ReCasa Financial Blog

Many parents invest in a 529 plan for their children. However, this isn’t the only way to plan for future costs that lie ahead. Investing in real estate is not only a way to increase wealth or supplement your retirement, but can also be a viable option to save for your children’s future.

How is this accomplished? If you purchase a rental property when your child is young, it could serve as a source of extra income for 15+ years. By the time your child reaches adulthood, your debt obligation on the property would likely be minimal.  If the property is located near where they plan to go to college, they could live there, and after graduating, the property could serve as a first starter home for them. With ample equity, a HELOC could be taken out to address upgrades or other customizations that are desired. Or, the property could be sold with the proceeds being used for a down payment on another house. This would result in a win on many levels. The property provided additional income to the parents for years, and provided flexibility to help out a child get started on the right foot as they get older.

It is always a good idea to consider your options and think of all options to prepare for the future. Have you ever thought about parlaying a rental property into your child’s future?