Ekabo Home Financial Freedom Mastermind Podcast
A podcast for those who do not believe they were put on this earth to work 40 to 50 hours per week for 40 to 50 years, to hopefully retire at the age of 65.
Ekabo Home Financial Freedom Mastermind Podcast
152. 10 Real Estate Lessons Learned the Hard Way!
🌟 10 Essential Real Estate Tips from a Decade of Investing! 🌟
Welcome to the Ekabo Home Financial Freedom Mastermind Podcast! In this episode, host Niyi Adewole shares valuable lessons learned over 10 years of real estate investing. Join us for an insightful discussion filled with practical tips and strategies that can help you navigate your own real estate journey!
🔥 The Quote of the Day:
""More money, more problems, so bring on the problems."
- Justin Parham
🔥Acknowledging that challenges will arise, but they are part of the journey. Embracing difficulties can lead to growth and learning opportunities.
🎙️ What You'll Learn:
Top 10 Real Estate Tips:
- Location, Location, Location: Understand the critical importance of property location and avoid the pitfalls of investing in less desirable neighborhoods.
- Don’t Fall in Love with the Property: Keep emotions in check until you have a property under contract to avoid fudging the numbers.
- Buy with Long-Term in Mind: Only purchase properties that you plan to hold for at least five years to maximize your investment.
- Focus on One Deal at a Time: Avoid overwhelm by concentrating on securing one property before moving on to the next.
- Treat Relationships Like Gold: Build and maintain strong relationships with lenders, contractors, and fellow investors for long-term success.
- Join a Community: Engage with other investors for support and shared experiences to help you through challenges.
- Have All Discussions Up Front: Clear communication with partners about expectations can prevent misunderstandings down the road.
- Expect Stabilization Challenges: Be prepared for unexpected issues during the stabilization period of a property.
- Maintain a Strong Why: Keep your motivation at the forefront to help you stay focused during tough times.
- Celebrate Small Wins: Acknowledge and celebrate your progress to stay motivated and inspired along your journey.
💰Wisdom Nuggets from Justin's Journey in Real Estate!
- "If y'all don't take anything away from this call, make sure you put some money away while you're making this money, because you gonna need it at some point."
Emphasizing the importance of saving and having reserves. In real estate, unexpected expenses can arise, and having financial reserves can prevent panic during tough times. - "I like to have someone who's doing what I aspire to do, I like to have someone that's operating on the same level as me, and then someone that I'm pulling along."
Highlighting the value of having a diverse support network. Surrounding yourself with mentors, peers, and those you can mentor creates a balanced ecosystem of growth and support. - "You have to have a little bit of fun when you're doing this. It can't be all work, work, work, work, work, because that's just not how we're wired."
Stressing the need for
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Our Links
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Niyi Adewole is a licensed realtor in Georgia, brokered by EXP Realty. Feel free to reach out at Niyi.Adewole@exprealty.com if you would like to work with an investor friendly real estate agent.
Welcome to the Financial Freedom Mastermind Group Podcast. Here we're all about breaking free from the 40 to 50 year work ride and accelerating our journey towards financial freedom. Join us every Wednesday at 7 p.m. Eastern as we explore different types of investments that can fast-track your path to financial independence. We serve as a hub for connecting with fellow members during our sessions so you can share successes, ask questions, and keep the momentum going.
SPEAKER_03:Good evening, everyone. This is Nigi Adawale, host of the Akaba Home Financial Freedom Mastermind Group. And I'm excited to be joining you here today on this Wednesday. I'm actually joining you from another state, a little bit further south than Georgia. And it's exciting being able to help uh my wife put together a project down here. And so today is going to be a little bit different. I know we're getting close to the Christmas time frame. And it was actually in December of 2016, which is almost 10 years ago, that I actually purchased my first investment property. And so today I wanted to talk through 10 things that I've learned through a decade of real estate investing. 10 things that I've learned through 10 years of real estate investing. And these are just tips that can help across the board. Please excuse the granularity of my screen. I'm not in my studio, I'm working remote. And so you're going to see a bit of a grainy video because I don't have my professional camera. But today we're going to talk about the 10 things that I learned through 10 years of real estate investing. Number one, location, location, location. When it comes to location, this is something that you hear all the time that it's important. But especially for new investors, you fall into the trap of, hey, these numbers look incredible. And you start going out there and fudging the location piece and trying to say, oh, well, it's close enough. And you go buy a property in maybe a C-class neighborhood. This is absolutely a mistake that I made when I first bought my first couple properties. I bought the first one as a house hack in a C class neighborhood. I lived in one of the units, rented the other two out, and didn't have any issues really. And I was able to get the tenant to replace my spot and make it really awesome, which was good. But what ended up happening down the road is I continued to invest in that same C class neighborhood, and it led to a lot of tenant issues. And so I actually had, and this is crazy, I've had two tenants die in units, right? In that neighborhood. I've had evictions take place, I've had issues with bed bugs, issues with a lot going on, naked squatters, like all the stuff just like I have evidence to show you like this has actually happened from that. And it was because I strayed away from that principle of location, location, location. And so that's number one. But Justin, how you doing, man?
SPEAKER_01:Doing good, Ni. How you doing, brother? I'm super good. Is there anything top of mind that you wanted to connect on? Nah, man, nothing super top of mind.
SPEAKER_02:Please excuse me, everybody, uh that'll be watching this recording. I am having a late lunch, so that's why I turned my camera off real quick. That's fair.
SPEAKER_01:I'm gonna listen to it. Nah, man.
SPEAKER_02:Uh, I guess the um the only thing I got top of mind, man, just another successful closing. Just was working with Yvette. Uh, we just got a video done for her, had an apprentice out there working on the video. We got a new person that we're training up and to the team. So all of that stuff was going good. It's a senior at Clark Atlanta that's jumping into doing some video work for us.
SPEAKER_03:Come on now. And and that's the key to all these businesses. First, you do, you show, and then you're able to coach somebody else up to do it as well. And it just allows you to accomplish so much more.
SPEAKER_02:Yeah, exactly. Elevate and delegate. You told me that a long time ago.
SPEAKER_03:Come on now. I love it. And today, what we're diving into, and I'd love to get your thoughts on each of these, but this actually this December marks about 10 years of investing in real estate for me. And so I'm going through 10 top tips that I learned from 10 years of investing in real estate. The first one was location, location, location. The second one is don't fall in love with the property until you have it under contract. The reason being, what we tend to do is you'll walk a property or you'll see the quote unquote numbers on paper for a property, or you'll think, man, if I can get the offer at this number, it makes a lot of sense. And you'll put it out there, and then the seller comes back and says, Ah, I got another person that's going after this, or ah, you know, we're not going to accept that. You need to come higher. And what tends to happen if you fall in love with a property before you have it under contract is you can start to fudge the numbers, right? And I've done this on at least one deal for myself where it was like, I think it, I think it could really do this. And it ended up not performing to the level that I needed. And I had to figure out a way to kind of shift that property. And so my advice is do not fall in love with the property until you have it under contract. There's many of other fish in the sea, and so you need to run the numbers agnostically and make sure that it makes sense. Put the offer out there. And if the seller tries to push it to a level that doesn't make sense or there's a bidding war and it gets to a point where it doesn't make sense, you have to be comfortable walking away. Justin, what are your no?
SPEAKER_02:I think that's 100% the right way to do it. You know, at the end of the day, in this business, when you're running like a business, the numbers matter. Like nothing else, I mean, everything else matters as well. But like, like you say, you can't get emotional about it. Like you have to look at the numbers and you have to look at it with an outside perspective. Like, you know, you can't trust your gut when the numbers are telling you something else. It's like you have to look at the numbers that's on the paper because at the end of the day, the dollars and cents is what makes the most sense in the in this business.
SPEAKER_03:Come on now. Dollars and cents makes the most sense. Listen, he's dropping bars out here on a Wednesday. I like it. Number three, only buy properties that you plan to hold long term. And my view of long term is five years. If you can look at a property and say, hey, I'd be happy to hold this at these numbers and at this purchase price for the next five years, you will be successful in real estate. Now, a lot of people say that they are long-term investors, like, hey, I'm thinking about the future, I'm long term, but then their actions reflect something different. They'll buy a property, and if in the first year they're not getting some crazy cash flow numbers while they're stabilizing it, now they're looking to us like, hey, can we get this thing sold? And I have plenty of clients where something pops up in a personal life or or or something where they have to get it sold, and I get that. But if you're an investor, when you're buying something, it should be with a minimum of five years in mind. Because think about it, when you purchase a property, there's closing cost, there's title fees, there's agent fees, there's so many things that go into it that it really doesn't make sense to resell that property unless you were doing a flip, like a planned flip on that property and you ran the numbers on that in less than that time frame, right? Now you could hit a period of time like 2020, which is once in a blue moon where it just accelerates like crazy, but that's few and far between. However, if you look at each five-year, five to 10 year period, typically the cycles are going through at that time period. Usually it's about 10 years, but in five years, you could see that appreciation and see, like, hey, where are we at in the market and time where you want to sell and kind of go from there?
SPEAKER_02:Yeah, I like that approach. You know, I'm a house hacker till I die. So even the five years helps us a lot because if you stay in that property two out of those five years, you can avoid that capital gains tax penalty when you move off of that property as well. So that five-year number works really well for me in the house hacking situation that I'm in. You know, if we're moving every two years, if we sell within that five-year period, we can avoid those capital gains tax. That way we're making those tax-free returns because you know, at the end of the day, Uncle Sam is what hurts us the most in this real estate business. So we can find ways to avoid that capital gains tax penalty, the more the merry.
SPEAKER_03:Come on now. Absolutely. And and that's a hack in and of itself, right? The two out of the last five years. I'm actually contemplating with the previous house I was in, because we've been renting it for about two years now, whether or not we're going to sell it because it has appreciated. I want to see what happens with the World Cup next year and what happens with the market. But if we were to sell it, it'd be tax-free up to 500K in gains, which is pretty cool. Or we'll just keep it and hang on. If we keep it and hang on, we're gonna have it for the long term because it's I mean, it's built in 2018. There's no capex, so it's good.
SPEAKER_02:Yeah, yeah. What is it a good rate on it?
SPEAKER_03:Yeah, yeah. The interest rate was 3.5. We got that in 2021.
SPEAKER_02:Heading towards, you may have to keep that one.
SPEAKER_03:Yeah, this is true. And and the neighborhood's awesome. We've we've often talked about like, man, we may even go back to that house, but yeah, it's uh I think we buy another one, you know, five. But number four, focus on one deal at a time and one step at a time, especially new investors, right? When they come and when we have first conversations, they're thinking, oh man, I want to build out a portfolio of 10 properties. And how do I get my eighth property when we haven't even secured the first one? And the truth is, if you secure the first one and then you focus on the second, and then you focus on the third, you are gonna learn so much and it's gonna reveal the opportunity and the how of how you're going to continue to build your portfolio. Don't worry about capping out at you know X amount on a conventional loan until you've got your first one and you move from there. And even further from that, I like focusing on one step at a time. I can't tell you how many people will say, Hey, what about an LLC? I need to go create this before I even start shopping for a property so I can buy it in the LLC. And then what about, you know, neighborhoods and things of that nature? Like, how do I know if I can if I can get this property at you know one percent cash on cash return when we haven't even gotten a pre-approval yet? You need to focus on one piece at a time. And I would say that that's gonna help you not get overwhelmed because if you look at the whole uh all the steps that are involved in purchasing a property and and accurately running it, it could be overwhelming and you could end up sitting on the sideline and not getting in. And so what you want to do is focus on one deal at a time, one step at a time. And then after you stabilize and focus and knock out that one deal, move on to the next one.
SPEAKER_02:100%. You know, you can't learn to dive until you get your feet wet. This is true.
SPEAKER_03:This is true. Number five, treat every relationship in real estate like gold. Real estate is is a is a small community, especially when you talk about being an investor in real estate, you're gonna run into people that you're gonna see all the time, whether that be investor-friendly lenders, whether that be realtors, whether that be contractors, and you want to treat each and one of these with relationships like gold because unlike transactional things, like, hey, I'm gonna go buy you know a stock and then just hope that company performs in real estate. You need all these pieces to make sure that your property is gonna stay up and running and perform the way that you're looking for it to perform. And so I've seen more than a few people damage relationships with contractors and different vendors just by treating them as if they're not human beings, right? And treating them in a different manner. And so you want to treat them with the utmost respect because at the end of the day, those are the guys they're gonna be going above and beyond to make sure that you are doing well in your property and it can lead down the road to more opportunities to be able to knock out deals and projects for a bit less money. I can tell you that I truly value the partnerships and relationships that we've been able to build with the Cabo Home. And what it's led to is when we're working on our personal projects, there are some discounts that are applied, right, to some of these deals that we're working on. Like, hey, typically it's gonna cost X amount, but you know, we're gonna make sure we can get this done for you for X, or hey, there was this thing that I noticed now. Those are the things that you want to start to build uh as you're getting out into the real estate realm, especially if you're thinking long term about building a full-on portfolio.
SPEAKER_02:Yeah, relationship capital is some of the most important capital in the world. Even with what you said, man, started this thing what three years ago now, just working with you on real estate videos, right? I didn't have the wherewithal of thoughts of like, hey, I need to go out here and make some deals and get some investment properties of my own. But when I'm in those rooms and I'm hearing those deals over and over again and I'm seeing the relationships that you were building within your business, I was like, man, I need to get on board and I need to get some properties myself. And it has in turn spurred into another relationship with the cleaning business that I have now. So, like just utilizing those tools and those relationships as you spoke of, your value is endless because the people around you are who are gonna truly make you successful. Because if you know anything about life, you can't do anything in this life alone. So the people that you can put around you and put in place that is gonna help you get to where you're trying to go is the most important.
SPEAKER_03:Come on now, could not have said it better. And bonus tip, and this is one that came from Justin. If you're going to be around others that are doing something that you want to do, don't be afraid to ask questions, right? Ask questions, learn. And and what Justin did better than most people that I've seen is he just absorbed the knowledge and then ran with it. Like we, I think we sat down for one like 10-minute segment of like, hey, this is how you run numbers on this. And the next day he had like 15 properties where the numbers were perfect. I'm like, what the how'd you do this? And then so long story short, if you if you keep those pieces in mind, you will be successful in this game. And it only compounds over time because once you learn something one time, my goodness, you can use it for many, many years moving forward. The other piece, number six, when you talk about the real estate game, I recommend that you join a community, whether that's the Icaba Home Financial Freedom Mastermind Group that meets every Wednesday at 4 p.m. Eastern or some other network, whether it's in person, virtual, you need to join a community. Reason being it can be a lonely spot, right? When you get that call at 2 a.m. that a pipe just burst, or you know, the toilet needs to get replaced, or the tenant just moved out in the middle of the night and left the door open. It can be pretty heart-wrenching and you can feel like you're the only one going through this. But when you get around other investors, you realize this is just a part of the game and that we all have war stories. But if you stick through it, man, there's a lot of benefits on the back end, and it becomes something that you you get to laugh about later with some of your investing buddies. And so get yourself around a network of other people that are achieving things that you want to achieve, and ideally around other people where one, you can aspire to get to someone else's level, and two, you can reach a handout to help somebody else who maybe hasn't started or is just getting started and pull them up.
SPEAKER_02:Yeah, and to piggyback on what you just said, I was gonna I was gonna say that I was thinking about it the whole time you were talking. I like to have three though. I like to have someone who's doing what I aspire to do. I like to have someone that's operating on the same level as me, and then someone that I'm pulling along because I found that having that person that's operating on the same level, there's a lot of things that we're both going through at the same time so we can have those conversations. That's who I'm working with right now, currently, AJ. We meet every Friday at 2 p.m. to talk to things that are going on through our personal life, through our real estate business, and things of that nature, because we're pretty much operating on the same level and we both have those goals to reach out and, you know, and be like someone like yourself as we continue moving through this journey.
SPEAKER_03:Come on now. You are spitting bars today, and that is huge to be able to even have that accountability partner where you guys are connecting and saying, hey, this is what we want to achieve. We both have that North Star that we're moving toward. And and just a side note, if you guys ever meet on a pickleball or tennis court, just call your boy. I'll come out there and teach something else.
SPEAKER_02:AJ mad at me right now because he keeps trying to get me to play pickleball and tennis. I'm like, yo, dog, hey, I don't know about all that.
SPEAKER_03:No, AJ's trying to set you up. Don't let him do it. Number seven, operation and and this is this is about partnerships. So this is hugely important. Number seven, when it comes to partnerships, have all discussions up front, whether that's relationship or business partnership. This will help you avoid a lot of confusion and it'll help you make sure that you can maintain that partnership and relationship for a long time after. And it it goes with contractors too. And so the thing that gets a lot of people in trouble is they assume, based on the life they've lived and the interactions they've had with other people, that everyone else thinks the same when that is probably not true, right? It it helps when you actually put it on paper and you have a detailed conversation about, hey, what if this goes bad? Like what if the worst case scenario happens? How would we be able to go ahead and move past this? And what I can say is, even when it comes to even like family members, right? I've had partnership with family members where I pull out all the papers and things that nature and they look at me like me, we've known each other for how long? Like, I don't what are we doing here? Like you're good. And I'm like, no, no, no, no, no, no, no. If we're gonna do this, I want to make sure that it's all on paper and that you can see exactly what's going on so that we're on the same page. That way, if there's ever a dispute, you can go back to the documents and say, hey, this is exactly what we talked about. And it's not a you versus me, it's uh hey, us just trying to make sure that we're living up to our ends. And you're also able to discuss, hey, who's doing what and what's the value that's being brought from each of the different partners. And so when you look at this piece, it's hugely important. I can tell you in a couple ways, uh, that it's it saved me and helped me. Uh, one is the partnership with the storage facility that I have, right? With uh my my realtor Monica out in Kentucky. That has been incredible. And us putting that together and having everything spelled out on paper has helped because there was an instance where I actually sold off a portion of the land, which I mentioned before, back to her. And we had to go back to the document because neither of us remember this was like many years ago, right? Like three, four years ago that we put it together and say, okay, what was the split? How did we map this out? How is this actually gonna work when we need it split off? And we were able to look back at that and say, okay, here it goes, circle this piece and make it happen because we had talked about it up front. Justin?
SPEAKER_02:Yeah, yeah, man. I think that's solid because at the end of the day, you don't want to ruin relationships that you have, you know, based on something that can be handled as long as you put it on paper, right? You know what I'm saying? Like you said, if we both hold up uh our end of the bargain, then we should be good because at the end of the day, it's business. You know, it shouldn't really affect our personal lives if we're doing good business. It should be our business that we're doing outside of our personal lives. And a lot of times those things are gonna coincide anyway. So if I think if you're just doing things the right way, putting it on paper, like you said, and keeping up your end of the bargain, everything will go well.
SPEAKER_03:Come on now. And and the cool thing is when you do that, especially when you're getting into business with like personal friends and and family and things of that nature, it helps maintain that because you can always go back and look at that piece and it helps keep it separate. They say don't mix state with religion. I think that was that's the saying, don't re mix religion with state. You shouldn't mix business with quote unquote personal unless you have it all mapped out on paper and and everybody agrees to it and you're good to go.
SPEAKER_02:Yeah, and and me personally, man, I hear people say that all the time, but like I ain't trying to have friends that ain't good people, so I'm not trying to be in business with people that ain't good people. So for me, I feel like those paths may cross a lot because I'm trying to just be around good folk anyway.
SPEAKER_03:Come on now. I think you're spot on. And I think the one caveat is a lot of people just say, Hey, this is a really good friend I grew up with, or hey, I know this person, let's just get into a partnership, and they don't have that conversation, even when you're getting married to somebody, right? Like, you you gotta have the conversation about what like do you want to have kids? Like, what does this look like financially? Like, what like if you don't have those conversations up front, you could be severely disappointed when they don't share the same view.
SPEAKER_02:Because we all we all have our own expectations. Like, what do what do you want out of this? What is your goal on this? You know, we just had conversations like this not too long ago, so it's like you know how it is. It's like you have you have to be open, you have to talk about these things.
SPEAKER_03:That's it. Moving on to number eight, when it comes to stabilizing a property, especially one that's either a rehab or one where you're taking over where tenants were there before, it's going to take longer than you think, right? And so a lot of people come into the stabilization of a property and think that, hey, as soon as I put a tenant in there, it's fully stabilized. I shouldn't hear anything, everything's good, I've done all the renovations. It's not true. Whether it's a short-term rental or long-term rental, within the first 30 to 60 days, you should always just be prepared for a couple things to pop up. Because until somebody else is living there full time or staying there as a short-term rental guest, you're not going to know the things that are going to pop up. I bought a brand new build, right? Uh last year and moved in. I was like, okay, everything's great. You know, we fixed all the things. And with the first guest that we had, water was leaking through the ceiling. I'm like, where did this come from? They said, Oh, there was nails put through on one of the pipes, but not for the main faucet, for the main like shower faucet, but for the side handle that you use to like spray the walls and things of that nature. And so that's what was leaking behind the wall. And that's on a brand new build because somebody put screws there, and there was a couple other myriad of things. Like one of the toilets went out because like the handle had been used too much or whatever, right? So there's always going to be something within the first 30 to 60 days. Uh, this is normal. You just got to buckle down, get those things fixed, and then it should subside over time and then kind of ease off. Justin, what has your experience been with that?
SPEAKER_02:Man, I think Drake said it best. More money, more problems. So bring on the problem. This is true. But you know, like you said, like whenever you're doing stuff, you're gonna always have problems. It's about how do you get them handled, right? Having that team in place for when those problems arise, because problems will arise and make sure you got them reserved. If y'all don't take anything away from this call, make sure you put some money away while you're making this money because you're gonna need it at some point. And if you don't have it, that's when you have problems. That's how, you know, even in this business, we find someone who has a hot deal that's coming our way. It's because they need the money. They're strapped for cash. They got a little, they got in a little too over their head, they got an issue and they need the cash in. Me personally, I think 10,000, like if you can work towards having 10,000 per property in reserves, for me, that's a good number. Because anything outside of 10,000, I'm probably leaning on my insurance at that point. Once it gets so high, you know, I had an issue where we had some flooding at one of our units, it's a basement unit. You know, once it went over 15 grand, it's like, all right, cool, we got to let the insurance handle this anyway. That's what we're paying the insurance for. But anything below that, I'm kind of looking to make sure I can take care of it with my reserve. So if the AC goes out, things like that, that you can't really put off on your insurance. But you know, you'll the major things like a tree goes through your roof, it's like you'll you'll you'll you'll utilize your insurance. But if you know you're on year 18 of a 20-year roof, you better be putting some money away so you can get that roof replaced or you get it replaced in the deal at closing. You know, with the with the strategy you have the jab jab uppercut, you know, you want to build some of those things into the deal. That way you can make sure you don't have those capital capital expenditures when you do go into the home, whether you're doing a renovation flip or whatever, get some of those consistency up front so you can make sure you can take care of those things.
SPEAKER_03:Come on now. And and and all of this was straight knowledge. If you're listening to this later, please rewind everything that Justin just said and play it again because you spot on. You definitely need to have reserves, and it's one of those things where as you build the portfolio out and you get more units, it gets to be less money per property that you actually need, right? Like when you it was a lot different when I had one property and I need to have, you know, an AC replaced or you know a furnace replaced versus having you know 10 properties, and then you can kind of flex those funds to where you can have a bit less per property but have it flexed across the board to help cover something. And when you have that, it just gives you peace of mind. You start to think, like, man, okay, even if I didn't have a tenant in here for X number of months, I would be fine. And it helps you not have to make an irrational decision like trying to sell in a full-on buyer's market in the middle of winter a week before Christmas, right? If you can avoid that, let's avoid that. Let's list in the spring, list in the summer, and kind of go from there. But reserves are gonna dictate whether or not you can with withhold with withstand the storm.
SPEAKER_02:Yeah, and uh a little anecdote to what you just said is very similar to having an uh an umbrella insurance policy, right? When you have a lot of homes in your portfolio, you kind of have an umbrella of reserves for all of those properties. That's the same way you can get a lower weight, a lower rate when you have your insurance policy because they're looking at all of those properties. The chances of a roof going through all 10 of these are very low. So you can get a better rate if they're insuring all 10 of them, same way with your reserve.
SPEAKER_03:100% agree. And that was something I didn't realize until I got to a bunch of units because each time you buy a property, you tend to go and get like insurance right for the house. I mean, you kind of have to if you get a mortgage on it. And so, fun fun fact when I was in Kentucky, I got up to 30 units, and each time I was just getting a new policy, different policy, different policy. And then I look up and talk to an insurance broker, and he's like, dude, like why do you have all these under different policies? Did you not want to do like an umbrella or just cover them all together? I said, I didn't know you could do that. And so he gave he did a portfolio loan, ended up saving me$4,000 per year. I was like, This is crazy, just by having them all together because the insurance company gives like a discount or something over all those. So it was pretty cool. And so to that point, as you continue to grow, you'll start to reach economies of scale, whether it comes to services from different vendors or it comes to even getting insurance, you can you can start to really save some money.
SPEAKER_02:Yeah, you just have 4,000 go right back to the bottom line, immediately could go to your reserve, so your numbers just got a whole lot better.
SPEAKER_03:Absolutely. And we are going to number nine, lucky number nine, maintain a strong why andor a 10-year vision, right? So when you look at the whole reason that you're even looking to get into real estate investing, you have to keep that reasoning and the goal at the top of your mind, keep it written down somewhere where you can see it at least a couple times a week and read it to yourself. Because once you start getting into the weeds, you may get overwhelmed at times. This is why we recommend that you get into a group where you can have conversations on a weekly basis. But at times you're gonna feel like, hey, I got to jump in that foxhole and make it happen for this property. And with that in mind, what's gonna help drive you is that why. You need to have a written-down, strong enough why of why you want to do this, what your ultimate goal is that's gonna help drive you to continue to stay consistent and build up that portfolio over time. Because without that why, it's very easy to get frustrated with you know another tenant call and go ahead and and and and sell and kind of defeat the whole purpose of this thing. Justin, what are your thoughts?
SPEAKER_02:Man, 100%. Like when we were at the gathering the other day and Lupe explained her why being her son, it's like we all have someone that we're doing it for or a reason that we're doing it for, whatever you have it. And as long as you can keep that at the forefront, like you always can keep going. You know, it's like it's always you always got to be pushing towards something because that's the only way you're gonna be able to stretch. So just keeping that why top of mind is always gonna help you out.
SPEAKER_03:Come on now, and getting as granular, granular as you can will help as well. Because one thing I've noticed, and you probably have too, is as you start to accomplish some things, that goalpost can move and it can move pretty rapidly. And so writing it down at that point in time helps you see, and later on, you're able to look back and say, hey, I actually achieved that. So you can celebrate that, which leads us to number 10, celebrate all small wins, right? Especially those that you know are in our space, like Justin, you are an entrepreneur, right? Like with everything that you're doing, you're definitely an entrepreneur. And a lot of the people that get into the real estate investing world have that entrepreneurial itch that they're scratching. And so what you have to be able to do is celebrate each small win along the way because it will propel you to the next win. You don't want to have this big 10-year or five-year vision, like, hey, in five years, I want to leave the W-2 and have 30 units, right? And then when you get to unit two or three or four or five, you're just moving on to the next without actually taking a second to celebrate. And I believe you should do this not only with your real estate and things that nature, but with personal items as well, right? And so, an example is when I was in medical device sales, and I told the story before, but I took over for a rep in Louisville, Kentucky. And that rep was retiring. He'd been there for 34 years. He was uh one of the better portfolio reps, and he retired. And all he wanted to do when he retired was move down to Destin, Florida and build a house for his family. And so he retired and he did that. And midway through building that, about six months in, he suffered from a stroke. And thankfully, he's still alive today. But now he walks with a bit of a gait. He can't drive solo and he's just limited in a lot of the things that he could do or thought that he'd be doing in retirement. And for many, many years, he just put it off, put it off throughout all the accomplishments he had, put it off, put it off, put it off. And so when I heard about this and and was connecting with him on everything that was going on, I made a uh a promise to myself at that time, and this is back in 2016, that I'm not gonna wait until I'm 60 to start crossing different places off the bucket list and different things that I want to do in life. I'm gonna start doing it now, but doing it responsibly. And so what I did when I was in medical device sales is I took 90% of the commissions that I made and I put that toward investing. Whether that be real estate, whether that be SP 500, whatever, I just, hey, I'm gonna invest this for the Nasdaq for the future. But 10% I put into a fun account and I spent that with no regard. I literally, it was, hey, knee, you have to spend this. I spent it on trips where I got to see different parts of the world that you know I hadn't seen before. I spent it on stuff that I like, like, hey, I think I want this, this is kind of cool, or experiences. And now when I look back, I have all these memories and I'm continuing to build those because you got to celebrate the wins along the way. Same thing in the real estate realm, right? As a real estate agent, right, I celebrate with the team every single win that they do along the journey to the goals that they have. Like you have to celebrate that. Even our clients, we celebrate every single closing that our client has because we realize that this one small step is what's gonna lead to the bigger dominoes down the road. And so that's the final tip that I have from the 10 years of investing, just 10 quick tips that were top of mind. But Justin, what are your thoughts on that last one?
SPEAKER_02:Man, I say live every day like it's your last because one day you will be right, you know. So, like you said, man, just trying to celebrate those small wins and even having that 10% account, it keeps you accountable to where now you want to earn more because you see that 10% going up. You're like, whoa, if I can double what I'm doing on this end, I can double the amount of trips I can go on or whatever you have it. So I think just having those numbers and having it set in stone. For me, I use relay, it automates those percentages as soon as the money hits now, which makes it a whole lot easier. Now I'm not having to move things around or figuring them out on my own. I can automate that so I don't have to worry about it. And I think that has helped me a ton in my W-2. I have the automation set up to where when my money hits my account, it automatically goes to my investment account. I got a lot of it coming out pre-taxed, so I'm saving on that and I can enjoy those things in retirement. So to your point, I have the money that I'm gonna look to enjoy in retirement, but I also have some money that I'm enjoying right now, doing the things that I love to do. So I think it's very important because at the end of the day, you have to have a little bit of fun when you're doing this. It can't be all work, work, work, work, work because that's just not how we're wired. You know, we're wired to be able to do things that we enjoy and and this, that, and third. But I think something that happens in America is some people try to put the fun before the work. But I think what you're doing by doing the 90-10 is like you're putting way more towards the afterlife, not the afterlife, the extended part of your life than the fun right now, but you're still having fun, you know. And if you're really out here hustling and grinding, that 10% can be significant.
SPEAKER_03:Come on now, and you are spot on, and it's it's that little piece that helps you continue to push toward that next one because you need to take breaks too. A lot of people are like this, you know. I I've heard terms from from our Gen Z counterparts talking about going back to the days of working essentially 18 hours a day, right? And and just stopping to sleep. And that that makes no sense to me. You you need to take a break, you need to be able to recover so that you can work more efficiently as you get going. And so, one other piece that I thought about too, and and it's it's just true, like at different phases in your life, there's certain things that you would do that you may not do at another phase. For example, before having a kid, right, I went skydiving, which was amazing. You know, I went skydiving in Dubai. This is a couple years ago, right? I ain't doing it, yeah. See, yeah, so but you have but you you're in the same boat with me. We both have kids. And so if you ask me right now, like, hey Nate, do you want to go skydiving? Probably not. I I want to stay feet planted on the ground, right? With the family that we're building and things of that nature. And so there's different points in your life where you may do something where later on you probably wouldn't do that. And so you want to be able to take advantage of that with the funds that you have, but just plan it out. Plan it out. And I'm a huge fan of what Justin just said. I use relay as well, and I'm able to plan it out in advance and know, okay, if if I'm doing X percent toward investments and X percent toward fun, I would be happy at the end of the year with this breakdown. And so you're able to just continue to expand from there. Yeah. All right. Well, Justin, this was a good one, man. We just jumped through a couple of things. I'm trying to bring more topics like this to the podcast. Anything else top of mind you got?
SPEAKER_02:No, man. Uh, but to anyone who watches this, just keep going. You know, like there's gonna be hard times, there's gonna be trials and tribulations, but you never know when your break is coming. You know, I think even me personally, I felt like a little stagnant a few months ago, but like now I'm hustling, my wheels are turning, I got a lot of things in motion, but it's just because I kept going, right? You know, if you don't keep going, you can't get through that wall because the wall's always gonna come, it's always gonna be something that comes up that you feel like you can't tackle. But if you just keep pushing, you can get through it. So if anybody out there is listening, just keep going because you don't know when your break is coming.
SPEAKER_03:Come on now. I love it. We're gonna end on that note. If you like what you heard on this podcast, go ahead and hit that subscribe and follow button and leave us a comment on which of the tips that you like the most that you're gonna implement. We wish everybody an awesome week and we will catch you next week.
SPEAKER_02:Also, send us a deal. I know y'all got some deals out there.
SPEAKER_00:Send it to me though, not Justin. All right, y'all. I'll take care. See you, man. Join us every Wednesday at 7 p.m. Eastern as we explore different types of investments that can fast track your path to financial independence.
