Pros and Cons of Owning a Rental Property

Owning rental property can seem like a great idea for a stream of investment income. However, there are pros and cons to being the owner of a rental property. The following describes the positive and negative aspects of this investment choice.

Of course, the first and foremost advantage is a stream of rental income. On top of this, the owner can also enjoy the property appreciation. A rental property can be a great way to build personal wealth.

The tax advantage is wonderful. As the rental property appreciates, the owner can refinance the mortgage and pull out cash tax-free. Capital gains taxes can be avoided by switching investment properties every several years. Don’t forget the tax deductions! Mortgage interest, insurance, property taxes, and maintenance are all tax deductible.

Blue Duplex Housing

Rental properties can provide the owner with a free vacation from time to time! Purchase a rental property at a vacation spot, and keep it free for a few weeks each year for your own personal use. You can also save it as a retirement property or permanent vacation home. What a great way to have the perfect retirement home or vacation home while making some extra money in the process.

While there are some excellent advantages, owning a rental property does not come without disadvantages too. First, being a landlord is a huge responsibility, and may even become a burden. Basically, you are “on call” 24/7. Tenants will call you at any time of the day or night for emergencies, such as a broken air conditioner, or a washing machine in need of repair. As the property owner, you must respond to these issues in a timely manner. This includes while you are on a family vacation, not feeling well, swamped at the office, or just enjoying some quiet time.

Not every tenant is going to be responsible. In a perfect world, the landlord would collect a rent check on the first of the month from the renter with no delay. The check would clear, and everyone would happily go on with their lives. This is not always the case. Someone can move in, lose their job, and not pay rent. Aside from lost cash flow, now the landlord must deal with the eviction process. Or, they can just be irresponsible and not pay rent. Either way, it becomes a major financial headache for the landlord.

Even worse is not having a renter. Depending upon market conditions, your property can sit vacant for awhile. And you are still responsible for monthly mortgage payments, taxes, and maintenance. This can be a financial burden on the landlord, especially when there is no rental income.

You need to have capital available at all times when you own a rental property. Aside from the 20% down needed to make the purchase, cash must be available in case a problem arises. Something could go wrong with the property, costing hundreds or thousands of dollars, and the landlord must fix it in a timely manner, no matter the cost.

13 Best Overhead Cost Reduction Strategies

If you are having trouble sticking to a budget in your business then you may want to take a second look at your overhead. Here are 13 of the best overhead cost reduction strategies to help you:

1. Evaluate Everything on Record

The first step in reducing overhead expenses is getting a clear picture as to where your money is going. If you have an accountant, have him/her pull up an expense sheet detailing all of your overhead expenses. If you use bookkeeping software instead, then gather this crucial information on your own.

2. Don’t Look for Just One Area to Reduce

Realize that there is likely no “magic bullet” when it comes to reducing your overhead costs. You are more likely to find that the best way to save money will come from a series of small adjustments, instead of one large one.

3. Have and Employee Brainstorming Session

Your company’s best resource is your employees. Their advice can lead you to savings that you couldn’t see on your own. You could even provide a bonus incentive for the idea that saves you the most money.

Computer Keyboard with cursor shows Paperless

4. Go Paperless

While you can’t completely eliminate paper from your business, simply backing up your files to the cloud or to an external disk and shredding the excess paper can be a real boost to your productivity and peace of mind.

5. Cut Under-performing Staff Members

If you have staff members that aren’t living up to their full potential, then it may be time to let them go. This may also be better for them since it will free them to find work better suited to their talents.

6. Find Credit Cards With Better Rewards

Make sure that you are using a card that gives you the most rewards possible in an area that your business uses. If you don’t do much travel, for example, you may want to switch from a card with travel rewards to one with cash back instead.

7. Outsource Your IT Department
There are large costs (and risks) associated with maintaining an in-house IT department. New advances in technology allow you to take advantage of outsourcing services for all of your IT needs. This can involve data warehousing, vendor management, and many other areas that help you meet your needs without overspending on staff and computers.

8. Sublease Your Office Space

If you have your own office space, you might find there are rooms (or even whole floors) of space that you aren’t really using. Consider leasing this space to another small business for extra cash-flow.

9. Downsize

If you realize that you don’t really need as much space as you have, consider downsizing. There is no shame in relocating to a cheaper area or reducing the size of your office space to accommodate your true needs.

10. Restructure Employee Benefits

You may want to look into getting health savings accounts for those employees who are over fifty-five years old. This will help to reduce health care costs for aging employees.

11. Make Employees Multitask

You should be proud to have some extremely talented people working for your company. Put that talent to its full use. You may have a customer service rep with a degree in accounting or a person in IT who shows an aptitude for management. You may be able to use different people in more than one area to maximize your money.

12. Reduce Travel Expenses

You may have employees who take advantage of expense accounts without even knowing it. Get a full travel expense report for the last year and see if there are any areas that you can cut down on.

13. Plan Ahead

While the future can never be predicted with complete certainty, its best predictor is still the past. Track all of your expenses for as long as you have been in business. Knowing what’s coming and when to expect the most money to cover any extra expenses can save you a lot of money in the end.

If you follow these simple steps you will be on the road to saving money in no time. And your business will be more streamlined and efficient as well.

Car Door Magnets vs. Vehicle Wraps: Which is Better?

Car Door Magnets vs. Vehicle Wraps

If you’re running a business, you know how important advertising can be to getting sales and making a profit. The traditional methods of advertisements, flyers, banners, and signs are slowly giving way to a more popular trend. Car door magnets and vehicle wraps are quickly gaining popularity with business owners. These magnets and wraps can make much more people see your business in a short period. This article will compare the two, and list pros and cons of each one. By the end, you should be able to pick which Car Door Magnets vs. Vehicle Wraps suits your needs.

Car Door Magnets

Car magnets come in a variety of styles and sizes. They can cover a small section of your vehicle or you whole door. They are a one-time expense that you can use to market your business for as long as you like. You can also put as much information on the magnet as you like, and this makes it easy for people to get everything they need to know about your business at a glance. They are less expensive, starting around $10. According to signazon.com, a car door magnet is an inexpensive way to raise awareness about your business or brand. They last for years if they are properly maintained, and come in endless styles and colors. The top two pros and cons are listed below.

Pros

  • Inexpensive
  • Easy Way to Boost Your Brand Awareness

Cons

  • They Could Potentially Fall off The Vehicle
  • If Your Car’s Body is Fiberglass, it Won’t Stick

Car wrapping specialists using heat gun to prepare vinyl foil

 

Vehicle Wraps

A vehicle wrap is an advertisement that goes around your entire car. This makes your whole car become an ad by itself. Unlike the magnets that are inexpensive, car wraps can easily cost up to $5,000, with bus wraps costing upwards of $10,000 per wrap. They offer a wider area to work with though, and there is no danger of them falling off. You can choose between a full wrap and a partial wrap as well. Aretedis.com states that these wraps are an excellent investment because they can be easily removed, and as a bonus, they also protect your vehicle’s paint job while they are on. The top two pros and cons of a vehicle wrap are listed below.

Pros

  • Durable
  • Large Area to Advertise Your Business or Brand

Cons

  • Expensive Cost Upfront
  • Average Life Span of a Wrap is Three Years

Whether you end up to choose a car door magnet or a vehicle wrap, both of them are an excellent investment opportunity for your business or brand. They offer a quick, easy way to get people talking about your business, and they can also improve the flow of people buying products from you. If you’re not ready to invest in a full or partial wrap, start small with a magnet and work your way up to a wrap. Either one should get your more business and brand awareness.