Copy Scenario

Copy this new  Scenario to your Real Estate Financial Planner™ software:

01 Earn 10% More Income From Job

The  Scenario you want to copy into your Real Estate Financial Planner™ software has the following:

• 2  Accounts (including  Default Cash Account)
• 1  Properties
• 3  Rules

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Once it is in your account, you can view detailed  Charts for dozens of variables and edit any of the assumptions for  Accounts,  Properties, and  Rules to run your own what-if  Scenarios.

Scenario

• Modeled for 720 months (60 years)
• 15% effective income tax rate
• 3% inflation rate
• 4.375% mortgage interest rate
• 4% yearly safe withdrawal rate (SWR)
• $7,000 minimum target monthly income in retirement (MTMIR) in today's dollars
• $10,000 ideal target monthly income in retirement (ITMIR) in today's dollars

Accounts

Summary of assumptions for the Account in this Scenario.

• Account Name:  All-In-One Account
• $40,000 starting account balance
• 8% yearly rate of return (at start)
• Asset Type: Stocks

Properties

Summary of assumptions for the Property in this scenario (at the start of the Scenario).

Property Address/Description: 5% Down

• Greeley, CO 80634
• This  Property is a Dynamic resuable template of a property that we can buy multiple copies of using  Rules.
• This  Property is a Nomad™ property that you live in until you buy your next owner-occupant property. When you buy your next Nomad™ property, this one becomes a rental.
• This  Property uses dynamic  Rules to determine when we buy/sell it in the  Scenario.
• Account for down payment, income and expenses for this  Property:  All-In-One Account
• $485,000 property value and purchase price and it goes up at a rate of 3% per year.
• 5% of purchase price for down payment.
• 1% of purchase price in closing costs at time of purchase.
• No seller concessions.
• 4.375% is the mortgage interest rate with a term of 360 month mortgage term.
• Private Mortgage Insurance (PMI) at a rate of 0.7% of the initial loan balance until the loan-to-value drops below 80%.
• $2,500 per month in rent but rent increases at a rate of 3% per year.
• 3% of the monthly income is the assumed vacancy rate.
• 10% of the monthly income is the assumed maintenance rate.
• $350 per year for HOA fees on the property and they increases at a rate of 3% per year.
• 1% of the value of the property each year is the assumed property taxes rate. Based on the initial value of $485,000 that's about $4,850 per year in property taxes at the start and it changes as the property value changes.
• 0.35% of the value of the property each year is the assumed property insurance rate. Based on the initial value of $485,000 that's about $1,697.50 per year in insurance costs at the start and it changes as the property value changes.
• This is a residential property and 15% of purchase price is considered the value of the land (when doing our depreciation calculation).

How to Calculate

See the steps walking you through how to calculate various metrics for this property.

Walkthrough how to calculate...

• Gross Potential Profit
• Gross Operating Income
• Operating Expenses
• Net Operating Income
• Cap Rate
• Cash Flow

Rules

These are the Rules included with this Scenario.

Paycheck and Personal Expenses - Paycheck

• This  Rule runs for the entire  Scenario.
• Depositing paycheck into  All-In-One Account but no personal expenses with this  Rule.
• Personal expenses will be Inflation Adjusted.
• Gross paycheck is $8,800 Inflation Adjusted.
• Assuming no taxes on this paycheck. It is possible this is already an "after-tax" amount.
• The paycheck will stop when they reach "Financial Independence" (goal of Minimum Target Monthly Income in Retirement achieved).

Paycheck and Personal Expenses - Personal Expenses

• This  Rule runs for the entire  Scenario.
• No paycheck, but pulling expenses out of  All-In-One Account.
• Paycheck will be Inflation Adjusted.
• Assuming no taxes on this paycheck. It is possible this is already an "after-tax" amount.
• This paycheck will not stop at retirement.
• Personal expenses are $7,000 Inflation Adjusted per month.

Buy Property When Account Has Down Payment - Buy 10 Nomads™

• This  Rule runs for the entire  Scenario.
• This  Rule will buy another copy of the Dynamic (template property) 5% Down whenever  All-In-One Account has enough for down payment and closing costs...
• Plus at least $10,000 Inflation Adjusted left over in the  Account
• This  Rule requires that with the purchase of the property with this  Rule that Debt-To-Income ratio remains below 45%.
• This  Rule will only buy 10  Properties maximum. But if you sell any, it will try to buy more to replace them.

Significant Events

These are the  Significant Events for this Scenario.

• Month 1  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 44  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 142  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 221  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 290  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 357  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 361  Paid Off Mortgage
• Month 400  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 404  Paid Off Mortgage
• Month 409  Achieved Financial Independence Goal
• Month 502  Paid Off Mortgage
• Month 515  Achieved Ideal Financial Independence Goal
• Month 581  Paid Off Mortgage
• Month 650  Paid Off Mortgage
• Month 670  Bought New Dynamic Property Based On Rule Buy Property When Account Has Down Payment
• Month 717  Paid Off Mortgage
• Month 719  Achieved 2 X Ideal Financial Independence Goal