This post is probably not for everyone. Starting your own business is hard – you really need to have passion and commitment to make it work. Having said that – it is one of the most common ways that actual millionaires have increased their net worth.

Now that I have given the necessary and perfunctory disclaimers – I will share my little side gig – it’s actually more my wife’s business, but I like to think it’s a team effort (it’s really not.     .      .)

About 7 years ago, my wife and I started Mcdowell Mountain Getaway LLC. This business is a vacation rental of our log home in southern Mcdowell county – about 45 minutes east of Asheville – in the foothills of the Blue Ridge mountains. I love spending time in the Blue Ridge Mountains – I’ve always found it to be peaceful and picturesque – and the food is great too (my favorite is Tupelo Honey in Asheville).

(our street – scenic vista drive – viewing the blue ridge mountains in the distance – picture doesn’t do it justice.     .      .)

The heavens declare the glory of God; the skies proclaim the work of his hands Psalm 19:1

We chose to build a log cabin because land and housing prices declined significantly following the “great” recession of 2008/9.  I don’t think we would make the same decision today, because labor and building materials have increased so significantly.  I recall one report that indicated the cost to build a home has increased 25%, just since 2009.

Another reason I have for justifying our investment is diversity. While stocks and bonds make up the majority of our retirement savings, I also believe in diversification and think that real estate and other non-financial assets complement traditional retirement savings (e.g., 401k, pension, etc.)

We market our vacation rental exclusively through www.vrbo.com/351528 (if you want to see pictures). We have been pretty happy with this arrangement. VRBO manages to rent our property between 100 and 120 days per year.  We pay less than $500 (annually) to be on their site, but do pay an additional fee if people choose to book online. Basically, this results in between $15,000 and $20,000 in “income” per year.   It’s basically cash neutral whereby the rent pays normal operating costs. I say normal because we have spent some of our own money on capital projects such as adding an outdoor patio, a fire pit, some major landscaping projects, and partially finishing the basement, etc. We selected a 15 year mortgage (to reduce the total interest expense) and hope that the rent will essentially pay the operating costs for 15 years and ultimately we will own the property outright – essentially using other people’s money.

I say it’s not for everyone because my wife works really hard keeping up with renters and making sure the property is clean and presentable for our guests. It’s a lot of work and with online reviews you can easily hurt your image with negative reviews. We haven’t had any bad reviews but I have seen some (for other listings on VRBO) and it’s a little intimidating knowing we don’t have any control over what people choose to say about our property and their recent stay.

A real estate investment isn’t for everyone; however, most homes appreciate – at least at the rate of inflation – so I think it’s a reasonable way to diversify your retirement savings.

(our cabin)