2024 Year In Review

2024 has been a major “level up” year for our family. The kids are making big moves, we acquired 8 more rental units, and I now have a “real job” for the first time in my life. Here are some of the high points of the year:

Kids:

Kid #1: Kid #1 has been living on his own for a full year now. In the summer his GF moved in with him from New York. They have since adopted 2 kittens, in addition to Minion, who has been Kid #1s cat for a decade. No more cats allowed. They are in the process of figuring out adulting. We still have not accomplished a drivers license, which needs to be super high on the list for 2025. He is continuing to invest in his Roth 401K and is making tracks on slowly improving his house.

Kid #2: Kid #2 graduated from high school 2.75 years early!  He is currently looking for a job and will hopefully be employed soon. He passed his drivers test this year and bought his first car.  He got hit by another car while driving in South Bend and it ended up being a good deal for him.  The other driver (who was clearly at fault) chose to turn in an insurance claim. We weren’t going to file one, but since she started the ball rolling we did.  It quickly got ruled in his favor and her insurance company totaled out his car, writing him a check for slightly above what he paid for it. He is still able to drive it, so effectively he ended up with a free car, just with some extra dents and scuffs.  If he were to move out right now he would be in a stronger position that I was when I moved out at 18.  Hopefully he lives at home another 2 or 3 years and banks a ton of money.

Kid #3 and #4 both love Football and played this year. Kid #4 had his last year in Rocket Football. He is a little guy and in his 2 seasons had very little opportunity to get his hands on the ball, in fact an interception he got last year was the only time up until his last game.  On his last game the coach made sure he got the ball on a run play for the last play of the game.  He got about 10 yards with the ball. After the game he came running up to us with tears in his eyes yelling “I got the ball, I got the ball, did you see? I got the ball!”  It meant the world to him. 2 kids in his Rocket football team ended up with broken arms during the season.

Kid #3 played on a middle school team this year, his first year outside of Rocket Football.  3 smaller schools come together to make a team.  They had a pretty good season until the last game. It was unreal seeing the players on this team.  These kids were the size of grown adults. The average kid on our team probably weighed 90 pounds.  The average kid on this team had to be 200+.  They were literally picking them up.  Not only were they able to run the ball through for a touchdown on each play, but they also did not hold back on tackles.  We had 3 kids come off the field with injuries in 3 plays.  In so many of these games the clock would run non stop, but for some reason they kept stopping the clock during this game, making it so there were more plays and opportunities for these kids to get hurt. Thankfully the coaches called the game at halftime.  Middle school is hard. The size differences of kids is so extreme compared to any other age group.

Kid #3 also participated in FFA and raised a goat and a pig at his school this year.  Typically at the fair the animals are sold to market (above market prices) at auction. In this instance, Mrs. C. bought his goat so he could be our pet.  Then we found out that a single goat is REALLY REALLY ANNOYING.  All day he goes BAAAAAA BAAAAA BAAA like he is being tortured.  We got him a friend and he chilled out, so now we own 2 goats.  They lived in our yard for the summer and fall, and moved to his Grandpa’s yard for the winter.  Papa built a really nice, sturdy goat shed for them.  We plan to continue shared custody and we should get the goats back in the spring.  Also…I got to check off 1 more box in the versatility of minivans….transporting livestock!

Employment:

In July of this year I officially became staff with the contract company I have been working for since 2006.  What this means is that when I am not on assignment I am paid a stipend rate, similar to unemployment.  I also receive benefits such as 401K matching and health insurance.  This decouples the cost of health insurance from my income.  With Obamacare premiums are based on income, with employer provided health care it is a flat rate.  This is a savings of over $400 per month for us.

Our project managers are getting older and the plan is when one of them retires that I will move into a project manager role.

The only downside to taking this staff spot is that I am no longer eligible for a recruiting bonus.  Our company provides maintenance work at nuclear plants during refueling outages which are scheduled temporary jobs lasting about 6 weeks.  Our company needs to hire about 70-100 new people every 6 to 12 months and that has become very difficult.  A couple years ago our company started paying a $750 recruiting bonus for anyone who we brought in that the project managers decide to hire, pass all their training, and stay until the end of the job.  I took full advantage of this and built a recruiting website with a funnel to submit their resumes and contact info to me, paid for Facebook ads out of my pocket, and ended up being the top recruiter by far for our company.  I brought in 50 people through this program.  Now that I am staff I am no longer eligible for this.  The staff deal is still very advantageous to me, especially since they started it during a long period of time between assignments for me.

Real Estate:

Sold Big Flip House:

It feels like this was so long ago!  We paid $35K for this 5 bedroom house, put about 20K into it and sold it for $119K.  After closing costs, Realtor Fees, cash back at closing to buyers, and a termite bill we cleared 100K, with profit of around 40K. Since we had financed this entire project on our Heloc, we paid the heloc back for everything we put in and paid the rest of our heloc down from it.

We needed to get some breathing room and I am glad this house sold. We originally planned for this to be a rental house, but with the after repair value on it and what we could get for rent, it made more sense to sell it.  The most important part of this project is that it showed us that we could be successful in a different business model than our normal.  We can do fix and flips successfully.  If we had no W2 jobs, we could do 2 of these a year and live very comfortably.

This house was a lot of work. We had to rip out the old carpets, replace several windows, paint everything, rebuild a room, and do a thousand other random tasks.  The largest was having city water installed when we found out the well was bad (Womp Womp).

After selling the flip house the plan was to not buy anything for the next couple years and focus on strengthening our balance sheet, but then….

We Bought A House In Our Neighborhood:

I was driving to our 6 unit apartment building and saw a for sale sign go up in the yard of this house.  I tried looking it up, but got nothing.  I kept hitting the reload button and finally it loaded.  They listed it at 85K.  Houses rarely sell in our neighborhood and recently the going rate has been around $225K for 2 bedrooms and $250K for 3 bedrooms in decent shape.  This house of course was not in decent shape.

I showed it to Mrs. C. and she said to buy it.  We were the first people to look at it and I’m sure we were the first offer.  We put in a strong offer of all cash, no contingencies or inspections, quick close, seller can take or leave whatever stuff they want, and we had an escalation clause up to 110K.  We got the house for 101K. The closing on the house was delayed due to the soon to be ex-husband of the seller not moving out.  We got $5K off the price and closed at $96K. We have spent a lot of effort getting this house ready to turn into a short term rental.  After putting a roof on it and clearing out the junk we were able to get a cash out refinance on the house for the full $96,000 we paid for the house.  This gave us some breathing room back as we ended up over extending ourselves.  Our Heloc was full and I was paying for repairs with credit cards.  Part of this was because before we closed on this property…

We bought A 7 Unit building!:

This thing had been listed for sale forever for $125,000. It was a 7 unit commercial building with solid brick construction.  Then they dropped the price to $100,000 and it was listed forever. This was the best deal on the market, but it was not where we wanted to be…,Then they dropped the price to $60,000 and I convinced Mrs.C. to look at it.

We were under contract on the house in our neighborhood and the best we could come up with in cash was around $40K.  I originally wanted to structure a seller financing offer, however when we realized the situation of the building, the best option was to give them a clean break and make an easy deal for them.  I offered $36,100 no inspections or contingencies and they could leave all the junk behind. The next morning they accepted our offer with no counter.

This has been exhausting.  3 of the units had tenants with leases.  2 of the units had been leased by 1 guy, who was still living in one with his 3 dogs…and hadn’t paid rent in months.  The other 2 units still had a bunch of stuff left behind from previous tenants who appeared to also still have access to those units.  Within a month we got the guy with the dogs to move out and we cleared out the other 2 units.  Of the 3 tenants we have 1 who is far behind on rent and is moving out this month.  The other 2 have rent that is far below market rate.  We have flipped one of the units and just got it leased for $850/mo.  If I can get all 3 residential units up to $850 a month, then this property will be profitable and then I can focus on the commercial units. Over the long term I expect this property to become cash flow positive by between $2,500 and $3,000 per month.

This building is quite the adventure, but man, this thing is built like a tank!  Solid brick and concrete construction. We should have this building able to break even on cash flow around March.

OK so for 2025 NO NEW BUILDINGS!  in fact I want to sell a couple!

We effectively want to sell all our single family houses in Benton Harbor city. We are offering those to our tenants first, and will go from there.  We have been working with a tenant since July to buy the first one and it looks like we may be able to get a sale through in the first quarter of 2025.

We also had to replace a central A/C this year and repair a furnace brain, so those were 2 big repair expenses.

For our 6 unit apartment building we had a long term tenant move out (after not being able to pay rent for 2 months) and we turned that unit into a short term rental. Now 5 of the 6 units are STRs.  For some reason we were light in May and June, but the rest of the year has been much better. Last winter we only had a few short bookings, right now we are booked solid!  Part of this is due to the ongoing work at the Palisades Nuclear plant, but we also have a few people transitioning between housing situations.  Very thankful for how busy it has been!

I really want to focus on strengthening our balance sheet for the next 18-24 months.  Selling 1 or 2 of our Benton Harbor city houses will help tremendously.  In addition to that I want to reinvest most of our rental income into continuing to pay down our heloc, then to work on paying down the 6 unit apartment building.  That property has a note coming due in March of 2027 and I don’t want to renew it. I currently owe $103,000 on it.  Right now I am planning to have the heloc empty and that loan at least 50% paid off by then. The remaining balance I will transfer to the heloc, then continue to pay it down.

Investment Accounts:

This is another year where I have contributed very little to investment accounts.  Starting in August I received a 401K match, so I am contributing 8% of my income to this into a Roth 401K.  I also am putting in $100 per pay period into my HSA.  The company also matches up to $500 $1 for $1 into the HSA.

The biggest overall change for our investment accounts has been Tesla Stock. In 2016 I invested 12K into Tesla stock, which was over a quarter of our total investible assets at the time. Since then I have added another approx 40K.

Tesla stock hit a low of $142/share in April.  Tesla hit an all time high of $480/share in late December and then quickly retreated below $400/share. This is a significant change in our net worth.  I sold off 200 shares at $340/share and plan to rebuy shares if/when there is a pullback. Even with the pullback this was a very big increase in net worth.  In the short term the stock market is a voting machine, in the long term it is a weighing machine. I am more concerned about the value of Tesla stock in 2030 and 2035 than 2025 and 2026.

Fun:

This year we bought season passes for all of us to Cedar Fair parks.  We went to Cedar Point twice, King’s Island once, and Michigan Adventure 3 or 4 times.  We had a ton of fun and all the kids got to go on big roller coasters. Kid #4 overcame a lot of fears.  One of my favorite moments was at King’s Island when my parents met us there and my dad rode Orion with me and Kid #3.  My dad always loved roller coasters, but hasn’t been to parks in years, and this was his first “giga coaster.

My sister and her family came to Southwest Michigan after her Sister In Laws wedding and had an Airbnb near us.  Our kids got to play together and we took a day trip into Chicago to the Shedd Aquarium.

I don’t have an easily accessible picture, but we had a very successful garden this year.  We had a ton of squash, zucchini, tomatoes, watermelons, and pumpkins.  I grew some sweet corn, but the deer felt they needed it more than us.

What have been your biggest items for the year?