What money?

Last Friday I called my insurer, USAA, to inform the company that I had paid off the condo.  The USAA representative responded “congratulations.”  She then stated, ” now since you’ve paid off the condo, have you considered investing that money with USAA?”

I replied, “what money?”

Yes, I paid off my condo.  But I still have expenses.  A little over half of the monthly rent pays the condo fee.  So, yes, no longer having a $652.31 monthly mortgage payment, I do have money.

But, there are other expenses.  I now must set aside money to pay property taxes twice a year (March & September).  And to operate my condo as a rental property, the government of the District of Columbia requires that I have a basic business license (& of course I pay a fee to maintain that license).

I’ve been renting my condo since 2005.  The business has operated at a loss, in the red.  Because of the operating loss, I owed only $100 annually when filing taxes as a sole proprietor.  Only this year will the business have a profit, operating in the black.  I’m excited about the debt free property and the profit, but I can tell you, the Treasurer of the District of Columbia is even more excited.  Why?  Because the annual taxes my business will have to pay will definitely increase.

And, with any rental property, upkeep is important.  In 2008 I had the bathroom completely renovated (unfortunately I didn’t have enough cash so I had to take out a home equity loan; thankfully I paid that off in May 2009).  I recognize, in the next five  years, the kitchen will need a complete renovation.  I don’t want to incur any more debt.  So I’ll be saving money to pay for the future renovation with cash (do I hear an applause, Dave Ramsey?).

As I thought about all of these ongoing and future expenses, I chuckled and told the USAA representative, “I won’t have any money to invest any time soon.”


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