<prompt> Human: I just turned 22 and Im looking for advice on howif I should get into real estate. I have a family member passed a couple years ago who made his entire living off if real estate investing. I live at home so I pay no rent, no car insurance, no phone bill, etc. All I pay is 150 per month on my car payment and 200 per month on credit cards but that debt will be cleared in the next couple months. I also have 40,000 saved in my bank account and work about 25 hours a week making 11 an hour. Is it smart for me to try buying a home and renting it out for my income? I have been reading into real estate for the past month and am looking for advice.  <response>: A If youre looking at single family homes, start looking at how you will finance the purchase. Will you need a loan? If so, start reading up on what lending requirements youll need to meet Credit Score, Debt-to-Income ratios, Annual Income, etc.. Will your rental income count as actual income for the purposes of securing the loan, given your personal real estate investment and management experience and situation? This is important, as it likely wont.B Lets say you get past the financing part and use all but 10,000 of your cash for the initial investment and your rental house is happily inhabited by tenants. A string of bad luck runs your way and suddenly you have to pay for a new roof, a new water heater, fix a leaky foundation, and repair some of the guts of your house because of a termite problem that was missed on the initial inspection I know, this sounds ridiculous, just go with it. Will your 10,000 cash cover it? What does your insurance policy look like and what does it cover? C What kind of cap rate are you shooting for? D Whats your personal cash-flow situation like outside of this rental property? Could you absorb 2-3months of mortgage payments lost because of difficulty finding tenants? E You have a much easier alternative if youre looking for real estate exposure with limited liability. Real Estate Investment Trusts. 