Alternative sources of income

[8741empls]

Ok, quick questions for me and any others not down with the lingo.

1. What does NOI stand for?
2. What is "cap?"

It's probably super obvious, but I'm not catching on yet. Help me out.

NOI=net operating income=yearly revenue-expenses.
I’m assuming cap is referring capitalization rate which=NOI/property value (can be initial purchase value or current market value depending on how you number crunch).

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[Mad Jack]

I think at our level of incomes, unless it's something you genuinely love doing, your best bet is almost always gonna be to work another shift


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Developing passive secondary income streams can help you make money while you make money.

 

[emergentmd]

Developing passive secondary income streams can help you make money while you make money.

I wish I did passive income coming about of residency rather than waiting 10 yrs. I would be at my lakehouse rather than in the ER right now. But its never too late.

 

[EctopicFetus]

I wish I did passive income coming about of residency rather than waiting 10 yrs. I would be at my lakehouse rather than in the ER right now. But its never too late.

Curious what criteria do you look for in your rentals? Cap rate etc?

 

[emergentmd]

Go to biggerpockets.com Questions way to complex to answer b/c imo its personal preference. In places like Cali, you will never get a good cap rate but great appreciation. Others like michigan has good cap rates but you are opening a new can of worms.

I think starting out you should invest in a place near where you live b/c you already know the market and what to expect.

Curious what criteria do you look for in your rentals? Cap rate etc?

 

[The White Coat Investor]

Think of cap rate as the cash return from a paid off property. So if your property costs $100K and generates rent of $1000/month and has expenses of $4000 per year, then it has a cap rate of 8 ($8000/$100,000).

Be aware that NOI specifically excludes mortgage expenses (P&I).

What is 'Net Operating Income - NOI'
Net operating income (NOI) is a calculation used to analyze real estate investments that generate income. Net operating income equals all revenue from the property minus all reasonably necessary operating expenses. NOI is a before-tax figure which excludes principal and interest payments on loans, capital expenditures, depreciation and amortization.

Read more: Net Operating Income (NOI) | Investopedia Net Operating Income - NOI

So if a property has a cap rate of 4, it darn well better appreciate faster than one with a cap rate of 8, or it's an inferior investment. The problem is income is a much more guaranteed source of returns than appreciation.

 

[The White Coat Investor]

I wish I did passive income coming about of residency rather than waiting 10 yrs. I would be at my lakehouse rather than in the ER right now. But its never too late.

So you're working only for the money? Really? If so, no physician is ever really more than about 10 years away from full retirement. So there's that.

How To Punch Out of Medicine in 10 Years | The White Coat Investor - Investing And Personal Finance for Doctors

 

[emergentmd]

So you're working only for the money? Really? If so, no physician is ever really more than about 10 years away from full retirement. So there's that.

How To Punch Out of Medicine in 10 Years | The White Coat Investor - Investing And Personal Finance for Doctors

Did I say that?

I would work til I can't physically but I rather work 4 dys a month rather than 14 days a month

 

[The White Coat Investor]

Did I say that?

I would work til I can't physically but I rather work 4 dys a month rather than 14 days a month

So you're working just for the money 10 days a month and 4 days a month because you enjoy it.

I'm not making any judgment here (I'm going to 8 shifts a month soon myself), I'm just reflecting back what you're saying in a way that perhaps you haven't considered before and I hope it is helpful to you.

 

[GonnaBeADoc2222]

I'm pretty interested in real estate as an alternative source of income. I'm a first year attending, working to pay off loans and still purchase my primary residence, but some kind of rental property is likely in my 7-10 year plan. Does anyone have a good resource (book, blog, etc.) to help learn about this area? @The White Coat Investor @emergentmd ?

 

[The White Coat Investor]

I'm pretty interested in real estate as an alternative source of income. I'm a first year attending, working to pay off loans and still purchase my primary residence, but some kind of rental property is likely in my 7-10 year plan. Does anyone have a good resource (book, blog, etc.) to help learn about this area? @The White Coat Investor @emergentmd ?

Best Financial Books for Doctors | The White Coat Investor - Investing And Personal Finance for Doctors

 

[arandazzo88]

Focus. Do one thing really really well and you'll reap the rewards. Like others have said, unless you have a passion for something else, I would focus on honing one craft and better opportunities and better paying jobs will open up.

 

[emergentmd]

I'm pretty interested in real estate as an alternative source of income. I'm a first year attending, working to pay off loans and still purchase my primary residence, but some kind of rental property is likely in my 7-10 year plan. Does anyone have a good resource (book, blog, etc.) to help learn about this area? @The White Coat Investor @emergentmd ?

Biggerpockets.com

 

[TooMuchResearch]

I'm pretty interested in real estate as an alternative source of income. I'm a first year attending, working to pay off loans and still purchase my primary residence, but some kind of rental property is likely in my 7-10 year plan. Does anyone have a good resource (book, blog, etc.) to help learn about this area? @The White Coat Investor @emergentmd ?

Bigger pockets website/forums/podcast

 

[Psai]

Best Financial Books for Doctors | The White Coat Investor - Investing And Personal Finance for Doctors

Your book was amazing, really helped me make a lot of decisions

 

[dchristismi]

I've got an extra copy of WhiteCoat's book... can mail it to someone in need.

I am finishing up my 10th year out. Will be mortgage free in 2 years (the 15 year mortgage plus double payment plus 25% down in our case to make it a 5 year mortgage,) and basically on the brink of financial independence. But... I have rediscovered that I actually do like medicine... just not what I was doing where I was doing it.

I am down to only 1 rental property, but I was never in it for the money... I'm a lousy landlord. However, I've singlehandedly helped a really deserving family get back on their feet, kept a roof over their heads, and perhaps most importantly, provided some needed stability by keeping the kids at the same school for the last several years. There's something to be said for Karma. Husband will be inheriting some commercial real estate, and contemplates buying more, but not for now.

I am also dropping down to about 8 EM shifts a month, but my "alternate income" is much less than I make in EM. But I'm happier, and that's saying something. Also, the statement that "Well, nobody died..." doesn't really have the same effect anymore. (I round at an inpatient hospice on weekends. And I really love it.)

 

[EctopicFetus]

Focus. Do one thing really really well and you'll reap the rewards. Like others have said, unless you have a passion for something else, I would focus on honing one craft and better opportunities and better paying jobs will open up.

I am gonna call bs on this. Sorry, reality is EM is that those who are most flexible will get the best jobs. You could be the biggest badass EM doc but if you are in SD the jobs are the jobs. That being said if you dont know someone in the good jobs then you have a 0.1% chance to get that job.

In my experience of 2 really good jobs and being involved in hiring at both what matters most is references and personality (aka the beer test... would I like to have a beer with this person)