Get Paid To Take Vacations Using Real Estate
How To Use Real Estate As A Vacation Fund
The summertime brings many things for families, including good weather and more time to spend together as a family. As children are often out of school and have a break from extra-curricular activities it’s the perfect time to plan a family vacation. This is why summer is the peak travel season.
Parents with large families know that traveling can be quite a hassle. It takes a lot to get children ready and acclimated to the different modes of travel you will take, or the length of the journey you will take to get to your destination. If you are traveling with extended family or elderly family members that brings additional complications and considerations you need to think about while planning your vacation. An elderly family member may need certain medical attention, have dietary restrictions, or have mobility restrictions that may limit what they can do on vacation.
That’s a lot for the heads of a family to worry about when planning a vacation. We didn’t even get to the finances. How are you going to pay for that vacation without taking on a lot of unnecessary credit card debt or making a huge dent into your savings? For many the answer is real estate investing. While real estate is a proven investment vehicle that can create millionaires and help you retire, your investment goals may be more modest. If you want to invest just to have extra funds so you can cover your vacation, then real estate works for that as well. Imagine how much more tranquil your vacation would be knowing that you didn’t have to think about the finances for your trip.
In this article we look at 3 ways you can use real estate investing to pay for or reduce the costs of your next vacation. This works if you are traveling with a large family, group of friends or even as a solo traveler.
Earn Extra Savings To Pay For Your Vacation
One of the most straight forward ways to use real estate to pay for your next vacation is literally to use the income you earn from real estate to pay for your next vacation. If you are creating a “vacation fund” from your earnings from investing, it is important that you properly budget your cash needs for your investment property.
Investors that self-manage or are “active investors” that have third party management should ensure that they have a “capital expenditures” fund to cover any major repairs that may pop up in the property now or in the future. If you are adequately saving up for capital expenditures, then you can spend your “vacation fund” worry free.
Passive investors don’t have this worry. Since they are not actively managing the investment property and are just receiving returns from the investment there is no need to have this additional capital expenditure savings. If you are a passive investor you can assume 100% of the income you earn can be used by you.
Invest In Vacation Destinations Or Vacation Homes
Another way to earn benefits or reduce costs of your vacation is investing in vacation destinations or vacation homes.
Do you enjoy the beaches in Florida? How about the forests of Northern California? Why not invest there? Anytime you visit to check on a property you could also spend a quick (or long) vacation. Whether you are doing due diligence research to passively invest in a multifamily apartment syndication or you are an active investor looking after your own properties you will gain a benefit. It will be a lot more enjoyable visiting investment properties if they are in areas that you like to go to!
If you invest in a vacation home, you will be able to use that home when you desire to go for vacation and then for the remainder of the year you will earn income which can cover the expenses of the house. This option may prove to be significantly cheaper (even free) when compared to renting from someone else or staying at a resort. The rise of short-term rental websites such as AirBnB and VRBO have made this option even more viable. There may also be some nice tax benefits that may make your vacation even more profitable.
Get A Tax Write Off For Your Vacation
As you may already know, tax benefits are one of the biggest benefits that you get investing in real estate. Tax benefits can reduce some or all of your expenses incurred during your vacation as these expenses could be converted into deductions that offset taxable income. Based on how you structure your real estate investing, who goes on the vacation with you and what you do during the time you are on vacation the connected expenses incurred may be tax deductible as business expenses. Directly connected to the specific property you are investing in, travel, meal and entertainment expenses may be deductible directly against revenue of the property.
Additionally, in cases such as Short-Term Rentals or certain Passive Income deductions (based on your income) you may be able to deduct net “losses” from your real estate investments directly against your earned W2 income. You will get the double benefit of using your real estate income to pay for your vacation then being able to use that “expense” to reduce your taxes. With the increased money you save from paying less taxes you could invest in more real estate or go on more vacations. Either way it’s up to you. You can clearly see that real estate could pay you to go on vacation.
Real estate is a versatile investment vehicle that works for both large goals and small ones. The income that you earn from real estate investing is ultimately only a means to achieve your dreams. In this case that dream may be your dream vacation. Whether on the beaches of Maui or climbing Mount Everest, real estate investing can get you to those memorable life experiences.
The three main ways to use real estate to cover your next vacation are as follows:
Use your investment income to pay for your vacation.
Invest in vacation destinations or vacation homes you can visit.
Get a tax write off for your vacation expenses.
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