The Real Estate Investor’s Guide To Capital Expenditures - FortuneBuilders

Abstract

What Are Capital Expenditures? Capital expenditure is a fancy way of describing the money spent to maintain one's real estate business. An expense is usually only considered a capital expenditure if it is used to improve an existing capital asset or business operations for at least a year. Why Are Capital Expenditures Important? Capital expenditures are used to keep business operational. The tax money saved by making capital expenditures can often lead to huge savings every year, not the least of which business owners may reinvest in their companies. What Can Capital Expenditures Tell You? CapEx represents the money spent on existing and fixed assets to maintain business operations. How To Calculate Capital Expenditures Knowing how to calculate capital expenditures has less to do with predicting the future, and more to do with making an educated guess. What are capital expenditures, if not for the necessary cost of running a successful real estate business? Understanding how to find the CapEx will come with time and experience.