Creating a Tenant Welcome Letter
House 1 as it currently appears.

Creating a Tenant Welcome Letter

Now that I’ve placed a new tenant in our first rental property, the lessons are coming fast and furious.

So far, it is going really well. The new lease went into effect on June 1. I spent the week beforehand cleaning the property, performing some minor repairs, and getting the yard under control. While I acknowledge that at some point we will probably need a property manager, we are trying to delay that day as long as possible and are currently self-managing remotely.

One tip that worked well for me and that I wanted to share was the concept of a tenant welcome letter.

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What I Learned While Searching For My First Tenant
Bedroom view of House #1

What I Learned While Searching For My First Tenant

It’s now been eight months since my fiancée and me decided to ease ourselves into the world of real estate by renting her old home. It’s been a wild few months, but overall I’m happy with the decision so far. Our first tenant was a personal friend, and he has now moved out. These past few weeks we’ve leveled up and discovered how to list and rent the property to the general public.

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College Clunkers

The below is a post I originally wrote back in college for my very first personal finance blog, originally published in 2010. The writing is a little rough, but the tips are still valid, so I’m re-posting it here as a resource to have in the back catalog.

The clunker. Many a student has driven one. Whether it was your parents’ Civic or your grandfather’s Model-T clunkers skimp on the frills but manage as cheap transportation.

After the government programs this summer some people assumed the death of the used car business. The “Cash for Clunkers” program rewarded consumers for upgrading to a more fuel-efficient vehicle. To qualify for the tax rebate the dealer must have destroyed the old “clunker”. While many cars no doubt ended up in the scrap heap this way, there still is a burgeoning market for used cars.

I was recently pointed to the website Cars for a Grand. Like the title suggests, the site specializes in cheap cars for under a thousand dollars. You can search by type of car and location. I clicked on Columbus and was rewarded with listings for a 1990 BMW, a 2002 Mustang, and a Saturn L-Series among others all listed for under a thousand dollars. The site aggregates ebay motors listings in order to provide the best variety.

Now obviously TINSTAAFL. That 2002 Mustang with 37,000 miles probably needs some work done. Even still, this site can be a steal for college students looking for a pair of wheels to get them home and around campus.

“Clunkers” have a number of advantages over their pricey counterparts. Insurance, already in the stratosphere for students, is cheaper for really old cars. Plus, you can get liability-only coverage and not lose sleep at night. Old cars are sometimes safer, and at the very least there won’t be a 8-CD stereo to distract you while driving.

In fact, I know some students who graduated and still drive their clunkers. Even with a better job there is no use wasting the money if it works. The downsides to clunkers can be unexpected repairs. If I chose to purchase a car I would put monthly repairs in my budget.

Whether your car hails from the 90’s, the 80’s, or god-forbid the 70’s, if it still gets you places then it’s worth it. But keep the clunker in mind when you go to buy your next car.

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Cut Back Spending with Cash System

The below is a post I originally wrote back in college for my very first personal finance blog, originally published in 2010. The writing is a little rough, but the tips are still valid, so I’m re-posting it here as a resource to have in the back catalog.

Do you find yourself making a lot of impulse purchases? Do you keep swiping your card only to be shocked at the final bill? One way of getting your spending under control is with a cash only system. This is often favored by those in severe debt, but can also be helpful for keeping students spending what they have and no more.

Research has proven that those who spend cash feel a larger psychological loss then those who use credit. Not only do we feel worse about our spending, but studies have also proven that those who use credit on average spend more than those who use cash alone.

The Cash-Only System

The cash only system is simple and to the point.

  1. Say good-bye to your credit cards, debt cards, and other forms of plastic. 
  2. Then, figure out your weekly budget and take that amount from the ATM at the beginning of every week. 
  3. Spend your cash over the course of the week. 
  4. If you run out of cash stop spending.

It really is that simple. You can play with the rules to suit your individual lifestyle. Some people might want to keep a debt card in their wallet for emergencies. Other people might want to set aside cash for specific expenses like in Dave Ramsey’s envelope system. It might take a little experimenting to find a system that works for you as an individual.

The great thing about cash is that everyone accepts it, there are no late or overage fees, and you can’t get into debt with it. There are times when using cash to pay a $2 meal is a lot easier than pulling out a card. The best part is that you “feel” the cash leaving your hand a lot more than you would a credit card.

While this system can be useful in getting your spending down to reasonable levels, I don’t recommend it for the long term. Cash is not convenient, and you miss out on the rewards that can be earned for some credit or debt cards. I recommend using cash only until you feel confident enough to avoid major impulse purchases with your plastic. Once you have that mastered reduce your cash use as you would like.

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Get Your Overdraft Fee Waved

The below is a post I originally wrote back in college for my very first personal finance blog, originally published in 2010. The writing is a little rough, but the tips are still valid, so I’m re-posting it here as a resource to have in the back catalog.

For over a year now I’ve had my checking account without issue. But everyone makes mistakes and I had a slight one this past week. The balance of my online account wasn’t totally up to-date causing me to transfer more money to my online ING Savings Account then I had in checking. The result was a $25 overdraft fee.

For those new to this whole personal finance thing, an overdraft fee happens when you take more money out of your checking account then you have. The bank is forced to cover the shortage, and then gladly charges you $20 to $30 for the privilege.

The shortage in my account was quickly remedied, but this left me with the fee to deal with. In one swoop $25 would wipe out my interest gains for the year. Luckily I had read before that often the bank will waive a fee for you if you just ask.

The Call

Surprisingly, the hardest part of my call was actually getting a human on the line. For Fifth Third customers fighting through the automated system press 0 to get a customer service representative.For others look under the customer service area of your online banking account.

After that it was remarkably simple. I mentioned that I had been a good customer and asked to get the overdraft fee waved. The representative told me they would waive one fee as a courtesy. I have no idea if they could be pressed for more. All in all the conversation took less than 5 minutes.

Why?

Think about it for a moment. Banks pay hundreds of dollars to advertise and find customers. They want to keep the good customers around and that means keeping them happy. Although students may not have a long history with their bank, just the amount of free stuff they pass out shows how much they value the new accounts.

Don’t Get Comfy

This isn’t a get-out-of-jail-free card. It’s not an excuse to not manage your finances. Fees can start at $30 and easily go into the hundreds before you realize what’s going on. Balance your checkbook or use some sort of online tracker and keep these fees from happening.

But even if you can’t get a fee waved, it’s certainly worth a try. Think of it as an easy way to earn that money back. The worse thing they can say is no.

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Here’s What I’m Doing to Prepare For the Upcoming Recession

It’s safe to say that a few things have happened in the last few weeks. An unprecedented virus has swept across the country and the economy has been stopped in a way that’s never been done before. It’s as if the big pause button in the sky has been pressed with all financial activity suddenly frozen in time.

The economy is rapidly hurling towards a recession. Full disclosure: it’s already affected me personally, as my company has announced a 15% across-the-board pay cut and the suspension of the 401K match.

So the question becomes, with storm clouds on the horizons, where do we go from here? In this situation, frugality is both a blessing and a crutch. If you’ve been keeping a close eye on your expenses while keeping a high savings rate, you should be well-positioned to survive a loss of income or a change in job prospects. On the other hand, if you’ve reduced expenses already then there’s likely little fat left to cut.

I’m somewhere in-between. The last few years have gone well, and So here’s what I’m doing to prepare for the upcoming recession:

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7 Tips to Save on Printing While In School

The below is a post I originally wrote back in college for my very first personal finance blog, originally published in 2010. The writing is a little rough, but the tips are still valid, so I’m re-posting it here as a resource to have in the back catalog.

Brother Monochrome Laser Printer, Compact All-In One Printer, Multifunction Printer, MFCL2710DW, Wireless Networking and Duplex Printing, Amazon Dash Replenishment Enabled

When your at school printing is a fact of life. Whether your turning in a paper or printing the PowerPoint notes for a class sooner or late you will have to print, and anyone who’s bought ink can tell you printing is not cheap.

However, before you go spend your life savings on ink there are five tips you can use to keep those printing costs under control.

  1. Ditch the printer. You might not even need a printer to begin with. Many schools allow their students so many pages of printing per semester. This is often included as part of the student fees so take advantage of it, you have to pay anyway. Also check with your college to see if they offer anything above and beyond the basic school offering. At Ohio State, I get 50 pages of printing per quarter and then 200 more pages through the business school.

  2. Ditch the inkjet. Even with the free printing, you may still want your own printer. It may be appealing to pick up the latest deal from Wal-Mart, but it’s important to remember that the cost of ink over a printer’s life dwarfs the cost you pay up-front. Many printer manufactures rely on this face, selling their inkjets below cost and making up the difference on ink sales. Laser printers have a higher cost to purchase, but will offer you a better cost-per-page. With costs for a black-and-white printer now dropping to as low as $99 you really have no excuse to keep paying that inkjet premium.

  3. Use both sides. One way to cut your paper cost down is to use both sides. This has the side effect of making massive packets of lecture notes easier to handle. Many modern printers have a “double-sided” feature that makes reverse printing even easier. It’s a good thing to keep in mind when looking for a new printer.

  4. Save ink in draft mode. Many printers feature an economy or draft setting that operates at a lower dpi and can save ink in exchange for a slight down grade in quality. A setting like this is perfect for printing off lengthy reading assignments and rough drafts.

  5. Share your printing responsibilities. So maybe you don’t have enough cash to go out and buy a laser printer right at this moment. Consider going together with your roommates and purchasing one as a group. Today sharing a printer on a network is easier than ever and the larger price of a laser can be split multiple ways. Not only does this option save you money, but it also saves space in your dorm or apartment as well.

  6. Adjust your document settings. This is such a small tip some people don’t even think about it. Adjusting your margins down to 0.5 inches can save 11 square inches of printing per page. Cutting your font size down can help too. If that’s not enough, you can even take this a step farther. Set the document to landscape and 50% normal size to fit two pages on the area that would have been taken by one.

  7. Go Paperless! It’s important to not only think about the how’s of printing but also the why’s. In this day and age going paperless isn’t always an option, there will also be that one professor who requires a paper copy of everything, but increasingly instructors are posting assignments online. It never hurts to ask if you can email that paper in. You’ll save your cash and the planet.

I try to keep all these tips in mind when I choose to print something. While I haven’t been very good at using my school’s printing (can’t beat the convenience of my desk…) I did bite the bullet and bought a laser printer. The Brother printer (pictured above!) can do all of my black and white document printing and also features a scanner for when I need it. Best of all I got it on sale at Office Depot.

Have any more printing tips you’ve picked up? Let me know in the comments below.

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Side Hustle Report: September 2019

Side hustles, odd-jobs, swindles. These terms all mean the same thing. Side hustles are work that is performed to supplement income from one’s primary job. A debates rages about side whether side hustles are a productive use of time. I may elaborate on that in the future, but to start out I am only going to log the extra income I earned over the last thirty days.

I intend to log the previous month’s earnings on or about the mid-point of the following month. The goal is to hold myself accountable, and earn extra money that I can use for investments and projects.

Side Hustle Report

ActivityAmount
Ebay Sales:$52.98
Arcadia Electric:$25.00

Month-End Wrap-Up

All in all, it was a pretty weak month. We moved to a new primary residence in late August and spent September filled to the brink with activity for the move. As such, I only sold a couple of items on eBay that I no longer needed. I also had one referral bonus earned through Arcadia Electric, as described in this post.

But it’s a starting point and ia great opportunity to begin this habit. I already have some projects and irons in the fire for October. More to come if you watch this space!

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Buy Rent Rehab Refinance Repeat by David Greene

This past week I finished reading Buy Rehab Rent Refinance Repeat by David Greene. While I was a long-time listener to the BiggerPockets Podcast, where David is a co-host, I only recently became serious enough in my investing plan to spend the time to start reading through reference books on the subject. 

This is David’s second book. His first, Long-Distance Real Estate Investing, surprised me with its utility and casual writing style. I enjoyed it enough to pick up the sequel, even though I’ve traditionally been skeptical of the BRRRR. method. 

BRRRR….Is it cold in here?

BRRRR is a real estate strategy where the practitioner purchases a cash-flowing property below-market, supervises a remodel that repairs deferred maintenance, and then refinances the property once complete. The key is that many lenders will lend up to 75 or 80 percent of the home’s value, and the newly remodeled home will often be worth enough for the investor to pull cash out of the property to reinvest elsewhere.

To put it simply, when you buy a property, fix it up, make it worth more, then refinance, you’re borrowing against the value of the property when it’s at its highest. Done correctly, this allows you to recover more of—or sometimes all of—the money you invested in the property.

David Greene

In this work, David gives a brief introduction and walks through each step in the process. There are one to three chapters in each section, in the order of Buying (Deal Finding), Rehab (Contractor Management and Common Strategies), Rent (Finding Quality Tenants), and Repeat (Building Systems). Once you’ve progressed through pter in the order of Buy, Rehab, Refinance, Repeat, he concludes with common arguments against the method and their counterarguments, and where this method could best help improve investing results. 

What did I learn?

If as I did you have recently completed Long-Distance Real Estate Investing, some of this will sound familiar. Themes, concepts, and advice were repeated, with some concepts lifted straight from it. Like in the previous work, David says focus first on building your team, the “Core Four”, and I found this review to be helpful. 

Other items expanded upon from the previous work were itemized bids and setting up checklists. These are both important items when setting up an investing system and the repetition well-warranted.

One item that was new to me in BRRRR was the concept of having different levels and types of labor. Here, David correctly points out that there is more than one type of labor involved with rental properties, they have different cost levels, and you want to make sure the type of labor used is appropriate for your project. For instance, the local neighborhood handyman may be cheap at $20/hour, but you don’t want him planning a general rehab. Instead, that’s the appropriate amount of time to use a licensed contractor. 

My favorite piece of advice though, was the step-by-step guide to how to identify, interview, and select a property manager. I found this to be so informative, that I photocopied the pages in order to have on hand when I hire my own property manager later this year. There were also similar tips on the best ways to identify agents. 

What’s not to like?

One thing I did not like is some of the repetition within the book. Once the benefits of the strategy are described in the introduction, I don’t need to hear them repeated again and again. This might be less aparant if you are not as familiar with different real estate investing strategies. But if you have been around it for a while, as I have, you may tend to skim ahead at times. 

Overall, I thought Buy, Rehab, Rent, Refinance, Repeat was a solid follow-up to Long Distance Real Estate investing. It might not have been quite as groundbreaking, and if you have no interest in the concept of BRRRR there are better real estate resources out there. For those that have been researching real estate at all, these concepts won’t be new, but if you think that this strategy might be a good fit, then having it all put together in a coherent strategy helps to make it seem much more actionable. If that sounds like it might be you, I would recommend picking it up online or at your local library. 

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Save Money and Save the Planet with Arcadia Power

For over a year now I’ve been using Arcadia Power to manage my electricity usage and save money, while helping the environment. Arcadia Power’s claim to fame is that they source 50% of their power from wind energy at no extra charge. Sign-up is quick and easy, with over 300,000 members nationwide. You can join them in under five minutes via my referral link, and we’ll both pocket some additional cash.

Arcadia is an aggregator for electricity similar to Mint.com or Personal Capital. You provide your login information to your local utility’s online portal. From that point on they pull your statements directly into their dashboard and process all payment via their auto-pay tool or payment portal. The main benefit is the guarantee that 50% of the electric purchased will be from renewable wind energy sources. For a small surcharge, you have the option of purchasing 100% renewable power. Arcadia’s business plan is to entice customers with the 50% plan and then up-sell them to the 100% plan.

I have had Arcadia for a little over a year and a half now across three properties. I can now safely safe it is a legit service with several benefits. Initially I used 50% wind energy for several months, but it was not long until I upgraded to the 100% renewable charge as part of my new year’s resolution to reduce my carbon footprint.

At this point I think it’s important to mention that when you sign up with Arcadia Power, you are not changing your utility or electric provider. Instead, they are paying your bill on behalf of you and then you are paying them back.

Arcadia brags about their green credentials, and their business plan revolves around renewables, but in reality I find their cost monitoring and dashboard features to be the star of the show. Some of these more modern features may still be years away at your utility.

The dashboard is clean and well-organized. Not only does it show your past twelve months of electricity usage and how much of that was renewable, but it also ranks your usage compared to the average Arcadia customer. There are stats for how much clean energy you have used and the status of any referrals submitted.

For those involved in credit card churning, Arcadia’s auto-pay feature allows for credit card payments at no additional charge. Many utilities charge an extra 2-3% for credit card usage.

My favorite feature though is the automatic rate tracking. Not everyone knows this, but in many deregulated markets you do not have to buy your power from the local utility. Instead, you can pay a separate company to source your power and only pay the utility for transmission. This all happens seamlessly through your provider when you sign up.

However, to take advantage of this requires spending more time tracking utility rates and competitors then most people have the time for. Arcadia takes the hassle out of this, by automatically making sure you are buying electricity from the cheapest sources. All that competitive searching is reduced to the occasional email from Arcadia that notifies you that, “Yes, you are now saving more money.” That’s the kind of spam I can get behind!

One option I would stay away from are the “Community Solar” projects that you have the option to buy into. I ran the numbers on several of these projects and was unable to get any of them to pencil out. While this may be different in other parts of the country, I would think twice before signing up.

The only other issue I had was when I made the mistake of changing my utility password without updating Arcadia. No longer able to login, Arcadia was unable to pay my bill and I ended up paying it late. I admit this issue was 100% caused by my mistake.

Overall, the environmental bonus is a nice perk, but reality the cost savings are what keeps me with Arcadia Power. If the service I’ve described is interesting, you can sign-up for free using my referral link. Right now, we’ll both earn a referral bonus of up to $25.

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