Currently, most of my money is invested in the house and I have little savings left, so the question is, how do I prepare for the worst case scenario? Although I’m confident I can have the house rented out by November, I should still have a plan B.
My house is already rented out for the month of October, so let’s assume it takes me two months before I find another tenant. My total monthly expense for the house is about $810; two months would set me back $1620. Assuming I will need to shell out another $3000 for unexpected repairs. This scenario would cost me $4620.
If necessary, I will dig in my paychecks to cover the extra costs of the house. I’m currently working two jobs, so my income has increased slightly. I’m also selling some of my assets at home to increase my cash line. However, those are not enough cover for the worst case scenario. So, I had borrowed $10,000 from a 0% APR credit card ahead of time and the money will be in my account by this week.
I have been positive about this investment all along, so I believe things should work out well for me. But since I’m a very defensive player, I always have a backup financial plan.