have a couple rental properties in SF. property management company handles to the day to day nonsense...I just cash the checks. Could I keep my standard of living if the pilot thing went away? no, but could feed the family and pay the mortgage.

 

I own a few rentals, my brother is the manager though I have a fair amount of involvement. To be honest I don't trust this industry and need something to offset inflation. Like someone said above, it's not enough to live off of, but it covers the mortgages and some bills if I ever get a WARN notice. My wife is also involved as well and it's something we enjoy doing (for the most part). YMMV

 

I had a few rentals while I was flying full time: 2 condos and a Tri-plex.
The condos would net $200 per month each and the Tri-plex about $1k.
Lots of work and money upgrading and managing but when I sold everything
after 5 years it was payback time, good profits.
Started a charter boat company after the last condo was gone, took tourists
and local out on sight seeing cruises in Fort Lauderdale, all boat expenses
deducted on regular income taxes.
Also done day-trading as a side gig, got adrenaline kicks out of it and made
a few $$.
Now retired and lazy but the side hustles paid off.

 

Along with two partners (non pilots) we own a medical company in a state other than the one I reside in. I’m usually at the office a few times a month for a day or two and do most of things from home via web. Because of education, my responsibilities revolve around the finance and accounting aspect of the business and I’m the de facto CFO. Also, social aspects such as golfing with providers falls into my domain. The day to day running of the business is done by a management team we hired and we receive weekly reports and meetings from them. Along with those reports we can see the status of things thru electronic software. We don’t participate in the daily operations of the business but more of a Company Board. It was heavy capital intensive to open, and for a while we second guessed things often, however now it has a significant value and something that I can replace my income with should I have a need. In the meantime it’s a source of supplemental income to allow me to position myself financially for other opportunities.

While stressful in the opening I’m very happy I’m in it now as a backup plan as well as a tangible asset for my family, especially since it has resiliency in down markets (we have no cash transactions, all insurance).

Disclaimer
Prior performance is not indicative of future results. Consult your investment and tax professional prior to taking any actions. Investment in a business is not protected from loss.

Good luck!

 

I have a single rental house I own free and clear so no loans/mortgage. I pay a property manager to run it. He calls me from time to time to ask how to proceed with certain issues that pop up but that’s the extent of my involvement. It produces income averaging about $10k per year since I’ve rented it. So it’s income but not something I could live off of. I am planning on adding more houses to the portfolio though but that takes some more dough. I will say, these regional pay rates lately are speeding up my expansion plans. :-)

 

How did you connect with the two other partners? Did you know them previously?

 

Yes, both personal friends.

 

Take a loan out against your free and clear house. Use as down payments for one or more rental houses. Make sure your cash flow, interest rates, taxes, depreciation, property management fees, maintenance, empty rental percentage, etc. works. Likely could fund 3 more houses, own 4, total, at 25% down with a 75% mortgage.

 

It’s something I’ve thought about. And honestly, it was the original plan all along except my wife didn’t want to finance and I haven’t been able to talk her into it (she is NOT a money person, just knows debt is bad). That said, we are VERY close to being completely debt free for the first time in our adult lives and it’s making me not want to finance anything else either. At the rate we’re going, we can probably have 10 or so rental units when I retire, free of debt, in addition to 401K and IRA savings. And that’s without financing.

But yeah, my original plan was to finance against the rental to purchase more rentals and thought about it enough to have a plan in place to do it. Just haven’t been able to convince the other half.

 

There is good debt and bad debt. Credit card high interest rate debt is bad debt. Mortgages on good cash flow is good debt. Think about airlines if they did not take a loan to buy their planes. Yes, I know, logic bears no impact on your wife. But worth a shot. Then drop it, let it sink in. See if she wants to bring it up in 6 months.