Need side income
Erik was recently separated from the military, and now he hopes to have a career in real estate. His wife works as a teacher, but things are starting slowly for him. He asks Dave if they should sell their home.
QUESTION: Erik and his wife in San Antonio, Texas, are thinking about selling their home. He was recently separated from the military due to downsizing, and his wife is a teacher who brings home about $3,500 a month. The only debt they have is their mortgage at $1,616 monthly, plus he was given a $35,000 severance package. Now, Erik is just starting a job in real estate and things are slow. Dave gives him some advice to help bridge the financial gap.
ANSWER: Variable income isn’t hard. It’s having no income that’s hard. Are there some things you can do on the side while you’re getting your real estate business going that will create some income? I mean, if you could create $1,000 to $2,000 a month, you’d change the whole picture and be able to keep your home while you make this transition.
Long term, two years from now, you’re selling a bunch of homes as a realtor, and you could easily stay in the house. But if you don’t find some side income while you get your real estate business going, I mean if you’re not willing to do that, then you probably need to sell the house.
It takes about six to nine months to start making a living in the residential real estate business. So, exactly like I was saying, if you go make $1,000 to $2,000 a month on the side while you’re running your residential real estate business and getting it going — even if it’s just delivering pizzas — $1,500 a month changes your whole life right now. It gives you patience to get the real estate business going, so you don’t have to sell your house.
The more houses you sell, the less pizza you deliver. But let’s find something to do to supplement your income in the short term, for the next six months or so, while you get the real estate business going. If you don’t do that, then you need to sell the house.