Help with managing money from a rental house
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Anonymous
| I bought a cheap house in pg county and after 6 months moved in with my bf in his house. My house is now being rented out. I get 600 a month off the house. My question is, what now? I want to keep it as a rental but how much do I need to set aside and for what? Do I set money aside for emergency repairs? How much? For if I don't have tenants? How much? Anything else? What do I do with the money after that? Just put in a savings account? I know it's not a lot of money but I want to prepare myself. Thanks |
Anonymous
| Remember that you will need to claim the rent as income on your tax returns. And keep track of your expenses related to the rental as those are deductible. As for reserves, it depends how much cushion you have financially and how much your mortgage is, if any. When I had a rental property I didn't set up separate reserves other than the security deposit. |
Anonymous
|
If you don't need the money for everyday expenses or to cover the mortgage, just put it in a separate account and treat the next year or two as your learning time, to see what expenses are attached to this investment. You can decide how to use these funds later (e.g. insurance, upgrades, the kids' camp fees). |
Anonymous
| Agree with 9:02 - you could probably invest in CD's if you didn't want to have the cash earning the teeniest possible interest rate. But you want to make sure you have some liquid cash (or room on your credit card) in case you have some months without a tenant or a major repair. |
Anonymous
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OP not exactly what you asked but I found this book to be very helpful: Every Landlord's Tax Deduction Guide.
http://www.amazon.com/Every-Landlord%C2%92s-Tax-Deduction-Guide/dp/1413319270 |
Anonymous
|
You might want to read some webforums for landlords like:
https://www.biggerpockets.com/ |