If you didn’t want complex banking and accounting, you should have found another calling in life.
Real estate investing means financial finagling: multiple bank accounts, constant money shuffling and all the accounting headaches that come with the territory. If you use limited liability companies (LLCs) to hold various properties, each one will need its own checking account. Likewise for each series in a Delaware Series LLC. If you have a 401(k), that may well be with a separate investment broker. Then there are the IRAs, Roth IRAs or perhaps SEP-IRAs for retirement, and the 529 accounts for college savings.
And that’s just for your assets. Your liabilities, from mortgage loans to credit cards to student loans to car loans to crowdfunding loans, each is its own account.
My wife and I, between us, have no fewer than twenty accounts.
But beyond the accounting acrobatics, here’s a question more landlords and real estate investors should be asking themselves: how much richer am I this month than I was last month? This year, over last year? What’s the bottom line after all the accounts are (sorry) accounted for?
Enter: Mint.com’s free financial hub. You select which banks you have accounts with, which lenders you have mortgages with, which investment banks you have retirement accounts with, and enter your login data. Mint then aggregates all of your accounts, categorizes them, and tracks their balances and transfers in real time automatically for you. As an especially nice feature for real estate investors, they draw live data from Zillow on your rental properties’ estimated values, and adjust them automatically as the market changes.
Why is any of that important? Because ultimately, you work and invest for one reason: to get richer. If 50% of your waking hours are devoted toward a singular goal, you need to make darn sure you’re tracking your progress towards that goal.
It also does a nifty psychological trick for you, in making the growing of your wealth tangible and real. After all, that extra $500 in your pocket could go towards paying down your rental property’s mortgage… or it could go to that new gadget you’ve been eyeing. Let’s be honest, for most of us the reward is just too intangible to use extra money to pay down a mortgage faster, especially when compared to something real that we want to hold in our hands right now. But if you can see daily progress towards growing your net worth, and see time estimates of when you’ll have that mortgage paid off and an extra $500 in your pocket every month instead of just this month, that might tip the scales.
Mint helps you create budgets, and will alert you when you’re approaching (or surpassing) your budget limit each month. It also monitors your financial trends, and can alert you when a trend is looking dire, or when there’s a sudden change in a normal trend. And like the mortgage example above, it lets you set financial goals, with all sorts of handy tools to help you reach them.
You also probably know how critical your credit score is to real estate investing. Mint will track your credit scores for you too, for free.
Sure, you could try to manually track all of these different checking, savings, mortgage, credit card, retirement, loan, college and real estate accounts with a spreadsheet. Entered by hand. Every month. But why waste the time or risk the errors? As a real estate investor and landlord, your time is valuable, and the more that you can automate the better off you’ll be.
It is absolutely true that most of us will only ever get rich slowly… but your progress can still be sped up with wealth tracking tools like Mint to help keep you moving on the road to riches.