Strategy 90 of 107 · new for the five-year plan
Run a licensed adult family home
What it is
Some states license homes to care for a few adults who need help with daily living.
Steps
- Some states license homes to care for a few adults who need help with daily living.
- Training, inspections and background checks are required.
- Send the net income to principal.
Repeat: Monthly.
Measure: Net monthly income after staff and costs.
Try it in the calculator Enter its amount in "Monthly non-income amount to principal". Add a payoff goal of 5 years to see what is still needed.
Risks
- Round-the-clock responsibility.
- Licensing, staffing and liability.
- Income ends if you stop.
Who it fits
Married couples, Grandmas and grandpas (62 and over), Single, No high school diploma, No college degree
Needs
A spare room, unit or space to rent
How predictable
Depends on people or program rules (tenants, family, IRS records, lenders)
A worked example (hypothetical, not guaranteed)
Picture a hypothetical household (married couples). They owe $300,000 at 6.5% with 30 years left. The required payment is $1,896 a month, and that payment, which comes from income, never changes in this example.
They follow the steps: some states license homes to care for a few adults who need help with daily living.
Suppose it brings $2,000 a month on principal from this strategy, not from the paycheck. The loan would be paid off in 8 years 4 months instead of 30 years, saving about $293,382 in interest. To finish in five years, they would still need about $1,974 a month more from other strategies. That is why the five-year sequences stack several at once.
The amount above is chosen only to show the arithmetic. It is not an estimate of what this strategy will produce for anyone. Put real numbers from the fact finder into the calculator.
Sources and more information
Where to get help
- CFPB: Find a HUD-approved housing counselor (free or low cost) consumerfinance.gov
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