Finances can be tricky whether you’re buying a rental property, investing, or drawing up a budget. I will often get stuck in a classic “paralysis by analysis” situation.
At times like these, it has helped me a lot to follow a few simple rules of thumb for every situation. When considering an investment or a purchase, a quick rule of thumb can help you see whether it is worth following up or further analyzing. Use these rules of thumb as a basic guide to help you make a quick decision.
Now let’s look at what we discussed in this episode:
- My favorite financial rules of thumb in real estate
- My favorite financial rules of thumb for personal finance and retirement
- How Much House Can You Afford?
- How high should your net worth be?
- How Much Life Insurance Do You Need?
Here’s a breakdown of how this episode played out …
The rule is that your investment property should rent 1% of the purchase price.
The amount you have should depend on what your sources of income are and how consistent they are.
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