If you had 3 rental properties, would you manage and invest on them or go to college?

Question

i have 3 rental properties, was thinking if son should manage them or go to college and get student loan

Altheavas · Accepted Answer

If that was me, I would let him go to college and get a student loan. While he’s at that, I would continue buying investment rental properties.
You could gift him, or promise him a rental property at the expense he gets good grades and he graduate college/university.

Katie1964 · Accepted Answer

I would get a job to help pay for college and manage to properties to help pay for college, then see about grants, scholarships and loans. Invest in yourself but try to hold on to the assets at the same time, if possible.

Oliverlogan263 · Answer

Man, that's a tough call. On one hand, having 3 rental properties is dope. That's steady money coming in every month and a nice little business you could build up over time. Managing them full time would probably make some good cash flow.

But on the other hand, college is also really important these days to set yourself up for a good career. And it'd suck to miss out on that college experience of making friends, joining clubs, going to parties etc. Plus student loans aren't the end of the world as long as you study something that can get you a good job after.

I guess it depends on if your son is more interested in business/real estate or has his heart set on a specific major at school. Managing the properties full time now could set him up later on down the road if that's what he wants. Or maybe he could go to school part time while still overseeing the properties some.

All I know is whichever path he chooses, he's lucky to have you looking out for him with those rental properties. Not many kids his age have that kind of a head start. Maybe have an honest talk with him about his goals and see what he thinks is the best move. You seem like a good dad for wanting him to make the right choice - just support him in whatever he decides.

MrOracle · Answer

First, what does HE want to do?

Second, unless these are large properties (say, 4 or more units each), I don't think managing 3 units would be a full-time job unless they're badly in disrepair already. As such, it might be a good way to work through college - and I'd start at community college. Even if it takes 4 years because he's talking half a normal load and managing the properties the rest of the time, that will give him a good feel for both college and a real-world job. He may hate one and love the other. Either way, he'd be making good use of his time.

DJB72 · Answer

Why would you let him take out a loan if you have 3 properties? If they're mortgaged, sell one and use what you spend on the mortgage to fund his studies.
If you own them outright, sell one and use that to pay his tuition or give him the rental income to pay his tuition and let him get a job for the difference.

Be his bank. Don't let him start out with enough debt to create the "I can't do this so I'm going to kill myself" thoughts set in.

My son's 5. If I retire - unlikely but if - it's likely to be the year he starts college if he chooses that path. So I'm planning his college fund and my retirement annuity to both pay up in about 15 years.

So I'm going to write a book.

RavVid · Answer

College/Uni is far less rewarding now. An engineering degree is still good but those feminist studies and pyschology degrees are just debt traps.

One of the problems is that too many are doing degrees. Like law was good but a girl with two lawyer parents was telling me it was too hard to get a job. Too many law degrees have been pumped out.

In the past selection criteria was more stringent which meant brighter people only went to Uni. Brighter people were probably always going to do better in a meritocracy.

So I think there needs to be some realism about degrees and IQ plus consideration lower level tertiary training. The 80/20 rule can apply. 80% of the benefit from 20% of the cost effort.

Finally I went straight to Uni then took a work break and went back. Before I got credits and after I got high distinctions. Studying is work and work experience is good for study. So it wouldn't hurt your son to work a job then study.

OlderAndWiser · Answer

I do not see why managing three rental properties would be a full-time job? Why couldn't he manage the properties and attended a local college part-time?

RoseySarah · Answer

If he is smart enough manage properties he will learn way more then college drinking and having sex and parties!

College is a joke now enforced by business that also demand you have more experience in your friend then you can get in college.

So if you don't your screwed if you don't your screwed

JacobJordan · Answer

If you are making money off the properties stick with that. Use the profits to cover your expenses and save. Buy another and repeat as needed. Way better than getting stuck with a multi 10s of thousands loan for a degree you likely won't even use

Danny_dan92 · Answer

Why not do both.

Many of the most wealthiest people in the world are so because they have drive, initiative.

By making him do both you’re setting him in the right direction, you’re putting him in the mindset of a CEO.

Static_In_The_Attic · Answer

As for your son you have the power to write his future or he can write his own future. On one hand he can manage all three rental properties & on the other hand he can go to college. As for your son maybe he can do both. Manage 3 properties & take classes online. Ask your son & let him decide.

wolfcat87 · Answer

Both at the same time, that's what we did. Is there a reason that he would have to choose only one?

Cute_potato01 · Answer

Co- Manage and invest while he's in college. It's a another source of income regardless and would gave him a possible advantage financially.

Mark987 · Answer

This is an AMAZING question. I would find someone that could handle it, while I go to college... the more you know the better it is. Let your son go to college learn, let him learn as much as possible, and teach him how to manage rental property on the side. It's a win win.

Jdic8rjfnelsodjfb · Answer

In the end, the question can be broken down to these basic terms:

1) management companies for rentals cost ~10% of monthly rent. So if for example you receiving $1.5k/mo on each property. Then management company would get $450/month. Annualized it comes to $5,400.

2) so $5.4 k would be the value diverted to your son, I assume, rather than some firm. This isn't much at all so he would need to find other work on top of this task since in this scenario, he would have opted to not gone to college.

I would conclude that managing to properties and going to college don't need to be mutually exclusive unless you plan on significantly buying more units.

Even then, i would advise you to consider what experience he has with legal knowledge in rental industry, determining a renters worthyness, hiring contractors, spreadsheets, etc.

loveslongnails · Answer

Borrowing money to go to college is generally a bad investment unless it's for a very specific trade or career that will pay it back in a little time. College loans are very predatory. You're better taking out a home equity loan or a line of credit loan.

Iron_Man · Answer

He can manage them later right now he needs to go to school or join the military

KrakenAttackin · Answer

Perhaps he should consider a trade school (learn construction, welding, HVAC), and property management. This would be an excellent education for building a real estate empire.

A basic four year degree doesn't mean jack shit. He needs actual skills. I have a Bachelor's, Masters, tons of technical certifications and qualifications. The formal degrees make me sound smart at a cocktail party. The technical qualifications put food on my table.

rigmarole · Answer

I don't see why any adult couldn't do both. If you already own the property you have cash flow to support you. You just have to have to set time for work and time for study.

MasseurDeMojo · Answer

Why not do both. Manage the properties, and use the income to put you through college. You would be doing part-time college, where the properties are paying for all your college.

AnusNdaPainus · Answer

Depends on what you’re going to college for  STEM = Worth it. Literally everything else = Not Worth it.

HelpfulWoman · Answer

depends on what my son wants to do i guess. if i can, i'd enable him to do what he chooses

RedInnocent68 · Answer

No contest. College. If anything, study business to manage them later.

Saiesh30 · Answer

College is important. Nothing gives more value to a person than his education. It's a must in my opinion.

LunarEclipse433 · Answer

Depends on your available time. Worst case is hire someone to manage them for you. And bank the extra money.

clampfan101 · Answer

I’m most likely going to need college for my dream job.

Jmmmfi4 · Answer

DEFINITELY GO TO COLLEGE

Anonymous · Answer

Manage and invest I'm no liberal so college wouldn't be for me

Mangospacho · Answer

I’d sell them all right now. It is a sellers market and it is a major hassle managing properties unless it is your full time job.

AmeerX · Answer

Why get student loan if you can afford then pay for his college expense so he doesn't have to fall into the student loan trap.

AngryCarl · Answer

Student loan my ass. Loan him some of your sweet rental money. Student loans are a pernicious tax on education.

serious_miss419 · Answer

Does he have income to pay off the student loan 💵  Any loan is often stupid

Charliefretz329 · Answer

Use the profit from the properties to educate yourself any number of ways.

msc545 · Answer

Go to college. The education will be worth more.

krin_m · Answer

Use the income from the properties to pay for college.

AviatorTom · Answer

Why not do both?

FunkyMonkee · Answer

I've already done the college bit.

Christoff92 · Answer

I would use them to buy more properties

strateguy632 · Answer

i would manage them

Alex8736 · Answer

Definitely invest

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