cash out refinance and enjoy your money while you are young. The best part? It is tax free!

 

[wagrxm2000]

With rental properties, you can actually do a cash out refinance and enjoy your money while you are young. The best part? It is tax free!

Ah living in debt, what a life.

 

[flowers47]

Ah living in debt, what a life.

There is good and there is bad debt. An investment that generates money every month is good debt.

Besides, doing a cash out refinance is like cashing out. You already got your profit.

 

[wagrxm2000]

There is good and there is bad debt. An investment that generates money every month is good debt.

Besides, doing a cash out refinance is like cashing out. You already got your profit.

There's only bad debt and taking advantage of debt.

Hard pass. We're debt free and loving it

 

[PharmDminus]

With rental properties, you can actually do a cash out refinance and enjoy your money while you are young. The best part? It is tax free!

i cant find anything that meets 1% rule in my area. home prices are so high.

 

[mentos]

A lot of millionaires in this thread but how many can quit their 9-5 job and still have a good life? Now THAT is wealth.

Only you, BMB.

 

[flowers47]

i cant find anything that meets 1% rule in my area. home prices are so high.

Those RE “rules” are silly. They mainly just look at rent and not other ways to make money. More importantly, higher rent sometimes means. sacrificing the quality of tenants.

There are several ways to make good money in RE:

- buying it below market price or/and buying it in an up and coming neighborhood

- extra rent after expenses

- paying down of mortgage by tenants

- appreciation (value goes up over time). Ability to leverage is the key here. Banks are not going to lend you $200 k to buy stocks with extremely low interest rate but they would for rentals.

- tax benefits like cash out refinance without paying taxes, minimize tax by taking depreciation, 1031 exchange (trade in your rental for another rental without paying taxes), passing on the rental to your children without paying taxes, etc.

- protects you for inflation. In California, property tax can only go up 2% max per year even if inflation is like 3%. Therefore, the cost of owning a rental gets cheaper and cheaper over time. The best part? If your children inherited your rental property, they would also inherit your low property tax.

- not specifically talking about rentals but if you live in your house for 2 out of the last 5 years, you can sell it and not pay any tax on the profit up to $250 k for singles, $500 k for couples.

The only rule I follow is to make sure the rental has a positive cash flow which means monthly rent exceeds expenses. This rule minimizes my risk exposure. It also acts like a backstop by preventing me from overpaying for a rental.

Does this mean everyone should buy rentals? Absolutely not. You have to do your own analysis and weigh things like time and risk. It is not like buying the S&P 500.

 

[wagrxm2000]

Ah rentals where everyone finds the perfect house everytime and they have the perfect tenants always paying on time.

That's the dream right there

I wonder how much debt bmb....I mean flowers has

 

[mentos]

Ah rentals where everyone finds the perfect house everytime and they have the perfect tenants always paying on time.

That's the dream right there

I wonder how much debt bmb....I mean flowers has

We tried to rent out our first home but had to spend over $10k to get it deleaded, remove mold and asbestos, repair the outside stairwell etc. It was such a headache before we even had a tenant that we decided to sell the damn place.

 

[wagrxm2000]

We tried to rent out our first home but had to spend over $10k to get it deleaded, remove mold and asbestos, repair the outside stairwell etc. It was such a headache before we even had a tenant that we decided to sell the damn place.

That's one of the things people seem to forget about. The upkeep costs.

To make a bad analogy. Rentals are like dogs, you love them they are fun but you constantly have to take care of them.

Stocks are cats, they annoy you but are self sufficient.

Get a cat people.

Bad analogy over

 

[flowers47]

Ah rentals where everyone finds the perfect house everytime and they have the perfect tenants always paying on time.

That's the dream right there

I wonder how much debt bmb....I mean flowers has

That is why your model must take into account maintenance cost, vacancy, and an occasional bad tenants. It is just the cost of doing business. Walmart takes “leakage” into account. They know people are going to steal from them but that doesn’t stop make from making good money.

I have 7 figures in mortgage debt. This is good debt (so far) because I am making money every month from my investment and the value of my rentals has greatly appreciated. By owning physical assets, it also protects me from inflation. Inflation is my good friend especially since I am just paying < 3.5% interest rate. Check out home prices in the late 1970s when inflation was rampant but unlike those years, most likely income is going to be flat moving forward.

 

[flowers47]

We tried to rent out our first home but had to spend over $10k to get it deleaded, remove mold and asbestos, repair the outside stairwell etc. It was such a headache before we even had a tenant that we decided to sell the damn place.

That is the mistake a lot of people make. Renting out your old house is not the same as buying a house specifically for rental. Not every house is a good rental. For example, I would buy a big, luxurious house for my family but I wouldn’t buy one as a rental property because there is a cap on how much rent I can get and the maintenance cost would be too high.

I also don’t recommend managing the property yourself. You should hire a professional to manage it. I am not saying it is something you can’t do yourself but you are going to have a steep learning curve and you are going to make mistakes along the way. You don’t want a second job. You want it to be as passive as possible.

 

[wagrxm2000]

That is why your model must take into account maintenance cost, vacancy, and an occasional bad tenants. It is just the cost of doing business. Walmart takes “leakage” into account. They know people are going to steal from them but that doesn’t stop make from making good money.

I have 7 figures in mortgage debt. This is good debt (so far) because I am making money every month from my investment and the value of my rentals has greatly appreciated. By owning physical assets, it also protects me from inflation. Inflation is my good friend especially since I am just paying < 3.5% interest rate. Check out home prices in the late 1970s when inflation was rampant but unlike those years, most likely income is going to be flat moving forward.

7 figures in debt that's all I read

You are playing a dangerous game my flowery friend. Hopefully those thorns don't get you.

A person with 5 to 10 rentals is probably getting called every week for another light bulb going out.

 

[wagrxm2000]

I would never listen to a person who paints a "rosy" picture in the rental business. They are dandi-lying to you.

 

[flowers47]

7 figures in debt that's all I read

You are playing a dangerous game my flowery friend. Hopefully those thorns don't get you.

A person with 5 to 10 rentals is probably getting called every week for another light bulb going out.

If the housing market collapses then I am pretty sure stocks and jobs would go first. We had a stock market crash this year but it didn’t affect the housing market. It actually went up.

Last time I checked, I have 55% equity and 45% debt.

When you talk about debt, you also should talk about interest rate and what you are going to do with the money. If you can borrow $1M with 3% interest rate...why wouldn’t you borrow at that ridiculously cheap rate and invest it in something that is reliable and stable like real estate? The odd is in your favor so you have to take it. Play the long game.

 

[flowers47]

I would never listen to a person who paints a "rosy" picture in the rental business. They are dandi-lying to you.

I never said it is all rosy. I did say you should take unexpected cost and event into account in your business model. It is not going to be a straight line up. There are going to be bumps along the way. You should be prepared for those bumps.

 

[wagrxm2000]

If the housing market collapses then I am pretty sure stocks and jobs would go first. We had a stock market crash this year but it didn’t affect the housing market. It actually went up.

Last time I checked, I have 55% equity and 45% debt.

When you talk about debt, you also should talk about interest rate and what you are going to do with the money. If you can borrow $1M with 3% interest rate...why wouldn’t you borrow at that ridiculously cheap rate and invest it in something that is reliable and stable like real estate? The odd is in your favor so you have to take it. Play the long game.

You've been doing this for like 5 years and you already have paid off half your debt

Sure I believe that....

 

[flowers47]

You've been doing this for like 5 years and you already have paid off half your debt

Sure I believe that....

I have been doing real estate since the housing market collapsed. I didn’t want to talk about it because it was still risky during those years and I was still learning.

Do you know how much real estate has gone up for the last 10 years? Yes, I have 55% equity right now. Cash flow positive in all my properties.

 

[flowers47]

Life of a debtor is grand if you can borrow for cheap and invest it in something that appreciates in value over time.

 

[PharmDminus]

Life of a debtor is grand if you can borrow for cheap and invest it in something that appreciates in value over time.

how many rentals do you own?

 

[mentos]

 

[flowers47]

how many rentals do you own?

I don’t want to be specific since it is identifiable information. Let’s just say this might be the first year I have not bought a property in years.

 

[flowers47]

The neighborhood I have been buying in is 10% more than what I am willing to pay for a rental property. Rent would not cover expenses. I would need to either put down a large down payment or I would need to cover the difference every month.

I can also look into another neighborhood but that means restarting all over again.

 

[Splenda88]

Cash flow of rental properties is good but there are easier way to make money if one especially has equity in these properties. For instance, I own 2 rental properties with combined equity of 360-370k. My cash flow is $500/month (6k/year) after all expenses...

These properties have no room anymore to appreciate since they both are back to the price when the housing market was at its peak. On the other hand, I can take that 360k equity if I sell them and buy a high dividend yield index fund like VYM and that will net me 12-13k/yr. If reinvest the dividend payout for 10 years, that 360k will grow to ~850k assuming VYM replicate its earning for the past 10 yrs... The max amount I can make get for these properties if I sell them after 10 yrs might be 580k plus ~100k if I reinvest the $500/month cash flow in VYM.

 

[flowers47]

Cash flow of rental properties is good but there are easier way to make money if one especially has equity in these properties. For instance, I own 2 rental properties with combined equity of 360-370k. My cash flow is $500/month (6k/year) after all expenses...

These properties have no room anymore to appreciate since they both are back to the price when the housing market was at its peak. On the other hand, I can take that 360k equity if I sell them and buy a high dividend yield index fund like VYM and that will net me 12-13k/yr. If reinvest the dividend payout for 10 years, that 360k with to ~850k assuming VYM replicate its earning for the past 10 yrs... The max amount I can make get for these properties after if I sell them after 10 yrs might be 580k plus ~100k if I reinvest the $500/month cash flow in VYM.

And some people here think you don’t make good money from RE or it is not worth the time.

I have not sold one rental. Cash out refinance is the better option as long as the numbers still make sense.

 

[Splenda88]

And some people here think you don’t good money from RE or it is not worth the time.

I have not sold one rental. Cash out refinance is the better option as long as the numbers still make sense.

I think they were saying there are easier ways to make money. In real estate you have to buy in the right place at the right time if you gonna make money that worth your time TBH.

I don't manage my properties and I pay $276/month (~$3300/yr) so I don't have to deal with tenants. It's been ok and probably spend 6-8 hrs/yr of my time talking on the phone with property management company, so I essentially spend ZERO time managing these properties. Managing RE is probably not for most people.

 

[wagrxm2000]

The neighborhood I have been buying in is 10% more than what I am willing to pay for a rental property. Rent would not cover expenses. I would need to either put down a large down payment or I would need to cover the difference every month.

I can also look into another neighborhood but that means restarting all over again.

This sounds like something another poster keeps saying

I think he is like an rxm at Walgreens.

I will say though, nice job buying near the bottom.

 

[wagrxm2000]

I think they were saying there are easier ways to make money. In real estate you have to buy in the right place at the right time if you gonna make money that worth your time TBH.

I don't manage my properties and I pay $276/month (~$3300/yr) so I don't have to deal with tenants. It's been ok and probably spend 6-8 hrs/yr of my time talking on the phone with property management company, so I essentially spend ZERO time managing these properties. Managing RE is probably not for most people.

The is exactly why people stay out of rentals

It's not worth the hassle and I'm not paying 10% to someone just like I'm not paying a financial advisor.

Even if you MIGHT make a percent or two more, just go stocks, set it and forget it

 

[mentos]

The neighborhood I have been buying in is 10% more than what I am willing to pay for a rental property. Rent would not cover expenses. I would need to either put down a large down payment or I would need to cover the difference every month.

I can also look into another neighborhood but that means restarting all over again.

How much do you put down for a rental?

 

[flowers47]

How much do you put down for a rental?

25%

 

[Sabril]

25%

How much does a property management company typically charge? Is it based on the value of the property? If something breaks in the house, how is it usually handled? Does the company fix it and send you the bill?

 

[Splenda88]

MY property management charges between 8-10% depending on the rent. They charge 10% on rent < $1500, above or equal that they charge 8%. When something breaks, they call you and you spend your own money to fix it. You can use contractors affiliated with them or shop around to find someone cheaper. If they fix it, they automatically collect the amount agreed upon from the rent they collect.

 

[wagrxm2000]

MY property management charges between 8-10% depending on the rent. They charge 10% on rent < $1500, above or equal that they charge 8%. When something breaks, they call you and you spend your own money to fix it. You can use contractors affiliated with them or shop around to find someone cheaper. If they fix it, they automatically collect the amount agreed upon from the rent they collect.

In other words, watch out or you may have a huge bill

 

[flowers47]

How much does a property management company typically charge? Is it based on the value of the property? If something breaks in the house, how is it usually handled? Does the company fix it and send you the bill?

It depends on the rent you are getting. Since rent in California is already high, they are charging me just < 5%. I teamed up with other investors and use the same property manager. We are a big part of her client portfolio.

It is usually between 5-10% of rent. They charge like $1500 to replace a new tenant. I also use their lawn maintenance guy and their handyman. I am sure they get a cut. That is fine because I want to take good care of them.

I rarely speak to my property manager except when we are deciding how much rent we should increase. For repairs, I ask her to just send me a picture and the estimated cost. I am almost always authorize it without going to another handyman. The cost has been reasonable.

 

[Splenda88]

In other words, watch out or you may have a huge bill

As I said, it's not for most people. If I could sell my 2 properties right now, I would and take the money and invest it in a high dividend yield index fund (like VYM)

 

[flowers47]

In other words, watch out or you may have a huge bill

He had also made $360 k in equity alone. I am sure he will do just fine.

 

[TheBlaah]

Life of a debtor is grand if you can borrow for cheap and invest it in something that appreciates in value over time.

I have a few rental properties of my own, but I own them outright. It's mostly because I'm too lazy to manage mortgage payments as well figuring out how well I'm doing with interest rates and whatnot.

I guess what I want to ask is what interest rates have you been borrowing at and if it's having a significant effect on your profit margin.

 

[Splenda88]

He had also made $360 k in equity alone. I am sure he will do just fine.

Probably ~290k as I put some money down and made some repair when I purchased them. I am happy regardless.

I could have made a ton if I was not too conservative. 2BR/1BA condos were selling 14k-16k where I lived. They were offered to me and did not get them because of ~$200 HOA. One of my friends purchased 7 of these condo in 2010 and sold them in 2017 for > 700k with no middle man as there were a REIT company who wanted to turn to community into an apartment complex.

 

[flowers47]

I have a few rental properties of my own, but I own them outright. It's mostly because I'm too lazy to manage mortgage payments as well figuring out how well I'm doing with interest rates and whatnot.

I guess what I want to ask is what interest rates have you been borrowing at and if it's having a significant effect on your profit margin.

I think the highest interest rate was around 5.0% for a rental. I have refinanced all of them. They are like 3.5-4% now.

A cut in interest is a big deal. If you have $1M mortgage, a reduction of just 1% is $10,000 in saving per year (decrease as time goes by of course).

Low interest is great if you have a lot of debt but that also means prices are going up. I can’t find a good deal this year. I don’t even bother going to the house and checking it out. This might be it.