A 16 year old asked me how to start real estate investing recently. I was so impressed that this young person had any inclination to get started. There’s so many years ahead that it can be overwhelming to even start. But, there are a few steps you can do to get in the right position.
- Understand you won’t likely be purchasing a property any time soon. At 16 it’ll be difficult to find lenders unless you have a solid cosigner, and even then, you’ll have to convince the bank that your cosigner can step in and manage the property if you can’t.
- Learn. Now is the time to get educated. There are many niches in real estate such as single family rentals, short-term rentals, multifamily rentals, notes, syndication, etc. You probably don’t have any idea of what you want to do yet. Stick to learning general real estate. The Bigger Pockets Podcast is a good way to start. Also, mindset books like Rich Dad, Poor Dad by Kiyosaki are good. Avoid going into the weeds on deal evaluation just yet. Get a general education on real estate by reading first.
- Save. Chances are you don’t have a huge amount of money in a trust account. Save at least 10% of your income, and probably more since you likely don’t have many expenses. This cannot be stressed enough. Save money now and get into the habit of living frugally.
- Get an Education. Believe me, this is still important. Finish high school. Get a degree. Then get a job. That job may be short-term for you, but it’ll give you a lot of help when getting a loan for your first property.
That’s it. At this early stage. I know it may seem slow since I’m not recommending buying anything now. But, if you do these things, you can position yourself to be ready for that first purchase when you are 18. You’ll be light-years ahead of every other investor out there. Best of luck to you.
